Strategic and Administrative Human Resource Management (HRM): A Study of HRM Reporting in Entrepreneurial Firms

Abstract

This paper reports the results of an exploratory study examining firm characteristics associated with choosing an administrative or strategic approach to HRM. Strategic HRM is defined as having a senior HRM executive who reports to the CEO, while administrative HRM is defined as having the HRM function report to a Vice President of Administration. Data are gathered from a cohort of firms that went public in 1993. The results show that different sets of characteristics are associated with each HRM reporting form, and analysis of stock price growth after the IPO demonstrates that the strategic HRM companies enjoy increasing stock price, while the administrative HRM firms have decreasing stock price. Implications for new forms of HRM in entrepreneurial firms are discussed.