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HRM systems and firm performance: The mediation role of strategic orientation

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  • Irene Chow
  • Stephen Teo
  • Irene Chew

Abstract

Prior research evidence of a set of internal fit human resource practices supports a positive human resource management (HRM)–performance relationship. Yet we know very little about exactly what drives the HRM–performance (also known as strategic HRM) relationship. In response to the call for suitable theories to explore the “black box” between HRM and firm performance, this study is designed to extend previous work by examining how the relationship between HRM and strategic orientation influences firm performance. Specifically, it examines the relationship between HRM systems, strategic orientation, and performance in a cross-section of 190 firms in Singapore. The research hypotheses were tested using multiple regression and LISREL. As predicted, there was an indirect effect between Inducement and Investment HRM systems and firm performance, such that the relationship was mediated by strategic orientation. In particular, Singaporean firms which implemented product and market differentiation strategies would mediate the HRM systems–performance relationship. Implications for research and managerial practices are provided. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Irene Chow & Stephen Teo & Irene Chew, 2013. "HRM systems and firm performance: The mediation role of strategic orientation," Asia Pacific Journal of Management, Springer, vol. 30(1), pages 53-72, March.
    • Handle: RePEc:kap:asiapa:v:30:y:2013:i:1:p:53-72
    DOI: 10.1007/s10490-012-9288-6
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    References listed on IDEAS

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    3. Nakhon Kokkaew & Vachara Peansupap & Noppadon Jokkaw, 2022. "An Empirical Examination of Knowledge Management and Organizational Learning as Mediating Variables between HRM and Sustainable Organizational Performance," Sustainability, MDPI, vol. 14(20), pages 1-25, October.
    4. Yun-Hwa Chiang & Chu-Chun Hsu & His-An Shih, 2015. "Experienced high performance work system, extroversion personality, and creativity performance," Asia Pacific Journal of Management, Springer, vol. 32(2), pages 531-549, June.
    5. Ammar Ahmed & Faiz Muhammad Khuwaja & Noor Ahmed Brohi & Ismail bin Lebai Othman, 2018. "Organizational Factors and Organizational Performance: A Resource-Based view and Social Exchange Theory Viewpoint," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 8(3), pages 579-599, March.
    6. Yan Zhu & Li-Yun Sun & Alicia Leung, 2014. "Corporate social responsibility, firm reputation, and firm performance: The role of ethical leadership," Asia Pacific Journal of Management, Springer, vol. 31(4), pages 925-947, December.
    7. Pawan Budhwar & Vijay Pereira & Kamel Mellahi & Sanjay Kumar Singh, 2019. "The state of HRM in the Middle East: Challenges and future research agenda," Asia Pacific Journal of Management, Springer, vol. 36(4), pages 905-933, December.
    8. Kenneth S. Law & Chi-Sum Wong & Ming Yan & Guohua Huang, 2016. "Asian researchers should be more critical: The example of testing mediators using time-lagged data," Asia Pacific Journal of Management, Springer, vol. 33(2), pages 319-341, June.
    9. Paul Higgins & Man-fung Lo, 2018. "The strategic and cultural legitimacy of HR professionalization in Hong Kong," Asia Pacific Journal of Management, Springer, vol. 35(4), pages 1139-1160, December.

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