Abstract
There has been growing interest in the relationship between HRM practices and organizational performance, but few studies have provided evidence supporting this relationship by considering the moderating effect of CEO support. Therefore, this study intends to examine the effects of various HRM practices on organizational performance and the moderating effect of CEO support on the relationship between HRM practices and organizational performance through a survey on 215 Chinese firms. The results indicate a positive relationship between HRM practices and organizational performance and verify the moderating effect of CEO support on this relationship. This study is the first one on demonstrating the moderating effect of CEO support on the relationship between HRM practices and organizational performance in the context of Chinese firms. These findings may help adding knowledge to the Chinese firms’ CEOs while considering about making HR policies and HRM activities which are mainly decided by their attitudes and participations.
Highlights
In recent years, firms have been urged to adopt a variety of performance-enhancing or progressive HRM activities to increase their market share and improve their competitiveness in the global market because HRM plays a critical role in firms’ success by having considerable influence on organizational performance
This study investigates the relationships between HRM practices and organizational performance by focusing on the moderating effect of CEO support
The results reveal that HRM practices, training, participation, and compensation had positive effects on financial performance and that recruitment, training, participation, and compensation had positive effects on nonfinancial performance
Summary
Firms have been urged to adopt a variety of performance-enhancing or progressive HRM activities to increase their market share and improve their competitiveness in the global market because HRM plays a critical role in firms’ success by having considerable influence on organizational performance. Abundant studies have documented the significant relationship between HRM practices and organizational performance. It is generally known that HRM practices are positively related to organizational performance, there remains a need for more robust evidence supporting the HRM-performance relationship in various cultural contexts (Yazam & Ahmid, 2011). Another issue is that many researchers have questioned this relationship (Katou, 2008; Gerhart, 2005). This study examines whether there is a positive relationship between HRM practices and organizational performance and whether CEO support moderates this relationship
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