Gaining Competitive Advantage through Human Resource Management Practices

Competitive advantage is the leverage that a business has over its competitors. This can be gained by offering clients better and greater value, advertising products or services with lower prices or higher quality interests’ consumers and target markets recognize these unique products or services. Human resources are defined as firm's knowledge, experience, skill and commitment of the employees to the firm; their relations with each other and with others outside the firm. They are the most important firm asset, the ones that research, design, project and differentiate the firm from other firms.

HR researchers and managers for a long time have emphasized that the HR function plays an important role in the performance of the firm. From a historical perspective, the human resource department is not considered one of the main departments in the organization. Even nowadays, due to many reasons, most HR functions are seen as less important than the departments of finance, information technology, marketing etc.