Abstract
Purpose. The purpose of this study was to describe the perspective of field and management employees on positive and negative aspects of a centralized HR model. It also addressed the insights gained on control of rules and decision making, cost savings, improved customer service, the effect of centralized or decentralized HR models on management. Methodology. A qualitative descriptive case study was designed to survey participants using face-to-face and telephone interviews. Subjects responded to an open-ended questionnaire to assess: (1) the positive and negative aspects of changing from a decentralized to a centralized HR model, and (2) the insights gained regarding standardization of rules and decision making, cost savings, improved customer service, and the effect of centralized or decentralized HR models on employees. Findings. The examination of qualitative data from employees identified positive aspects of centralization of HR as consistent rules, governance, procedures, processes, and decision making; cost savings and efficiency. Some positive aspects of a decentralized HR function revealed are face-to-face-interaction and accessibility, understanding and awareness of local issues and laws, rapport and relationships and higher level of customer service. Inconsistent application of policies and procedures is the number one negative aspect of a decentralized HR function. Conclusions. The study supports the conclusion that companies can benefit from centralization and decentralization and will sometimes require combinations of both models to accomplish mission objectives and to meet business goals. Recommendations. The research revealed some issues that may require further study. They are (1) a cost analysis on the savings of a centralized HR model, (2) benefits of improved online technology, (3) comparative analysis within other oil industry companies on the impacts of a centralized HR model and the insights gained on standardization of rules and decision making, cost savings, customer service, and the effect on field and management employees. More research is needed in addressing the down side of centralized HR functions and collecting the insight of field and management employees on how to compensate for these deficits. Building on the research in this area could provide the depth of insight necessary to address the negative impact of centralized HR functions.