Market orientation, HRM importance and competency: determinants of strategic HRM in Chinese firms

Abstract

This study examined three factors leading to a firm's adoption of strategic human resource management (SHRM): market orientation, HRM importance and HRM competency. Using a sample of firms from China, empirical results showed that the three factors are significantly related to a firm's adoption of SHRM. Given the transitional nature of the Chinese economy, the moderating effects of ownership types and firm size were also investigated. However, the moderating effects were not as strong as predicted. Managerial implications and directions for future research of SHRM in an emerging economy context are discussed.

Keywords:

• Strategic human resource management
• market orientation
• HRM competency
• HRM importance
• Chinese firms
• emerging economy

Acknowledgements

The authors would like to thank the Enterprise Survey Organization of the National Bureau of Statistics of China in assisting data collection for this project. The assistance of Rosanna Lo and the helpful comments of Hang-Yue Ngo on an earlier draft are appreciated. This project is funded by CERG (CUHK4310/01H).