on HRM literature has been to demonstrate the importance of effectively managinghuman resources of organizations. Management scholars and practitioners alikehave become increasingly interested in learning more about HR practices to enhanceemployee and organization performance (e.g. Boselie
, 2001; Den Hartog andVerburg, 2004; Ferris
, 1999; Guest, 1997; Huselid, 1995; Paauwe, 1998, Powerand Boselie, 2003; Pfeffer, 1994). In particular, the last ten years have seen anincreasing research interest in the HRM–performance relationship, although the focus of the research is in the developed world as well as in the manufacturing industry. Thecurrent study aims to test empirically the impact of eight HR practices on employeeperformance in a developing country: the Eritrean civil service organizations.Eritrea, being the youngest African nation, became a sovereign nation in 1993. Since1993, Eritrea has embarked on a multifaceted nation-building and reconstruction processin which the civil service is one aspect. The critical challenge that faces Eritrea today isthe establishment of economic, social, administrative and political institutions and thedevelopment and utilization of human resources to enable these institutions to operateeffectively (Gafer, 1996; Haregot
, 1993; UNDP, 2002; UOA, 1997). Thus, Eritreatoday is experiencing a growing need for civil servants who are capable of efﬁciently,effectively and creatively mobilizing the available scarce resources to achieve nationalobjectives.Eritrea, just like most developing countries (DCs), introduced civil service reforms(1995–7) that led to (1) streamlining of about 34 per cent of the Eritrean civil servants(UOA, 1997); (2) the establishment of the Eritrean Institute of Management (EIM) in1995; (3) the introduction of a new salary scale in 1997; and (4) the launching of theEritrean HRD Project (1998–2003) (EHRDP, 2003). However, the critical challenge thatfaces Eritrea today is the utilization of human resources to enable civil serviceorganizations to operate effectively. Generally speaking, the
within whichEritrean civil servants are employed does not seem to attract, motivate and retaincompetent civil servants. In this connection, the availability and utilization of capablecivil servants is of utmost importance. The main research questions of this study aretherefore:
How, when and to what extent do HR practices affect HRM outcomes (HRcompetence, motivation, role clarity and retention)?
How do HRM outcomes in turn affect employee performance in the context of Eritrean civil service?
Effective HRM now more than ever before is a crucial ingredient in the developmentprocess of DCs. However, HRM has come under strong criticism in many DCs with theireffectiveness thrown into considerable doubt (Bennell, 1994; Budhwar and Debrah,2001; Hilderbrand and Grindle, 1997; Kiggundu, 1989; Praha, 2004; World Bank,1994b).Decades of declining real incomes, deplorable working conditions, politicalinterference and poor management have created cadres of civil servants in many DCswho are chronically demoralized and de-motivated (e.g. Das, 1998; Jaeger
, 1995;Kiggundu, 1989). The civil service, on the one hand, is increasingly unable to retaintrained personnel wherever other employment opportunities exist. On the other hand, itutilizes poorly the expertise of those civil servants who do not leave. Even worse,moonlighting and corrupt rent-seeking practices have become a way of life for civilTeclemichael Tessema and Soeters:
HRM in developing countries