Strategic Human Resource Management and Organizational Competitiveness in SMEs of Pakistan: Moderation Role of Regulatory Environment and Industry Characteristics

Abstract

Cirowth of small and medium enterprises is considered vital in economic development. Globally, it is under the limelight of public policy, and every country takes significant measures to levitate the developments in this sector. However. Pakistan's SMI! sector is not too effective to produce desired results despite hav ing a substantial contribution in GDP. This study assumed that internal factors hindered the SMI! growlh and performance. Moreover, it also examined the level of adaptation of strategic human resource practices framework aligned with SMF. competitiveness. The study is quantitative in nature. Field survey method was used to collect the primary data from 273 small and medium enterprises operating in Pakistan. The data was analysed by using regression and moderation analysis: career planning, health and safety are the popular SHRM practices. The results exhibit an increasing impact of SHRM on organizational performance while facilitating HR outcomes and organizational success factors. The adoption of SHRM practices among manufacturing and service sector SMEs show no significant differences whereas, organizational characteristics demonstrate significant differences in the SI IRM practices of small-sized, medium-sized, and exporting firms. Empirical results report the inverse effect of legal and regulatory env ironment on the relationship between organizational success factors and organizational competitiveness.