The Impact of Human Resource Management Practices on Performance: Mediating Role of Strategic Orientation and Moderating Role of Environmental Dynamism in Knowledge-oriented Firms

Human resource management practices as a strategic resource for organizations lead to employee empowerment and competitive advantage improvement. The present study investigates the effect of human resource management practices on performance through the mediating role of strategic orientation and moderating environmental dynamic role. According to 183 electronic questionnaires collected from small and medium-sized Knowledge-oriented firms and data analysis with structural equation modeling, the research results indicate that the relationship between human resource management practices and performance is not significant directly. However, the strategic orientation concept (entrepreneurship orientation and market orientation) can positively and significantly play a mediating role in that relationship. The positive and significant effect of entrepreneurship orientation and market orientation on performance is also confirmed statistically. In a dynamic environment, entrepreneurial orientation has a positive, while market orientation has a negative and significant effect on performance. The finding indicates the need to implement entrepreneurial and market-oriented strategies for exploiting human resource management practices and pays attention to conceiving entrepreneurial strategies in dynamic environments. The executive and research suggestions are discussed.