Human Resource Management (HRM) is critically important in that it ensures that human capital is well managed and that all issues relating to this resource are effectively dealt with. Human Resource Management is a planned approach to managing people effectively for performance. It aims to establish a more open, flexible and caring management style so that staff will be motivated, developed and managed in a way that they can and will give of their best to support departments' missions. Human resource management is a new area for Iranian small enterprises. There are a few of studies on HRM practice and its impact on enterprise performance in Iranian small enterprises. This article attempts to provide a pilot study of examining the status quo of HRM practice in Iranian small enterprises, and searching for possible correlation between HRM and enterprise performance.The result of the study is based on analysis of intensive interviews with 37 small enterprises in various cities in Iran. The paper concludes with 4 hybrids of feasible interrelationships between HRM practice and enterprise performance within Iranian enterprises, as a result of distorted indicators in such a transition economy as the one in Iran.