Does strategic human resource management matter in high‐tech sector? Some learning points for SME managers

Purpose – The main purpose of this paper is to examine the nature and impact of human resource capabilities and involvement on the firm's performance in the SME sector. Design/methodology/approach – This research is based on an empirical survey of Chief Executive Officers (CEOs) and their perception of the HR involvement in strategy development in high tech SMEs operating in the electronics industry in the UK. Postal questionnaire is the main data collection instrument for this research. A combination of qualitative and quantitative approaches has been employed for data analysis. Findings – The important conclusion reached is that increasing the core competencies of the firm, in particular in HR, is the key element to the success of the firm. Moreover, it is posed that the growing involvement of the HR in the development and implementation of business strategy will lead to the increased effectiveness of the organisation and the industry as a whole. Finally, the competitive advantage a firm enjoys can come from the distinctive capabilities which provide it with a core competence in HR. Research limitations/implications – The present study is concerned solely with small and medium‐sized enterprises in the electrical and electronic manufacturing sector in the UK. A further comparative international‐wide study is recommended. Practical implications – In order to increase firm performance and to benefit from HR capabilities, it is recommended that practitioners and SME CEOs increase the involvement of their HR specialists in the processes of strategic management in their firms. Originality/value – The principal contribution of this first‐time study has been the attempt to explore the CEO's perceptions of HR, its capabilities and its degree of strategic involvement as significant determining factors to ensure competitive advantages for the firm in a highly changing market.