The authors, Brian E. Becker and Mark A. Huselid, discuss the future direction of strategic human resources management (SHRM) in both scholarship and practice. They identify key challenges and propose several new directions, emphasizing the need for a clearer understanding of the "black box" between HR and firm performance. The central mediating variable in this relationship is strategy implementation, which they argue should be the focal construct in SHRM. They highlight the importance of differentiated HR architecture both across firms and within firms, and suggest that effective strategy implementation is a function of strategic capabilities and activity systems reflected in strategic business processes. The authors also address empirical challenges, such as the need for new measures of intermediate outcomes and the importance of estimating HR's impact in managerially significant terms. They emphasize the need for a more differentiated HR architecture and a focus on fit and contingencies, while acknowledging the challenges of measurement error and mutual causation. The article concludes by assessing the state of SHRM practice and the progress and hurdles faced by HR managers in implementing these ideas.The authors, Brian E. Becker and Mark A. Huselid, discuss the future direction of strategic human resources management (SHRM) in both scholarship and practice. They identify key challenges and propose several new directions, emphasizing the need for a clearer understanding of the "black box" between HR and firm performance. The central mediating variable in this relationship is strategy implementation, which they argue should be the focal construct in SHRM. They highlight the importance of differentiated HR architecture both across firms and within firms, and suggest that effective strategy implementation is a function of strategic capabilities and activity systems reflected in strategic business processes. The authors also address empirical challenges, such as the need for new measures of intermediate outcomes and the importance of estimating HR's impact in managerially significant terms. They emphasize the need for a more differentiated HR architecture and a focus on fit and contingencies, while acknowledging the challenges of measurement error and mutual causation. The article concludes by assessing the state of SHRM practice and the progress and hurdles faced by HR managers in implementing these ideas.