The effect of organizational culture, strategic leadership, and employees’ commitment on strategic human resource management practices in the banking sector

Abstract

Strategic Human Resource Management (SHRM) refers to aligning the skilled workforce with the strategic business needs as companies seek a competitive edge following organizational culture and leadership. Hence, human resources or people at work have become essential for organizational success. This study aims to address the research gap by assessing the relationship between organizational culture, strategic leadership, employees’ commitment, and strategic HRM practices. At the same time, strategic leadership and employees’ commitment mediate the relationship between organizational culture and strategic HRM practices. To obtain the study’s objectives, the author adopted two theories: resource-based view theory and upper echelons theory. A questionnaire was developed using the Likert Scale point-5. The data were collected from 228 respondents working in different banks in Saudi Arabia. The data were analyzed data using Smart PLS software to test this study's direct and indirect hypotheses. Overall findings show a positive relationship between organizational culture, strategic leadership, employees’ commitment, and strategic HRM practices in the banking sector of Saudi Arabia. Furthermore, strategic leadership mediates the relationship between organizational culture and strategic HRM practices. Plus, employees’ commitment shows no mediation effect between organizational culture and the strategic HRM practices. The current study also tests the sequential mediating role of strategic leadership and employees’ commitment between organizational culture and employees’ commitment. This study may provide dynamic implications to financial institutions, the banking sector, banking and finance professionals, universities, policymakers, and academicians. They can obtain support to strategize their plans and operations to develop a pool to adopt SHRM practices.