Firms should develop innovation capability to manage innovation process from generating ideas to commercialization. Strategic human resource management (SHRM) is considered as a key element to innovation capability since the human element is involved in the innovation process. This study investigates the relationship among SHRM practices, innovation capability and innovation performance. For this purpose an empirical research is conducted to analyze data from Indonesian software firms. The result indicates that SHRM practices are positively related to innovation capability, which in turn has a positive effect on innovation
performance.