Human resource practices, organizational climate, and customer satisfaction

The degree to which organizational climate mediates the relationship between human resource practices and customer satisfaction is investigated for 351 small businesses in the same industry. Results indicated support for the hypothesized mediated relationship. The indirect effects of HR practices on customer satisfaction were significant and relatively large while the direct effect was nonsignificant and near zero. The results were supportive of a social context model of the impact of human resource practices on organizational outcomes. Limitations of the study and implications for future research are discussed.