79237940 Service Sector

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Human Resource

ManagementHuman Resource Management in Service SectorBy D1


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Service Sector

The service sector is defined as theportion of the economy thatproduces intangible goods.

It consists of the activities wherepeople offer their knowledge andtime to improve productivity,

performance, potential, andsustainability.

The basic characteristic of this sector

is the production of services.


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The service sector of industryinvolves the provision of services toother businesses as well as finalconsumers.

Examples of service sector areEducation, Banking, Insurance,Financial services, Legal services etc.


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Objective of HRM in Service Sector

The objectives focus on:

The importance of retention in the

service industries. Most effective methods to find the

cause of turnover.

Factors favoring retention. Innovative methods adopted by

companies to retain people.

Constraints faced by the organization


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Need for HRM in Service Sector

The success of an organizationdepends heavily on the quality andcompetency of its human resources.

Excellent companies recognize thathuman resources are their numberone asset. This is all the more true in

the service industry.

Therefore, employees must beade uatel trained and retrained to


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Innovative and creative circles: HRM isrequired due to continuous innovation inthe service sector.

Customer focus and understandingcustomer requirements: Employees are

the face of the organization and havedirect contact.

Performance appraisal: Difficulty inmeasurin erformance as there are no


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Measuring HR effectiveness

Quantitative measures of hardmeasures i.e. numerical measures ofinputs, outputs and outcomes.

Qualitative or soft measures whichprovide information on staff attitudesand managers view of HR via

surveys and interviews. Process analysis which can trace a

process through its various stages to

gauge its effectiveness.


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Difference in the process of HRM inservice and production sector

Job analysis: Because much of servicework is knowledge work, in which job

activities are less observable, this maymean differences in the way a job analysisis conducted, which is not the case inproducing sector as there are standards.

Recruitment and selection: Producingsector selection process is traditional,

where as innovative techniques may be


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Training: Training in the servicessector may require increasedattention to technology skills, as

many service sector jobs now requirethe use of computers than inmanufacturing sector.

Performance appraisal: Noobservable outcomes in some cases.

It likely to be different than in the

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79237940 Service Sector