Impact of HRM Practices on Customer Service Outcome through Mediation of Emotional Performance and Moderation of Organizational Justice

Abstract

The economy worldwide has become increasingly service oriented and organizations are facing the challenge of providing exceptional customer service. Given the strong links established between employee‘s emotional performance and customer service outcome, there remains a need for clear understanding of the processes by which the employees comply with emotional demands at work. Scholars have developed an integrated conceptual framework highlighting how HR practices (related to three broad HR domains i.e. ability-enhancing HR practices, motivation-enhancing HR practices and opportunity-enhancing HR practices) should elevate emotional performance. The AMO framework suggested that ensuring the employee's discretionary effort needed three components: employees had to have the necessary skills, they needed appropriate motivation and employers had to offer them the opportunity to participate. To address this research gap in the literature, this research has examined the impact of those HR practices on customer service outcome in the banking sector of Punjab, Pakistan. This study also proposed and analyzed the mediating effect of emotional performance on the relationship between HR practices and the customer service outcome. Moreover, moderating effect of organizational justice was also examined on the above relationships. Furthermore in the domain of social exchange theory (SET), organizational justice is related with the standard of mutual social interaction between the employees and their organizations. The research used a quantitative method through survey instrument and 467 usable questionnaires were collected from the employees and same numbers of questionnaires were also collected from customers of banks of Punjab, Pakistan. Partial Least Squares (PLS) was employed to analyze the data. The results implied that motivation-enhancing HR practices and opportunity enhancing HR practices are linked with customer service outcome but ability-enhancing HR practices are not linked directly with customer service outcome. The results further suggested that emotional performance mediated the relationship of ability-enhancing HR practices and motivation enhancing HR practices with the customer service outcome. Emotional xi intelligence component of emotional performance mediated the relationship between opportunity-enhancing HR practices and customer service outcome but emotion regulation component of emotional performance did not mediate this relationship. Results also indicated that relationship between ability-enhancing HR practices and customer service outcome was not moderated by the organizational justice, but the relationship between opportunity and motivation-enhancing HR practices and customer service outcome was moderated by the organizational justice. By summarizing the results of this research and building a link to its useful applications, the study is also useful and important for policy makers, academicians and practitioners for further improving and developing the customer service outcome. The implications of this research may benefit all category of stakeholders; the academic community may have deeper insight that how AMO framework of HR practice with the help of emotional performance as mediator and organizational justice as moderator functions to have impacts on organizational performance; and also for HR managers to employ findings of this investigation for practical execution to achieve significant customer service outcome in the organizations especially those facing tough competition in the market. Findings of this research, if applied can manipulate the satisfaction and interest of customers of the banking sector of Pakistan.