Moderating Role of Organizational Strategy on the Relationship between Human Resource Outsourcing and Organizational Performance: A Study on Service Sector of Pakistan

Abstract

In today's increasingly competitive environment, the benefits of high organizational performance are becoming progressively more important. Organizations worldwide are increasingly adopting human resource outsourcing (HRO) practices, most importantly to reduce cost, transferring focus to achievement of business goals, capitalize on scale economies, transferring risk and liability for people issues and for strategic integration of Human Resource department. There is a scarcity of research on the impact of an organization's outsourcing operations notwithstanding the fact that Organizational Strategy (OS) has been investigated from a variety of angles. The intent of this research was to check the role of OS as moderator in the connection between HRO and OP within Pakistani service sector firms. A descriptive research design based on a positivist methodology was employed. 230 businesses were selected using random chance and surveyed using a questionnaire. The data were then examined by means of the Smart PLS software (3.3.3) and the structural equation modelling (SEM) technique. The outcomes of research demonstrate a substantial positive association amongst HRO - OP. Moreover, results recognized the moderating role of the OS between HRO and OP relationship midst service firms. This study is significant in the relevant literature as it has made an effort to look at the relationship between HRO and OP from a different lens.