Strategic Hrm

Topics: Human resource management, Knowledge management, Organizational learning Pages: 29 (8746 words) Published: April 3, 2011

By: Mohd. Fairuz Abd. Rahim

Supervisors: Dr. Chew Yin Teng and Prof. Pervaiz K Ahmed



Globalization and the turbulent business environment forces many firms, multinational corporations and local players to reassess their competitive strategy and proactively create, renew and sustain their competitive advantages in the global market place (Ghoshal 1987; Hao 2004; Kogut 1988; Manning & Baines 2004). The resource based view of the company asserts that an organization can achieve sustainable competitive advantage by continuously developing existing and creating new resources and capabilities in response to rapidly changing market conditions (Barney 1991). A growing number of studies provide support for the notion that the human resources of an organization can be a source of competitive advantage when aligned to strategic business planning and organizational culture (Collins & Smith 2006; Khatri 2000; Panayotopoulo & Papalexandris 2004; Poole & Jenkins 1996; Wright & McMahan 1992). This focus on the strategic role of HRM in meeting business objectives by creating an organizational environment that encourages employee behaviours and capabilities that contribute to firm competitive advantage has been labelled strategic human resource management (SHRM) (Bowen & Ostroff 2004; Collins & Clark 2003; Collins & Smith 2006).


Background of the Study

Numerous studies have found that HRM practices have a positive effect on firm performance (Arthur 1994; Bae & Lawler 2000; Boselie et al. 2005; Collins & Smith 2006; Delery & Doty 1996; Huselid 1995; Ichniowski et al. 1997; MacDuffie 1995; Paauwe & Boselie 2005). While these studies have been useful in demonstrating the value created through HRM practices, very little is known about the underlying mechanisms by which these practices exert their impact on organizational performance measures (Delaney & Huselid 1996; Delery 1998; Hislop 2003; Lopez et al. 2006; Paauwe & Boseli 2003). Hence, there is a need to refine and develop more comprehensive theoretical models of HRM – performance relationships, which include mediating and moderating factors.

Many researchers have suggested the importance of HRM in developing LOs ( Hislop 2003; Marquadt 1996: 2002; Rahim et al. 2008a; Watkins & Marsick 1993). However, not many studies have tried to

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test the relationship between HRM and LO (Dechawatanapaisal 2005; Lopez et al. 2006; Mavondo et al. 2005; Rahim et al. 2005; Saru 2007). Hence, the current study will address this gap by empirically testing the link between HRM and LO. Furthermore, the majority of previous writings on HRM and performance mostly focused on either studying HRM as systems/bundles of practices or as individual practices, for instance recruitment, selection, and training. The SHRM view suggests that other HRM components should be considered if HRM were to make a strategic impact (Chang & Chi 2007; Conner & Ulrich 1996; Panayotolou & Papalexandris 2003; Ulrich 1997). One such HRM component is the HRM roles, which includes HRM playing the role of change agent, strategic partner, employee champion, and administrative expert (Ulrich 1997). So far, only one paper by Conner and Ulrich (1996) has developed a scale to measure HRM roles and empirically tested the scale, but they only focused on examining the relationship between HRM roles and performance. Thus, there is a need for a more refined instrument to measure HRM roles, particularly from the context of LO. Hence, the current study will attempt to address this gap by developing a more refined HRM roles scale that is modified to suit the LO dimensions and analyzing the moderating effect of HRM roles to the relationship between HRM and LO.

Despite the continuing attention to the learning organization (LO), the lack of a theoretically derived measure of the construct that...

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