Human resource management practices and performance of firms listed on the Nairobi securities exchange
Abstract
Most research demonstrating the link between HRMP and firm performance has focused
on the private sector, yet understanding this relationship in publicly listed firms, in the
Developing World setting is equally important. The role of organizational learning,
employee outcomes and competitive strategy on HRMP–firm performance relationship-
has not been established with the selected set of variables, yet theory has demonstrated
that these variables can have an effect on firm performance. This study was motivated by
the desire to fill these gaps in knowledge. The study objectives were: to establish the
relationship between HRMP and firm performance; to assess the relationship between
HRMP and employee outcomes; to assess the relationship between employee outcomes
and firm performance; to assess the moderating effect of organizational learning in the
relationship between HRMP and employee outcomes; to assess the moderating effect of
competitive strategy on the relationship between employee outcomes and firm
performance; to determine whether the effect of HRMP on firm performance is mediated
by employee outcomes, and; to establish whether the joint effect of HRMP, employee
outcomes, organizational learning and competitive strategy on firm performance is
greater than the independent effect of HRMP, employee outcomes, organizational
learning and competitive strategy on firm performance. The research design was cross
sectional descriptive survey. Data was collected using a self-administered questionnaire,
from a population of 60 NSE listed firms. The response rate was 60%. Descriptive
statistics, correlation and regression techniques were used to analyze the data. The results
of the study show a statistically significant relationship between HRMP and firm
performance. The results also show that HRMP have a significant effect on employee
outcomes. The results further show that employee outcomes do not affect firm
performance. The results show that relationship between HRMP and employee outcomes
is not moderated by organizational learning. The results indicate that competitive strategy
moderates the relationship between employee outcomes and firm performance. The
results show that the relationship between HRMP and firm performance is not mediated
by employee outcomes. There was empirical evidence that the joint effect of HRMP,
employee outcomes, organizational learning and competitive strategy on firm
performance was greater than the independent effect of HRMP, employee outcomes,
organizational learning and competitive strategy on firm performance. This study
contributes to understanding of the link between HRMP and firm performance, while at
the same time confirms the findings of previous studies that have found a significant link
between HRMP and firm performance. The finding that employee outcomes do not
mediate in the relationship between HRMP and firm performance was surprising. It was
contrary to expectation and even contrary to previous studies. The study has empirically
confirmed that competitive strategy moderates the relationship between employee
outcomes and firm performance. The study also established that the combined effect of
predictor variables on firm performance was greater than the independent effects. It was
recommended that firms have to ensure that they synergistically combine various
variables that they choose to use in order to attain and sustain a superior competitive
advantage in their operations.
Citation
Doctor of philosophy in Business AdministrationPublisher
University of Nairobi