Strategic Human Resource Management Practices and Competitive Priorities of the Manufacturing Performance in Karachi

Abstract

Pakistan is a developing country with scarcity of HRM research. An ineffective and maladaptation of strategic HRM practices potentially reduce the manufacturing performance in Karachi. This study investigates the impact of eight strategic human resource management practices on the four competitive priorities (i.e., cost, quality, delivery and flexibility) of the manufacturing performance when controlled for information sharing and relationship with employees. A sample of 182 usable survey questionnaires is collected from 90 organizations of 15 manufacturing sectors based in Karachi. The method of exploratory and confirmatory factor analyses were used to assess the reliability and validity of the measurement model. The structural equation modeling method was then applied to examine the theoretical framework. The results of the structural model show that all of the eight strategic HRM practices collectively demonstrate a very good model fit between the theory and the sample drawn however, both performance appraisal and employment security have been found statistically significant to predict these four priorities in isolation too. The study validates the theory of the integration between HRM practices and manufacturing operations, and investment perspective of strategic HRM, in particular. The contribution of this study is the construction of structural and measurement models of strategic HRM practices and the four chosen competitive priorities that could facilitate future research on human resource management. It also highlights important implications for HR managers in developing countries such as Pakistan.