Article Review Group Assignment

LUNAR INTERNATIONAL COLLAGE
Human resource management Group assignment
PREPARED BY
Fiseha Seifu(GSR/0159/12)
Submitted to
Dr. Asres Abitie
2
The Article
In search of sustained competitive advantage: the Impact of
organizational culture, competitive strategy and human resource
management practices on firm
Abstract
As a summary of the international journal of human resource
management the hypothesis they made (the positive impact of HPHRP,
OC… on firm performance) and the practical findings aren’t exactly
correlated rather very far from what was stated.
Introduction
This research was made on the impact of organizational culture,
competitive strategy and human resource management practices on firm.
Scholars try to better understand how organizations sustain their
competitive advantage and listed out some conjectures later found not
supportive base on the Hong Kong firm.
The purpose of this study is to understand how firms sustain a

competitive advantage through the effective management of people
According to Pringle and Kroll (1997), intangible knowledge-based

resources (i.e. people) are more likely to lead to a sustainable
competitive advantage when the environment is changing rapidly since
2
human resource is adaptable and unlikely to change when things around

the world change.
Description of the study

Resource-based view (RBV) theorists contend that competing firms can
enjoy sustained advantage due to resource heterogeneity and the
imperfect mobility of such resources. However, the RBV suffers from
two major theoretical deficiencies:
1. Assumes static equilibrium,
2. Focuses only on the difficulties and barriers in competing firms

imitating, substituting or taking away resources rather than on the
complementarities or co-specialization of resources.
Objective of the study

Assess direct link between high performance human resource practices ,
organizational culture, 4 cultural traits(involvement consistency,
adaptability,and traits), differentiation strategy and firm performance
surmised to be positive but was later proved wrong , although there is
slight correlation for organizational culture and firm performance.
Examine the notion of resource co-specialization by testing the potential

interactive effects of organizational culture and HPHRP on firm
performance (negative effect as well)
2
(3) Consider the contingent relationship between strategy and HPHRP

by evaluating the moderating effects of competitive differentiation
strategy.
Literature evaluation
Literature review revolves on how the intangible knowledge-based
resources (i.e. people) are more likely to lead
to a sustainable competitive advantage when the environment is

changing rapidly and deed a research on the variables that affect the
performance assessing on how the use of high performance human
resource practices (HPHRP) will be related to firm performance it also
observes on how Organizational culture relate to firm performance .the
research tries to see on Organizational culture in the impact of
performance human resource practices on firm performance and The
extent to which the firm emphasizes a differentiation strategy on high-
performance and firm performance.
Sample
The sample was taken from Firm performance by assessing with the
eleven-item measure developed by Delaney and. Senior executives were
asked to assess various performance indicators, such as their product or
service quality, marketing, profitability, employee relations, etc., by
comparing their firm with similar companies in Hong Kong The two
2
factors are labeled as ‘perceived organizational performance’ and

‘perceived market performance’
Method and design

A structured questionnaire was found for data collection. On the
predictors which are the dependent variables like HR practice variables,
Competitive strategy variables, Culture variables, Control variable
affecting the independent variables of organizational and market
performance.
Analysis
Data analysis was made in a correlation showing the relationship
between organizational culture, competitive strategy and human
resource management practices on firm performance
Major findings
1. The researchers predicted that HPHR practices would be positively
related to firm performance. Neither the correlations nor the regression
analyses showed a significant relationship between HPHR practices and
performance which was not supportive to their previous basis.
2
2. Performance. Involvement, policy consistency and adaptability were

significantly and positively correlated similarly, the mission trait was
correlated with organizational performance only the adaptability and
mission traits were positively correlated with market performance.
Although none of the culture traits emerged as significant predictors of
firm performance in the regression analyses, as a block they did
impudence organizational performance. Thus there was a partial support
3. These results indicate that certain dimensions of organizational

culture and HPHR practices do interact to impact on firm performance.
None of the other moderators was significant. In so far significant
findings were in the opposite direction to that Hypothesized,
4, to test the moderating effects of differentiation strategy on the

relationship between HPHR (high performance human resource)
practices and firm performance, research had followed the same
procedures and analyses
Described above none of the interactions were significant, thus refuting

their previous beliefs
2
Conclusion
The research found that the result were non-supportive, suggesting that the
relationship between a firm’s strategy and its HR practices may be more
complex than originally imagined. A possible explanation for the findings,
however, is that the research included only one type of competitive strategy in
the analyses. The research didn’t test the cost-leadership strategy which may
have detected stronger relationships with the HPHR practices of Hong Kong
firms. Thus, encourage future researchers to examine more discrete forms of
competitive strategy in the future to be more ascertained.

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LUNAR INTERNATIONAL COLLAGE

Human resource management Group assignment

The purpose of this study is to understand how ﬁrms sustain a

According to Pringle and Kroll (1997), intangible knowledge-based

human resource is adaptable and unlikely to change when things around

Description of the study

1. Assumes static equilibrium,

2. Focuses only on the difficulties and barriers in competing ﬁrms

Objective of the study

Examine the notion of resource co-specialization by testing the potential

(3) Consider the contingent relationship between strategy and HPHRP

to a sustainable competitive advantage when the environment is

factors are labeled as ‘perceived organizational performance’ and

Method and design

2. Performance. Involvement, policy consistency and adaptability were

3. These results indicate that certain dimensions of organizational

4, to test the moderating effects of differentiation strategy on the

Described above none of the interactions were signiﬁcant, thus refuting

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