Effect of HRM Practices on the Performance of Companies Listed on NSE

Abstract

The human resource function can make a crucial contribution in developing the key competencies in the institutions and individual employees that lead to high performance. The human resource configurations effectiveness is affected by the weak social capital among most organizations in Kenya, as evidenced by a lack of knowledge sharing and knowledge hoarding. The study's main objective was to see how HRM practices influenced the performance of firms listed on the Nairobi Securities Exchange (NSE). The research was guided by the ability-motivation-opportunity theory. This research utilized a descriptive research design and applied the positivist approach. The population of the study included 65 companies listed on the Nairobi Stock Exchange (NSE), and it employed both primary and secondary data, with secondary data consisting of the financial indicator Return on Assets (ROA). Questionnaires were employed to gather primary data, and descriptive and inferential statistics were utilized to analyze the data. The method utilized was linear regression. According to the findings, human resource practices have a beneficial influence on the performance of companies listed on the NSE. This study recommends that the organizations should put mechanisms in place to ensure that all stakeholders are aware of the organizations culture, structure and human reward practices so as to attract the best applicants.