This article explores reasons why organizations adopt or reject human resource practices. Four theoretical approaches are brought to bear on this issue.
According to the economic approach, organizations adopt HR practices that
are economically beneficial to them. Similarly, the alignment approach views
firms as adopting HR practices if these practices are aligned with strategic objectives. In contrast, the decision-making approach invokes a constrained-rationality model of managerial judgment, and the diffusion approach attributes
the adoption/rejection decision to institutional pressures that encourage imitation. Literature in these areas is reviewed and the implications for HR research and practice are discussed. © 2006 Wiley Periodicals, Inc