STRATEGIC HUMAN RESOURCE MANAGEMENT AND ITS IMPACT ON INNOVATION PERFORMANCE

Abstract

The concept of Strategic HRM is still evolving; the field has continuously witnessed an increased interest among management scholars for both empirical as well as theoretical research. Despite various theories and critical arguments by scholars, one thought has predominantly received consensus which is that of people or the human resources as the source of innovative performances and simultaneously the firm’s competitive advantage. India being the context of the study has emerged as one of the sources of global investment in the world economy thereby displaying its massive growth potential in almost all the sectors. The Indian service industry which is based on timeliness, uniqueness and customization in client preferences needs to redefine and strategize its HR practices so that the productivity is taken up to higher levels. With the increasing demand of IT based solutions in the domestic as well as overseas market, the human capital management has become an issue of concern for this industry. With the increasing demand of IT based solutions in the domestic as well as overseas market, enterprises face tenacious hurdles and pressures from rival firms with respect to incessant technological advancements; constant challenge to retain and make their employees more skilled and involved in their task delegation. The Indian IT sector is facing cut-throat competition because of its exigent work environment, the job demands challenging work roles, aggressive timelines; resulting in low creative output and job stress. The role of HR in such a business condition becomes highly prominent where the employees can be put in center-stage and their need can be assessed before-hands in order to remove blockages for effective performance and also adhering to work ethics simultaneously. The alignment of the various HRM functions may help industries like the Indian IT industry in redefining age old HR practices. HRM functions which are organic and integrated towards the strategies of the organization may help in achieving competitive advantage. These collective HR practices can be a mediating mechanism to boost employee work-behavior and morale for innovative work performances. This sector reflects a gap to be levied on the Strategic HRM professionals who can work to address the human well-being by sufficing the competency mapping through alignments both horizontally as well as vertically, thus enabling employees to perform differently. The literature also suggests significant gaps and inadequate theoretical basis between Strategic HRM and Firm Performance research work. The scarcity in literature regarding the mediating or moderating mechanisms i.e. the black-box in between SHRM and Innovation Performance; and ii the various antecedents for the same was an identified gap. There is also a need to find out the mediating mechanism in-between Strategic HRM and firm innovation performance which would further attenuate this relationship. The black-box between the two constructs needs to be unveiled, hence helping the managers of this sector to eradicate the surface problems which hinders the growth paradigm. The data for the present study was collected through self-administered survey questionnaires. Respondents were the employees working in the Indian IT sector. By using convenience sampling technique, data was collected from locations where the IT hubs are situated (n=335). The data collected in this study was analyzed with the help of two software’s: AMOS 20.0 and SPSS 20.0. The purpose of this study is to examine as to how Strategic Human Resource Management when aligned with a bundle of selective Human Resource Management practices can enhance Innovation performance of employees in uncertain market conditions. Results indicated that SHRM has a positive relation with HIHR practices and innovation performance. Empirical results support the hypothesis that states the mediating role of HIHR practices on the interaction between SHRM and innovation performance. Through this model the research work has tried to fill a gap by investigating the whole procedure and the dynamics of Strategy and Human Resource Management. This model may provide a stepping-stone for added empirical research on HIHRP and will make an influential impact on the literature, HIHRP and IP in the Indian IT sector.