Human Resoourse Management Practices

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HUMAN RESOURCE MANAGEMENT PRACTICES AND FIRM PERFORMANCE: THE MODERATING ROLES OF STRATEGIES AND ENVIRONMENTAL UNCERTAINTIES

NORMALA BINTI DAUD

UNIVERSITI SAINS MALAYSIA 2006

HUMAN RESOURCE MANAGEMENT PRACTICES AND FIRM PERFORMANCE: THE MODERATING ROLES OF STRATEGIES AND ENVIRONMENTAL UNCERTAINTIES

by

NORMALA BINTI DAUD

Thesis submitted in fulfillment of the requirements for the Degree of Doctor of Philosophy JULY 2006

DEDICATION

This dissertation is expressly dedicated to the memory of my father, Daud bin Sulaiman who left us with the most precious asset in life, knowledge. I know that he would be the happiest father in the world to know that his daughter has successfully completed her thesis. May Allah place his soul among the righteous; and to my mother, Hajah Mariam Idris, for her continuous blessings and prayers and whose love and guidance throughout my life can never be repaid.

Secondly, I dedicate this dissertation to my family members, my son, Azam, my three wonderful cheerleaders, Aaina, Alyaa and Amirah and especially to my beloved husband, Alias Abdul Jalil. Thank you for your continued encouragement, endless

support, love, understanding and sacrifice. You are my life and my inspiration.

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ACKNOWLEDGEMENTS

I begin in the name of Allah, Most Beneficient and Most Merciful. Praise to Allah S.W.T for providing me with great health, strength and emotional support in completing this dissertation. It is with great appreciation that I acknowledge the

contributions and support in completing this dissertation. It is with great appreciation that I acknowledge the contributions and support of my supervisor Associate Professor Dr Zainal Ariffin Ahmad, whose time, effort and guidance were highly beneficial especially during my early years in the program. My sincere gratitude and appreciation to Professor Dr Mohamad Jantan and Professor Dr Mahfooz Ansari for their invaluable guidance and assistance. I am especially indebted to associate Professor T. Ramayah for his statistical input and invaluable help. Special thanks to Professor Mohamad

Sulaiman, and Associate Professor Dr Osman, Dr Fauziah, Dr Intan and Dr Aizzat and other lecturers in the School of Management for their constant support, guidance and friendship. My sincere appreciation and thanks to my colleagues, Razli, Herri, Aminu, Joseph, Lena, Mastura, Norjaya, Rozita and Rohanita and my colleagues from UiTM, Noraini, Mala Amir, Siti, Norlida K, Yati Dahan and Yati Ahmad for making my stay in Pulau Pinang a memorable one. My heartfelt appreciation to my family members: my children, Azam, Aaina, Alyaa and Amirah who were forced to understand their mother’s need to be away most of the times and especially to my husband, Alias; who has to play both roles of a parent while his wife is busy studying in Pulau Pinang. Their endless support, encouragement and

understanding throughout my good times as well as my tough times are so meaningful. Finally I am grateful to UiTM, my employer whose scholarship allowed me to pursue this doctoral program on a fulltime basis.

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TABLE OF CONTENTS

PAGE

DEDICATION ACKNOWLEDGEMENTS TABLE OF CONTENTS LIST OF TABLES LIST OF FIGURES LIST OF APPENDICES ABSTRAK ABSTRACT CHAPTER 1 INTRODUCTION 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 Introduction Background of Study Problem Statement Purpose of Study Research Objectives Research Questions Significance of Study Scope of Study Definition of Key Terms 1.9.1 1.9.2 1.9.3 Human resource management HRM practices Firm performance

ii iii iv x xii xiii xiv xvi

1 1 5 6 6 6 7 7 8 8 8 8

iv

1.9.4 1.9.5 1.9.6 1.9.7 1.10

Business strategy Environmental uncertainty Manufacturing sector Employees

8 9 9 9 9

Organization of Remaining Chapters

CHAPTER 2 LITERATURE REVIEW 2.1 2.2 2.3 2.4 2.5 Introduction The Concept of Human Resource Management The Importance of HRM as a Source of Competitive Advantage Single HRM Practices and Firm...
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