Introduction
It is well known that the fit between human resource (HR) practices and organization’s
strategic objectives is one of the core elements in strategic human resource management
(SHRM). Empirical research has shown that this vertical fit positively affects
organizational performance (e.g. Wall and Wood, 2005). The linkage between HR
practices and corporate performance can be attained by two vertical alignment
mechanisms. The top-down approach suggests that suitable HR practices should be
adopted, such that the necessary human capital is available, allowing the organization to
execute its business plan and to fully exploit market opportunities. On the other hand,
inspired by the resource-based view on a firm (Barney, 2000), recent theoretical work in