Beyond Human Resource Practices: A Resource-Based View of Strategic Human Resource Management and Organizational Performance in Islamic Banking

Abstract

This study aims to explore the role of Strategic Human Resource Management (SHRM) in enhancing organizational performance from the Resource-Based View (RBV) perspective within the Islamic banking industry. Amid increasing competition, digital transformation, and regulatory changes, Islamic banks are required to develop sustainable competitive advantages by effectively managing their strategic resources. RBV argues that organizational performance is influenced by valuable, rare, inimitable, and non-substitutable resources, among which human resources are considered one of the most critical assets. Therefore, understanding how SHRM contributes to organizational performance through the development of strategic human capital becomes increasingly important in the context of Islamic banking.This research employs a qualitative approach using a case study design. Data were collected through semi-structured interviews with managers, human resource practitioners, and employees from Islamic banking institutions, complemented by document analysis and organizational reports. The data were analyzed using thematic analysis to identify patterns, themes, and relationships between SHRM practices and organizational performance outcomes. The findings indicate that SHRM practices, including strategic recruitment and selection, competency-based training and development, performance management, talent management, and employee engagement initiatives, play a significant role in strengthening organizational capabilities. These practices contribute to the development of human capital, organizational knowledge, and adaptive capabilities that align with RBV principles. Furthermore, the study reveals that the integration of Islamic values into HR strategies fosters employee commitment, ethical behavior, and organizational cohesion, which further support organizational effectiveness and long-term performance.The study concludes that SHRM serves as a strategic mechanism for transforming human resources into unique organizational assets that generate sustainable competitive advantages. From an RBV perspective, human capital and organizational capabilities emerge as key drivers of organizational performance in Islamic banking. The findings provide practical implications for managers seeking to enhance organizational performance through strategic human resource initiatives while maintaining alignment with Islamic principles. This study also enriches the literature on SHRM and RBV by offering contextual insights from the Islamic banking sector in an emerging economy.