The Evaluation of the Function of Human Resource Management in the 21th Century: A Case of Social and Personal Service Industry

The managerial practices in the Service Industry are not well developed yet, it is especially true in the HRM function. Improving HRM practices, thus, is the key to enhance competition of the service department. This study is to evaluate the functions of human resource management and investigate their competitive HRM indexes.

There are five major purposes in this study as following: (1) the existing HRM functions and systems in the Social and Personal Service Industry; (2) the impact of organizational characteristics on HRM practices; (3) the impact of external environment on HRM practices; (4) the influence of HRM core competencies on organizational effectiveness; and (5) the effect of management systems as well as organizational culture on organizational effectiveness.

The results indicate that in most cases of the study underutilize HRM functions by using traditional personnel administration. The functions of human resource management in the Social Service Industry are underprized and its functions are viewed as administrative rather than strategic. As for the relationships between of HRM and organizationalcharacteristics and external environment, the transformation of the Service Industry as well as circulation of information have strong relationship with the functions of HRM.

Generally speaking, organizations can overcome external environmental turbulence by maximizing HRM core competencies. Finally, implementation of HRM core competencies such as performance appraisal, dispute resolution and compensation has positive relationship with organizational effectiveness. In other words, the higher degree of HRM functions organizations implement, the higher effectiveness organizations have.

However, the implementation of HRM core competencies has no impact on employees\' tturnover rate. Overall, the better HRM functions organizations implement, the better effectiveness organizations have. As for HRM policies (management system and organizational culture), the results show that the centralization of the organizations has negative relationship with organizational effectiveness.

Thus, service organizations should adopt more decentralized decision making and organizational structure to overcome environmental turbulence.