The link between business strategy, human resource management and business performance : the case of the Greek manufacturing sector
The purpose of this study is to develop an understanding of the processes by which
business strategies and HRM policies are related with business performance.
Using a sample of 178 organisations operating in the Greek manufacturing sector. I
investigated the universalistic model focusing on the extent to which HRM policies are
used in the Greek manufacturing organisations and the contingency model focusing on
the moderating effect of business strategy on the HRM-performance relationship.
Furthermore, I examined the impact of HRM systems (resourcing-development and
reward-relations) on business performance mediated by employee skills (competent and
cooperated), attitudes (motivation, commitment, satisfaction), and behaviours (turnover.
absenteeism) in an attempt to investigate the so-called "black-box" through which HRM
systems lead to business performance.
The results show strong support for the universalistic model, indicating that the HRM
policies of recruitment, training, promotion, incentives, benefits, involvement, and health
and safety are positively related with organisational performance, and the HRM pol icies
of recruitment, job evaluation, promotion, and health and safety are positively related
with financial performance.
Moreover, the results show some support for the contingency model, indicating that the
HRM systems of resourcing-development and reward-relations are either universally
applicable or they are contingent on the business strategies of quality, innovation and
cost, according to the specific organisational performance variable (effectiveness,
efficiency, development, satisfaction, innovation, quality), or the specific financial
performance variable (return on equity, return on capital employed), are called to predict.
Finally the results support the concept that the HRM outcomes of employee skills,
attitudes and behaviours play a mediating role between HRM systems and business
performance, and generally in a framework linking HRM systems and financial performance, any theory of linkages should explicitly recognise all major links from the
initial till the final step, otherwise the results may be erroneous.