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The field of strategic human resource management (SHRM) has been criticized for lacking a solid theoretical foundation. This article documents that, contrary to this criticism, the SHRM literature draws on three dominant modes of theorizing: universalistic, contingency, and configurational perspectives. Seven key strategic human resource practices are identified and used to develop theoretical arguments consistent with each perspective. The results demonstrate that each perspective can be used to structure theoretical arguments that explain significant levels of variation in financial performance.
During the last decade there has been a dramatic shift in the field of human resource (HR) management. This shift has broadened the focus of HR research from the micro analytic research that dominated the field in the past to a more macro or strategic perspective. The strategic perspective of HR, which has been labeled strategic human resource management (SHRM), has grown out of researchers' desire to demonstrate the importance of human resource practices for organizational performance.
The basic premise underlying SHRM is that organizations adopting a particular strategy require HR practices that are different from those required by organizations adopting alternative strategies (Dyer 1984a, 1984b; Fombrum, Tichy, & Devanna 1984; Jackson & Schuler, 1995; Jackson, Schuler, & Rivero, 1989; Schuler & Jackson, 1987a, 1987b, 1988; Schuler & MacMillan, 1984). If this fundamental assumption is correct, then much of the variation in HR practices across organizations should be explained by the organizations' strategies, and organizations that have greater congruence between their HR practices and their strategies should enjoy superior performance. There is some support for this assumption. For example, Schuler and Jackson (1988) and Arthur (1992) demonstrated that organizations following different strategies utilize different HR practices. Other researchers have demonstrated that HR practices can influence organizationally relevant outcomes such as productivity and profitability (Arthur,1994; Gerhart & Milkovich,1990; Huselid, 1993, 1995; Terpstra & Rozell, 1993).
Despite the growing body of empirical SHRM research, the field has been criticized for lacking a solid theoretical foundation (Bacharach, 1989; Dyer, 1985). This criticism arises, in part, because three different modes of theorizing have been employed in the field, but the differences among the alternative perspectives have not been explicitly acknowledged. Some authors have adopted a universalistic perspective (cf. Dewar & Werbel, 1979) and argued for a "best practices"...