Exploring the best HRM practices‐performance relationship: an empirical approach

Abstract

Purpose

This paper aims to empirically examine the linkages between best human resource (HRM) practices, knowledge management, organisational learning, organisational capabilities and organisational performance. The proposed framework and findings intend to add to the understanding of the specific processes that mediate between best HRM practices and organisational performance.

Design/methodology/approach

To carry out this research a survey research strategy was followed. The sample frame for this study consisted of Greek firms that belong to the tertiary (services and commerce) sector, employing at least 50 employees. The final research sample consisted of 242 questionnaires. Descriptive statistics as well as structural equation modelling (SEM) techniques were used to analyse the data.

Findings

This paper proposes an answer to “how” best HRM practices can influence performance. Results indicate that service and commercial firms pursuing best HRM practices achieve better performance through the interaction of these practices with knowledge management and organisational learning capability and the creation of organisational capabilities.

Research limitations/implications

Possible limitations of the study include the relatively small sample size, the use of subjective performance indicators and the measurement of organisational capabilities.

Practical implications

The paper can help human resource practitioners and/or managers to understand better the importance of organisational learning and knowledge management processes and the way best HRM practices, through the integration of these two processes, lead to superior and sustainable performance.

Originality/value

This paper attempts to shed some light on the processes through which human resource management practices influence performance. Moreover, the value of the human factor in knowledge management and organisational learning initiatives, as well as on organisational capabilities, is explored. While this has already been underlined in the past, there is still no complete model simultaneously describing and testing all those relationships.

Citation

Theriou, G.N. and Chatzoglou, P.D. (2009), "Exploring the best HRM practices‐performance relationship: an empirical approach", Journal of Workplace Learning, Vol. 21 No. 8, pp. 614-646. https://doi.org/10.1108/13665620910996179