Human resource management: the forgotten dimension of decentralisation in Indonesia

Indonesia has introduced radical decentralisation measures, transferring many functions and much finance to democratically elected sub-national governments. However, human resource management (HRM) has largely been overlooked. Using data obtained from central personnel agencies and nine sub-national governments, this article examines the major elements of HRM at sub-national level: recruitment and selection; promotion and advancement; training and development; remuneration; and performance management. The structure and operation of these elements are compared with those advocated in Strategic HRM, the dominant paradigm of contemporary HRM. The findings are that a centralised, bureaucratised system of HRM remains in place in Indonesia, with many practices retained from the pre-decentralisation period. The HRM system is only minimally linked to strategic concerns and organisational goal achievement. Reforms are essential, but an incremental approach is recommended, keeping the basic framework centralised but creating incentives for reform by making local governments more accountable for personnel costs and performance.