Mediating Role of Human Capital between SHRM and Firm Performance

This study explores mediating role of human capital between strategic human resource management (SHRM) and firm performance. Some HR scholars, such as Takeuchi, Jiang, and Boon found mediating role of human capital in this relationship. Human capital is firm’s stock of skills and knowledge. This employee-specific skill enhances task performance and firm performance consequently, because knowledge, skills, and abilities (KSAs) of employees increase task performance. Plenty of empirical research found numerous mediating variables in SHRM-performance relation. However, obvious mediating factor is not understood yet. In 1990s, behavioral perspective, resource-based view, ability, motivation, and opportunity (AMO) framework, and social exchange theory are accepted as mediators by HR scholars. Nowadays, HR systems are accepted as current mediator between HR and performance. This study theoretically discusses human capital theory as mediating variable. Furthermore, this study aims to discuss progress of strategic human resource management in Turkey. Turkish firms do not apply SHRM theory in their organizations yet. This study proposes that firms may adopt personnel human resource management (p-HRM) model to progress SHRM. According to p-HRM model, HRM department applies personnel management and human resource management together to develop employee’s performance. Therefore, in HRM department, there must be HR manager, personnel supervisor, and strategic HR director. HR manager becomes manager of the HRM departments; the others are become subordinates