This paper examines the extent to which strategic human resource management influences firm performance from various critical perspectives. Rapid environmental changes, competition to provide innovative products and services, changing customer and investor demands and globalization have become the standard backdrop for firms. Sustained competitive advantage could be generated from a firm’s human capital by designing strategic human resource management to diagnose a firm’s strategic needs which is required to implement a competitive strategy and achieve operational goals. Keywords: Human resource management, Diversity, Change management, Competitive strategy.