High value human resource management practices and organisational performance : an exploratory study

In its broadest sense, the field of human resources management (HRM) has had until recently two prevailing HR philosophies. The first of these is that efficiency and effectiveness in the recruitment, selection and management of human resources will have positive performance outcomes and lowered production costs. In other words, investment in the human capital of an organisation would be rewarded with a return on investment that would boost overall organisational outcomes. This HR philosophy was a logical extension of the personnel management/public administration utility view of the HR processes and functions (Pfeffer 1998). The second HR philosophy to emerge in the 1980's was the strategic HRM (SHRM) approach or model in which the HRM systems and processes were tasked with supporting organisational strategies through the creation of inimitability of HR (Becker and Huselid 1998). This inimitability of the organisation's HR created competitive advantages that the organisation could exploit for profitable gain. While both of these HR philosophies have wide acceptance in organisations today, a third HR philosophical perspective is emerging that shifts the focus away from individual HR practices. programs and processes and focuses on the HR function as a holistic value based system with emphasis on spirituality and its consequential impact on the organisation's success in terms of healthier interpersonal relationships (Anderson, 1997; Pruzan, 1998; Kriger and Hanson, 1999; Waddock, 1999; Butts, 1999; Wagner-Marsh and Conley, 1999; Russell, 2001; Tischler, Biberman, and McKeage, 2002; Krishnakumar and Neck, 2002) as well as improvements in financial performance (Huselid 1995; Huselid & Becker 1996,1997; Becker & Huselid 1998; Becker & Gerhart 1996; Pfeffer 1998).