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Strategic Hrm
LINKING HUMAN RESOURCE MANAGEMENT, LEARNING ORGANIZATION AND PERFORMANCE: A CONCEPTUAL FRAMEWORK

By: Mohd. Fairuz Abd. Rahim

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

1.

INTRODUCTION

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).

1.1

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



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