Managing the human resource in Indian SMEs: The role of indigenous realities

This paper discusses how issues of people management are addressed in Indian small and medium enterprises (SMEs). It also highlights the indigenous approaches to human resource management (HRM) that have surfaced in the Indian SME context. The research formulation has been built on the mapping of pe...

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Bibliographic Details
Published in:Journal of world business : JWB 2008-10, Vol.43 (4), p.417-434
Main Authors: Saini, Debi S., Budhwar, Pawan S.
Format: Article
Language:English
Subjects:
Business studies
Cultural diversity
Emerging markets
HRM
HRM SMEs India Industrial relations Indigenous practices
Human resource management
Human resources
India
Indigenous practices
Industrial relations
Labour relations
Management research
Management science
Native peoples
Personnel management
Small & medium sized enterprises-SME
Small and medium sized enterprises
SMEs
Studies
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Summary:This paper discusses how issues of people management are addressed in Indian small and medium enterprises (SMEs). It also highlights the indigenous approaches to human resource management (HRM) that have surfaced in the Indian SME context. The research formulation has been built on the mapping of people-management practices in two SME case studies, one of which is also a family-based organization. The analysis shows that indigenous realities in HRM in Indian SMEs relate mainly to the provision of financial, emotional and social support to the workforce; employee involvement (EI) practices; recruitment; skill development; managing employee relations; and managing vis-à-vis labor law framework. The paper argues that in the sphere of people management in SMEs, the willingness to innovate and formalize the HR systems is constrained by a kind of bounded rationality, i.e., the owners of SMEs mostly believe that they are already doing what is humanly possible in this regard. The analysis has an important message for concerned practitioners—in order to realize their full potential and to progress towards fulfilling their vision; SMEs eventually have to intertwine indigenization and formalization for their people management approaches.
ISSN:1090-9516
1878-5573
DOI:10.1016/j.jwb.2008.03.004