From Customer‐Oriented Strategy to Organizational Financial Performance: The Role of Human Resource Management and Customer‐Linking Capability

Abstract

Drawing on the organizational capabilities literature, the authors developed and tested a model of how supportive human resource management (HRM) improved firms’ financial performance perceived by marketing managers through fostering the implementation of a customer‐oriented strategy. Customer‐linking capability, which is the capability in managing close customer relationships, indicated the implementation of the customer‐oriented strategy. Data collected from two emerging economies – China and Hungary – established that supportive HRM partially mediated the relationship between customer‐oriented strategy and customer‐linking capability. Customer‐linking capability further explained how supportive HRM contributed to perceived financial performance. This study explicates the implication of customer‐oriented strategy for HRM and reveals the importance of HRM in strategy implementation. It also sheds some light on the ‘black box’ between HRM and performance. While making important contributions to the field of strategy, HRM and marketing, this study also offers useful practical implications.