The Relationship between Human Resource Management and Firm Performance in Malaysia

Drawing upon resource based theory which explains human capital as the key resource for the firms ’ development, this paper hypothesized that the human resource management (HRM) was anchored on firm performance. HRM were conceptualized as 4- and unidimensional constructs, respectively. The main thrust of the paper is to assess the impact of HRM on firm performance. The research uses a sample of 85 firms surveyed in Sarawak, Malaysia. The findings suggested that incentives and information technology are positively related the firms ’ performance. Implications of the findings, potential limitations of the study, and directions for future research were further discussed