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Journal of Management
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How Executive SHRM System Links to Firm Performance: The Perspectives of Upper Echelon and Competitive Dynamics{dagger}

Hao-Chieh Lin

Department of Labor Relations, National Chung Cheng University, 168 University Rd., Min-Hsiung, Chia-Yi, Taiwan 621, R.O.C., linhjtw{at}ccu.edu.tw

Chih-Ting Shih

Department of Business Administration, National Pingtung Institute of Commerce, 51 Minsheng E. Rd., Pingtung, Taiwan 900, R.O.C.

This study adopts the upper echelon and competitive dynamics perspectives to investigate the mechanisms by which strategic human resource management (SHRM) can create a competitive advantage for a firm. Top management team (TMT) social integration and action aggressiveness are identified as internal-oriented and external-oriented capabilities, respectively, for a teamwork-oriented executive SHRM system to support in enhancing firm performance. Structural equation modeling is performed to test hypothesized relationships. Statistical results demonstrate TMT social integration and action aggressiveness in sequence partially mediate the relationship of an executive SHRM system and firm performance. Action aggressiveness partially mediates the relationship of TMT social integration and firm performance. This study provides further insights into the SHRM, upper echelon, and competitive dynamics perspectives. The research findings also serve to remind top executives to remain alert in developing a set of teamwork-focused executive SHRM practices, building an integrated team, and proactively shaping competitive actions to outperform rivals.

Key Words: strategic human resource management • top management team • competitive dynamics • social integration

This version was published on October 1, 2008

Journal of Management, Vol. 34, No. 5, 853-881 (2008)
DOI: 10.1177/0149206308318612
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