| With the development of strategic management, the human resource management (HRM) becomes a strategic element for an enterprise. The extent to which, if any, human resource management impacts on organizational performance has emerged as the central research question in the HRM field. There are three modes of theorizing which attempt to explain this causal relationship: universalistic model, contingency model and configurational model. However, researches haven't yet validated properly the relevance of these strategic models of HRM. For example, these models mostly were tested in the empirical studies based on American or European context. Researchers also preferred to take large enterprises in manufacturing sector as samples. There are few empirical researches conducted in Asian context. Furthermore, though the small and medium sized enterprises occupy a decisive position in economy, they rarely get enough attention in academic domain. This paper attempted to broaden the scope of existing literature by testing the universalistic model in Chinese small and medium sized enterprises in service sector.;This study took a hypothetico-deductive approach which combined the theoretical analysis and empirical analysis. Based on the theories synthesized, an investigation was performed quantitatively by a survey. A structured questionnaire was sent by e-mail with a cover letter enclosed to 210 managers of SMEs in non-public service sector in China in order to collect the necessary data concerning the presence of human resource (HR) practices and firm performance. To ensure the response rate, the snowball technique and follow-up mailings were also used. The current study aims to assess the extent to which, if any, the following HR practices: incentive compensation, training, selective hiring, performance appraisal, work organization, information sharing, employment security and social activities and sports may contribute to firm performance.;Data collected was subjected to correlation and regression analysis as well descriptive statistics in pursuance of the stated objective of finding the positive relationship between organizational performance and strategic human resource management (SHRM). Results show that four HR practices including training, selective hiring, performance appraisal and information sharing were widely used in the Chinese SMEs in service sector. Results also indicate that irrespectively of the firm strategy, all of the practices identified in this study had a strong effect on firm performance. It therefore, implies that these practices are fit for Chinese SMEs in service sector. They should pay more attention to these practices with a view to improving their implementation across the industry. Thus, the results provide overall support for the universalistic perspective.;Different from most of the previous empirical studies, this study was conducted in China context taking small and medium sized enterprises in service sector as samples. This study has extended an academic debate. The findings brought some new elements to the research of SHRM. The resource-based view and universalistic approach were proved to be viable in the Asian society. Another contribution of this study is that contrary to the empirical researches conducted in Chinese service industries, it successfully proved the significant positive relationship between HR practices and firm performance in this sector. Furthermore, our study also provided guidance for Chinese SMEs in service sector to plan their future. |
