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HOW HUMAN RESOURCE CAPABILITIES AFFECT THE ORGANISATIONS ’ PERFORMANCE ? THE CASE OF ELECTRONIC INDUSTRY IN THE UK

The impact of the Human Resource (HR) capability on the firm’s performance and its involvement in developing business strategies are becoming increasingly important particularly in high tech Small and Medium-sized Enterprises (SMEs). Not surprisingly, the main debate in HRM, particularly in SMEs, is nowadays concerned with the relationship between HR capabilities and the firm’s overall performance. This paper is exploring the above relationship in the Electronic Manufacturing industry in the UK. The findings are based on an empirical survey of Chief Executive Officers’ (CEOs) and their perception of the HR involvement in strategy development in high tech SMEs. The important conclusion reached is that increasing the core competencies of the firm, in particular HR, is the key element to the success of the firm. Moreover, it is posed that the growing involvement of the HR in the development and implementation of business strategy will lead to the increased effectiveness of the organisation and the industry as a whole.