Sustainable HRM practices linked to customer satisfaction in Vietnamese firms

A new study of 330 companies in Da Nang, Vietnam, reports that sustainable human resource management practices ripple through the workforce to reach customers: firms whose HR practices enhanced employee opportunity and motivation saw higher employee satisfaction and competence, which in turn were associated with greater customer satisfaction. The research, published as an open-access article in Discover Sustainability, was conducted by Anh Chi Phan, Nhung Thi Tran, Ha Thu Nguyen and Yoshiki Matsui. It set out to examine how Sustainable Human Resource Management, or SHRM, translates into customer outcomes in an emerging economy experiencing rapid economic development and evolving institutional conditions.

The team built its framework on two established models: the AMO framework, which links employee performance to ability, motivation and opportunity, and the Harvard HRM model. Unusually, the study also treated external conditions, such as competition and labor markets, as antecedents that shape which HR practices firms actually adopt, rather than treating HR policy as an internally generated choice alone. Data were collected from 330 companies in Da Nang and analysed using partial least squares structural equation modelling, a statistical technique well suited to testing chains of relationships among multiple constructs simultaneously.

The results showed that opportunity-enhancing SHRM practices positively influenced both employee satisfaction and employee competence. Those two employee-level outcomes, in turn, affected customer satisfaction, tracing a pathway from HR policy through the workforce to the service experience delivered to customers. Among the external factors examined, competitive pressure emerged as the most influential driver of SHRM adoption, followed by labor market conditions.

This suggests that in a fast-growing Vietnamese business environment, firms may adopt sustainability-oriented HR practices primarily in response to the markets in which they compete and the workers they need to attract. The study also compared different types of HR practices and found that practices enhancing opportunity and motivation played a more decisive role than ability-focused practices. In other words, giving employees room to act and reasons to engage appeared to matter more for the measured outcomes than building skills alone.

By modelling external pressures alongside internal organizational outcomes, the authors argue their integrated framework moves SHRM research beyond firm-level analysis and explains how contextual forces shape sustainability-oriented HR practices in an emerging economy. The authors frame the findings as relevant to service quality, employee well-being and sustainable organizational performance at the firm level, and to United Nations Sustainable Development Goals 3 and 8 at the national level.

Subject of Research: Sustainable human resource management and its links to employee and customer outcomes in Vietnamese firms

Article Title: Exploring sustainable HRM and the employee-customer link under external pressures in emerging economies

Article References: Phan, A. C., Tran, N. T., Nguyen, H. T., & Matsui, Y. (2026). Exploring sustainable HRM and the employee-customer link under external pressures in emerging economies. Discover Sustainability. https://doi.org/10.1007/s43621-026-05134-0

Image Credits: AI Generated

DOI: 10.1007/s43621-026-05134-0

Keywords: sustainable HRM, employee satisfaction, customer satisfaction, AMO framework, PLS-SEM, Vietnam, emerging economies, competitive pressure, labor market, Discover Sustainability, SDG 8, HR practices