Human resource strategy and innovation capability of service companies

Abstract

It is widely acknowledged that human resource management can build a dedicated and engaged workforce, which contributes to a strong corporate performance; However, researchers are only beginning to explore the role of Human Resource (HR) strategy in fostering organisational innovation, while its impacts on service companies' effectiveness and efficiency still hold untapped potential for sustainable and socially responsible development of innovative services and call for a holistic approach to the HR strategy. The research question: how could human resource strategies orient stakeholders' performance to sustainable competitive advantages of service companies? The pursuit of new business opportunities is essential for sustainable growth: innovative HR strategies might provide the basis for an economy to reach a new level of technological excellence, productivity, and prosperity, while human resource management has a significant impact on employees' behaviour, attitudes, and the overall corporate performance. This study aims to explore and deepen the theoretical, methodological, and empirical knowledge on the interaction between organisational culture and human resource practices to foster innovation and contributes with the enhanced organisational innovation capability. The semi-structured interviews with human resource experts of service companies led to pertinent implications for human resource strategy enhancement. Reference to this paper should be made as follows: Laužikas, M., Miliūtė, A., Rudžionytė, M., Stasilo, M. 2025. Human resource strategy and innovation capability of service companies. Insights Into Regional Development, 7(1), 131-143. https://doi.org/10.70132/q9664546647