Multidimensional Research Insights

Purpose: This review discusses the role of Strategic Human Resource Management (SHRM) in developing a performance-oriented culture in Saudi Arabian Small and Medium-sized Enterprises (SME). It explored the impact of SHRM practices on employee engagement, responsibility, and business performance alongside cultural factors unique to the Saudi context.
Approach: The literature reviewed Saudi Arabian and international SME settings to discuss the major SHRM components, leadership characteristics, and cultural effects. It critically examined Vision 2030 and other government strategies that present a considerable problem and an opportunity to implement SHRM, supported by empirical research and a real-life case. The data was collected between January and May 2025 through 54 studies with Saudi Arabian and international SME literature and critically reviewed using thematic review and case-based evaluation methods.
Findings: The review determined that SHRM, in line with the Saudi Arabian cultural beliefs and under transformational leadership, would play a greater role in improving the performance of SMEs. The most relevant practices involve transparent recruitment, continuous training, and culturally sensitive performance systems. Although challenges as the lack of Human Resource (HR) knowledge, resources, and cultural resistance are present, government support and digital HR solutions provide great room to improve.
Practical Implications: To integrate SHRM practices, Saudi SMEs ought to focus on leadership development, slow formalisation of HR structures, and the implementation of cost-effective digital applications. The only way to ensure a longterm effect is to adapt the best international practices to the Saudi culture.
Originality: This article adds value because it creates a theoretical-to-practice connection in the context of Saudi SMEs and provides a culturally conscious outline of how to develop performance-driven organisations now aligned with the visions of Vision 2030.