Prior research suggests that HRM systems as a resource can lead to competitive advantage [1]. A number of studies have demonstrated relationships between different bundles of HR practices or philosophies and firm performance in large firms [2]. In spite of the significant research in the area of Strategic Human Resource Management (SHRM) in large firms, little has been done to test similar relationships in small businesses [3]. Because of the demand placed on small business owners and managers to create and exploit growth opportunities, there is a potential for them of benefit from understanding and implementing HRM systems in a strategic way. Indeed, there is evidence to suggest that human resource management matters to small business managers and plays a key role in the performance of small businesses. For example, small business owners have cited human resource issues including recruitment, motivation and retention as major issues that they deal with in managing their firms [4] and [5].