Collectivistic-HRM, firm strategy and firm performance: an empirical test

Abstract

This study tests the effect of collectivism-oriented HRM (C-HRM) and that of firm strategy on firm performance among samples of international firms. Based on the relevant literature, we predict that C-HRM should have a positive effect on firm performance. Moreover, we argue that a contingent factor, i.e. firm strategy of product diversification, should have a direct negative effect on firm performance. Moreover, this firm strategy should also moderate the relationship between C-HRM and firm performance. Analyzing empirical data from multiple sources to test relevant hypotheses in a major emerging economy, i.e. P.R. China, we found evidence supporting our hypotheses. The paper concludes with a discussion of the implications of the findings.