“Dealing With it.” Creating External Fit in HRM Through Learning and Collaborating

Aim – The aim of the article was to begin with it explicitly adopts a best fit approach to external fit in HRM, by examining HRM innovation as the dependent variable. Then the article theorizes how HRM innovation relates to external developments that organizations experience. And finally, a theoretical framework is developed to understand how organizations to adapt to these developments. Methodology - The present study relies on a quantitative method and a deductive approach. Cross-sectional data were collected including several cases at one point in time. The responses from these cases provide the information for testing the hypotheses that state relationships among specific variables. To investigate whether it was possible to reduce information and to create reliable measure of multiple items, a scale analyses were performed. Findings - The main findings of this study are twofold. First, the more developments organizations face, the more innovate they are with regard to how they manage their human resources. Secondly, these innovations take place because organizations have organizational learning practices and cooperate more often on HR related issues with other organizations. Practical implications - Findings are basically in line with alignment approaches, while adding more detail to the underlying mechanisms through which alignment is achieved according to the dynamic capabilities approach and the relational view. According to these approaches, organizations seek internal and external fit and those possessing dynamic capabilities and external ties are better in achieving such fit. Since facing several trends means that misfits occur between the environment and the organization, organizations respond by innovating their HRM through learning and collaborating. Originality/Value - This study tests the hypotheses that organizations achieve external fit via (1) the development of organizational learning practices; and (2) by collaboration with other organizations. Quantitative data gathered with a survey among 711 private organizations from the Netherlands are used to test these hypotheses.