Innovations in the Field of Human Resources Management

The Indian economy was forced to adopt a structural adjustment program in the beginning of 1991.The structural adjustment program or liberalization initiated the process of the opening of an otherwise closed economy of India. It created a hyper-competitive environment and to respond to this turbulence. Indian organizations adopted innovative changes in their HRM practices. Current research shows that HRM practices are important for enhanced corporate performance but little has been reported on the effect of HRM practices and corporate performance in the context of economic liberalization of India. This paper tried to understand the role of innovative HRM practices and specifically questions how HRM practices, like the role of HR department, recruitment, retraining, redeployment, performance appraisal and compensation enhance corporate performance during the change process. A multiple-respondent survey of 69 Indian organizations was undertaken to study the impact of innovative SHRM practices on firm performance. The survey found that the innovative recruitment and compensation practices have a positive significant relationship with firm performance. It was observed that recruitment, role of the HR department and compensation practices seem to be significantly changing within the Indian firms in the context of India and economic liberalization. The synergy between innovative HRM practices was not significant in enhancing corporate performance during the liberalization process.