HUMAN RESOURCE MANAGEMENT

Human Resource Management

Human Resource Management

Problem Statement

It is now commonly acknowledged that workers constitute an important source of competitive benefit for firms.

Introduction

This study investigates the relationship between human resource management (HRM) and the performance of 101 foreign-owned subsidiaries in Europe. The study's outcomes provide support for the claim that investments in HRM practices can considerably assist a firm in improving performance. Further, different HRM practices for managerial and non-managerial workers are found to be considerably associated to firm performance. Only restricted support, although, is got for the hypothesized relationship between efforts at aligning HRM practices with firm strategy and subsidiary performance.

The overhead realization has led to increased interest in the influence of HRM on organizational performance, and a number of investigations have discovered a positive relationship between so called "high presentation work practices" (Huselid, 1995) and distinct assesses of company performance. Furthermore, some empirical clues carries the hypothesis that companies that align their HRM practices with their enterprise scheme will achieve superior outcomes (for recent reconsiders, glimpse Becker and Gerhart, 1996; Becker and Huselid, 1998).

The implications of these outcome for multinational companies, however, remain to be investigated. Most investigations of the connection between HRM and organizational performance have been conducted on the household procedures of US firms, with a lesser number of investigations conveyed out in Europe (e.g., visitor and Hoque, 1994) and Asia (Ngo et al., 1998). Scholars of worldwide enterprise have so far focused on the extent to which HRM practices inside multinational corporations are globally normalized and/or in the local area adapted (Rosenzweig and Nohria, 1994; Taylor et al., 1996) and mostly ignored the connection between HRM and firm presentation (for an exclusion, see Ngo et al., 1998). The review of the literature indicates a serious lack of large-sample empirical studies designed to investigate whether extensive use of "high performance" HRM practices and a good alignment between HRM and firm strategy have positive effects on the performance of foreign subsidiaries located in transition economies like China or Europe. To fill some of the above-mentioned voids, this study will examine the relationship between HRM and foreign subsidiary performance in Europe.

While business performance of foreign companies in Europe to a large extent depends on external macro factors like general legislation and its frequent change, individual firms can do little to affect the external environment. This study aspires to enquire an significant area which firms can leverage, their HRM practices. Several authors have pointed to the importance of HRM in Europe and provided anecdotal discussions about HRM or discussed one dimension in depth. However, little systematic Europen-language research exists on HRM issues and the Western literature investigating Europen management is also very limited. Recent studies such as Elenkov (1997,1998), Holt et al. (1994), and Ralston et al. (1997) have shown that significant differences exist in the national cultures of Europe and the United States (and Western European countries). Further, it has been suggested that different HRM practices may be appropriate for Europe than for ...