The mediating role of leadership and people management practices on HRD and organizational performance

Abstract

Drawing upon prior research, we identify strategic value and transaction effectiveness as two significant HRD contributions and examine their dyadic effect on leadership and people management practices, and influence on firm performance. Results of path analysis on 138 participants supported the dyadic effect hypothesis. More significantly, we found leadership and people management practices as a significant predictor on the relationship between strategic value and organizational performance, which suggests that organizational performance is affected by the combined effect of leadership and people management practices. A key implication of this research is that where organizations had effective leadership and people management practices, both types of HRD contributions – strategic value and transaction effectiveness – significantly enhanced firm performance.