Does Strategic Human Resource Involvement and Devolvement Enhance Organisational Performance? Evidence from Jordan

Purpose – The purpose of this paper is to test empirically the relationship between the strategic involvement and the devolvement of human resource functions with organisational performance. Design/methodology/approach – This paper is based on the primary data collected from the population of financial firms based in Jordan. The methodology adopted for the purpose of data analysis includes the use of basic statistics, zero‐order correlations, confirmatory factor analysis and hierarchical regressions. Findings – The results provide strong support for the hypothesis that the involvement of human resource functions into the business and corporate strategy reduces employee turnover rate and enhances financial performance. The analysis does not support the second hypothesis that empowering day‐to‐day human resource functions to line managers impacts negatively on employee turnover and positively on financial performance. Practical implications – Our results imply that financial performance can be enhanced and employee turnover rate decreased by involving human resource directors in the overall strategic decision‐making process of companies. However, our results also imply that the devolvement of routine human resource issues to line managers is neither positively related to the financial performance of the companies nor negatively related to employee turnover. This raises doubts as to whether, after having involved human resource functions into the strategic affairs of the company, they are empowered enough to make a positive impact. Originality/value – This is one of few papers conducted on this topic in a non‐western environment, and the first of its kind for the country of Jordan. This paper contributes to the field through its approach to measuring and testing strategic human resource management theory. The paper also successfully links the core aspects of strategic human resource management with objective indicators of financial performance of the companies

Introduction

This chapter introduces the book entitled Human Resource Management in an Emerging South Asian Economy: The Case of Brunei. It describes the aim and importance of the book, which is mainly focused on analysing, comparing, and contrasting domestic enterprises and multinational enterprises, and oil and gas and non-oil and -gas sectors, and draws out the comparative lessons for understanding the potential and performance consequences of HR interventions in resource-centred national economies. The chapter also presents the structure of the book

International Human Resource Management in the Arab Gulf States – An Institutional Perspective

This paper seeks to explore the increasingly dominant role of International Human Resource Management (IHRM) policies and practices of Multinational Enterprises (MNEs) operating in the emerging economies of the Arab Gulf States and, more specifically, in the United Arab Emirates (UAE).The existing literature on institutions suggest that MNEs are under influence and pressure to adopt HR practices that are viewed as being appropriate for the context and situation. However, distinctive institutions in the Arab Gulf States such as the UAE, and their impacts on MNEs’ people management have been largely overlooked in prior work. Hence, with a particular focus on institutional theory, this work explores the effects of home-country institutional factors on IHRM in foreign subsidiaries. Furthermore, the paper aims to examine how regulative, cognitive and normative institutional dimensions affect the IHRM choices of MNEs. In depth interviews with 26 Human Resource (HR) managers located in the head offices of the participating MNEs were conducted, revealing that IHRM practices in this institutional setting are built upon fragile, dependent and uncertain conditions, and they are not grounded in the sort of deep and stable institutional foundations prevalent in most developed economies. As a result, we propose a more nuanced institutional framework that captures the peculiar aspects of the Arab Gulf States

Perceived Training Opportunities and Knowledge Sharing: The case of the United Arab Emirates

We seek to explore the interplay between perceived training opportunities (PTOs) and knowledge sharing in the context of the emerging economic setting of the United Arab Emirates. We also examined the moderating role of intrinsic and extrinsic motivation and engagement in social interaction on the relationship between PTOs and knowledge sharing. The study employed a survey method to collect the data, and tested the proposed hypotheses by using the partial structural equation modelling (PLS-SEM) technique. Data is based on 815 responses across all sectors in the country context of the UAE. Our findings indicate that PTOs are positively related to knowledge sharing. Notably, the results show that the proposed relationship between PTOs and knowledge sharing is negatively and significantly moderated by intrinsic motivation. Moreover, the moderating role of extrinsic motivation and engagement in social interaction were insignificant. At a theoretical level, this article provides an individual level analysis, which indicates that PTOs pave the way for intraorganizational knowledge sharing; hence, they offer insights into the mechanisms in which PTOs impact on knowledge sharing. This article also contributes to our general understanding on human resource management (HRM) practices and knowledge sharing in the context of the emerging economy of the UAE; the latter has a number of implications for both, theory and practice as delineated in this study

Managing Upward and Downward Through Informal Networks in Jordan: The Contested Terrain of Performance Management

This study explores how local managers, in practicing HRM, may pursue their own interests that are out of line with the agendas of headquarters in Multinational companies (MNCs). It is widely acknowledged that informal networks have an impact on HRM practices in emerging markets. While these networks are often regarded as beneficial for organizations in compensating for institutional shortfalls, they may also lead to corruption, nepotism, or other ethical transgressions. Indigenous scholarship on informal networks in emerging markets has highlighted how their impact occurs through a dynamic process; powerful placeholders deploy informal networks to entrench existing power and authority relations when managing people. Qualitative data were gathered through 43 in-depth interviews and documentary evidence from MNCs operating in Jordan. MNCs are subject to both home and host country effects; we highlight how, in practicing HRM, country of domicile managers deploy the cultural scripts of wasta informal network to secure and enhance their own relative authority. HRM practices are repurposed by actors who secure and consolidate their power through wasta. They dispense patronage to insiders and marginalize outsiders; the latter includes not only more vulnerable local employees but also expatriates. This phenomenon becomes particularly evident during the performance appraisal process, which may serve as a basis for the differential treatment and rewards of employees. Consequently, this further dilutes the capacity of MNCs to implement – as adverse to espousing – centrally decided approaches to HRM

Indigenization of Staffing in MNEs: The Case of Saudi Arabia

In the Gulf States, there has been increased emphasis on requiring MNEs to indigenize their staffing. Based on a survey of 157 HR directors in MNEs headquartered in Saudi Arabia, this article explores why so little headway has been made through applying and extending Resource Curse Theory. Surprisingly, we found formal ties with government had little effect; Resource Curse Theory would suggest this would be due to the concentration of regulatory scrutiny and support on the oil and gas industry, where, indeed, indigenization was most pronounced Again, although they may compensate for regulatory shortfalls, we found intra firm ties made little difference in advancing indigenization. Again, Resource Curse Theory would suggest that non-minerals sectors suffer a drain in capital and human resources, which would make indigenization more challenging. Resource Curse Theory assumes that mineral endowments negatively impact on macroeconomic and societal outcomes, but only accords limited attention to how these pressures are transmitted via organizations. Through providing organizational level evidence, we both further illuminate Resource Curse effects in practice, and contribute to extending the base and scope of application of the theory. We draw out the implications for practice

Resource Cursed Economies and HR Practices

This chapter explores HR practices in resource-cursed economies, with a particular focus on the context of Brunei. The literature available on the resource curse implies that organisations in non-oil and -gas sectors across petro-states experience a number of key obstacles to achieving competitiveness and becoming self-sustaining. This chapter investigates the link between particular HR policies and practices and business performance; emphasis is placed on examining and drawing contrasts between oil and gas and non-oil and -gas sectors, whilst further seeking to highlight the comparative lessons aimed at garnering insight into the possible and performance-related results associated with HR interventions in resource-focused national economies

The impact of leadership on absorptive capacity: new insights from the UAE

This paper investigates the impact of transformational and transactional leadership on the absorptive capacity of firms within an emerging market setting. Unlike some findings from the Western world, the results indicate that both transformational and transactional leadership styles positively influence the learning processes of absorptive capacity. More specifically, the results indicate that transactional leadership style positively influences the exploratory and transformative learning processes, while the transformational leadership style positively affects the exploitative learning process. Given the unique context under investigation and the fluid institutional arrangements associated with it, the results reflect the need for leadership guidance. Implications for theory and practice are discussed