A Causal Model of Factors Influencing Strategic Human Resource Management Effectiveness:

Empirical Evidence on Management Accounting

Abstract

Prior research shows that strategic human resource management (SHRM) minimizes the risk of ignoring human resources as an important source of organizational competitive advantage. Recently, literature also asserts actively involvement in SHRM of management accountants, but evidence of the extent of the management accountant's role and accounting information to assist HR managers in fulfilling the SHRM goals is limited. Thus, this research is aimed to (1) study factors related to strategic human resource management effectiveness from empirical evidence on management accounting and (2) analyze the causal relationship between business partner roles of management accountants (BPMA), managerial relevant information (MRI) that influences SHRM effectiveness. Data was collected from the auto parts businesses in Thailand 212 firms by questionnaire mail survey, and using confirmatory factor analysis and structural equation modeling to analyze data. The results found that BPMA and MRI were confirmed in the measurement portion of the model because these two-factor models appear to be a good fit to the empirical data. Moreover, the results also showed that the hypothesized model fit to the empirical data (c²=88.364, df=69, p-value=0.058, c² /df =1.281, CFI=0.990, IFI =0.990, GFI=0.943, RMSEA=0.037) and all variables in the model could explain SHRM effectiveness at 58%. There was a stronger indirect effect of BPMA on SHRM effectiveness by transmission MRI with a path coefficient that equaled 0.695. In total, this empirical evidence reveals that organizations need management accountant business partners in providing information for planning, decision-making, evaluating and controlling HR strategy. Importantly, the management accountant role should focus on the areas of strategic support, risk and business management, technical skill, and social skill to advise strategy and achieve organizational goals.