This study theoretically develops and empirically tests a conceptual model that describes how the system of HRM pratices is likely to have and impact on organisational performance.Drawing on the Resource Besed View, the Behavioural Perspective and the Social Exchange Theory, the study provides a conceptual framework consisting of five constructs though which the underlying mechanisms linking the system of HRM practices and organisational performance are examined. It is proposed that HRM systems improve organisational performance by strengthening human capital and employee attitudes and behaviours (employee commitment). Primary data was collected from public and private universities in the republic of Cyprus.