Impact of Human Resource Management (HRM) Practices on Hotel Industry’s Performance: The Mediating role of Employee Competencies

The aim of this paper is to examine the impact of human resource management practices on hotel industry performance by means of employee competencies. An integrated research model was developed by combining principal factors from existing literature. Data were collected through questionnaire from 700 employees of the selected hotels. The validity of the model and hypotheses were tested using structural equation modeling (SEM). The reliability and validity of the dimensions are established through confirmatory factor analysis. The results indicate that some human resource management practices influence organizational performance through their impact on employee competencies. Career planning and performance appraisal however, do not impact employee competencies of the firms studied. The research was undertaken in the hotel industry and the analysis based on cross-sectional data which cannot be generalized across a broader range of sectors and international environment. The findings of the study have the potential to help stakeholders and management of hotels in adopting properly and well-articulated HRM practices in building human capital and stimulating the necessary behaviours that create advantage for the organization. This study contributes to the human resource management literature, integrating HRM practices and employee competencies into a comprehensive research model that impacts organizational performance