Strategic Human Resource Management Practices and SME Internationalization Performance: Evidence from Emerging Economies

Small and medium-sized enterprises (SMEs) in emerging economies face unique challenges and opportunities in their internationalization endeavors. This article examines the relationship between Strategic Human Resource Management (SHRM) practices and the internationalization performance of SMEs operating in emerging market contexts. Drawing upon the resource-based view (RBV), dynamic capabilities theory, and the ability-motivation-opportunity (AMO) framework, we develop a comprehensive theoretical model that elucidates how SHRM practices encompassing recruitment and selection, training and development, performance appraisal, and compensation systems influence SME internationalization outcomes. Through a systematic review of extant literature and synthesis of empirical evidence from emerging economies including India, China, Indonesia, Turkey, and Costa Rica, we demonstrate that SHRM practices serve as critical enablers of internationalization performance by building human capital, fostering innovation capabilities, developing relational capital, and enhancing organizational adaptability. The findings reveal that training and development practices particularly favor both innovation performance and export performance, while human capital and relational capital directly influence international performance, with entrepreneurial orientation mediating these relationships. Furthermore, we identify that emerging economy SMEs predominantly adopt informal, relational, and strategically adaptive HRM practices shaped by local economic constraints and cultural norms, contrasting with the formalized approaches observed in larger organizations. This article contributes to the SHRM and international business literature by providing a contextualized understanding of how SMEs in emerging economies can leverage human resource practices to achieve superior internationalization outcomes. We conclude with theoretical implications, practical recommendations for SME managers and policymakers, and directions for future research.