How Human Resource Capabilities Affect the Organisations' Performance? the Case of Electronic Industry in the Uk
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HOW HUMAN RESOURCE CAPABILITIES AFFECT THE ORGANISATIONS'
PERFORMANCE? THE CASE OF ELECTRONIC INDUSTRY IN THE UK
Azhdar Karami
School for Business and Regional Development,
University of Wales, Bangor, UK
a.karami@bangor.ac.uk
Session H-2
Abstract
The impact of the Human Resource (HR) capability on the firm's performance
and its involvement in developing business strategies are becoming increasingly
important particularly in high tech Small and Medium-sized Enterprises (SMEs).
Not surprisingly, the main debate in HRM, particularly in SMEs, is nowadays
concerned with the relationship between HR capabilities and the firm's overall
performance. This paper is exploring the above relationship in the Electronic
Manufacturing industry in the UK. The findings are based on an empirical survey
of Chief Executive Officers' (CEOs) and their perception of the HR involvement in
strategy development in high tech SMEs. The important conclusion reached is
that increasing the core competencies of the firm, in particular HR, is the key
element to the success of the firm. Moreover, it is posed that the growing
involvement of the HR in the development and implementation of business
strategy will lead to the increased effectiveness of the organisation and the
industry as a whole.
Keywords: HR Capabilities, Perception, Small and Medium Sized Enterprises
(SMEs), Firm Performance, Chief Executive Officers (CEO's), HR Involvement in
Strategy, UK.
1
How Human Resource Capabilities Affect the organisations' Performance? The
case of Electronic Industry in the UK
Dr. Azhdar Karami
Lecturer in Business and Management
School for Business and Regional Development
University of Wales, Bangor
College Road, Bangor, Gwynedd
LL57 2DG, UK
Tel: +44 1248 388350
Fax: +44 1248 383228
Email: a.karami@bangor.ac.uk
The Fifth European Conference on Organizational Knowledge, Learning and Capabilities,
Centre of Strategic Management & Leadership, University of Innsbruck, April 1-3,
Innsbruck, Austria
Track:
Leadership and HRM in knowledge-based organisation
2
How Human Resource Capabilities Affect the organisations' Performance? The
case of Electronic Industry in the UK
Abstract
The impact of the Human Resource (HR) capability on the firm's performance and its
involvement in developing business strategies are becoming increasingly important
particularly in high tech Small and Medium-sized Enterprises (SMEs). Not surprisingly,
the main debate in HRM, particularly in SMEs, is nowadays concerned with the
relationship between HR capabilities and the firm's overall performance. This paper is
exploring the above relationship in the Electronic Manufacturing industry in the UK. The
findings are based on an empirical survey of Chief Executive Officers' (CEOs) and their
perception of the HR involvement in strategy development in high tech SMEs. The
important conclusion reached is that increasing the core competencies of the firm, in
particular HR, is the key element to the success of the firm. Moreover, it is posed that the
growing involvement of the HR in the development and implementation of business
strategy will lead to the increased effectiveness of the organisation and the industry as a
whole.
Key Words:
HR Capabilities,
Perception
Small and Medium Sized Enterprises (SMEs)
Firm Performance
Chief Executive Officers (CEO's)
HR Involvement in Strategy
UK
3
INTRODUCTION
In recent years, much concern has been shown for the strategic involvement of the
Human Resource (HR) and its effect on firm's performance (Lahteenmaki et al, 1998;
Rangone, 1999; Analoui, 2000). The debate has led to the creation of a resource-based
model of HRM (Boxall, 1996), identifying HR as being responsible for increasing
organisational success (Kakabadse and Kakabadse, 2000) and a realistic indicator for the
improved organisational effectiveness (Analoui, 1999a; Analoui, 2002). The resourcebased
approach to strategic management considers HR as a unique source of
competitive advantages of the firm (Lorange and Murphy, 1984; Boxall, 1991; Lundy,
1994; Story, 1998).
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