Examining the Relationship between Aspects of Human Capital Management and Employee Job Performance: Mediating Role of Employee Engagement and Moderating Role of Perceived Organizational Support

Abstract

This paper examined the effect of the selected aspects of human capital management on employee job performance and the mediating role of employee engagement. Likewise, this study tested the moderation role of perceived organizational support on the HCM-employee performance link. The research sample is the responses of 426 participants from twelve banking organizations operating in Addis Ababa, Ethiopia, utilizing the social exchange theory and the theory of the resource-based view. This paper is structured quantitatively, with stratified and simple random sampling techniques. The research model analysis method applies structural equation modeling with AMOS to test the hypothesized relationships. The results showed that the Human Capital Management (HCM) practices, namely knowledge accessibility, learning capacity, workforce optimization, leadership practice, and career advancement, positively related to employee job performance. Moreover, the bias-corrected bootstrapping iteration revealed that employee engagement partially mediates this relationship between aspects of human capital management and employee job performance. The findings also show that perceived organizational support positively moderates the association between knowledge accessibility, learning capacity, leadership practice, career advancement, and employee job performance. Conversely, it has an insignificant moderation effect on the association between workforce optimization and employee job performance. Finally, the limitations and future research implications are discussed.