Innovative Human Resource Management Practices and Firm Financial Performance in the Nigerian Banking Industry

Abstract

Innovative human resource management has been the focus of intellectual ferment over whether it exists in reality or is merely rhetoric. The 2005 consolidation exercise in the Nigerian banking industry created a  competitive environment and to respond to the challenges, banks make some innovative changes in their HRM practices. Recent studies show that HRM practices are important for improved corporate financial performance but little has been reported on the effect of these innovative HRM and firm financial performance in the context of economic liberalization in Nigeria. In this study, the effect of innovative HRM practices on the financial  performance of banks in Nigeria is examined. Results indicate that  strategic integration and devolvement of HRM are practiced to a moderate extent in the Nigerian banking sector. Findings also show that innovative  HRM practices have significant positive effect on firm financial performance. The paper therefore recommends that organizations should further pay  more attention to the implementation of innovative HRM practices with a view to improving the degree of their impact on firm financial performance.

Key words: Innovative HRM, Devolvement, Integration, Performance, Banks.