Factors Affecting Smes Perception of Human Resource Management Practices: A Structural Equation Modeling Approach

Abstract

Purpose: The purpose of this manuscript is to examine the factors affecting SMEs perception of human resource management practices. Theoretical framework: The conceptual model for this study was developed based on previous research in the field of human resource management globally. The conceptual model has four variables that affects SMEs perception of human resource management practices. Design/methodology/approach: A survey instrument in the form of a structured questionnaire was designed based on a careful review of pertinent literature. This study collected empirical data from 216 Dhaka-based small and medium-sized businesses. PLS-SEM is used to test the significance of the research model. Findings: It is clear from the PLS-SEM that Bangladeshi Small Businesses need training and development, performance measurement, and monetary incentives to succeed. Research, Practical & Social implications: The implication drawn from this study aids human resource managers to focus their resource on the key variables that can afect SMEs perception of their organizations. Originality/value: This study is critical for leadership because it confirms the necessity or desire of business owners to grow human capital to improve corporate performance and give the organization a competitive advantage in the marketplace.