Evaluating HRM practices for embracing the digital circular economy in Indian manufacturing firms: an analytical study

Purpose: Human Resources Management (HRM) plays a crucial role in fostering sustainability and operational efficiency in Indian manufacturing firms. This study examines the impact of recruitment, training, and performance appraisal on the adoption of digital circular economy models, identifying gaps in current HRM practices and their impact on firm performance.

Design/methodology/approach: HRM practices significantly impact the adoption of a digital circular economy in Indian manufacturing firms, according to a study involving 256 employees across 17 firms, using structural equation modeling to test hypotheses and provide insights. 

Findings: HRM practices in Indian manufacturing firms significantly contribute to the adoption of the digital circular economy, but the influence of compensation, rewards, and employee engagement on circular economy adoption needs to be better aligned with sustainability goals. 

Research limitations/implications: The research has limitations in terms of limited sample size and focus on specific HRM practices, which may not fully represent the diverse landscape of Indian manufacturing firms and omit factors such as organizational culture and external environment. 

Originality/value: HRM practices are significantly impacting the Indian economy, with a focus on enhancing sustainability and operational efficiency in manufacturing firms.