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The Effect of Strategic Human Resources Management (SHRM) on

Organizational Excellence

Article  in  Problems and Perspectives in Management · November 2020

DOI: 10.21511/ppm.18(4).2020.05

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 The Effect of Strategic Human Resources Management (SHRM) on Organizational
Excellence
Mohamad Noor Al-Jedaiaha, Rokaya Albdareen*
mjedaiah@jadara.edu.jo, rokaya@jadara.edu.jo
ab
Associate Professor, Faculty of Business, Business Administration Department, Jadara
University
* Rokaya Albdareen : rokaya@jadara.edu.jo

Abstract
The objective of this research is to investigate the effect of SHRM components on organizational
excellence. The study was applied on industrial organizations in Industrial City. The questionnaire
was used to collect data. Simple random sample of organizations managers were selected to answer
the questionnaire questions. The results showed that SHRM components effect the organizational
excellence. The study recommended that the organization should connect the SHRM strategy with
the other organization activities that lead to excellence.
Keywords: Strategic human resources management, organizational excellence.
Introduction
Organizational excellence is the core of any business. The dynamicity of business environment
calls any organization to build its own sustainable organizational excellence. Sustainable
organizational excellence should consider all the factors that affect the performance of the
organization. Of these factors and in first position is the market changes, business development,
creativity of competitors, quality management and customers’ satisfaction (Hussain, et al., 2018).
The accomplishment of excellence requires a learning organization that have the abilities and
capabilities to meet the new manufactory developments to be in the first position compared to
other competitors. The sustainability of organizational excellence requires integrated human
resources management. The organizations’ human factor is the key to lead the organization for
excellence.
Reliability on strategic human resources management (SHRM) could lead organizations to build
its own integrated plan for human resources that help the accomplishment of sustainable
excellence (Vardarlier, 2016). Strategic human resources management should be connected to
other organization plans to accomplish excellence and lead integrated and sustainable business
growth. The objective of this paper is to investigate the effect of SHRM on achieving sustainable
organizational excellence.

Literature review
Human resources are the base that determines the extent of organization success. The deep and
strong management of HR will determine the extent these resources will take over the different

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activities successfully. Strategic planning of HR will determine the organization needs and at the
same time will relate the HR strategy to the organizational overall strategy. Human resources
strategy will direct the HR in all directions. The strategy will help in determining the organization
needs and moving forward side by side with the organizational strategy to accomplish the
organization target in markets. Moreover, the HR strategy will specify the other organizational
needs that help managing HR such as the experiences required and training to improve the
organizational capabilities. On the other direction, the success of HR strategy will be affected by
different factors. One crucial factor will be the technology available to manage HR. So, the success
of HR strategies will be tied with the availability of high technology that helps in its management
which affect directly the performance of the organization.

Human resource management strategies represent the process of focusing on human elements in
organizations, where it is concerned with attracting, evaluating and rewarding employees, in
addition to following up organizational leadership and organizational culture, ensuring the
commitment of the human elements to the strategic plans of the organization, and human resource
management strategies sometimes referred to as individual or personal management skills, because
they require a strategic focus to ensure the ability of individual resources to achieve the objectives
of the organization (Anyadike, 2013). The SHRM strategy will be very powerful if it has clear,
defined and flexible one in both attitudes, the policies and practices which will have significant
role to accomplish the organizational objectives. The strategy should concentrate on improving
employees’ skills to improve the opportunities to reach the organizational objectives (Zehir, et al.,
2016); (Marashdah& Albdareen, 2020).

The excellence of organization mainly can be achieved through human resources management.
The role of human resources within the organization should be connected directly to the strategies
the organization build toward its excellence. Strategic human resources management should be
part of the other strategies of the organization and work parallel to them. The role of SHRM is to
determine the human resources role in accomplishment of other strategies (Hamadamin & Atan,
2019). Continuous assessment of SHRM and the feedback will help the organization to stay on
track of excellence.

The components of SHRM will impact directly the strategy and so the organization excellence as
it affects the quality of processing and outputs of the organization (Alkhazali & Halim, 2015).
Human resources strategy should consider four major elements to formulate integrated one. These
elements include the organization, people, processes and systems (Administrative, 2005). The
organizational factor concentrates on the changes inside the organization to accomplish the
excellence. The processes concentrate on the internal management that leads to excellence. The
people refer to the ability of people in one organization to lead the organization to excellence,
while the systems reflect the external technological developments that should be adopted to lead
to excellence.

Human resources management strategies should concentrate on the practices that lead to human
resources excellence. The practices include the recruitment, development, training and the
incentive and benefits system, and career development in organization (Arbab & Mahdi, 2018).

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The SHRM should reflect and include the HR practices that help in its achievement (Mwaniki &
Gathenya, 2015).

Organizational excellence is the reflection of the organization ability to satisfy sustainable

development of organization and meet the customer needs (Hashemy, et al., 2016). The
measurement of organizational excellence is affected by the type of organization; public or private,
and the nature of organization activities. In industrial organization, the excellence should
concentrate on different elements that related to quality, technology management and deploy,
customers’ satisfaction, and competences (Shirvani & Iranban, 2013). In light of the great
technological transformations and developments, organizations have sought to take advantage of
these changes and make them more effective in their policies and strategies in order to maintain
their position in a rapidly changing environment. Several studies, such as (Demirkaya, et al., 2011;
(Khashman & Al-Rayalat, 2015); Alhazam, 2016; Al Shobaki, et al., 2017), have pointed out that
the characteristics and effects of technology have led to significant changes in the labor market,
which have a significant impact on human resources strategies and their role in these changes.
This paper is based on resource-based view theory. The theory is based on HRM practices which
has impact of organization’s employees’ behavior, attitudes and skills. On the other hand, the
theory is based on HRM-outcomes which represented in the improvement of organizational
performance (Boxall & Steeneveld, 1999). The theory concentrates that the organization should
have the ability to reflect its capabilities and resources. The theory does not concentrate on the
inputs of the organization, but on the outputs. The theory concentrates on human resources
management policies and its relation to the organizational performance (Wright, et al., 2005). The
other theory that reflects the performance of the system is the AMO theory. The first part of theory
concentrates on the ability and the skills of the organization based on training and education, while
the other part concentrates on motivation and incentives, which represented in employment
security and the promotion opportunities. The third part of the theory concentrates on opportunity
which related to quality, cost of labor, and the profit gained (Appelbaum, et al., 2000).
Methods
The reachability of organizational excellence depends mainly on the internal capability of the
organization to take over all challenges to improve its profitability and meet the customers’
satisfaction. Excellence in industrial organization is considered a challenge that should be
accomplished through formulating strong SHRM. The objective of this research is to investigate
the effect of SHRM components on achieving the organizational excellence. This research will be
applied on industrial organizations. The population of this research is the industrial companies of
Al Hasan Industrial City in Jordan. Simple random sample was selected of the industrial
companies. The sampling unit included managers, units’ heads and human resources managers of
these companies. The random sample included 120 persons in the previous explained positions.
The questionnaire was used as a data collection tool. The questionnaire composed of three parts.
The first part concerned with the collection of demographic data, while the second part concerned
with the collection of sampling units point of view of implementation of SHRM components extent
and the third part is concerned with the attitudes of the sample of the accomplishment of excellence
under the execution of SHRM strategy. Five Likert scale was used to measure the extent of
agreement. The scale started with highly agree with 5 weight and highly disagree with weight 1.

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The research model consisted of two parts. The first part is related to SHRM components, while
the other part is related to organizational excellence in the industrial sector. The major elements of
SHRM composed of HR recruitment, development, training, and career development, while the
variables of organizational excellence included customers’ satisfaction, deploying technology,
product quality and competiveness within the same industry (Figure 1).

IV DV
SHRM components
1. Recruitment (R) Organizational excellence
2. Training (T)
1. Customers’ satisfaction (CS)
3. Development (D)
2. Technology deployment (TD)
4. Career development
(CD) 3. Product quality (PQ)
4. Competiveness (C)

Figure 1: Research model

To reach the objectives of this research, the study will test the following hypothesis:
Ho: There is no significant effect of recruitment on achieving organizational excellence.
Ho2: There is no significant effect of training on achieving organizational excellence.
Ho3: There is no significant effect of organization HR development on achieving organizational
excellence.
Ho4: There is no significant effect of career development on organizational excellence.
This research will contribute to human resources management science through raising the
important inputs that contribute to improve organizational performance and excellence in the
industrial sector.
Results
The reliability of the questionnaire was measured using Cronbach’s alpha. The results showed that
the minimum value was recorded 0.75 for career development, which is higher than the acceptable
limit for such research. The highest reliability was recorded for the test of all variables together
for SHRM components (0.91) and organizational excellence (0.94).
Table 1: Reliability analysis of major variables using Cronbach’s alpha
Variable Value
SHRM components 0.91

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 Recruitment 0.86
Training 0.90
Development 0.89
Career development 0.75
Organizational excellence 0.94
Customers’ satisfaction 0.86
Technology deployment 0.85
Product quality 0.91
Competiveness 0.90

Attitudes of Mangers’ for the components of SHRM components toward excellence

The highest agreement for managers was given for the designing of careers according to the
excellence requirement with mean 3.45 (Table 2). The companies concentrate on technology
experience of recruited people with mean 3.31 to enhance the company capabilities in this regard.
The staff responsible for recruitment collect information about the company needs to reach the
organizational excellence with mean 3.22. The least negative attitude was given for the integration
of recruitment policy with human resources management strategy.
Table 2: Manager’s attitudes for the role of SHRM recruitment component toward excellence
Recruitment Mean St. Dev.
The company design careers according to its excellency 3.45 1.21
requirements
The assigned staff should have experience with advance 3.31 1.25
technology to reach company objectives
Recruiting staff recognizing the real needs for organizational 3.22 1.20
excellence
The formulation of recruitment policy take into 3.11 1.22
consideration different managing levels needs
The recruitment policies are connected to human resources 2.90 1.21
management strategy
All 3.20 1.19
The agreement of the contribution of training toward excellence was positive. The highest
agreement was given for the regular assessment of the training needs with mean 3.61, while the
least agreement was for in situ training to assure employees excellency with mean 3.48. The
respondents agreed on the concentration of training needs contribution to excellency, the
assessment of training impact on employees’ behavior toward excellency, and the employees
recognize the objectives of training and its connection to organization excellency (Table 3)
Table 3: Manager’s attitudes for the role of SHRM training component toward excellence
Training Mean St. Dev.
The organization has regular assessment for the training
3.61 1.17
needs

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 The organization concentrate on training related to
3.56 1.17
technology contribute in excellency
The organization assess the benefits of training for
3.55 1.17
excellency regularly
The objectives of training is announced for trainees before
3.49 1.17
training
In situ training is conducted regularly to assure employees
3.48 1.24
excellency
All 3.54 1.09
Table 4 shows the mean of respondents to role of development in organizational excellence. The
results showed that highest agreement was for the relationship between human resources practices
and organizational development (3.57) (Table 4). The least negative agreement was given for the
connection between SHRM strategy with organizational strategy with mean 2.97. The companies,
care for the introduction of organizational development strategy for human resources and staff,
also, the company development is measured through the progress made by the staff.
Table 4: Manager’s attitudes for the role of SHRM development component toward excellence
Organization development Mean St. Dev.
Human resources practices are related to organizational
3.57 1.15
development
The organization has integrated policy for organizational
3.52 1.07
development through human resources development
Organizational development strategy is clear for all human
3.46 1.09
resources
Organizational development progress is measured regularly
3.33 1.07
through the HR staff
Organizational development policy is connected to SHRM
2.97 1.19
strategy and organizational strategy
All 3.37 0.98
Concerning career development, the managers’ agreed that the human resources staff has equal
opportunities to develop their careers with mean 3.38. The least positive agreement was for the
connection between SHRM strategy to organizational excellency (3.09). The companies care for
the employees’ behavior toward excellence, agree that career development is an important factor
toward excellence, and the internal culture helps the exchange of experience and encourage career
development (Table 5).
Table 5: Manager’s attitudes for the role of SHRM career development component toward
excellence
Career development Mean St. Dev.
Human resource staff have equal opportunities to develop
3.38 1.15
their careers
Career development included promotion and punishment
3.32 1.13
according to employee behavior toward excellency

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 Career development is the encouraging key for employees
3.27 1.14
toward excellency
Career development is handled through the change of
3.25 1.18
experience internal culture
Career development is directly connected to SHRM strategy
3.09 1.16
and organizational excellence
All 3.30 1.03

Attitudes of managers for the accomplishment of excellence

Customer satisfaction is very important measure of excellence according to managers’ point of
view (3.44). The highest agreement was given for the regular measurement of customers’
satisfaction (3.69), while the least positive agreement was given for including the products
information that provide easy methods for customers to contact the company for complains and
suggestions (3.29). Customers’ satisfaction is reached through formulated policy, the feedback
from customers is collected through different methods, the communication tools provided by the
company to measure customer satisfaction (Table 6).
Table 6: Managers’ attitudes toward excellence through customers’ satisfaction
Customers’ satisfaction Mean St. dev.
Organization measures customers’ satisfaction regularly as a
3.69 1.08
measure of excellency progress
The organization has a policy to achieve customers’ satisfaction 3.43 1.21
The organization receives customers’ feedback through known
3.41 1.03
channels
The organization include communication tools to get customers’
3.40 1.18
satisfaction
The products of the organization include information about
3.29 1.19
customer contact
All 3.44 1.10
The attitudes for the agreement for the positive effect of technology deployment on excellence
(3.12). The highest agreement was for the search of new technology that update and meets the
organization excellence (3.18). The least positive agreement was for the regular assessment of
organization technology toward improvements (3.06) (Table 7).
Table 7: Managers’ attitudes toward excellence through deploying technology
Technology deployment Mean St. dev.
The organization searches all the time for technology updates to 3.18 0.86
meet its excellency objectives
The organization has a budget to improve its technology 3.14 0.98
regularly
Technology update is directly connected to organizational 3.12 0.99
excellency

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 The organization tries to collect information about technology 3.11 0.90
developments of other companies through different tools
The company assess its technology regularly for the 3.06 0.88
improvement purposes
All 3.12 0.85
The highest attitudes were given for the product quality (3.44) (Table 8). The highest agreement
was given for the measurement of product quality as major factor of organization excellence (3.55).
The least agreement was for the regular improvement of products (3.22).

Table 8: Managers’ attitudes toward excellence through product quality

Product quality Mean St. dev.
The organization measures the product quality regularly 3.55 0.95
Organization collect information about similar products quality 3.52 0.97
and improvements for other companies
The feedback about quality is collected through customers’ 3.51 0.95
directly
The quality improvement policy is connected to organizational 3.38 0.91
excellency
Organizational managers care for the improvement of products 3.22 0.98
regularly
All 3.44 0.89
The agreement for the competiveness as a measure of excellence was positive (3.12). The highest
agreement was for the regular measure of market share (3.18), while the least agreement was for
the connection between competiveness with the organization strategies (3.06).
Table 9: Managers’ attitudes toward excellence through competiveness
Competiveness Mean St. dev.
The organization measures its market share regularly 3.18 0.86
The organization collect information about the product from 3.14 0.98
hyper stores
The organization measure the competiveness as part of 3.12 0.99
profitability
The organization has specific measures for competiveness 3.11 0.90
measurement
The competiveness is directly connected to excellence through 3.06 0.88
the different organizational strategies
All 3.12 0.82
Hypothesis testing
The effect of SHRM components on customers satisfaction was significant (p<0.01). The highest
effect was attributed to career development (β=0.40), while the least effect was for recruitment
(β=0.08) (Table 10). Moreover, the effect on technology deployment was significant (p<0.01). The

8
highest effect was attributed to recruitment (β=0.7), while the least effect was associated with
training (β=0.31).
The effect of SHRM on product quality was significant (p<0.01). The heist effect was associated
with recruitment (β=0.61), while the least effect was resulted of training (β=0.31). For
competiveness, the effect of SHRM components was significant (p<0.01). The highest effect was
resulted of recruitment (β=0.83), while the least effect was for development (β=0.38) (Table 10).

Table 10: Multivariate analysis for the effect of SHRM components on organizational excellence
Dimension β T Sig R R2 F Sig
Customer satisfaction
R 0.08 0.58 0.56
T 0.16 1.37 0.18
0.61 0.37 14.18 0.00
D 0.35 3.35 0.00
CD 0.40 4.18 0.00
Technology Deployment
R 0.70 13.7 0.01
T 0.31 4.6 0.01
0.618 0.38 186.9 0.00
D 0.36 3.25 0.00
CD 0.42 4.23 0.00
Product quality
R 0.61 9.63 0.001
T 0.31 2.30 0.18
0.49 0.24 9.82 0.00
D 0.33 3.71 0.00
CD 0.41 4.18 0.00
Competiveness
R 0.83 10.62 0.001
T 0.41 1.42 0.18
0.41 0.172 7.99 0.00
D 0.38 3.39 0.00
CD 0.43 4.23 0.00
Discussion
The objective of this research is to investigate the effect of SHRM on accomplishing the excellence
of industrial organizations in Al Hassan Industrial City in Jordan. The results showed that mangers
of the companies investigated carrying nationalities more than the Jordanian one. This provide the
chance of industrial company to use different experiences to accomplish its objectives. Variation
in experience exchange would help the industrial organization to adopt decisions that help its
sustainability. The experience of the studied managers varied indicating that the industrial

9
company concentrates on the quality of experience more than the long traditional experience to
accomplish its excellence. Moreover, the results showed that the research tool is reliable.
As most organizations seeks excellence in its work. The recruitment plays a crucial role in
awarding that. The organization design the careers needed by the organization to reach excellence.
Harky (2018) found that recruitment will affect the organizational performance. This will help the
organization to recruit staff that meets the organization needs all the time. The organizations look
to improve the technology capacities through the recruitment of employees that have technology
experience. The new recruited staff would enrich the technology experience of the organization.
The results showed that there is a lack of connection between the different sub-strategies of the
organization to make integration including the recruitment policies with organization strategies.
Training was found to improve the experience of organization toward excellence. The design of
training programs and its follow up was shown to reflect the benefits organization gain of training.
Musa and Tulay (2008) showed that the training improves the employee skills which reflected on
the organization performance in general. The results showed that when the employees contribute
the design of training the objectives of training will be clear for them and enhance the benefits
gained from training to achieve excellence.
Organization development is crucial for the accomplishment of excellence. Organization
development requires clear plans to reach the required development. The plans of organization
development should be connected clearly to the other plans and strategies of the organization to
maximize the benefits. Moreover, career development will improve the attitudes of employees
toward excellence knowing that the excellence of employees is part of organization excellence.
Career development was found to improve the employees’ behavior especially if the development
is connected to the integrated SHRM strategy of the organization.
Results showed that excellence is high associated with customer satisfaction. The hard efforts
extended to get feedback about customers’ satisfaction the more excellence the organization
achieved. The results showed that the organizations lack the provision of different connection tools
to improve customers’ contribution to provide feedback.
Technology deployment in the organization play important role in accomplishing excellence. The
deploying of the required technology will necessarily improve the quality and improve customers’
satisfaction and increase competiveness. Lal (2017) investigated the effect of technology on
organizational excellence. The research results showed that technology is crucial for any
organization to accomplish excellence.
The results showed that SHRM strategy components affect directly the organization excellence.
The highest effect was associated with the requirement process and the technology deployment,
which reflects the connection between these two variables toward excellence. The other higher
effect of recruitment was on the product quality as the product quality is a result of technology and
human interference. Similar result was found by Al-Jedaiah (2008) indicating that information and
communication technology tools play a major role in organization performance.
Conclusions and recommendations

10
The objective of this research is to investigate the effect of SHRM component on the organizational
excellence. The study was applied on industrial sector. The results showed that most of the
questioned people have shown that the recruitment practices should be directed manipulate the
human resources strategy and target the excellence of the company. The managers’ were satisfied
that the company should develop its human resources capabilities toward the excellence and to
meet the technology requirements the achieve excellence. The research recommend that the
organization should formulate a strategy of excellence and investigate the human resources
requirements to achieve it.
Future research
The research related to organizational excellence is concerned to study this issue inside the
organization. For future research, organizational excellence study from external environment of
the organization would make radical change through monitoring the attitudes of customers, the
existed technology in the industry compared to the technology existed in the company, and
company market competiveness. The results can be compared to the information collected from
the internal environment of the organization to determine its suitability to accomplish the
excellence.
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