Strategy-Oriented Practices and Factors of Human Resource Management in Small and Median Sized Enterprise

Abstract

Human resource management (HRM) practices of small and medium sized enterprises (SME) are generally viewed as informal, contingent and ad hoc activities leading to less strategic and impeding the realization of organizational goal. As matter of fact, the conclusion of being less strategic of HRM practices in SME is reached on the ground of both no reference to the latest evolvement of HRM practices in SME and the improper evaluation criteria of HRM practices in relation to degree of strategic orientation in SME formed out of large firms which are operated in different context with more resources. In view of this situation, firstly, an acceptable and applicable standard is formulated for fair judgment and evaluation of HRM practices in terms of strategic orientation. Then this paper collects substantial and substantive evidence showing strategy-orientation of HRM in SME, then analyzes such related influential factors regulating and determining degree of formality and the performance of HRM practices as employer, size of firm, new technology, etc.. Finally we suggest that despite of informality provides SME some edges at the start-up, SME must reconcile the relationship between formality and informality of HRM practice through applying and moderating those influential factors with growth.