Capability to Achieve Sustained Competitive Advantage

According to Michael (2001), strategic human resource management is an approach or a progress to decision making on the intentions and strategy of the organization about the employment relationship and the organization’s staffing, training, improvement, performance management, compensation and employee strategies, policies and practices.

According to Cavetti (2008), Sustainable competitive advantage is the focal point of corporate strategy which allows the maintenance and improvement of the business competitive position in the marketplace .it is an advantage that enables organizations to survive against its competitors over a long period of time.

INTRODUCTION

Strategic human resource management (SHRM) is a strategic method to manage human resources of a firm or organization. Analyzed with technical HRM, SHRM is a new theory, despite its incessant development over the past two decades. Accord has been reached among researchers on SHRM vital function, which includes designing and implementing a set of internally stable policies and practices which guarantee that human capital of a firm contributes to the accomplishment of its business goals (Jackson 1995). The traditional HRM purpose, or technical HRM activities, covers a wide range of recruitment practices which involves recruitment, selection, performance appraisal, training, development and the administration of reward and reimbursement. By compounding the HRM function with business strategy, SHRM shows a more flexible arrangement and use of human resources to achieve the organizational objectives, and consequently helps organizations achieve competitive advantage (Anonymous 2006).

Preceding research suggests that organizations can gain sustainable competitive advantage in the course of strategically running their human resources and operationally utilized as strategic human resource management (SHRM). However, it remains vague about the conditions under which a business employs SHRM so as to achieve better performance. As an important trait underlying SHRM, fit reflects the interactive function of HRM practices and their correlation with the managerial strategy. In the proposed conceptual framework, the individual, functional and managerial level factors that influence both types of fit are discussed. Among these factors, individual/personal factors have impact on both horizontal fit and vertical fit, while HR role related practices and firm level factors influence horizontal fit and vertical fit; respectively.

Figure: 1 (Sources: A strategic HRM perspective, Aradhana 2005)

RESERCH QUESTION

Does strategic human resource management generates strategic capability to achieve sustained competitive advantage?

Strategic human resource management generates strategic capability to achieve sustained competitive advantage because its basic goal is to produce strategic capability by ensuring that the firm has the experienced, devoted and well-motivated workers it needs to achieve sustained competitive advantage. Its aim is to endow with a sense of direction in an often chaotic environment so that the needs of the firm, the individual and cooperative needs of its workforce, can be met by the development and achievement of consistent and realistic HR policies and programmers’ (Michael, 2001).

IMPORTANCE OF STUDY

Studying of this topic will further develop the relevant model, research and practices in managing employees. It will also help the researcher in understanding employment relationship. The researcher will fully understand strategic human resource management, how it generates capability to achieve sustainable competitive advantage and that how employees are managed at the workplace influences what they feel about their job and their employer which affect their behaviors and actions in the workplace which contributes to organizational performance. This research will show that strategic human resource management helps in effectiveness of an organization. It will also help future students in their research work and help future managers in their organizational planning.

LITERATURE REVIEW

BACKGROUND INFORMATION

STRATEGIC HUMAN RESOURCE MANAGEMENT

According to Wright (1992) defined strategic human resource management as “the mold of planned human resource deployments and activities proposed to enable the firm to accomplish its goals”.

Strategic human resource management is apprehensive with the affiliation involving human resource management and strategic management in the organization. Strategic human resource management refers to the overall trend the organization desires to practice in achieving its objectives through people. Strategic HRM addresses broad organizational issues relating to changes in structure and culture, organizational usefulness and performance, matching resources to future necessities, the development of unique capabilities, knowledge management and the management of change. It is concerned with both meeting human capital requirements and the development of process capabilities, which is the aptitude to get things done in actual fact. Overall, it will consider any major people issues which affect or are pretentious by the strategic plan of the organization (Michael 2001).

Strategic HRM focuses on measures that distinguish the firm from its competitors (Purcell, 1999). It develops declarations of purpose which define means to achieve ends, and it is concerned with the long term provision of significant company resources and with similar resources and capabilities to the peripheral environment (Michael 2001).

According to Hendry (1986), strategic HRM can referred to as the use of planning: an articulate approach to the intend and supervision of personnel systems based on an employment guidelines and manpower strategy and often underpinned by a “philosophy”, matching HRM activities and policies to some precise business strategy: seeing the people of the organization as a strategic resource for the realization of competitive advantage.

The primary aim of strategic HRM is to engender strategic capability by ensuring that the organization has the capable, dedicated and well-motivated employees it needs to accomplish sustained competitive advantage. Its objective is to provide a sense of direction in an often unstable environment so that the needs of the organization, and the individual and combined needs of its employees, can be met by the enlargement and execution of consistent and practical HR policies and programmers (Michael 2001).

The underlying principle for strategic HRM is the superficial advantage of having a contracted and understanding basis for developing approaches to people management in the longer term. It has been recommended by Lengnick-Hall and Lengnick-Hall (1990) that underlying this foundation in a business is the concept of achieving competitive advantage through HRM.

The main approach for the development of HR strategies have been defined by Richardson and Thompson (1999) are: The best practice approach, which is based on the certainty that there is a set of superior HRM practices which, if adopted, will lead to better organizational performance. The best fit approach, which is based on the conviction that there can be no collective instruction for HRM policies and practices. It is all reliant on the organization’s perspective and culture and its business strategy. The configurational approach which focuses on the search for distinctive configurations measures of joined-up HR practices which combined together will function more effectively than if they existed as unrelated entities. This concept is commonly referred to as bundling.

The theoretical hypothesis that the skills and behaviors of employees must fit the strategic needs of the firm in order for the labor force to be a source of competitive advantage leads to the exploration of how HR practices might also need to achieve some form of fit. With regard to vertical fit, business strategies involve diverse skills and behaviors from employees. This is because HR practices are generally the levers through which the firm manages these different skills and behaviors. Horizontal fit refers to a fit between HR practices to make sure that the individual HR practices are set up in such a way that they prop up each other (Boxall 2003). An illustration of this would be a selection process that focuses on finding team players and a reimbursement system that focuses on team-based rewards. Tentatively, the justification for horizontal fit suggests that (a) corresponding bundles of HR practices can be redundantly reinforcing the development of certain skills and behaviors consequentially in a higher probability that they will occur and (b) contradictory practices can send diverse signals to employees concerning indispensable skills and behaviors that trim down the prospect that they will be exhibited (Becker et al. 1998). There appears to be some conformity in the literature that both types of fit are necessary for most advantageous impact of HRM on presentation (Baird 1998), but not necessarily pragmatic support for these types of fit.

SUSTAINABLE COMPETITIVE ADVANTAGE (SCA)

Long term competitive advantage that is unduplicable or unsurpassable by the competitors.

Sustainable competitive advantage is the core of competitive strategy. It include those capabilities, resources, relationships, and decisions which allow an organization to take advantage of opportunities in the industry and avoid threats to its preferred position.

Sustainable competitive advantage is the exceptional position that a firm develops in relation to competitors that allows it to surpass them consistently (Hofer, 1978). As this definition suggests, advantage can only be attained by establishing a clear and positive differentiation from competitors. This difference must be substantial and measurable, and it must be retained over time (South, 1981).

Recently, scholars have come to accept the value of HR competencies, capabilities, and skills as the sources of sustainable competitive advantage (Mabey et al., 1998).

Researchers like Wright et al. (1998) has argued that HRM capability is a source of competitive advantage as it is embedded in the collective knowledge of the firm members (inimitable), which is developed over a period of time (rare), and valuable as the firm’s procedure for administrating people can direct employees’ talent and behaviors to meet organizational objectives and create value.

According to Penrose (1959) and Wernerfelt (1984), the RBV of a firm’s growth and competitive advantage are function of the distinctive bundle of resources that it acquires and deploys (Barney, 1991, 1997).

According to Paauwe (2002), firms obtain critical human resources and then establish HR systems to enhance the potential value of human resources that are most difficult to imitate . The RBV perception views employees as a valuable resource which contributes significantly to organizational effectiveness. Thus it is seen as a source of competitive advantage for the organizations (Schuler, 1987). More recently, this viewpoint has been extended to reckon dynamic capabilities (Teece et al., 1997), which is a firm’s unique “ability to attain new and innovative form of competitive advantage given path dependencies and market positions” (Amit, 1993). One of the keys to victorious competition in the global marketplace is the effective exploitation of human resources to accomplish a competitive advantage (Schuler, 1993).

Much research on the function of human resources in world competitiveness has alert on management (Adler, 1992). The efficiency of management methods across cultures and the difficulties of amendment both at work and in the social environment have been broadly examined (Black, 1991).

Figure: 2 (sources: Identifying key knowledge area in the professional services industry, Gabriel 2004

STRATEGIC HUMAN RESOURCE MANAGEMENT GENERATES STRATEGIC CAPABILITY TO ACHIEVE SUSTAINED COMPETITIVE ADVANTAGE

SHRM generates capability to achieve SCA:

The primary aim of strategic HRM is to generate strategic capability by ensuring that the organization has the skilled, committed and well-motivated employees it needs to achieve sustained competitive advantage (Michael 2001). Recent conceptual and observed work on SHRM has concentrated on how organizations develop and maintain competitive advantage (Barney, 1991). This focal point on competitive advantage requires extra consideration in increasing global nature of competition, as proofed by surveys of U.S. business. Twenty-six (26%) percent of U.S. managers examined indicated that their companies had recently expanded worldwide. The percentage enlarged to 45% for firms with 1,000 or more employees (Kanter, 1991). In order to attain a sustainable competitive advantage, Distinguishing intercontinental organizations from multinational and domestic organizations are being done. The resource-based view of the organization was used to study how human resources can structure source of sustainable competitive advantage for domestic firms (Peteraf, 1993). Firms vary in the level to which they partake in global competition. According to Adler (1991), firms are categorized as domestic, international, multinational, and global, depending on the phase to which they participate in global competition. Understanding the differences across these categories will help to understanding the function of human resources in global competition and the need for it to commensurate with the rigors of global competition. Previous researchers suggested that organizations can gain sustainable competitive advantage through tactically managing their human resources and operations as strategic human resource management (SHRM). By combining the HRM role with business strategy, SHRM reflects a more flexible arrangement and uses of human resources to reach the organizational goals, and accordingly helps organizations attain competitive advantage.

It is generally accepted that businesses can create a competitive advantage from human resources and their management practices. Efficient human resource management will generate a higher capacity to attract and retain employees who are qualified and motivated for good performance. The benefits from having adequate and qualified workers are plentiful. Some examples are higher profitability, less rotation, higher product quality, lower costs in manufacturing and a quicker acceptation and implementation of the organizational strategy (Wright et al., 1995).

According to Wright et. al. (2001), human capital (the knowledge skills and abilities of the human resources) as well as the relationships and inspiration of the employees leads to long term competitive advantage. The purpose of HR practices is to develop or obtain this human capital and inspire the relationships and behaviors of the workers so that they can contribute to the goals of the firm.

SHRM do not generates capability to achieve SCA:

According to Daniel (2005), unlike SHRM, modernization is a source of competitive advantage. Market point of reference and organizational erudition are experience of novelty. He recommended that innovation requires the attainment and exploitation of acquaintance about the customers, the competitors as well as within the business. The consequence of organizational learning on innovation is advanced than the end product of market orientation but both market direction and organizational learning allows companies to attain a competitive advantage. Market orientation and organizational erudition affect performance because they promote innovation. Organization fascinated in enhancing innovation ought to widen a market orientation behavior and perk up its organizational learning procedure. These will facilitate companies to anticipate and comprehend better what the customer needs and the competitive situation of the business. It will also be of assistance to them to process the information more rapidly and widen new products according to customers needs. This process or structure allows the company to accomplish a competitive advantage.

According to Wan-Jing (2005) research which he focused on Taiwanese firms, one of the most momentous budding markets in the world and his result are unswerving with the torrent of research and theory proposing the “best fit” model, and are contradictory with the “best practice” model. This suggests that a lay down of best HRM practices exists for every part of the organizations. This study was futile to find a important undeviating brunt for SHRM on firm performance. Strategic HRM is not always a enhanced approach for organizational performance than the long-established human resource management (THRM) come close to. However, his study fruitfully entrenched that Product market strategy (PMS) moderated the liaison between SHRM accomplishment and firm performance. Furthermore, the quality improvement strategy was significantly and optimistically related to firm performance. Profitability grows when a firm focuses on producing the best superiority merchandise or service. There is interactive end product flanked by innovation strategy and SHRM, because a affirmative relationship exists alongside with considerable variance in firm performance. Given a deficient of innovation in the market environment, SHRM clearly has modest contact on profitability.

Figure: 3 (sources: Relationship between strategic human resource management and firm performance, Wan-Jing 2005)

This graph plotted the data for a considerable innovation strategy and SHRM interface. Clearly, firms that put into practice SHRM will perform superior in an innovation oriented market environment. Nevertheless, beneath the same environment, firms that implement THRM will perform disappointingly. This circumstance may occur because SHRM promotes team-based job designs, elastic workforces, employee empowerment and enticement compensation, and so on, which are fundamental for facilitating innovation in organizations.

According to john (1999), the pursuit of Sustainable Competitive Advantage is an idea that is at the empathy of much of the strategic management and marketing literature. Gaining a competitive advantage all the way through the provision of superior value to customers can be anticipated to lead to superior performance considered in conformist terms such as market-based performance (e.g., market share, customer satisfaction) and financial-based performance (e.g., return on investment, shareholder wealth creation) ( Hunt 1995). Research by Buzzell (1987), Jacobsen (1988) and Jacobsen and Aaker (1985) have argued that market-share and prosperity are both outcomes of the hard work by firm’s secure cost and differentiation advantages. Existing marketing literature emphasizes a connection between the release of value to customers and levels of customer satisfaction leading to prospective market share and profitability gains (Kotler 1994). Where the advantage is sustained, superior performance can be expected to persevere in a comportment of analogous to the concept of super-normal profit or rent in economics.

Figure: 4 (Sources: Competitive advantage through sponsorship, John 2004)

SHRM may generates or have little capability to achieve SCA:

Strategic human resource management can favor the improvement and/or utilizaton of organizational competences, and simultaneously these systems may demolish organizational competences and/or constrain their development. However, the use of these systems develops competences, although its necessary for a firm to reach a competitive position but might not be enough to reach long-term competitive advantage. Hence, it is necessary that the strategic human resource management is analyzed with the aid of concepts such as internal fit, external fit, and organizational flexibility (Patricia 2008)

However, it remains vague about the circumstances under which a n organization employs SHRM so as to gain better performance. According to Coyne (1986), competitive advantage is momentous only if it is felt in the marketplace; that is, the differentiation should be perceived as an important buying principle to a substantial customer base. Such an advantage will be sustainable, only if it cannot be imitated (Barney, 1991). In essence, a gap in the capability underlying the differentiation should distinguish the producer from its competitors; otherwise, competitors can erase the differentiation at will (Coyne, 1086).

Despite the positive changes, the most the researcher is able to say with confidence is that firms with motivated and devoted employees can apply strategies better than those without them. The researcher still knows very little about how HRM policies and practices (the HRM system)if translated into sustainable competitive advantage (Cavetti, 2008).

Researchers in the field of SHRM have increasingly relied on the resource-based view of the firm to explain the function of human resource practices in an organizational performance (Christopher et al. 2003). Indeed, hypothetical research on SHRM suggested that systems of HR practices may achieve firm performance and be sources of sustained competitive advantage because these systems of practices are frequently unique, causally uncertain, and difficult to imitate (Lado 1994). However, HR practices can only be a source of sustained competitive advantage when they support resources that offer value to a firm (Wright et al., 2001). Accordingly, they argued that SHRM should identify resources that are significant for advantage in a given competitive environment and the HR practices to build and support these resources. High-technology firms are important and fascinating context because such firms play an increasingly important cost-effective function and exist in an environment characterized by rapid change, ambiguity, and hyper-competition (D’Aveni, 1994).

With the arrival of the resource-based view of the firm, strategic HRM research moved to a more internal focal point in competitive advantage. Rather than simply developing competitive strategies to deal with the environment, the resource-based view suggested that organizations ought to look inward to their resources, both physical and intellectual, for sources of competitive advantage. He explicated how firm resources add to the sustained competitive advantage of the firm and also suggested that resources that are valuable, rare, inimitable and non-substitutable will lead to competitive advantage (Barney, 2005).

The resource-based view of the firm (RBV) stress towards internal analysis of the firm. It offered to SHRM a valuable conceptual framework to analyze the ways in which firms try to develop their human resources, aspiring to transform them into a sustained competitive advantage (Wright et al., 1992).

Resource-based view (RBV) has become the guiding pattern on which virtually, every strategic HRM research is based (Wright et al. 2001). RBV and its prominence on the internal resources of the business is a source of sustainable competitive advantage (Mathew 2006). The RBV and its application to SHRM research formed an important connection between strategic management and HRM research. However, the link between them can be strengthened by breaking away from the focal point on HR practices. The resource-based view has develop into almost the assumed model within SHRM research (Wright et al., 2001). It has been the basic abstract foundation from which lots of current strategic management research as regards to knowledge-based views of the firm (Grant, 2004), human capital (Hitt et al., 2001), and dynamic capabilities (Teece et al., 2007) are derived.

Figure: 5 (Sources: A holistic approach to acquisition of strategic resources, Jim 2007)

SUMMARY OF LITERATURE REVIEW

It is generally accepted that firms can create a competitive advantage from human resources and their management practices. Human capital as well as the relationships and motivation of the workers can lead to competitive advantage. The principle of HR practices is to develop or obtain this human capital, inspire the relationships and behaviors of the recruits so that they can contribute to the strategic goals of the firm.

Unlike SHRM, Innovation is a source of competitive advantage. Market orientation and organizational learning are background of innovation and they allow companies to attain a competitive advantage. Market orientation and organizational learning affect performance because they foster innovation. This process or system allows the company to accomplish a competitive advantage.

Strategic HRM is not constantly a better method to acquire organizational performance than the traditional human resource management (THRM) approach. However, this study successfully confirmed that Product market strategy (PMS) moderated the relationship between SHRM implementation and organizational performance. Interactive innovation and SHRM implementation effect on firm performance

Undoubtedly, firms that implement SHRM will perform better in an innovation oriented market environment. Researchers in the field of strategic human resource management (SHRM) have increasingly relied on the resource-based view of the firm to clarify the responsibility of human resource practices in firm performance. With the introduction of the resource-based view of the firm, strategic HRM research stimulated to a more internal focus in competitive advantage. Rather than just developing competitive strategies to deal with the environment, the resource-based view suggested that firms ought to look inward to their resources, both physical and intellectual, for sources of competitive advantage. The study explicated how organizational resources contribute to sustained competitive advantage and also suggested that resources that are valuable, rare, inimitable and non-substitutable helps in attaining competitive advantage.

The resource-based view of the firm (RBV) direction towards inner analysis of the firm, offers to human resource strategic management a valuable conceptual framework, which they can analyze the ways in which firms try to develop their human resources intending to transform them into a sustained competitive advantage. RBV and its importance on the internal resources of the firm is a source of sustainable competitive advantage. The resource-based view has become almost the assumed paradigm within SHRM research.

ANALYSIS

Analysis of SHRM generates capability to achieve SCA

According to Michael (2001), the main aim of SHRM is to engender strategic capability by ensuring that the organization has the capable, dedicated and well-motivated employees it needs to attain sustained competitive advantage (Michael 2001). The pasture of strategy focuses on how firms can situate themselves to contend, and its popularity began escalating exponentially. According to Barney (1991) research findings in the survey of U.S. businesses, the purpose of human resources in universal competition and the necessity for human resource management (HRM) systems proportionate with the rigors of global antagonism. Previous research suggests that firms can achieve sustainable competitive advantage in the course of strategically supervising their human resources, equipped exercised as strategic human resource management (SHRM). By combining the HRM purpose with business strategy, SHRM reflects a more elastic arrangement and exploitation of human resources to realize the organizational goals, and consequently helping organizations gain a competitive advantage. Barney (1991) also explicated how firm resources put in to the sustained competitive advantage of the firm. He suggested that resources that are important, rare, incomparable and non-substitutable will show the way to competitive advantage. Value in this framework is defined as resources either exploiting opportunities or neutralizing intimidation to the organization and infrequency is defined as being a resource that is not currently obtainable to a large number of the organization’s contemporary or future competitors (Barney, 1991). Exclusivity refers to the fact it is difficult for other firms to copy or otherwise replicate the resources for their own use. Finally, non-substitutability means that other resources cannot be used by competitors in order to duplicate the benefit (Barney 1991). When all four of these circumstances are met, it is said that the firm or organization acquire resources which can potentially lead to a sustained competitive advantage eventually.

In dissimilarity, there so numerous sources of sustainable competitive advantage apart from SHRM which includes Porter’s (1980) Competitive Strategy obtainable a more academically based analysis of strategy, but in a way that practitioners/executives promptly gravitated toward. This Industrial/Organization Economics based analysis first and foremost focused on industry characteristics, in scrupulous the five forces of barriers to ingress, power of buyers, power of suppliers, substitutes, and competitive contention as the determinants of industry profitability. While this analysis did suggest four standard strategies (cost, differentiation, focus, and ‘stuck in the middle’), the bulk of the analysis focused on external factors that resolute company profitability. This framework seemed to take over strategic management thinking of the early 1980s. However, with the initiation of the resource-based view of the firm (Barney, 1991), strategic management research enthused to a more interior focus. Rather than simply emerging competitive strategies to concentrate on the environment, the resource-based view recommended that firms ought to look inward to their resources, both physical and cerebral, for sources of competitive advantage.

SHRM is a strategic approach to administer human resources of an organization. It is commonly accredited that firms can create a competitive advantage from human resources and their management practices. Effective human resource management will breed a higher competence to magnetize and hold employees who are competent and motivated for good performance, and also the remuneration from having adequate and qualified employees are frequent (Wright et al., 1995).

According to Wright (2001) acknowledged that it is the human capital as well as the relationships and inspiration of the employees leads to competitive advantage. The purpose of HR practices is to widen or acquire this human capital and manipulate the relationships and behaviors of the employees so that they can put in to the strategic goals of the organization.

(Sources: Strategic Human Resource Management: Determinants of Fit, Wei 2006)

Analysis of SHRM do not generates capability to achieve SCA

Innovation is a source of competitive advantage compared with SHRM. Market orientation and organizational learning are basis of innovation which requires the acquisition and deployment of information about the consumers and the competitors as well as within the organization. The effect of this strategy allows companies to accomplish a competitive advantage because they foster innovation. Firms who are interested in attracting innovation ought to develop a market orientation behavior and advance its organizational learning procedure. These will facilitate companies to forecast and understand better the consumer needs and the competitive location of the company. This process or system allows the company to gain competitive advantage but not a sustainable one (Daniel 2005).

A research focused on Taiwanese firms, one of the most major promising markets in the world and shows that there is no significant direct impact for SHRM on firm performance compared to Traditional human resource management (THRM) and Product market strategy (PMS). Strategic HRM is not always a better system for organizational performance than the THRM approach. However, PMS moderated the relationship between SHRM implementation and firm performance. Moreover, the value development strategy remarkably and positively relates to business performance. Profitability grows when a firm concentrates on producing the best quality product or service.

Although Strategic HRM focuses on those measures that differentiate the firm from its competitors (Purcell, 1999), develops declarations of target which define means to achieve ends, and concerned with the long term allocation of significant company resources matching those resources and capabilities to the external environment.

There is interactive effect between innovation strategy and SHRM, because a positive relationship exists along with significant discrepancy in firm performance. Without innovation and PMS in the market environment, SHRM clearly have no impact on competitive advantage (Wan-Jing 2005).

Analysis of SHRM may generates or have little capability to achieve SCA

Strategic human resource systems can support the development and or use of organizational competences, and at the same time, it may demolish organizational competences and or bound their development. However, the application of these systems develops competences, even though it is necessary for a firm to attain a competitive position, it might not be sufficient to achieve sustained competitive advantage. Consequently, it is necessary that the strategic human resource system is analyzed with the aid of concepts such as internal fit, external fit, and organizational flexibility (Patricia 2008)

However, it remains uncertain about the conditions under which a firm employs SHRM so as to gain improved performance. Competitive advantage is meaningful if differentiation of the product is perceived in the marketplace. This is an important buying condition to a substantial customer base (Coyne 1986). Such an advantage will be sustainable, if it cannot be imitated (Barney, 1991). The capability essential to this differentiation must be notable between the product and its competitors; or else, competitors can expunge the differentiation at will (Coyne, 1086).

Despite the positive changes, organizations with motivated and steadfast employees can implement strategies better than those without them. The writer still knows very little about how HRM system can convert into sustainable competitive advantage (cavetti, 2008).

Indeed, theoretical researchers on SHRM has suggested that systems of HR practices may pilot to higher firm performance and be sources of sustained competitive advantage (Lado 1994). HR practices can only be a source of sustained competitive advantage when they support resources or competencies that supply value to a firm (Wright et al., 2001).

With the dawn of the resource-based view of the firm, strategic HRM research moved to an internal hub in competitive advantage. Rather than merely developing competitive strategies to deal with the environment, the resource-based view recommended firms to look within their resources for sources of competitive advantage. The RBV and its effect to SHRM study produced an important relationship between strategic management and HRM research. Nevertheless, this bond between them can be strengthened by infringement from the hub on HR practices. The resource-based view has suit almost the implicit paradigm within SHRM research (Wright et al., 2001)