Challenges and prospects of HRM

in developing countries: testing the

HRMperformance link in the Eritrean
civil service
Mussie Teclemichael Tessema and Joseph L. Soeters
Abstract In this article, the authors examine how, when and to what extent HR practices
affect performance at the employee level. As performance is a multi-faceted and
complicated concept, HRM outcomes were used as mediating factors between HR
practices and employee performance. The data were collected among civil servants in
Eritrea, Africas youngest and poorest country. Although the results generally are in line
with previous studies using Western data, their implications in this particular country may
be different. Therefore, the challenges and prospects of HR practices in Eritrean civil
service organizations are critically analysed and discussed. In the authors opinion, that the
Eritrean economic and political environment within which HR practices operate has not
been conducive in maximizing the impact of HR practices on performance. These ndings
highlight the situation of most developing countries.
Keywords Human resource management; HRMperformance link; civil service
organizations; Eritrea; developing countries.
Introduction
Every organization, whether it be a public, private or NGO, must operate with and
through people. Public organizations in particular are judged on the basis of the
performance of their human resources. Ingraham and Kneedler (2000: 245) underline
that government activities are typically highly personnel intensive. And thus, Human
Resource Management (HRM) practices are central to improving the quality of services
offered by the governments. In the words of Pfeffer (1994: 33), having good HRM is
likely to generate much loyalty, commitment, or willingness to expend extra effort for
the organizations objectives. Moreover, Stone (1998: 4) remarks that HRM is either
part of the problem or part of the solution in gaining the productive contribution of
people.
The above quotes suggest that organizations need to effectively manage their human
resources if they are to get the maximum contribution of their employees. But the
question is, how and when does HRM affect performance? Recently, the dominant focus
The International Journal of Human Resource Management
ISSN 0958-5192 print/ISSN 1466-4399 online q 2006 Taylor & Francis
http://www.tandf.co.uk/journals
DOI: 10.1080/09585190500366532
Mussie Teclemichael Tessema, Tilburg University (IVO), the Netherlands and University of
Asmara, Eritrea: POBox 90153, 5000LE, Tilburg, The Netherlands (e-mail: M.T.Tessema@uvt.nl).
Joseph L. Soeters, Tilburg University and Royal Netherlands Military Academy, the Netherlands:
PO Box 90002, 4800 PA Breda, the Netherlands (jmlm.soeters@mindef.nl).
Int. J. of Human Resource Management 17:1 January 2006 86105
on HRM literature has been to demonstrate the importance of effectively managing
human resources of organizations. Management scholars and practitioners alike
have become increasingly interested in learning more about HR practices to enhance
employee and organization performance (e.g. Boselie et al., 2001; Den Hartog and
Verburg, 2004; Ferris et al., 1999; Guest, 1997; Huselid, 1995; Paauwe, 1998, Power
and Boselie, 2003; Pfeffer, 1994). In particular, the last ten years have seen an
increasing research interest in the HRMperformance relationship, although the focus of
the research is in the developed world as well as in the manufacturing industry. The
current study aims to test empirically the impact of eight HR practices on employee
performance in a developing country: the Eritrean civil service organizations.
Eritrea, being the youngest African nation, became a sovereign nation in 1993. Since
1993, Eritrea has embarked on a multifaceted nation-building and reconstruction process
in which the civil service is one aspect. The critical challenge that faces Eritrea today is
the establishment of economic, social, administrative and political institutions and the
development and utilization of human resources to enable these institutions to operate
effectively (Gafer, 1996; Haregot et al., 1993; UNDP, 2002; UOA, 1997). Thus, Eritrea
today is experiencing a growing need for civil servants who are capable of efciently,
effectively and creatively mobilizing the available scarce resources to achieve national
objectives.
Eritrea, just like most developing countries (DCs), introduced civil service reforms
(19957) 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) in
1995; (3) the introduction of a new salary scale in 1997; and (4) the launching of the
Eritrean HRD Project (19982003) (EHRDP, 2003). However, the critical challenge that
faces Eritrea today is the utilization of human resources to enable civil service
organizations to operate effectively. Generally speaking, the environment within which
Eritrean civil servants are employed does not seem to attract, motivate and retain
competent civil servants. In this connection, the availability and utilization of capable
civil servants is of utmost importance. The main research questions of this study are
therefore:
. How, when and to what extent do HR practices affect HRM outcomes (HR
competence, motivation, role clarity and retention)?
. How do HRM outcomes in turn affect employee performance in the context of
Eritrean civil service?
Literature review
Effective HRM now more than ever before is a crucial ingredient in the development
process of DCs. However, HRM has come under strong criticism in many DCs with their
effectiveness 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, political
interference and poor management have created cadres of civil servants in many DCs
who are chronically demoralized and de-motivated (e.g. Das, 1998; Jaeger et al., 1995;
Kiggundu, 1989). The civil service, on the one hand, is increasingly unable to retain
trained personnel wherever other employment opportunities exist. On the other hand, it
utilizes 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 civil
Teclemichael Tessema and Soeters: HRM in developing countries 87
servants in many DCs (Bennell, 1994; Budhwar and Debrah, 2001; Das, 1998; Grindle,
1997; Prah, 2004). More than anything else, thus, it is the personnel crisis in the civil
service organizations in DCs that has to be addressed if meaningful improvements
in service delivery are to be realized.
Cohen and Wheeler (1997) as well as Hilderbrand and Grindle (1997) summarized the
current situation of HRM in many DCs as follows: low salary levels, lack of effective
performance standards, inability to re people, too few rewards for good performance,
recruitment procedures that do not attract appropriately trained people, promotion
patterns based too much on seniority or patronage and too little on performance, slow
promotion and lack of reward for hard work and initiative, inadequate and demoralizing
management by supervisors (ineffective leadership), underemployment and lack of
stimulating assignments. Moreover, Bennell (1994) and Budhwar and Debrah (2001)
disclosed that many DCs are trapped by outdated and ineffective HRM systems that put
unintended roadblocks in the way.
The situation discussed above being the existing situation of many DCs, one may
wonder how HR practices affect performance under such conditions. Recently, the
dominant focus on HRM literature has been to demonstrate the importance of effectively
managing human resources of organizations (e.g. Ahmad and Schroeder, 2003; Delaney
and Huselid, 1996; Ichniowski et al., 1997). Many scholars have identied a number of
HRM-related practices that greatly affect performance. For example, Pfeffer (1994)
advocated the use of 16 HRM-related practices to achieve higher performance; Delery
and Doty (1996) identied seven HRM-related practices. More recently, researchers
have found that bundles, or systems, of HR practices had more inuence on performance
than individual practices working in isolation (Arthur, 1994; Baron and Kreps, 1999;
Huselid, 1995; MacDufe, 1995). In other words, a greater use of those specied
practices results in higher performance across all types of organizations or countries. As
will be discussed, in this study, we used eight HR practices that we assume affect
performance.
Performance, as underlined by Paauwe (1998) and Guest (1997), is a multifaceted and
complex phenomenon. It is difcult to clearly know to what extent HRM affects
performance. When it comes to measuring public sector performance, the problem is
even more difcult (Guest, 2001: 1100; Hays and Reeves, 1984: 290; Ozgediz, 1983: 59).
Performance is, therefore, not the direct result of any one factor such as HRM. Rather,
HRM is only one important component of a diverse set of inuences that determine
performance level. If we are to speak with any certainty about the extent (net effect) to
which HRM affects performance, one would rst need to isolate HR practices effects by
controlling the rest of the variables bearing on performance. Only when we have made
progress in measuring the independent and dependent variables can we begin to give full
attention to the way in which they are linked (Guest, 1997: 274). As remarked by Legge
(2001: 30), there is a need to open up the black box of the process that links HRM and
organizational performance. This is mainly due to the existence of intervening variables.
Unless very careful controls are used to take account of all factors affecting performance,
it is possible that the results may overstate or understate the inuence of HRM on
performance (Fey et al., 2000; Guest, 1997; Wright et al., 2003). What has so far been
achieved is a skeletal nding and we need to put a lot of esh on the bones (Boxall, 2003;
Guest, 1997; Paauwe, 1998).
Although our knowledge of the net impact of HRM functions on performance is still
incomplete, there is no shortage of assumptions and theories regarding the role that HRM
plays in positively affecting performance. In other words, despite the absence of
unambiguous proof or net impact of HRM on performance, there is evidence that a
88 The International Journal of Human Resource Management
positive relationship does exist between the two (e.g. Becker and Gerhart, 1996; Huselid
et al., 1997; Wright et al., 2003; Youndt et al., 1996). Recently, there has been a growing
body of research that seeks to examine the impact, if any, of HR practices on
organizational performance. The most notable studies are those that use large data sets
and interrogate data using sophisticated statistical techniques. In general, the available
studies appear to reveal impressive evidence of robust impacts and outcomes. The now
classical studies in the United States include those by Becker and Gerhart (1996);
Huselid (1995); Huselid et al. (1997); Icheniowski et al. (1997); and MacDufe (1995).
In Britain, the major studies include those by Guest (1997) and Patterson et al. (1997).
In the Netherlands, studies include those of Boselie et al. (2001); Paauwe (1998); and
Den Hartog and Verburg (2004).
Recently, studies have begun to use HRM outcomes such as employee competence,
motivation and role clarity in explaining the HRMperformance relationship. As can be
seen from Figure 1, HR practices lead to HRM outcomes, which subsequently affect
employee and organization performance (e:g: Fey et al., 2000; Guest, 1997; Paauwe,
1998). The assumption here is that HRM outcomes serve as mediating variables between
HRM and performance. HR practices give rise to HRM outcomes, which will inuence
performance in and of the organization (Paauwe, 1998: 5).
Basically, there are a number of theoretical arguments (e.g. expectancy theory,
resource-based theory, human capital theory) supporting the idea that HR practices affect
performance (e.g. Guest, 1997; Paauwe, 1998; Pauuwe and Boselie, 2003; Youndt et al.,
1996). These theoretical arguments provide some insights into howHRpractices translate
into higher performance. Thus, the logic connecting the HR practices and performance is
intuitively appealing and supported by theoretical arguments froma number of disciplines.
Below, a brief discussion is given on the theoretical arguments of expectancy theory
mainly due to the fact that there is a growing consensus that the concept of expectancy
theory can provide one possible route to an explanation of how HR practices have an
impact on performance (Becker and Gerhart, 1996; Guest, 1997; MacDufe, 1995).
Expectancy theory assumes that if an employee is to be productive, three elements
must be in place: competence, motivation and role clarity (MacDufe, 1995). Put
somewhat differently, it has been proposed that HRM outcomes (employee competence,
motivation and role clarity) mediate the relationship between HR practices and employee
Figure 1 Conceptual framework for analysing the challenges and prospects of effective HRM in
civil service organizations
Teclemichael Tessema and Soeters: HRM in developing countries 89
performance. Employee performance, in turn, positively affects performance at the
organization level. However, given the situation of most DCs, like Eritrea, facing
the problem of retention of professionals, our conceptual framework adds employee
retention as the fourth HRM outcome that affects performance (see also Aredo, 2002;
Fey et al., 2000; Hilderbrand and Grindle, 1997; World Bank, 1994b, 1997). The
argument is that if civil service organizations are to provide the needed quality of
services (high performance), they must be able to retain professionals (competent
employees who are willing to stay and do not have the intention to leave). As contended
by Taormina (1999: 1060), employee turnover has high potential to negatively affect an
organization since the loss of trained employees would mean a reduction in organization
performance. Employee retention is not a frequently cited HRM outcome in the
developed world as contrasted with the situation in most DCs. Employee retention may
be particularly important in DCs like Eritrea in which, on the one hand, the country has
been experiencing acute shortages of qualied and experienced human resources and, on
the other hand, a high brain drain of qualied civil servants exists (Aredo, 2002; Das,
1998; ECA, 1989; Kiggundu, 1989, 1998; ILO, 1998). That is why, recently, it has been
argued that it is a paradox of todays world that the DCs (such as Eritrea) that have the
greatest need to use professionals to help them along the road to economic and social
development are not using them efciently and in fact are losing many of their best
educated young men and women to the developed societies.
To facilitate understanding, different parts of the conceptual framework (Figure 1) are
presented in the following manner: environmental factors such as economic and political
(A1A2) affect HR practices. HR practices (B1B8) affect HRM outcomes (C1C4),
which subsequently affect employee performance (D). The conceptual framework
reveals that HRM outcomes serve as mediating variables between HRM and
performance. Our conceptual framework provides a clear chain of causation. It is
assumed that other things being equal, employees who are motivated are more effective
and productive than apathetic employees; competent employees are more effective and
productive than incompetent employees; employees with clear duties and responsibilities
are more productive than employees with role ambiguity and confusion; and employees
who do not have an intention to leave are more productive than those who have an
intention to leave the organization. Thus, the higher the above HRM outcomes in place,
the better HR contribution would be (e.g. Becker and Gerhart, 1996; Den Hartog and
Verburg, 2004; Guest, 1997, 2001; Paauwe, 1998).
Given the scheme in Figure 1, one may ask which HR practices impact on the
aforementioned HRM outcomes: employee competence (ability to work), motivation
(willingness to work), role clarity (clear duties and responsibilities), retention
(willingness to stay)? A considerable amount of research has been done concerning
the relationships between HR practices and the above-mentioned HRM outcomes.
Although, the research so far conducted is unable to recognize clearly the net impact of
each HR practice on HRM outcomes, many of the studies found that different HR
practices are positively correlated with the HRM outcomes. For example, stable
connections have been found between compensation programmes and motivation/
job-satisfaction (e.g. Huselid, 1995; Lienert, 1998), and between promotion opportunities
and motivation (e.g. Ahmad and Schroeder, 2003; Hilderbrand and Grindle, 1997).
Others have also found unequivocal relations between investment in training and
employee competence (e.g. Kalleberg and Moody, 1994), between recruitment
and selection and employee competence (e.g. Hsu and Leat, 2000; Huselid, 1995),
between job descriptions and placement and role clarity (e.g. Becker and Gerhart, 1996;
Fey et al., 2000) and between compensation and retention (Hilderbrand and Grindle,
90 The International Journal of Human Resource Management
1997; Aredo, 2002; Taormina, 1999). The above-mentioned studies, therefore, support
our main argument stating that HRM outcomes can serve as mediating variables between
HR practices and performance.
In this study, we empirically tested the impacts of eight HR practices on HRM
outcomes. We also tested the impacts of both HR practices and HRM outcomes together
on performance, as perceived by the respondents.
Research methodology
This study is based on a sample of ten Eritrean ministries. The data were collected using
two methods:
1 A questionnaire distributed to 400 civil servants: in this survey-study, a multi-stage
sampling procedure was used: rst, ten out of 16 ministries were randomly
included in the sample; next 40 civil servants from each ministry were randomly
selected. In order to create a representative sample, the respondents were equally
drawn from the following ve services: administrative service, professional and
scientic service, sub-professional service, clerical and scal service, and crafts
and manual service. All in all, 400 questionnaires were distributed, of which 313
usable questionnaires were returned, leading to a response rate of 78 per cent.
In total, 23 per cent of the respondents were from the administrative service,
24 per cent of them were from the professional and scientic service, 25 per cent
of them were from the sub-professional service, 16 per cent of them were from the
clerical and scal service, and the remaining 12 per cent were from the crafts and
manual service. Hence, the non-response rate is somewhat larger in clerical/scal
as well as crafts and manual services. The questionnaires were developed in the
English language and subsequently translated from English into the local language,
Tigrigna. Back-translation was not deemed necessary, since the translation was
done by the rst author who has mastered both languages. Questionnaire data were
collected in April and May 2003.
2 Interviews with ordinary civil servants and management bodies: specically, in-depth
interviews were conducted with: (a) ten HR managers, (b) ten HRD managers, (c) the
Eritrean Civil Service Commissioner, (d) the Director General of the Eritrean HRD
Project, and (e) 50 ordinary civil servants. As to the process of conducting the
interviews, rst we identied relevant concepts from the literature to be used as a
signpost for us in order to focus the interviews on the most important issues. The
interviewees responded in the local language to facilitate communications and we then
transcribed the interviews into English on the same day the interview was conducted
while observations and information were fresh in our memory. The transcribed
interviews were read and the essential issues reported were annotated.
The questionnaire we administered contained eight HR practices, which included the
following items: recruitment and selection practices with ve items, placement practices
with three items, training practices with six items, compensation practices with six
items, employees performance evaluation practices with six items, promotion practices
with three items, grievance procedures with three items, pension programme (social
security) with three items. In addition, four items with regard to HRM outcomes and
three items with regard to performance as perceived by the respondents were included
(see Appendix 1 for the specic measurements). The model therefore consists of eight
HR practices as predictor variables and HRM outcomes as well as performance as
dependent variables. Respondents were asked to indicate the degree to which they agreed
Teclemichael Tessema and Soeters: HRM in developing countries 91
or disagreed with the items related to the above HRM issues (see Appendix 1). All the
items were measured on a ve-point scale ranging from 1, strongly disagree, to 5,
strongly agree (see Table 1 for explanation and scale reliability). The analysis also
includes three control variables. Except for the variables tenure and monthly salary,
which are simply entered in the equation as continuous variables, gender is measured
with a dummy variable.
Table 1 portrays the alphas to check the reliability of the eight HR practices and HRM
outcomes as well as the perception of performance. All alphas range from .71 to .92,
which can be considered satisfactory. We also performed ANOVA tests to discover
whether there are differences among the ten sample ministries; the tests, however,
demonstrate that the perceptions of the respondents are found to be statistically not
signicant among the ten sample ministries. This is mainly due to the fact that the ten
sample ministries are part and parcel of the Eritrean Ministries (civil service
organizations) operating under fairly similar conditions.
Results
As Table 1 discloses, the overwhelming majority of the variables were rated fairly low
(mean values ranging between 2.1 and 2.9 on a ve-point scale), which in turn signals the
magnitude of the problems associated with HR practices, as will be discussed later.
Table 2 presents the correlations between the variables included in the analysis. There
are a number of itemcorrelations; hence, potential multicollinearity had to be considered.
We computed variance ination factors (VIFs), which indicated that multicollinearity
was not a problem for the variables in the regressions whose results appear in Tables 3
and 4. As predicted, with the exception of placement practices, the other seven HR
practices are signicantly positively correlated with HRM outcomes (see Table 2). Such
correlations may disclose that HR practices affect HRM outcomes, as demonstrated in
our model (see Figure 1). Overall, the pattern of results reported in Table 2 is consistent
with our studys underlying theoretical premise, that HR practices are positively
correlated with HRM outcomes (see also Ahmad and Schroeder, 2003; Becker and
Huselid, 1998; Guest, 2001; Ichniowski et al., 1997; Paauwe, 1998).
One of the goals of the present study was to test to what extent the eight HR practices
explains the HRM outcomes, which are the mediating variable between HR practices and
performance. To that end, we performed a regression analysis (see Table 3). Table 3
demonstrates that ve out of the eight HR practices identied in this study show a
statistically signicant positive impact in explaining the change in HRM outcomes and
are greater than or equal to b .10. The ve signicant HR practices are recruitment
and selection practices, training practices, compensation practices, grievance procedures,
and pension or social security programmes. In addition, the eight HR practices altogether
explain about 54 per cent of the change in HRM outcomes (R
2
.54). Generally
speaking, we found reasonably good support for the propositions of our model. This may
suggest that the more the HR practices are in place, the more HRM outcomes would be
up to standard, which subsequently would positively affect performance (e.g. Guest,
1997; Ichniowski et al., 1997; MacDufe, 1995; Paauwe, 1998; Wright et al., 2003).
Hence, we have found that the more HR practices are in place, the more the civil servants
are competent, satised with the existing HR practices, have sufcient role clarity in their
job and have no intention to leave the organization. These ndings are in line with the
predicted relationships and thus support our model.
Results presented in Table 3 also show that compensation and pension practices are
the major contributors to the HRM outcomes (b . 24 and .21). One of the main reasons
92 The International Journal of Human Resource Management
Table 1 Descriptive statistics and Cronbachs alphas
Variable in model High value means Alpha Mean Min. Maxi.
Recruitment and selection practices (5 items) Strongly agree that effective recruitment
& selection practices exist
(.75) 2.7 1.2 5.0
Placement practices (3 items) Strongly agree that effective placement
practices exist
(.92) 2.7 1.0 5.0
Training practices (6 items) Strongly agree that effective training
practices exist
(.75) 2.7 1.0 5.0
Compensation practices (6 items) Strongly agree that effective compensation
exists
(.82) 2.4 1.0 4.5
Employee performance evaluation practices
(6 items)
Strongly agree that effective employee
performance evaluation practices exist
(.73) 2.9 1.0 4.3
Promotion practices (3 items) Strongly agree that effective promotion
practices exist
(.74) 2.4 1.0 4.7
Grievance procedure (3 items) Strongly agree that effective grievance
procedures exist
(.72) 2.7 1.0 5.0
Pension programme (3 items) Strongly agree that effective pension
programme exists
(.86) 2.1 1.0 4.0
HRM outcomes (4 items) Strongly agree that high HRM
outcomes exist
(.71) 2.6 1.0 4.5
Performance (3 items) Strongly agree that respondents own performance
is relatively good
(.74) 2.9 1.0 5.0
Gender
a
M/F
Tenure Years of work experience 17.2 1 43
Salary
b
Monthly salary level in Nackfa 1463 245 3020
Notes:
a
33% were female;
b
monthly salary is in terms of Nackfa. US$1 13.5 Nackfa as of September 2003.
T
e
c
l
e
m
i
c
h
a
e
l
T
e
s
s
e
m
a
a
n
d
S
o
e
t
e
r
s
:
H
R
M
i
n
d
e
v
e
l
o
p
i
n
g
c
o
u
n
t
r
i
e
s
9
3
Table 2 Correlations matrix
No Variables 1 2 3 4 5 6 7 8 9 10 11 12 13
1 Gender
2 Tenure 2.045
3 Salary 2.24** .27**
4 Recruitment and selection
practices
.13* 2.05 2.10
5 Placement practices .00 .04 .06 2.07
6 Training practices .08 .03 2.10 .63** 2.15*
7 Compensation practices .05 2.08 2.12 .41** .06 .42**
8 Employee performance
evaluation
.04 .11 .01 .43** 2.10 .52** .43**
9 Promotion practices .09 .06 2.10 .55** 2.04 .72** .49** .47**
10 Grievance procedure .07 2.08 2.10 .46** 2.01 .50** .59** .37** .50**
11 Pension programme .04 .03 2.11 .50** 2.08 .49** .52** .45** .55** .43**
12 HRM outcomes .10 .01 .00 .57** 2.06 .59** .59** .48** .56** .54** .58**
13 Performance level .15** .04 2.07 .57** 2.09 .66** .38** .65** .48** .42** .45** .66**
Notes:
**Correlation is signicant at the 0.01 level; and *correlation is signicant at the 0.05 level (two-tailed).
9
4
T
h
e
I
n
t
e
r
n
a
t
i
o
n
a
l
J
o
u
r
n
a
l
o
f
H
u
m
a
n
R
e
s
o
u
r
c
e
M
a
n
a
g
e
m
e
n
t
why the contributions of compensation and pension practices are found to be the highest
is that, given the poor economy and volatile environment of most DCs including Eritrea,
one may expect a greater impact of these two HR practices on HRM outcomes. As
previously discussed, compensation issues affect most HR practices or functions either
directly or indirectly. For instance, compensation affects employee motivation (Huselid,
1995; Lienert, 1998) and retentionintention to stay in the organization (Becker and
Gerhart, 1996; Grindle, 1997; Pfeffer, 1994).
In model 2 in Table 3, when gender, tenure and salary are added, the R
2
change that
we found was only .01. However, in connection with the importance of compensation
Table 3 Results of regression analysis on HRM outcomes
Variables Model 1
a
Model 2
a
Recruitment and selection practices .17
**
.16
**
Placement practices .00 2.02
Training practices .20
**
.20
**
Compensation practices .24
***
.25
***
Employee performance evaluation practices .06 .05
Promotion practices .01 .00
Grievance procedure practices .10* .10*
Pension practices .21
***
.22
***
Gender .06
Tenure .00
Salary .11
**
F 44.0
***
33.3
***
R
2
.54 .55
R
2
change .01*
Notes:
a
Standardized regression coefcients are reported;
*
p , .05;
**
p , .01;
***
p , .001; n 313.
Table 4 Results of regression analysis on performance
a
Variables Model 1
b
Model 2
b
Model 3b
Recruitmentment and selection practices .19
***
.18
***
.12
*
Placement practices .03 .03 .03
Training practices .37
***
.37
***
.30
***
Compensation practices 2 .03 2 .03 2 .12*
Employee performance evaluation practices .40
***
.40
***
.38
***
Promotion practices 2 .12* 2 .12* 2 .12*
Grievance procedure .06 .06 .02
Pension or social security .07 .07 2 .01
Gender .08* .06
Tenure .00 .00
Salary 2 .01 2 .05
HRM outcomes .35
***
F 49.1
***
36.4
***
42.0
***
R
2
.56 .57 .63
R
2
change .01 .06
***
Notes:
a
Performance as perceived by the respondents themselves.
b
Standardized regression coefcients are reported; *p , .05;
**
p , .01;
***
p , .001; n 313.
Teclemichael Tessema and Soeters: HRM in developing countries 95
practices, salary was also found to be signicant, which in turn suggests that
compensation-related issues considerably affect HRM outcomes such as employees
motivation and retention, as already mentioned.
As indicated in the introduction, we have gone further to inspect the impact of
the eight HR practices plus HRM outcomes together on performance as perceived by the
respondents (see Table 4). Table 4 also depicts some important results: three of the eight
HR practices show a statistically signicant positive impact in explaining the change in
performance, namely recruitment and selection practices, training practices, and
employee performance evaluation practices. In addition, the eight HR practices
altogether explain about 56 per cent of the change in performance (R
2
.56). As
revealed in Table 4, employee performance evaluation is found to be a major contributor
to performance (b .40, p , 0.001). This may be because employee performance
evaluation is crucial for most HR practices in that, if it is done properly, it could serve
several purposes: rst, for taking proper personnel actions such as salary increment,
promotion and other incentives; second, for assessing the strengths and weaknesses of
employees and taking the appropriate training and development measures; and third,
for assessing the effectiveness of HR practices such as recruitment, selection and
training (Baron and Kreps, 1999; Bowen and Ostroff, 2004; Kalleberg and Moody, 1994;
Pfeffer, 1994).
An interesting nding of our study is that, although we expected that the impact of HR
practices would weaken as we go to the right side of our conceptual framework i.e.
towards performance D in Figure 1 (Fey et al., 2000; Guest, 1997; Legge, 2001;
Paauwe, 1998) we found that the eight HR practices altogether explain 56 per cent of
the change in performance (R
2
.56). Thus, contrary to our expectation, the impact of
the eight HRpractices on performance (R
2
.56) exceeds that of HRMoutcomes (R
2

.54) (see Tables 3 and 4 and Figure 1).

In model 3 in Table 4, when gender, tenure, salary and HRM outcomes are added, the
R
2
change that we found was .06, which is signicant at p , .001. Besides, HRM
outcomes are found to show a considerable positive impact, which in turn may suggest
the importance of HRM outcomes in affecting performance. All these results conrm our
expectations based on theoretical insights. Clearly, the HRMperformance link that has
been demonstrated in the Western hemisphere also exists in the Eritrean context.
However, there is one exception. In all three models of Table 4 we found signicant
negative correlations to exist between the existing promotion practices and employee
performance. This nding suggests that the respondents with a (claimed) better
performance record are less convinced that the existing promotion practices are based on
written, formal policies and that priority is given to merit and seniority when decisions
on promotions are taken (see Appendix 1). Obviously, those respondents feel that
decisions on promotions are too much inuenced by other, mainly political
considerations, which is a well-known point of concern in the Eritrean civil service
(e.g. Soeters and Tessema, 2004; Tessema and Soeters, 2005).
Discussion
One of the main goals of this study has been to discuss the HRM challenges facing civil
service organizations in DCs such as Eritrea. To that end, we have presented the impacts
of HR practices on HRM outcomes, which subsequently affect performance at the
employee level. Again we have to stress that our results have demonstrated a strong
HRMperformance link in the Eritrean civil service. As such, our study aligns to a large
degree with other studies on the HRMperformance link in Western countries. However,
96 The International Journal of Human Resource Management
the situation is not fully comparable to the situation in Western parts of the world. In this
section, we need to go further to relate the empirical ndings to the actual economic and
political environment of Eritrea. One important issue is the role of the environmental
factors (economic and political), which are decisive in inuencing the impact of HR
practices on the performance of civil servants in DCs (see also Austin, 1990; Budhwar
and Debrah, 2001; Grindle, 1997; Jaeger et al., 1995; Kiggundu, 1989; Wasti, 1998).
Environmental factors, according to Kiggundu (1989: 75), can be very instrumental
either in facilitating or in hindering the operation of an organization. However, as
previously described, the Eritrean economic and political environment within which the
eight HR practices operate has not been conducive in maximizing the impact of HR
practices on performance. As a consequence, these eight HR practices were rated fairly
low (between 2.1 and 2.9 on a ve-point scale) by the respondents.
Most DCs are known for their economic problem in nancing different projects and
programmes, including HRM programmes (e.g. Freeman and Lindauer, 1999; Jaeger
et al., 1995; Kiggundu, 1989; Prah, 2004). Almost all of the senior civil service managers
interviewed pointed out that because of the deteriorating Eritrean economy (see also
UNDP, 2002; National Statistics Ofce, 2003), they were unable to allocate the required
resource for the eight HR (mainly compensation) practices. This demonstrates that, in a
period of budget constraints, the ability to pay has become the key criterion in pay
determination, overshadowing any broader conceptions of comparability. For instance,
according to the CPA (2002a), as of 2002, employees of international NGOs and the
private sector were earning a salary that is about three times higher than that of the civil
servants. This implies that there is a wide gap between the public and international NGOs
and private-sector pay, in favour of the latter. The existing compensation practices have
been adversely affecting most HR practices (see also Amanuel and Tesfagabir, 2002;
CPA, 2002b; Soeters and Tessema, 2004).
The prevailing situation has made it increasingly difcult for Eritrean civil service
organizations to attract qualied and suitable applicants, which in turn affects their ability
to be selective in their hiring exercise. Moreover, it has adversely affected the impact of
training in that although many civil servants have been given training opportunities by
donor agencies and countries, they have been unable to utilize their expertise effectively,
mainly due to the unattractive compensation programmes. As a consequence, civil
servants tend, once they have obtained better qualications through training, to move over
to the private sector or International NGOs or overseas. This phenomenon is widespread
in numerous developing countries (e.g. Cohen and Wheeler, 1997; Das, 1998; Grindle,
1997; ILO, 1998; Tessema et al., 2005; World Bank, 1994b). This is mainly due to the fact
that if training is not supplemented with necessary incentives, it may not increase
employees motivation as well as their commitment to the organization. Prah (2004: 3)
argues that in most SSA countries, middle-level ofcials can still barely feed, let alone
adequately house, clothe and educate their family. It was also underlined that temporary
solutions like increasing salaries on a project basis or earmarking foreign assistance to
enhance remuneration were not found to be sustainable for the aforementioned problem
(Das, 1998; Maggregor et al., 1998). Unattractive compensation has been important in
undermining the previously existing capacity (see also Cohen and Wheeler, 1997: 137;
Hilderbrand and Grindle, 1997: 42). The prevailing economic context, within which
HRM is taking place in most DCs like Eritrea, has therefore adversely affected the
impacts of HR practices (Analoui, 1998; Lienert, 1998).
Furthermore, like many DCs, the Eritrean political environment does not seem to
maximize the impact of the eight HR practices. It has been underscored that
organizations in developing countries often face a highly volatile and unstable political
Teclemichael Tessema and Soeters: HRM in developing countries 97
environment (see also Austin, 1990; Kanungo and Jaeger, 1990; Kiggundu, 1989). For
example, according to Kiggundu (1989: 62), many developing countries are
characterized by unexpected political changes, which create so much environmental
uncertainty and complexity that managers consider almost any planning or strategic
management responses impossible. DCs in general and sub-Saharan African (SSA)
countries in particular are characterized by low predictability of events, unstable political
climates and corrupt legal practices (see also Chabal and Daloz, 1999; Prah, 2004; Smith,
2003). Continuity of government policies is also hindered by frequent changes in ruling
groups or individual government ofcials. In some instances, these political groups strive
to gain and consolidate their power through coercive means. Patrimonial tendencies are
strong (Beugre and Offodile, 2001; Chabal and Daloz, 1999). Patrimonialism grew out of
the single-party, military or one-man-rule states, which have characterized many DCs.
By and large, the consequences of political instability for HR practices are signicant.
Indeed, it is frequently cited as one of the main reasons for qualied civil servants to
migrate to the West (ILO, 1998; Aredo, 2002).
It is also interesting to note that the civil service of many DCs has been politicized.
As noted by Das (1998: 19), politicization of the civil service has resulted in total
erosion of traditional civil service values such as political neutrality, probity,
rectitude, and objectivity. Interviews conducted with the civil servants uncovered that
the politicization of the Eritrean civil service has affected many HR practices, such as
recruitment and selection, placement and promotion, and compensation. For instance,
about 34 per cent of the interviewees believed that recruitment and selection practices
are inconsistent with modern principles such as open, fair and merit based. That is
why many scholars noted that favouritism, nepotism and political loyalty have been
affecting recruitment, selection and promotion practices in many developing countries
(e.g. Bennell, 1994; Beugre and Offodile, 2001; Das, 1998; Soeters and Tessema,
2004; World Bank, 1994b). About 38 per cent of the interviewed civil servants also
believed that the existing environment diminished the link between performance and
reward, which in turn suggests that employee performance evaluation is often largely
based on compliance rather than productivity. The nding of our study also reects
the general situation of the civil service in most developing countries (e.g. Analoui,
1998; Bennell, 1994; Beugre and Offodile, 2001; Soeters and Tessema, 2004). As a
result, many HRM decisions have been taken subjectively. As Waiguchu (Waiguchu
et al., 1999: 198) puts it, in an authoritarian setting, an appraisal system is
unavoidably one-sided. In such a case, the supervisors view of the subordinates
performance prevails.
Interviewed senior civil service managers noted that placement and promotion to
upper middle and top civil service positions are very much politicized in that the majority
of the senior positions in the Eritrean Civil Service (Minister, General Director, Director,
and Unit Head) are held by individuals who are loyal to the government. Although a civil
service is composed of both political appointees and career civil servants, of whom the
political appointees are few in number and occupy top or most senior positions (Heady,
1996), the Eritrean case reveals that the political appointees have even been holding
positions that conventionally are occupied by career civil servants (see also Pool, 2001;
Soeters and Tessema, 2004). Hence, non-merit considerations have been very much
affecting promotion decisions, which in fact we have shown in our regression analyses
(see Table 4). Up to now, there is no clear dividing line between administration
and politics. As Heady (1996) argues, some systems are civil service in name only and
actually function as spoils systems. That is, the governments personnel systems may
be nominally merit based but practically politically based.
98 The International Journal of Human Resource Management
The foregoing brief discussion demonstrates that in an environment where there are no
promising economic and political factors (peace and stability as well as good
governance), it is unlikely that a higher impact of HR practices on employee performance
will be achieved. For instance, the Eritrean case shows that, although many scholars and
government leaders like Bill Clinton cited it as a beacon of Africa, after seven years of
economic growth and political stability, it was again involved in a border war with
Ethiopia, which in turn has adversely affected the economy as well as the political
condition of the country, which further diverted the governments priority to national
defence. It should be noted that the border war between Ethiopia and Eritrea (1998
2000) has affected either directly or indirectly most HR practices. For instance, during
the border war, about 300,000 Eritreans were mobilized, that is, about 10 per cent of the
entire population or more than 50 per cent of the population of working age (Amanuel,
2002). Thus, the war had made the normal continuation and effective implementation of
many HR practices a very difcult task indeed. One can argue that such an environment
is likely to adversely affect the impact of HR practices on performance.
Heady (1996: 217), after analysing the management of civil servants in developing
countries, underlines that: In single or dominant party political systems, party claims to a
monopoly on policy making and executive make it imperative that civil servants pass
whatever test of party loyalty may be imposed and that they suffer not only loss of status
or position for falling short, but suffer in other ways as well, including imprisonment,
banishment to the countryside, or death . . . in such circumstances, the behaviour of civil
servants who want to remain in the civil service is overwhelmingly determined by what is
required of them by the current party line as to their roles.
What Heady underlines has great relevance to the actual situation of many DCs and
particularly that of SSA (including Eritrea) where the administrative crisis is most
critical and the enforcement of personnel rules and procedures has been broken
down (e.g. Chabal and Daloz, 1999; Prah, 2004; Smith, 2003). For the above reason, one
may argue that the rational, hierarchical and meritocratic model has failed in many DCs.
One can also suggest that there is nothing wrong with the civil servants of developing
countries, rather there is a problem in the management of the civil servants. The existing
situation has also led to widespread absenteeism, petty corruption, moonlighting (to use
ofce hours and equipment for private purposes), and a general breakdown in morale and
discipline (see also Lienert, 1998: 43; Prah, 2004: 3; World Bank, 1997: 95). One may
then argue that civil service organizations in developing countries such as Eritrea, are not
prestigious places that can attract, motivate and retain qualied and experienced
personnel (see also Das, 1998; ECA, 1989; Hilderbrand and Grindle, 1997).
The question is, what would be the prospects of HRM in the Eritrean civil service
organizations as well as those of other developing countries? One can reasonably argue
that the prospects of effective HRM would be contingent mainly upon the countrys
economic and political condition. That is, if there are improving economy as well as
political conditions, there is a high probability of successfully putting into effect all HR
practices thereby positively affecting performance (Dia, 1996; World Bank, 1997).
As previously indicated, given the above-stated environmental factors, the impact of
the eight HR practices on HRM outcomes in the Eritrean civil service organizations is
more or less in line with the predicted relationships (see Tables 1 to 4). This may suggest
that our ndings support the underlining premise of expectancy theory in particular and
other theories such as human capital theory and resource-based theory in general (e.g.
Paauwe and Boselie, 2003; Youndt et al., 1996). In particular, the ndings of this study
support the idea advocated by expectancy theory in that HRM outcomes could be
mediating variables between HR practices and performance at the employee level. Thus,
Teclemichael Tessema and Soeters: HRM in developing countries 99
an important nding of this study is that the assumption of expectancy theory may work
not only in the developed world but also in developing countries such as Eritrea.
Our ndings can also be viewed in the context of the growing body of research on
HRM and performance relationship (e.g. Ahmad and Schroeder, 2003; Delaney and
Huselid, 1996; Guest, 1997, 2001; Ichniowski et al., 1997), and the role of the
economic and political environment in that respect. The present study can be seen as
adding to this literature in that, unlike most prior research, we empirically tested the
model in the public sector as well as in the context of DCs. This is because prior
research has relied mostly on manufacturing industry and other parts of the world. In
this regard, the key contributions of the present research are: rst its attempt to open
the black box (the process aspect) by answering the following questions: how, when
and to what extent do HR practices affect HRM outcomes, which subsequently affect
performance? (Becker and Huselid, 1998; Guest, 1997, 2001; Legge, 2001; Paauwe,
1998); and second, its attempt to relate the ndings to the economic and political
environment, in explaining the HRM challenges facing civil service organizations in
DCs. Hence, our study has important implications for the theoretical and practical
debate in the area of the HRMperformance relationship.
Conclusion
This paper concludes that if the civil service organizations in developing countries like
Eritrea are able to successfully implement HR practices, they could achieve the
maximum contribution of their employees, although, at present, the economic and
political environment within which HR practices operate is not that conducive (see also
Hilderbrand and Grindle, 1997; Jaeger and Kanungo, 1990; Kiggundu, 1989; Prah, 2004;
Wasti, 1998).
This study provides further evidence with regard to the link between HR practices
and performance and relates the ndings to environmental factors such as economic and
political inuences. This study joins a growing body of research that attempts to open the
black box by explaining how, when and to what extent HR practices affect performance
at employee level. And thus, it is believed that this study contributes to research on the
HRM and performance relationship in general and that of the civil service of developing
countries in particular.
While this study is an important step forward in understanding how, when and to
what extent HR practices affect performance, as well as the challenges and prospects
for effective HRM in developing countries, it also leaves some questions open for
future research. First, the sample size may not be very large to generalize the ndings;
second, this study is the rst of its kind and thus we have not found prior studies against
which to compare our ndings. This is because similar studies in a similar environment
have not been conducted. Hence, in order to generalize and validate the ndings of this
study, we suggest that the same study is conducted with a larger sample size in other
developing countries.
References
Ahmad, S. and Schroeder, R. (2003) The Impact of HR Practices on Operational Performance:
Recognizing Country and Industry Differences, Journal of Operations Management, 21:
1943.
Amanuel, G. and Tesfagabir, Z. (2002) A Report on Labour Market Issues and Remuneration
Schemes. Eritrea: Asmara.
100 The International Journal of Human Resource Management
Amanuel, M. (2002) Veteran Combatants Do Not Fade Away: A Comparative Study on Two
Demobilisation and Reintegration Exercises in Eritrea. Bonn: BICC.
Analoui, F. (ed.) (1998) Human Resource Management Issues in Developing Countries. Aldershot:
Ashgate.
Aredo, D. (2002) Brain Drain Reportedly Costing $4 Billion a Year. Addis Ababa: UN Integrated
Regional Information Networks.
Arthur, J.B. (1994) Effects of Human Resource Systems on Manufacturing Performance and
Turnover, Academy of Management Journal, 37(3): 67087.
Austin, J. (1990) Managing in Developing Countries: Strategic Analysis and Operating
Techniques. New York: Free Press.
Baron, J. and Kreps, D. (1999) Strategic Human Resources: Frameworks for General Managers.
New York: Wiley.
Becker, B.E. and Gerhart, M.A. (1996) The Impact of Human Resource Management on
Organisational Performance: Progress and Prospects, Academy of Management Journal, 39(4):
799801.
Becker, B.E. and Huselid, M.A. (1998) High Performance Work Systems and Firm Performance:
A Synthesis of Research and Managerial Implications, Research in Personnel and Human
Resource Management, 16: 53101.
Benkhoff, B. (1996) Catching up on Competitors: How Organisations can Motivate Employees to
Work Harder, International Journal of Human Resource Management, 7(3): 73652.
Bennell, P. (1994) Improving the Performance of the Public Sector in LDCs: New Approaches to
Human Resource Planning and Management. Occasional Paper no. 25. Geneva: ILO.
Beugre, C.D. and Offodile, O.F. (2001) Managing for Organisational Effectiveness in Sub-Saharan
Africa: A CulturalFit Model, International Journal of Human Resource Management, 10(4):
53550.
Boselie, P. and Dietz, G. (2003) Commonalities and Contradictions in Research on Human
Resource Management and Performance. paper presented at the Academy of Management
Meeting, Seattle, August.
Boselie, P., Paauwe, J. and Jansen, P. (2001) Human Resource Management and Performance:
Lessons from the Netherlands, International Journal of Human Resource Management, 12(7):
110725.
Bowen, D. and Ostroff, C. (2004) Understanding HRMFirm Performance Linkages: the Role of
the Strengths of the HRM System, Academy of Management Journal, 29(2): 20321.
Boxall, P. (2003) HRStrategy and Competitive Advantage in the Service Sector, Human Resource
Management Journal, 13(3): 520.
Brudney, J., OToole, L. and Rainey, H. (2000) Advancing Public Management: NewDevelopments in
Theory, Methods, and Practice. Washington, DC: Georgetown University Press.
Budhwar, P. and Debrah, Y. (2001) Introduction. In Budhwar, P. and Debrah, Y. (eds) Human
Resource Management in Developing Countries. London: Routledge, pp. 115.
Central Personnel Administration (CPA) (2002a) Statistical Data of Eritrean Civil Service. Eritrea:
Asmara.
Central Personnel Administration (CPA) (2002b) Civil Service Functional Reviews Report. Eritrea:
Asmara.
Chabal, P. and Daloz, J. (1999) African Issues: Disorder as Political Instrument. Oxford: James
Currey for the International African Institute.
Cohen, J. and Wheeler, J. (1997) Training and Retention in African Public Sectors: Capacity-
Building Lessons from Kenya. In Grindle, M. (ed.) Getting Good Government: Capacity
Building in the Public Sector of Developing Countries. Boston, MA: Harvard Institute for
International Development, pp. 12553.
Das, S.K. (1998) Civil Service Reform and Structural Adjustment. New York: Oxford University
Press.
Delaney, J.T. and Huselid, M.A. (1996) The Impact of Human Resource Management Practices on
Perceptions of Organisational Performance, Academy of Management Journal, 39(4): 94969.
Teclemichael Tessema and Soeters: HRM in developing countries 101
Delery, J.E. and Doty, D.H. (1996) Modes of Theorizing in Strategic Human Resource
Management: Tests of Universalistic, Contingency and Congurational Performance
Predictions, Academy of Management Journal, 39(4): 80235.
Den Hartog, D. and Verburg, R. (2004) High Performance Work Systems, Organisational Culture
and Firm Effectiveness, Human Resource Management Journal, 14(1): 5578.
Dia, M. (1996) Africas Management in the 1990s and Beyond: Reconciling Indigenous and
Transplanted Institutions. Washington, DC: World Bank.
Economic Commission for Africa (ECA) (1989) Handbook for Manpower Planners in Africa.
Addis Ababa: ECA.
Eritrean Human Resources Development Project (2003) Terminal Report and Exit Strategy.
Eritrea: Asmara, 14 May.
Ferris, G.R., Hochwater, W.A., Buckley, M.R., Harrell-Cook, G. and Frink, D.D. (1999) Human
Resource Management: Some New Directions, Journal of Management, 25: 385415.
Fey, C., Bjorkman, I. and Pavlovskaya, A. (2000) The Effect of Human Resource Management
Practices on Firm Performance in Russia, International Journal of Human Resource
Management, 10(4): 53550.
Freeman, R.H. and Lindaer (1999) Why not Africa? Working Paper No. 694. Cambridge, MA:
National Bureau of Economic Research.
Frezghi, A. (2003) The Development of a Performance Appraisal System For the Eritrean Civil
Service. Unpublished MA thesis, University of Natal, South Africa.
Gafer, A. (1996) The Role of the Civil Servant in the Development of Eritrea. Eritrea: Asmara.
Gerhart, B., Wright, P.M. and McMahan, G.C. (2000) Measuring Error and Estimates of the HR
Firm Performance Relationship: Further Evidence and Analysis, Personnel Psychology, 53:
85572.
Grindle, M. (1997) The Good Governance Imperative: Human Resources, Organisations, and
Institutions. In Merilee, G. (ed.) Getting Good Government: Capacity Building in the Public
Sector of Developing Countries. Boston, MA: Harvard Institute for International Development,
pp. 328.
Guest, D.E. (1997) Human Resource Management and Performance: A Review and Research
Agenda, International Journal of Human Resource Management, 8(3): 26376.
Guest, D.E. (2001) Human Resource Management: When Research Confronts Theory,
International Journal of Human Resource Management, 12(7): 1092106.
Haregot, S., Stanley, J. Doctoroff, M. and Yosief, G. (1993) Public Sector Management Program
for Eritrea: A Diagnostic. Asmara: United Nations Development Program.
Hays, S. and Reeves, T. (1984) Personnel Management in the Public Sector. Massachusetts: Allyn
and Bacon Inc.
Heady, F. (1996) Congurations of Civil Service Systems. In Bekke, H., Perry, J. and Toonen, T.
(eds) Civil Service Systems in Comparative Perspective. Bloomington: Indiana University Press,
pp. 20766.
Hilderbrand, M. and Grindle, M. (1997) Building Sustainable Capacity in the Public Sector: What
Can Be Done? In Grindle, M. (ed.) Getting Good Government: Capacity Building in the Public
Sector of Developing Countries. Boston, MA: Harvard Institute for International Development,
pp. 3161.
Hsu, Y. and Leat, M. (2000) A Study of HRM and Recruitment and Selection Policies and
Practices in Taiwan, International Journal of Human Resource Management, 11(2): 41335.
Huselid, M.A. (1995) The Impact of Human Resource Management Practices on Turnover,
Productivity and Corporate Financial Performance, Academy of Management Journal, 38(3):
63572.
Huselid, M.A., Jackson, S.E. and Schuler, R.S. (1997) Technical and Strategic Human Resource
Management Effectiveness as Determinants of Firm Performance, Academy of Management
Journal, 40(1): 17188.
Ichniowski, C., Shaw, K. and Prennushi, G. (1997) The Effect of Human Resource Management
Practices on Productivity: A Study of Steel Finishing Lines, American Economic Review,
87(3): 291313.
102 The International Journal of Human Resource Management
Ingraham, P. and Kneedler, A. (2000) Dissecting the Black Box: Toward a Model and Measures of
Government Management Performace. In Brudney, J., OToole, L. and Rainey, H. (eds)
Advancing Public Management: New Developments in Theory, Methods and Practice.
Washington, DC: Georgetown University Press.
International Labour Organisation (ILO) (1998) Human Resource Development in the Public
Service in the Context of Structural Adjustment and Transition. Geneva: ILO.
Jackson, S.E. and Schuler, R.S. (1999) Understanding Human Resource Management in the
Context of Organisations and their Environment. In Schuler, R. and Jackson, S. (eds) Strategic
Human Resource Management. Oxford: Blackwell, pp. 428.
Jaeger, A.M. and Kanungo, R.N. (eds) (1990) Management in Developing Countries. London and
New York: Routledge.
Jaeger, A.M., Kanungo, R.N. and Srinvas, N. (1995) A Review of Human Resource Management
Success in Developing Countries. In Kanungo, R.N. and Saunders, D.M. (eds) Employee
Management in Developing Countries. Greenwich, CT: JAI Press.
Kalleberg, A.L. and Moody, J.W. (1994) Human Resource Management and Organizational
Performance, American Behavioural Scientist, 37(7): 94862.
Kamoche, K. (1993) Towards a Model of HRM in Africa. In Shaw, J.B., Kirkbride, P.S. and
Rowlands, K.M. (eds) Research in Personnel and Human Resource Management. Suppl. 3.
Greenwich, CT: JAI Press.
Kamoche, K. (1997) Managing Human Resources in Africa: Strategic, Organisational and
Epistemological Issues, International Business Review, 6(5): 547.
Kamoche, K. (2000) Sociological Paradigms and Human Resources: An African Context.
Aldershot: Ashgate.
Kanungo, R.N. (ed.) (1995) Employee Management in Developing Countries. Greenwich, CT: JAI
Press.
Kanungo, R.N and Jaeger, A.M. (1990) Introduction: The Need for Indigenous Management in
Developing Countries. In Kanungo, R.N. and Jaeger, A.M. (eds) Management in Developing
Countries. London: Routledge, pp. 119.
Kiggundu, M. (1989) Managing Organisations in Developing Countries: An Operational and
Strategic Approach. Bloomeld, CT: Kumarian Press.
Legge, K. (2001) Silver Bullet or Spent Round? Assessing the Meaning of the High Commitment
Performance Relationship. In Storey, J. (ed.) Human Resource Management: A Critical Test.
Stamford, CT: Thomson Learning, pp. 2136.
Lienert, I. (1998) Civil Service Reform in Africa: Mixed Result after 10 Years. In IMF Finance &
Development. Washington, DC: IMF.
Maggregor, J., Peterson, S. and Schuftan, C. (1998) Downsizing the Civil Service in Developing
Countries: The Golden Handshake Option Revisited, Public Administration and Development,
19(2): 4563.
MacDufe, J.P. (1995) Human Resource Bundles and Manufacturing Performance: Organisational
Logic and Flexible Production Systems in the World Auto Industry, Industrial and Labour
Relations Reviews, 48(2): 197221.
Ministry of Education (MOE) [Eritrea] (2001) Our People are our Future: A Framework for the
Development of Human Resources in the Education Sector. Eritrea: Asmara/MOE.
National Statistics and Evaluation Ofce (2003) Eritrea: Demographic and Health Survey 2002.
Eritrea: Asmara.
Noorderhaven, N. and Tidjani, B. (2001) Culture, Governance, and Economic Performance: An
Explorative Study with a Special Focus on Africa, International Journal of Cross Cultural
Management, 27(1): 3152.
Ozgediz, S. (1983) Managing the Public Service in Developing Countries: Issues and Prospects.
Staff Working Paper No. 583. Washington, DC: World Bank.
Paauwe, J. (1998) HRM and Performance: The Linkage between Resources and Institutional
Context. Rotterdam: Erasmus University.
Paauwe, J. and Boselie, P. (2003) Challenging Strategic HRM and the Relevance of the
Institutional Setting, Human Resource Management Journal, 13(3): 5670.
Teclemichael Tessema and Soeters: HRM in developing countries 103
Patterson, G., Johnson, W. and Spreng, A. (1997) Modeling the Determinants of Customer
Satisfaction for Business-to-Business Professional Services, Journal of the Academy of
Marketing Science.
Pfeffer, J. (1994) Competitive Advantage through People: Unleashing the Power of the Work
Force. Boston, MA: Harvard Business School Press.
Pool, D. (2001) From Guerrillas to Government: The Eritrean Peoples Liberation Front. Eastern
African Studies London: Long House Publishing Service.
Prah, K. (2004) African Wars and Ethnic Conicts: Rebuilding Failed States. Human
Development Report 2004 African Regional Background Paper, UNDP.
Smith, B. (2003) Understanding Third World Politics: Theories of Political Change &
Development. New York: Palgrave Macmillan.
Soeters, J. and Tessema, M. (2004) Public Management in Developing Countries: Some Notes on
Eritrea, International Review of Administrative Sciences, 70(4): 62335.
Stone, R. (1998) Human Resource Management. New York: Wiley.
Taormina, R. (1999) Predicting Employees Commitment and Satisfaction: The Relative Effects of
Socialisation and Demographics, International Journal of Human Resource Management,
10(6): 106076.
Tessema, M. and Soeters, J. (2005) Practices and Challenges of Converting Former Fighters into
Civil Servants: The Case of Eritrea, Public Administration and Development.
Tessema, M., Soeters, J. and Abraham, K. (2005) Practices and Challenges of Training and Labour
Utilisation in Sub-Saharan Africa: The Case of Eritrea, International Journal of Training and
Development, 9(4).
University of Asmara (1997) Implementation Plan of the Eritrean Human Resource Development
Project. Asmara: University of Asmara.
United Nations Development Program (UNDP) (2002) United Nations Development Assistance
Framework for Eritrea: 20022006. Eritrea: Asmara.
Waiguchu, M.J., Tiagha, E. and Mwaura, M. (eds) (1999) Management of Organizations in Africa:
A Handbook of Reference. Westport, CT: Quorum Books, pp. 99123.
Wasti, S.A. (1998) Cultural Barriers in the Transferability of Japanese and American Human
Resources Practices to Developing Countries: The Turkish Case, International Journal of
Human Resource Management, 9(4): 60931.
World Bank (1994a) Eritrea: Options and Strategies for Growth. Washington, DC: Country
Operations Division Eastern Africa Department, Africa Region.
World Bank (1994b) Adjustment in Africa: Reforms, Results, and the Road Ahead. A World Bank
Policy Research Report. New York: Oxford University Press.
World Bank (1997) The State in a Changing World. World Development Report, 1997. New
York: Oxford University Press.
Wright, P., Gardner, T. and Moynihan, L. (2003) The Impact of HR Practices on the Performance
of Business Units, Human Resource Management Journal, 13(3): 2136.
Youndt, M., Snell, S., Dean, J. and Lepak, D. (1996) Human Resource Management, Manufacturing
Strategy and Firm Performance, Academy of Management Journal, 39(4): 83666.
Appendix 1: Measurement of items
Respondents were asked to indicate the degree to which they agree or disagree with the
following items related to different HRM issues. All the items were measured on a ve-
point scale ranging from 1, strongly disagree to 5, strongly agree.
I Recruitment and selection practices
1 Presence of written and operational recruitment and selection policy
2 Presence of clear job description and specication
3 Presence of attractive salary scales that can attract qualied applicants
4 High role of merit in recruitment and selection exercise*
5 Presence of a good image that attract qualied applicants
104 The International Journal of Human Resource Management
II Placement practices
1 Assignment to the best position
2 Presence of clear duties and responsibilities*
3 Presence of good supervision
III Training practices
1 Presence of clearly written and operational training policy
2 Presence of continuous training needs assessment*
3 Presence of written & operational trainee-selection procedure
4 Presence of governments commitment to training*
5 Presence of linkages of training to other HR programmes
6 Continuity of monitoring and evaluation of training programmes
IV Compensation management practices
1 Presence of attractive compensation system
2 Presence of equitable internal salary
3 Presence of equitable external salary
4 Presence of salary that reects performance*
5 Presence of salary that encourages better performance
6 Presence of salary that reects the standard of living
V Employee performance evaluation (EPE) practices
1 Presence of written and operational EPE
2 EPE results has a lot to do with salary*
3 EPE results has a lot to do with personnel decisions
4 Provision of feedback of EPE results
5 EPE is considered as important task by superiors
6 Performance evaluators are knowledgeable
VI Promotion practices
1 Presence of written and operational promotion policy
2 Provision of priority to merit in promotion decision
3 Provision of priority to seniority in promotion decision
VII Grievance procedure
1 Presence of written and operational grievance procedure
2 Presence of written and operational disciplinary programme
3 Presence of superiors who are knowledgeable in solving personnel-related problems
VIII Pension programme or social security
1 Presence of attractive pension programme
2 I feel secure nancially in the future*
3 I save money in a bank for the future
IX HRM outcomes
1 I have got training that makes me competent (competence)
2 I am satised with HR practices (satisfaction/motivation)
3 I do not have role ambiguity and confusion (clarity of role)
4 I do have an intention to leave the organization (retention)*
X Performance as perceived by the respondents
1 My performance is better than that of my colleagues with similar qualications
2 My performance is better than that of employees with similar qualications in other ministries
3 The performance of my ministry is better than that of other ministries
*Items that were phrased as negative are reversed in the analysis in order to be in the same direction. Thus, all
items are measured on the same underlying dimension.
Teclemichael Tessema and Soeters: HRM in developing countries 105