Development and Validation of Human Resource System Model Using Exploratory and Confirmatory Factor Analysis

Abstract

This study aims to empirically develop and validate a human resource (HR) system model via exploratory and confirmatory factor analysis (EFA and CFA). The framework proposed, and findings expect to add to an understanding of the procedures that can be embraced for designing the HR system on the basis of the bundling of different strategic HR practices. The data were collected through a structured questionnaire. The sample frame for this study consisted of officer-level employees from 11 Nepalese commercial banks. The final research sample consisted of 248 respondents. This study proposes an answer to how the HR system model can be developed and tested. It validated the extraction of 8 HR practices (dimensions) from 38 items, which were further validated as first-order constructs with 33 items, and the second-order HR system model with 30 items. The tested HR system model provides a comprehensive and holistic picture of the HR system and could be applied to Nepalese organizations. The methods and procedures adopted by this study to develop and validate the HR system model are expected to help Nepalese HR managers and practitioners design their HR policies and practices toward enhanced organizational performance (OP). The findings of this study are significant in the Nepalese context, where human resource management (HRM) still needs to be taken as a system approach on the basis of a multidimensional concept.