HRM reactions to crisis situations: a latent class analysis approach

Small and Medium Enterprise (SME) sector is considered to be the backbone of Japanese economy. Its importance is often highlighted by the large share of the economy it occupies, whether in terms of number of companies, total number of employees, value of shipments or GDP. However, since last two decades many SMEs have gone out of businesses while firm entry rate is showing downward trend. According to some business advocates, one of the reasons for high rate of business failures in SMEs is due to its less attention to the human side of their businesses. Therefore, the broad objective of this study is to examine the role of Human Resource Management (HRM) practices in SMEs in Japan. Specifically, this study attempts to examine the relationship between HRM practices and labor productivity in manufacturing SMEs in Japan. Further, it aims to examine the mediating link of HR outcomes in between HRM practices and labour productivity. A structured questionnaire was developed and sent to 436 SMEs in Aichi Prefecture and 144 firms responded to the questionnaire resulting in 32 percent response rate. Based on the data analysis it was found that there is a strong positive relationship between HRM practices and labour productivity mediated by HR outcomes in manufacturing SMEs in Japan.

Research aims: This study aims to investigate the influence of Human Resource Management (HRM) practices on employee performance, with job satisfaction serving as a mediating variable, within the context of Micro, Small, and Medium Enterprises (MSMEs) in Indonesia.Design/Methodology/Approach: Data were collected using structured questionnaires distributed to owners and employees of MSMEs in Indonesia. The sampling technique used was purposive sampling, resulting in a total of 130 valid responses. Data analysis was conducted using Partial Least Squares Structural Equation Modeling (PLS-SEM) with the assistance of SmartPLS 4 software.Research findings: The results of the study indicate that HRM practices have a positive and significant effect on employee performance. Furthermore, job satisfaction significantly mediates the relationship between HRM practices and employee performance. These findings suggest that enhancing HRM practices can increase employee job satisfaction, which in turn leads to improved performance.Theoretical Contribution/Originality: The findings of this study can serve as a valuable reference for policymakers in designing programs and policies that support the enhancement of HRM practices within the MSME sector. Strengthening HRM practices can contribute to increased employee satisfaction and performance, which in turn promotes the overall growth and competitiveness of MSMEs in Indonesia.Practitioners/Policy Implications: The practical implication of this study highlights the importance for MSME managers to implement effective HR strategies aimed at enhancing employee job satisfaction. By prioritizing well-structured HR practices, MSME managers can foster a more motivated and productive workforce, thereby improving overall organizational outcomes.Research Limitations/Implications: This study focuses primarily on HRM practices and job satisfaction as the main variables influencing employee performance. However, it acknowledges that employee performance is also affected by other important factors, which were not examined in this research. Future studies are encouraged to explore these additional variables to provide a more comprehensive understanding of the determinants of employee performance within the MSME sector.

Due to the demographic change in age, societies, firms, and individuals struggle with the need to postpone retirement while keeping up motivation, performance, and health throughout employees’ working life. Organizations, and specifically the Human Resource Management (HRM) practices they design and implement, take a central role in this process. Being influenced by macro-level trends such as new legislation, organizational HRM practices affect outcomes such as productivity and employability both at the firm and individual level of analysis. This editorial introduces the Special Issue on “Age-related Human Resource Management Policies and Practices” by conducting an interdisciplinary literature review. We offer an organizing framework that spans the macro-, meso-, and individual level and discusses major antecedents, boundary conditions, and outcomes of age-related HRM practices. Further, we propose a typology of HRM practices and discuss the role of individual HRM dimensions versus bundles of HRM practices in dealing with an aging and more age-diverse workforce. Building on these considerations, we introduce the eight articles included in this special issue. Finally, taking stock of our review and the new studies presented here, we deduct some recommendations for future research in the field of age-related HRM.

PurposeInnovative small and medium-sized enterprises (SMEs) are key economic actors, but they are fragile. Their innovation trajectory requires an evolution in their competencies as their strategy evolves, and this is a particularly critical concern when they are engaged in both exploration and exploitation activities and want to develop organisational ambidexterity. In turn, this brings challenges for human resource management (HRM): some research studies have identified “mobilising” practices for innovation, but few authors have taken a dynamic approach. This study aims to fill this double-theoretical gap by answering the following two questions: how does HRM respond to the challenges associated with the search for ambidexterity in an innovative SME's trajectory? What HRM practices are mobilised in the innovation trajectory of SMEs?Design/methodology/approachThe authors carried out two longitudinal case studies concerning innovative SMEs in the medical equipment sector, which are now over 10 years old and seeking to stabilise an ambidextrous way of operating. The authors conducted 37 semi-structured interviews in 2018–2019 and collected public and internal documents. For each case, the authors identified sequences (Bidart et al., 2013) displaying a certain homogeneity in terms of innovation strategy. The authors then performed a cross-case analysis.FindingsThese case studies produced two main results. First, the trajectory of innovative SMEs consisted of sequences during which competency needs and HRM practices evolved. Despite their similar modes of ambidexterity, the two SMEs have mobilised different human resource (HR) practices. Second, the HRM practices implemented struggle to support the firm at key turning points in the innovation trajectories and can even hinder such changes in direction.Originality/valueThe originality of this work lies in two major dimensions. First, the authors choose to explore innovation and the search for ambidexterity, two themes that are traditionally studied in large firms, in the setting of SMEs. Second, the authors choose a longitudinal method to explore the evolution over time in modes of ambidexterity and HRM, along these SMEs' innovation trajectory. This is a departure from more traditional approaches seeking to identify which HR practices, or configurations of practices, are best able to foster ambidexterity and innovation. It leads the authors to show, in a contingent, dynamic perspective, the importance of the Human Resources Foundation’s (HRF's) positioning and attitude in supporting diversified SMEs’ innovation trajectories. This requires allocation of the necessary resources to the function, which needs time and resources to reflect on how to build the ambidextrous HRM that is essential for the firm's survival.

Human resource management (HRM), innovation, and regulation are widely acknowledged as critical determinants of small and medium-sized enterprise (SME) performance. Yet, their interplay in the context of halal-certified SMEs remains fragmented. This study systematically reviews empirical evidence to integrate the Resource-Based View (RBV) and Strategic Human Resource Management (SHRM) perspectives, examining how HRM practices, innovation, and regulatory compliance jointly shape halal SME performance. Following PRISMA 2020 guidelines, a Scopus-based search (2015–2025) identified 1,572 records. After screening and appraisal using JBI and CASP checklists, 106 studies were included for synthesis. A convergent approach combined descriptive statistics and thematic analysis. HRM practices grounded in the Ability–Motivation–Opportunity (AMO) framework and green HRM consistently foster innovative work behaviour and digital readiness. Innovation across products, processes, and business models enhances performance, while halal certification and broader regulations serve a dual role: creating compliance costs yet strengthening legitimacy and market trust. Evidence integrating the HRM–innovation–regulation triad remains scarce but reveals promising avenues for SME competitiveness. The findings highlight regulation as a strategic capability rather than a constraint. For halal SME managers, aligning HRM practices with digital innovation and regulatory compliance is essential for sustainable growth. For policymakers, designing enabling regulations is critical to strengthening SME resilience and legitimacy. This review is among the first to map the integrative mechanisms linking HRM, innovation, and regulation within halal SMEs, advancing RBV–SHRM scholarship and offering actionable insights for practice.

PurposeThis study focuses on owner-managers’ paternalism and its effects on human resource management (HRM) in micro, small and medium enterprises (MSMEs) during COVID-19 pandemic. It aims to describe and discuss how owner-managers paternalism enhanced the sustainability of exemplary MSMEs.Design/methodology/approachA qualitative approach employing Heideggerian interpretive phenomenological methodology was used. Data were collected from 30 exemplary MSME restaurants using non-participant observation, document analysis and in-depth interviews with a purposive sample of 75 key informants: 30 owner-managers and 45 of their employees in 10 Thai tourist provinces over three time periods. Verbatim transcripts were coded using template analysis to generate distilled data summaries.FindingsFour HRM themes were identified: (1) staffing, (2) development, (3) performance management and (4) compensation. A proposed model was suggested to understand how owner-managers’ paternalism affects four HRM practices. Owner-managers use their authority, combined with high levels of benevolence and morality, through supportiveness and kindness for employees to meet both their work and personal needs. Specifically, their employees repay them through performance and loyalty. This reciprocal relationship positively impacts employers, employees and MSMEs.Research limitations/implicationsThe generalization of the study's outcomes is limited by the sample size and study methodology. The findings propose alternative HRM practices for Thai restaurants, therefore, generalization to all types of MSMEs and all areas of the world is not possible. In future research, it would be useful to consider a mixed-methods approach using large samples of MSMEs across the country or in other countries. Some small HR issues that were noted in this study, such as using the horoscope, astrology and zodiac as hiring tools, could be studied further. Future studies should explore the main thrust and relationship established between owner-managers and employees to drive MSMEs' performance.Practical implicationsThe findings may be used as guidelines for creating a deep bond between employers and employees to strengthen MSMEs and foster sustainability.Social implicationsImportant for instilling HRM practices in MSMEs. This paper provides policy implications for governments, relevant public agencies and other developing countries. They need to put forward for consideration of new strategies for migrant policy, in order to solve the shortage of labor in MSMEs. A well-considered policy could increase employee well-being during crises by bringing supportive strategies together.Originality/valueThis study expands knowledge of the effects of paternalism on HRM practices in shaping employer and employee relationships through social exchange theory (SET).

PurposeThe purpose of this study is to explore the role of employee relations and human resource management (HRM) practices on firms' commitment to sustainability in the context of micro, small and medium enterprises (MSME) in India. This paper proposes a theoretical framework, namely “awareness, action, comprehensiveness, and excellence (AACE),” to present the solutions and practices as adopted by MSME firms in meeting their sustainability objectives alongside pluralistic constraints related to human resource, capital and legitimacy risk.Design/methodology/approachThe paper employs a cross-case methodology to investigate five food processing MSME firms to understand and delineate the role of employee relations and HRM practices in driving their commitment to sustainability.FindingsThe paper discusses the status of employee relations and HRM practices as practiced by MSME firms, specifically designed to meet their agenda to strengthen their commitment to sustainability. The study proposes a framework constituting four levels, namely “awareness, action, comprehensiveness, and excellence (AACE),” that reflects HRM practices as adopted by MSME firms to develop their commitment to sustainability.Social implicationsMSMEs and food processing industries are critical to the growth of Indian economy and likewise for other emerging and developing economies. They are especially critical for their contribution to overall employment and sustainability comprising the second, third and fourth supplier links in supply chains. They have a major impact on sustainability outcomes and the life quality of employees. This paper makes a contribution in this direction.Originality/valueThe study fulfills the need to explore the role of employee relations and HRM practices to develop “commitment to sustainability” in the context of food processing MSME firms in an emerging economy of India. This paper adds an understanding of people management practices and sustainability in small firms (MSMEs), adding to the existing literature on the domain, which is mostly skewed toward large firms.

Digital transformation in Japan’s small and medium-sized enterprises (SMEs) is becoming a hot topic, especially considering that of 105 Japan’s 4.21 million companies, about 99.7 % are small and medium-sized, providing nearly 70 % of all jobs. The IT is seen by SMEs as a tool for survival, productivity and competitiveness. Taking into account the declining birth rate, aging population and shrinking workforce in Japan, there are high expectations for SMEs as a driving force for economic growth and competitiveness. In this new reality, SMEs’ HR managers are required to develop human resource strategies that align with and support the company’s management and development strategy. This study attempts to identify the transformational processes in human resource management in the digital transformation of SMEs in Japan.

PurposeThe purpose of this paper is to establish if indeed human resource management (HRM) practices drive organizational learning capability and, in turn, fortify small and medium enterprises (SMEs) performance. The purpose of mediation analysis is to see if the influence of organizational learning capability is stronger than the direct influence of HRM practices on SME performance.Design/methodology/approachData was collected from managerial-level employees of SMEs using questionnaire survey. This study used the Partial Least Squares approach to structural equation modeling to test the hypothesized relationship, as it involves the relationships among multiple variables.FindingsOf the HRM practices, incentive and compensation and team working seem to be important for firm performance. As for organizational learning capability, only openness and experimentation and managerial commitment have a direct positive impact on firm performance. The results of the mediation analysis established organizational learning capability as a mediator, albeit partially.Originality/valueAlthough prior research revealed a positive relationship between HRM practices and performance, this study illuminates the black box in-between, as few studies have established its importance in the relationship between HRM practices and firm performance. The findings provide more consensus on the ongoing debate on the linkages among HRM practices, SME performance and organizational learning capability.

This study attempted to narrow the dearth in the literature with regard to the influence of human resource management (HRM) practices on employees. The study, using a sample of clerical front liners in service-based cooperatives in West Malaysia revealed that HRM practices (training and development, performance appraisal, communication and participation, and rewards) had a significant direct positive and indirect positive relationship with employee performance. The indirect relationship was mediated by affective organisational commitment. In contrast, HRM practices only had an indirect relationship with turnover intention, mediated by affective organisational commitment. Affective supervisory commitment did not mediate the relationship between HRM practices and employee performance nor the relationship between HRM practices and turnover intention. The results suggested that HRM practices can enhance employee performance directly as well as indirectly, through fostering affective organisational commitment. In addition, HRM practices can reduce turnover intention only indirectly through enhancing affective organisational commitment.

Purpose The purpose of this study is to explore the effect of adopting categories of high-performance work practices (HPWPs) in human resource management (HRM) in some health dispensaries in the context of the Kingdom of Saudi Arabia. It examines their impact on specific performance areas that can be measured in line with defined performance measurement criteria by adopting the approach of best practices that covers a wide range of departments, levels and processes, including those that reflect the HRM strategy's effectiveness. Design/methodology/approach The study employed descriptive-exploratory research design which explores the effect of adopting categories of HPWPs in HRM in some health dispensaries in the context of the Kingdom of Saudi Arabia. Findings This study's findings also point to inefficient practices in uplifting organizational performance levels, such as performance-related compensation and information exchange. HPWPs contribute in achieving the institutions' goals in the employees' performance improvement their productivity in health dispensaries improvement of institutional characteristics and performance. HPWPs led to the improvement in the elements of performance, remarkable of which are: improvement in innovation level and creativity; management level improvement due to the compatibility of human resources (HR) practices with the employees' qualifications and experiences; support of the administration to these practices, individual and institutional goal achievement. Research limitations/implications The drawback of this analysis is that HR drivers have been listed for healthcare in Saudi Arabia. There will also be extra drivers or potential examinations. The research used expert opinions; they could modify their views in the future. Such work primarily relates to Saudi Arabia and requires validation in specific contexts. There are prospects for more research in the future, as this analysis should be used. This offers the partnership pattern for HR drivers in healthcare in Saudi Arabia. Practical implications The study presents practical implications to HRM of health services in Saudi Arabia. This may help to improve healthcare programme in Saudi Arabia and transforming it into a comprehensive healthcare network through which the country offers quality health coverage across various government departments. The private sector's involvement in providing healthcare services is also growing but is hampered by many HR-related concerns. Social implications With this study, it offers to improve the health services of Saudi Arabia for social development with regards to HRM practices. In which efficiency in healthcare ensures that the patient wants treatment in an inexpensive, secure, efficient manner because it needs it. HPWPs in HRM are examined in this research paper. Originality/value Despite the magnitude of the health dispensaries in the Kingdom of Saudi Arabia, and the geographical expanse, it covers in rendering its practical and medical services, there is an apparent lack of full grasp on the part of managers concerning the potential role that HPHWs can play a major role in contributing to the development of health services across the board; in addition to the fact that some institutions are not desirous of changing the framework and operations of their HRM amongst healthcare institutions in Saudi Arabia.

Recent studies have examined the impact of human resource management (HRM) practices on workplace performance. Most find that the adoption of a coherent system of new HRM practices such as flexible job definitions, cross-training and work teams, along with extensive reliance on incentive pay, results in substantially higher levels of productivity than more traditional HRM practices. Studies have found that there is a correlation between HRM systems and labour productivity. We find that greatest contributor to labour productivity is the employee’s wage is congruent with the literature. The literature to date has shown that HRM practices in isolation may increase productivity or may reduce productivity because they have an inefficient side to them. Our study shows that when aggregated, HRM practices reduce productivity in Canada. Somewhat surprisingly, when combined with benefits, they increase productivity substantially. The main message from the aggregate productivity regressions is that: HRM by itself reduces productivity while HRM with BENEFIT increases productivity. Training by itself increases productivity and training with HRM also increases productivity. Wages clearly have the greatest impact on voluntary quits. HRM is not found to be statistically significant in the reduction of voluntary quits.

The importance of human resource management (HRM) practices to improve organizational attitudes and behaviors is not yet widely acknowledged. However, is not clear whether the effect of HRM practices on outcomes vary depending on the level of specific personal resources. The present paper aims to examine the relationship between HRM practices and work engagement by focusing on the moderating role of adaptability. We used cross-sectional data with surveys from 1219 Italian employees in public, private, and non-profit organizations. The results of structural equation models (SEM) showed that HRM practices were positively related to work engagement overall for employees with low adaptability. Therefore, adaptability moderated the relationship between HRM practices and work engagement. In terms of originality, this study is based on the paucity of empirical studies linking developmental HR practices to employees’ work engagement. Hence, the present study addressed this gap by examining the relationship between the perception of HRM practices and work engagement, as well as how adaptability moderated this relationship. These findings are discussed in terms of their theoretical and practical implications for HRM.

Purpose This study aims to conduct a comparative analysis of human resource management (HRM) practices between domestic and multinational enterprises within India, a large emerging economy. It also highlights the distinct institutional arrangements that potentially influence the employment practices of these organizations. Design/methodology/approach Data were collected from a diverse sample of domestic and multinational enterprises in India. The study utilized multivariate analysis to examine HRM practices, focusing on training and development, incentives and rewards and retention practices. Findings Contrary to initial expectations, the results indicate that DEs place significantly more emphasis on HRM practices than MNEs. This finding suggests that organizational scale and global presence do not consistently translate into a greater emphasis on critical HRM parameters. Instead, DEs leverage their local market knowledge and understanding of cultural and institutional nuances to prioritize effective HRM strategies. Research limitations/implications The study did not categorize the nationality of MNEs, which could reveal how different cultural contexts impact HRM practices. It is possible that MNEs headquartered in distinct cultural contexts may exhibit varying behaviors compared to enterprises based in different cultural environments. Additionally, while our findings reveal that domestic enterprises prioritize certain HRM practices over multinational firms, the question remains whether this emphasis translates into favorable organizational performance outcomes. Practical implications Both multinational and domestic enterprises should tailor their HRM practices to align with local dynamics and institutional arrangements. DEs can use their emphasis on HRM practices as a competitive advantage in attracting and retaining local talent, while MNEs should enhance cross-cultural competence to better integrate within different national contexts. Originality/value This study introduces a critical rethinking of HRM practices by illustrating the unique ways DEs and MNEs navigate institutional complexities within India. Unlike traditional assumptions that emphasize the superiority of MNE practices, this research uncovers how DEs strategically leverage local institutional knowledge to outperform MNEs in HRM dimensions. By embedding these findings within institutional theory, this study extends the theoretical discourse on organizational adaptability in emerging markets and provides actionable insights for aligning HRM strategies with local institutional contexts, fostering a comprehensive understanding of HRM dynamics across diverse economies.

How can human resource management (HRM) practices promote entrepreneurial performance in small and medium‐sized enterprises (SMEs)? This article discusses the association between human capital management (HCM) and other contemporary HRM practices and the ability of SMEs to be entrepreneurial. In a study of 99 SMEs, HRM practices that promote employee discretionary behavior, knowledge sharing, and organizational learning are found to be positively associated with entrepreneurial performance. Two contingencies are also identified for this relationship. First, the use of strategic HCM practices enhances the observed positive association. Second, these relationships are strongest for SMEs operating in high‐technology industries. © 2004 Wiley Periodicals, Inc.