Joint and Individual Effects of Human Resource Management Practices, Organizational Learning, Employee Outcomes and Competitive Strategy on Performance of Firms Listed on the Nairobi Securities Exchange

Abstract

This paper is based on empirical research carried out on firms listed on the Nairobi Securities Exchange in Kenya, focusing on the joint and individual effects of Human Resource Management Practices (HRMP), organizational learning, employee outcomes and competitive strategy on firm performance. Previous research demonstrating the link between HRMP and firm performance has mainly focused on the private sector in the Developed World but has not used the selected variables, yet understanding this relationship in publicly listed firms, in the Developing World setting is equally important. The joint effect of HRMP, organizational learning, employee outcomes and competitive strategy on firm performance has not been established with the selected set of variables, yet theory has demonstrated that these variables can have an effect on firm performance. This study was motivated by the desire to fill this gap in knowledge. The objective of the study was to establish whether the joint effect of HRMP, organizational learning, employee outcomes and competitive strategy on firm performance is greater than the independent effect of HRMP, employee outcomes, organizational learning and competitive strategy on firm performance. The research design was cross sectional descriptive survey. Data was collected using a self-administered questionnaire, from a population of 60 NSE listed firms. The response rate was 60%. Descriptive statistics, correlation and regression techniques were used to analyze the data. The results of the study show that there was empirical evidence that the joint effect of HRMP, employee outcomes, organizational learning and competitive strategy on firm performance was greater than the individual independent effects of HRMP, employee outcomes, organizational learning and competitive strategy on firm performance. This study contributes to understanding of the effect the predictor variables on firm performance, while at the same time confirms the findings of previous studies that have found a significant link between HRMP and firm performance. The study also established that the combined effect of predictor variables on firm performance was greater than the individual independent effects of the predictor variables on firm performance. It is recommended that firms have to ensure that they synergistically combine various variables that they choose to use in order to attain and sustain a superior competitive advantage in their operations.