Human Resources Premium and Competitive Advantage

The success and survival of a company in the knowledge economy is determined by a company's strategic framework and its implementation in managing the most important resource, the human resource. Any company that designs and implements human resource strategies in a superior manner to that of its competitors creates a niche in the labour market and succeeds in generating high level of human resource performance. This paper attempts to conceptualise this niche or Human Resource Premium and explore its application in strategic human resources management. A higher level of human resources premium delivers a higher level of human resource performance - a level that is higher than that of its competitors. This differential in human resource performance acts as human resource performance advantage for the company and leads to a sustainable competitive advantage.