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Impact of Information Technology on Human Resources

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CHAPTER 1

INTRODUCTION

BACKGROUND OF THE TOPIC

Technology has affected every aspect of human life. Every field of business has been affected by it. It has changed the ways of living of human ,the way we communicate, the way we learn, the way think. It has a great impact on private and business sector as well. It provides huge opportunities to help the development of business. Due to technology many impossible things have been become very easier for businessmen. It has reduced the large need of employees, but increased the efficiency of work. In past times which work required a lot of people and a lot of time to be completed, nowadays only single person finish that work in just few minutes.

For example, in past time the work of typing required many people to do that work, but now only a man can do that work in just few seconds.

So we see how technology is affecting our business. Human resource management also has its great influence. Technology has affected directly organizations and HR functions. It has some positive and negative influences on HRM organizations and its functions.

In this dissertation researcher have going to discuss the influence of information technology and telecommunications on human resource management. What are its good and bad effects on HRM, researcher will discuss in this dissertation.

A) POSITIVE IMPACTS OF INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS ON HRM

In past few years it was a belief that human resource managers use technology only to fulfill few needs such as administrative tasks. But nowadays it is no longer like this, these days the whole structure of business depends upon technology. A single step cannot be taken further without the think of information technology.

‘The future growth and development of business will depend on the use knowledge of technology, information technology and services provided by them' (Barley 1996).

So these days information technology is helping businesses to grow and to develop on a large scale. It helps managers to recruit efficient employees, to save their personal information, for the motivation and good leadership if the employees, to finding new techniques of work, to increase profit and for future planning for business.

So let's discuss the positive impacts of technology on human resource management:

Recruitment of new employees:

As we see these days maximum people rely on the internet, and according to the predictions of researchers number of people who use internet is growing in millions every year.

‘Well educated people, who have skills and full of ambitions, regular working with information technology and communication, have more influence of information technology' (Bola and Truman, 2003).

So many companies are taking advantage of this thing; they are recruiting efficient, skilled and passionate people online according to their needs. This procedure of recruitment is very much beneficial for the employers, one side it provides those efficient employees and on the other hand it is very cheaper and the third thing is it is a very quicker way of recruitment.

By postal or any other way only limited people can be informed for the company's requirement, but via internet hundreds of people can be attracted by your job and company. So we see information technology has made recruitments very easier.

To save employees full data:

Because of information technology the whole data of each employee can be saved for years. Means even after 50 year it can be confirmed that who worked on which post that time. An employee's personal details, job title, post, pay, duty hours etc can be saved for future use. Even his or her performance at work also can be measured, an organization can come to know that who is performing in the favor of the company and when time comes he or she can get promotion or can be fired from the job due to bad performance.

On the other hand organizations required to save employees skills, work experience, his efficiency on work and his performance in previous job and his salary for that job. These all things organization can get through internet can save on their system.

This information that firm can use in future, and if any employee needs any additional training then that firm can arrange it for him.

Organizations are finding new ways of work:

Because of developments of technology and communications now organizations are finding new advanced ways of work.

‘Communications and information technology is providing a wide range of opportunities to organizations to perform well' (Lindstrome, mob erg and Rapp, 1997).

These days' organizations are adopting new ways of ways of work which are more efficient, advanced, and profitable for them. By using these ways they are getting more productivity and more presence of employees at work.

Example:

The most relative of changing ways of work due to technology is teleporting, in which method an employee of an organization can do his or her job sitting at home even in his bed.

‘In this term of work, work comes to the worker not worker goes to the work' (Niles, 1998).

Because of this term of work an organization can save a lot of money. If they will do work at offices then organization would have to provide a lot of facilities to the employees, like a table, chair, computer, and a lot of other things but in teleconferencing an organization can save the cost of all these things.

There is another term of work which is being used in project oriented work with subcontracting. Today most skilled and ambitious people do not want to be bound with a company and organizations also hire those people who are necessary for their projects they need their assistance for work just for a limited time of period. So those people are not formal members of the company. It is very beneficial for the firms because they can get 100% benefits of the skills of that man, and they need not to employee him for a long time and if firm starts a new project then they can hire another man required to that project.

‘A huge number of people who work for an particular organization may be still work for the same job in future, but a slowly growing small number of people will not work like this. Part timer workers are the contractors for a limited period of time for an organization,' (Ducker, 2001).

Better information management

Because of information technology and communications storage of data and information has become so easier. IT is providing a lot of possibilities for the betterment of information management in organizations.

‘By using IT an organization can protect its information from outside world and IT also provides simple storage, maintenance, and sharing of information among organization's members. These all are the essential tasks for a better information management' (Marched et al. 2001).

Information technology helps to improve the performance of a business so to improve the performances.

For the motivation of employees:

Information technology helps organizations to motivate its employees for better performance. They can offer their employees much psychological, financial reward. An organization can offer many beneficial policies to its employees, by these rewards an employee tends to be honest with his work the organization can achieve its goals because without the co-operation of employees organization cannot be successful.

‘Because of information technology we can think of many changes about the motivation of an organization employees' (Bola and Truman, 2003).

So we can say that information technology helps a lot for the motivation of the employees, an organization can allow them to know how it is going to satisfy its employees. Like this it can attract other firms' skilled employees who are unsatisfied with their firm or organization.

Technology used in training of employees:

Nowadays many companies required employees trained with modern techniques of information technology because technology is developing with a fast pace and to compete in the industry organizations need employees with the knowledge of modern technology. Organization using technology for the training of employees, they can train them according to their requirements in a particular skill and they can be used for organization's favor and these trained workers can proved to be a profitable asset for the organization. Organizations need not to recruit a large number of employees, who are not perfect for that job, organization can spent money in a positive manner instead of giving wages to those employees who are not useful for them.

Another term is related to that is a company can give training of more than one to a single person, it is beneficial for them in case of one of the employees left the job who was working on a particular project then organization can recruit another employee from their own organization on the same post rather than finding another employee with the same skills, wasting time. Like this an organization can save a lot of time and money.

More profit for the organizations:

Today we can reduce the cost of organization with the effective use of information technology and the profitability of the organizations is increasing day by day with more improved technologies. There are a lot of things to get more profit for instance, these days due to technology; recruitment of people has been decreased. In past organizations had to recruit employees in a large number, their speed of working was less, but organization had to pay them a lot of money without getting much profit. But these days because technology has developed on a large scale so a large part of work which was done by people in past, now days by developments in technology has been done by fewer employees in a very short time period. Due to advancement in technology many HR functions such as recruitment of employees can be performed with less usage of time and resources and organizations can find easily the right persons for their jobs.

Another thing is organizations can always keep an eye on the performance of employees, due to this employee cannot shirk work. He gives his 100%. So like this an organization can get more profit, and more productivity.

So all these are the positive impacts of Information technology and communication but there are some negative impacts also. So let's discuss those too.

B) NEGATIVE EFFECTS OF DEVELOPMENTS IN THE FIELD OF INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS

There are many positive influences of speedily improving information technology but there also some negative effects of it. Due to the developments in this field of business every aspect has been changed, strategy of work, planning of work etc. and it is continuously changing even in present too. So for employees who are working with the old techniques, it is hard to understand new techniques of working. Those organizations which do not adopt new method cannot meet the ever changing requirements of the industry and it is also very hard for an organization to find out right skilled person for them, because persons with the knowledge of latest technology are rare.

Technology is directly affecting the functions of human resource management. So these all things are discussed here:

Cutting jobs:

As we have discussed above that technology is very cheaper and very fast, by technology any type of work can be done quickly as compare to men. So in past a huge number of employees had been recruiting. But nowadays organizations need a few employees with proper skill. As manpower planning a human being is referred as a machine in this technological era means if he is working or giving profit then it's ok otherwise through him out. It is not fault of organizations or human beings rather it is the requirement of today's world. Because of technological developments organizations require less but skilled person for employment to compete the world. An organization cannot tolerate the burden of overstaffing, because it is wastage of money, so organizations are cutting jobs. This action gives harassment to many people, especially to them who were old employees of the firm, having comparatively less knowledge of information technology, but now companies have to kick them out, so they do not have any other way of survival. People are compelled to study technology. The competition among today's generation has been increased. They have to do hard work to have a good job, but cutting in jobs harass them.

Unsatisfied employees of the company:

Organizations are using advanced technology in their work to get more profit and to be more efficient but this makes many employees unsatisfied and angry with the organization because they do not know about that technology and how to deal with that, and they also afraid of to lose their job. So it results in strike or other activities like this which affect the whole structure of the organization.

The latest example is ‘royal mail's strike and strikes in bus and train departments because all these companies want to adopt new and advanced techniques but their employees are unsatisfied with them. The reason is same because they do not know how to deal with rapid changes in firms technology, they are also afraid of losing their jobs.

Skill shortage for organizations:

As we know that using new technology in today's era is necessary for organizations, but to use that technology properly organizations need proper skilled persons for each project but there is a shortage of skilled persons for the organizations, because people are known to last techniques of work, and if an organization immediately decides to adopt new technology then it results in shortage of skilled workers.

For example, in last time period, Australian organization experienced growth in economic era, but suddenly they also faced crises due to the same problem of skill shortage as they want to adopt new technologies.

So this thing is more challenging for the organizations, because on one time they have to consider about so many things, like they have to manage their staff properly, have to satisfy the needs of their staff, and have to maintain themselves in this competitive industry.

Expenditure on employees for further training:

To get employees with proper skills organizations have to train people themselves with new technology, it costs a lot. Organization spend a lot of money on the training of people, but it is not guaranteed that all of them who are taking training will be able to perform a good job, will stay in your company and work with you for long time. All these things are not guaranteed. Moreover, other thing is technology is changing day by day, so in future a new technology can be introduced so it will cost again for the organization to retrain their employees with these changes, so all these factors are affecting organizations.

Hard to do for old people:

If a company is adopting new technology, but its old employees who are working with them for a long time cannot tolerate this change because they are working with old techniques and new ones are difficult to understand for them. On the other hand, organizations also not want to train those people because they want to use new ideas from new generation and if organization will train those old people then it will cost them a lot because those people are near to retirement and spending money on them will be wastage.

Next thing is due to changes in technology organizations are transforming people to one side to another side. So it irritates them a lot and results in strike etc.

PERFORMANCE MANAGEMENT

Performance management is the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities. Performance management is a whole work system that begins when a job is defined as needed. It ends when an employee leaves your organization.

Many writers and consultants are using the term “performance management” as a substitution for the traditional appraisal system. I encourage you to think of the term in this broader work system context.

A performance management system includes the following actions.

  • Develop clear job descriptions.
  • Select appropriate people with an appropriate selection process.
  • Negotiate requirements and accomplishment-based performance standards, outcomes, and measures.
  • vProvide effective orientation, education, and training.
  • Provide on-going coaching and feedback.

As companies reorganize to gain competitive edge, human resources plays a key role in helping companies deal with a fast-changing competitive environment and the greater demand for quality employees.

  • Effectively managing and utilizing people.
  • Increasing the innovation, creativity and flexibility necessary to enhance competitiveness.
  • Applying new approaches to work process design, succession planning, career development and inter-organizational mobility.
  • Managing the implementation and integration of technology through improved staffing, training and communication with employees.

PROBLEM STATEMENT

To explore how much information technology is deeply rooted in the organization and effect the efficiency of employees in ICI Paints.

OBJECTIVES OF THE STUDY

  1. To find out the impacts of information technology on the ICI paints.
  2. To see the impact of independent variables i.e., data processing, work burden, record keeping, on the dependent variable efficiency of employees in ICI Paints.
  3. In this study researcher try to find out to what extent the work has become easy because of the use of computer based information technology in ICI Paints.

HYPOTHESIS

H1Information Technology is designed to make people more effective and efficient when performing daily activities.

HoInformation Technology is not designed to make people more effective and efficient when performing daily activities.

SIGNIFICANCE OF THE STUDY

It has great advantage for H.R. It is useful for human resource department as well as executive level management. It has benefit of future and future decisions. It is useful for common people who are working in Human Resource Department and Accounts Department. It is helpful for maintaining records and retrieving records. It gives analysis reports of the employees. It helps for H.R managers for hiring the new employees in particular job.

PURPOSE OF THE STUDY

Purpose of this research is to understand and to analyze the process of development of I.T to enhance the efficiency of H.R, so as to have better understanding of the MIS and to make an informed judgment about the future decisions. The purpose of this evaluation is to identify strengths and weaknesses of the process of development of I.T in HRM. Main purpose is to achieve future objectives of the organization.

CHAPTER2

LITERATURE REVIEW

To understand the nature of the IT impact on human resource and firm performance, we must consider the fit between the characteristics of the IT and the users' tasks (Goodhue and Thompson 1995). Since the primary responsibility of professionals in public accounting firms involves information-intensive activities (Auditing Concepts Committee [ACC] 1972) such as gathering, organizing, processing, evaluating, and presenting data, the use of IT is likely to improve the productivity of accounting professionals (Pinsonneault and Rivard 1998). Teamwork is critical in a public accounting firm as audit engagements are performed by teams composed of professionals at different ranks. Therefore, the use of groupware technology is also expected to improve work collaboration and communication within teams, and thus enhance their productivity (Ellis et al. 1991).

Although previous IT research has examined the impact of IT investments on firm performance in different industries such as manufacturing (Barua et al. 1995), banking (Parsons et al. 1993), insurance (Francalanci and Galal 1998), healthcare (Menon et al. 2000), and retailing (Reardon et al. 1996), empirical research has not examined the professional services industry, such as public accounting firms, in which information and knowledge work play a prominent role. Hence, examining the impact of IT implementation on public accounting firm productivity is of considerable interest to both academic inquiry and practice.

Exploration of the productivity impact of IT implementation requires the recognition that the conversion from IT expenditure to business performance enhancement is a longitudinal process (Soh and Markus 1995). Proper IT management is essential to convert IT expenditure to IT assets. Appropriate use of IT assets generates organizational innovations and redesigned business processes, and favorable competitive dynamics enable improved organizational performance due to these organizational innovations.

Davern and Kauffman (2000) extended this IT conversion process sequence to emphasize the importance of considering the impact of IT planning and selection activities on realized IT value. A few field studies have explored the longitudinal IT conversion process to identify the factors at different points of the process that determine the success of IT adoption.

Venkatesh and Davis (2000) found that at different time points before and after IT implementation, factors such as subjective norm, voluntariness, job relevance, and output quality consistently influence users' perceptions about the usefulness of the systems. Bergeron and Raymond (1997) reported that organizational support, implementation process, and control procedures impacted the initial realization of benefits from Electronic Data Inter exchange (EDI) adoption, but three years later, only organizational support and control procedures remained significant. While these studies have examined factors that may impact the IT value creation process, they did not estimate the improvement in firm performance, if any, due to IT implementation.

Lucas et al. (1996) conducted a case study of the introduction of a financial imaging system at Merrill Lynch. Comparing the data flow diagrams of the old and the new business processes, they identified changes in organization structure, workflows, and operations. They reported improvement in customer service and reduction in costs. However, they did not conduct any statistical evaluation of improvement in firm performance after IT implementation.

Some cross-sectional studies of IT impact have compared the business performance of firms with IT to those without IT, and statistically estimated the impact. Using data from Hardee's fast food chain, Banker et al. (1990) compared the performance of the restaurants deploying the Positran technology (a computerized cash register point-of-sale and order-coordination technology) to those without Positran. They found that the use of the Positran technology is associated with a significantly greater productivity for stores with high diversity of sales. Analyzing data for 107 banks, Pennings (1995) found that the banks with ATM adoptions incurred significantly less non personnel operating expenses than those without.

There are several IT productivity studies that evaluate the contribution of IT as an input factor in the production function, for example, Brynjolfsson and Hitt (1995) and Barua and Lee (1997) estimated the economic production function using cross-sectional data to evaluate the marginal contribution of IT on output. Wang et al. (1997) and Shafer and Byrd (2000) employed DEA to evaluate the role of IT investments in firm production. Our research differs from this stream of research in two important ways. We consider EU adoption as an event and evaluate the extent to which it shifts the production function for a firm, instead of the marginal contribution of the IT input that differs cross-sectional. Thus, we make a longitudinal instead of cross-sectional comparison of the impact of IT implementation.

For IT to positively impact a user's performance there should be a good fit between the IT and the user's tasks (Goodhue 1995). In addition, training is a significant determinant of the IT user's effectiveness (Igbaria 1990). The FIRM has designed the new IT program to fit the requirements of its professionals, and enforced the training in the use of the software. Our field interviews suggest that the IT changes had a positive impact on the auditors' performance. Since an audit team is composed of professionals at different ranks (such as managers, seniors, and juniors) with different job responsibilities (Carmichael and Willingham 1989), IT adoption may benefit audit professionals at different ranks in different ways.

IT Impact on Auditors

The primary tasks that junior auditors perform are assigned audit procedures and preparation of working papers. Most of these tasks are relatively repetitive and involve substantial calculations and referencing across different accounts. Computer applications can automate such structured tasks and substantially reduce the processing time (Abbe and King 1988). In addition, the reduction in monotone work allows individuals to concentrate on more complex tasks and enhance their individual performance (Giuliano 1982). Our field interviews indicate that the principal benefits to a junior auditor from the IT changes are the savings in effort and the reduction in errors afforded by the electronic preparation of working papers. Incorrect computation is one of the major causes for misstatement (Bell et al. 1998), and by reducing such errors; IT use also benefits other audit team members. A junior auditor describes his experience using the new computerized systems as follows:

The most important benefit to me is that I can develop the working papers electronically. Without the computer, I have to write down all the numbers by hand and make difficult calculations using a calculator. Sometimes I need to repeat the same entry several times on different sheets. For example, the amount of cash may appear on the balance sheet, the working trial balance, the cash flow schedule, the bank reconciliation and so on, and all the numbers are the same or related. I have to be very careful when I write those numbers down. It is very tedious! However, using the audit software, I only need to key in the entry once and make the appropriate choice. Then, all the related numbers are generated automatically and cross-referenced, and there is no need to punch any keys on a calculator. With a computer, my working hours on an engagement can be reduced by more than half of that without the computer.

As the middle-level member of an audit team, a senior auditor assists in audit plan development, organization of audit activities, and supervision and review of the work of junior auditors. The firm's audit software organized all required audit procedures in a common list and cross-referenced them to items in the working papers. Since electronic presentation of information facilitates user's information acquisition (Jones et al. 1993), a senior auditor is likely to benefit from the convenient information gathering and organization enabled by the new software. A senior in the FIRM describes her favorite IT helper as follows:

I like to use the audit software to edit my audit plan and programs. It helps me get organized. The software lists all the necessary planning items for me, so I don't need to worry about missing an important element. All related forms are available by clicking a button, which is really convenient. In addition, we also have a database of document templates that I can use for almost all occasions.

IT Impact on Managers

As supervisors and reviewers, audit managers do not benefit directly from the audit automation process, except for the convenience of computer-based presentation of information. Analyzing survey data from 260 public managers, Kraemer et al. (1993) found that managers perceived computer-based information to be more useful. Since the firm's audit software organizes all audit evidence collected by juniors and seniors in an electronic format, audit managers are likely to be more effective when reviewing such data. Since the order of audit working paper documentation can impact the decision of the reviewers (Ricchiute 1992), electronic working papers that comply with a regular organization should provide more consistent audit decision quality. An audit manager expresses his support for electronic working papers as follows:

I don't use many functions of electronic working paper software. I just review its output. However, I do enjoy the neat screen output because everything is clear. Also, every item is cross-referenced which makes it easy for me to trace them. I can easily switch around and search for the items I want to see.

In the Notes, the FIRM includes various local and international databases regarding companies, industries, and regulations. Managers can easily search for information relevant to a certain client to help them perform analytical review (Cohen et al. 2000). In addition, the information in the databases is more reliable and objective (Reimers and Fennema 1999). The FIRM has also created some exclusive case databases that can be shared by its professionals. Such knowledge-sharing applications have been found to improve the quality of decision making (Orlikowski 1997). A manager describes his experience as follows:

Our Notes database has helped me increase my professional knowledge. We share our case experience, and business regulations using the database. It helps a lot in problem solving and keeps me updated on the current trend.

IT Impact at the Business Process Level

A current trend is to create a paperless office environment that replaces paper documents with electronic documents so that information can be accessed easily and with much less effort. In the practitioner-oriented literature, advantages of a paperless office in improving work efficiency and reducing operating costs have been reported (Hunton 1994). Together with the audit software, the FIRM created a client database to store all related audit files for each client. The documents in the database can be easily retrieved by a search function or with associated links. Consequently, auditors in the same team can share audit files and significantly reduce the coordination effort of the senior auditors (Salamasick et al. 1995). An audit senior at the FIRM also observed that database storage allows quick reference and modification from previous audit plans and reports for the client and, consequently, work hours for a client can be reduced significantly. In addition, the FIRM uses Notes as a tool to manage internal resources and documents to save time and increase effectiveness.

IT Impact at the Work Group Level

A professional service firm stands to benefit substantially from the knowledge-sharing applications (Vandenbosch and Ginzberg 1996). The Professional Development Department in the FIRM updates the Notes database everyday and communicates the update to everyone by email. To encourage audit professionals to collaborate, a Question and Answer electronic bulletin board in the Notes was set up for the discussion of all types of work-related questions. The Professional Development Department checks the board periodically and ensures responses to all the questions. Network applications that enable real-time information circulation can also facilitate communications efficiency in a public accounting firm (Zarowin 1994). Email is the most important network application for the professionals in the FIRM to communicate with each other, clients, and overseas colleagues. Some groups in the FIRM described to us their positive experience in utilizing the "net meeting" function in Notes to conduct group discussion. This is consistent with the experiments by Bamber et al. (1996) that found the use of group support system technology resulted in higher quality audit decision making. Also, a manager observed that the use of telecommunications applications had led to a decrease in operating costs such as postage and travel expenses.

Task-Technology Fit

Our qualitative analysis suggests that the FIRM's new IT program matches its audit professionals' tasks in three aspects (Goodhue and Thompson 1995). First, the new IT provides data to support audit decision making. The audit software organizes the audit evidence for audit judgments and the Notes databases provide relevant supplemental information. Second, the new IT fulfills the requirements of the FIRM's routine operations in its audit engagements. The audit software automates the preparation of working papers and the Notes applications facilitate communication between the professionals and the clients. Third, the new IT program fits the business needs. The Notes applications facilitate knowledge sharing and supply up-to-date information that supports the professional requirements of the information-intensive public accounting industry.

In the firm, the use of the audit software is mandatory. Our field interviews also indicated that audit professionals perceived the Lotus Notes applications to be highly useful. Davis (1989) indicates that satisfaction with IT is associated with high utilization of the technology. Goodhue and Thompson (1995) suggest that a good fit between the IT and the user's tasks is the key determinant of IT success when IT utilization is high. Therefore, we expect that the IT changes have enhanced the productivity of the FIRM.

Use of Internet for Staffing

American research (Global 500 Web Site Recruiting, 2000) shows, that 79% of companies from the Global 500 group (500 largest world companies by revenue) at least to a certain extent use the Internet for seeking new personnel. Also, comparison of data for years 2000 and 1998 shows that percentage of companies that use the Internet for mentioned purpose has grown considerably from 29% in 1998. According to 1999 RIS-research (RIS - "Raba Interneta v Sloveniji" - Usage of Internet in Slovenia.), only 4% of companies have used Internet for recruiting in same fashion. The main advantages for Internet supported recruiting are (Achieving Results with Internet Recruiting, 1998):

  • Lower costs of recruiting (savings in invitations for application, postal-costs, data-processing costs).
  • Quicker process of recruitment: period from the point when the need for a new employee is sensed until the point when he starts doing his job is, according to the research, cut for twelve days.
  • Possibility to attract better and more candidates - invitation for application published on a website can also be spotted by those, who are currently not seeking new employment actively.

Besides the corporate websites, third-party websites are gaining importance. Not only that they act as "work- force exchange" where supply meets demand and vice versa, many of them also publish relevant business news, articles on job-hunting, CV writing etc., which acts as additional pull mechanism for web users, which ensures head- hunting companies that their call for applications is seen.

Use of Internet for New Ways of Work

With Internet and (more broadly) Information-and-Communications-Technology (ICT) deve lopment in the full swing for the last two decades, organisations have been provided with 'a whole range of new possibilities for performing work and structuring organisations' (Lindstrom, Moberg & Rapp, 1997), which will undoubtedly extend even more in the future and therewith grasp even wider sphere of employees.

Two of new ways of work are discussed below.

Teleworking

There are many definitions of tele-working and in the field also many various terms are being used, for example tele-work, telecommuting, flexi-places, electronic cottages. Yet as the purpose of our paper is not tele-working itself the following definition will be quite satisfactory. As outlined in European Commission's annual report for year 2000 (Johnston & Nolan, 2001), telework is a wide concept, whose 'common element' is 'the use of computers and telecommunications to change the accepted geography of work'. It means that we are 'moving the work to workers instead of moving the workers to work', with help of information technologies (Nilles, 1998).

Teleworking offers significant advantages, which could be summarized and classified in three views: individuals, organisational and macro-societal; from the second perspective, benefits of telecommuting include higher productivity ("more work being done") and "decrease of absenteeism". Because the employees are more satisfied and their morale is increased, they are more unlikely to be searching for another job - organisations experience lower turnover rate; according to Dash, employee fluctuation can decrease by 50-80% when teleworking is introduced (Dash, 1999). Besides, organisations have 'the ability to access a broader pool of employees as the geographic tie to an "office" is diminished' (Venkatesh & Speier, 2000). Furthermore, organizations 'real estate costs can be cut because of the reduced office space requirements' (Nilles, 1998). Additionally, customer service improves due to flexible working hours (twenty- four-seven concept) (Telework the Benefits - and some Issues, 2000).

According to a research, 18% of Dutch, 12% of US and 5% of German and English employees were regularly teleworking to a certain extent (How many teleworkers, 2000), furthermore, the percentage has been increasing with a yearly rate of 10 to 15% in all of ICT-developed countries (Gordon, 1999). In this area, Slovenia is out of step with "developed" countries. According to a research (Raba Interneta v Sloveniji, 2000), there were approximately 50% of companies that have technological possibilities for teleworking yet only 29% of these companies have introduced teleworking. Viewed from the whole work- force population and taking into account the size of the companies, only 2% of full-time employed workers can be considered to telework in same fashion as their Dutch and US counterparts.

Use of Internet for Employee-Development

Acquiring new and supplementing existing knowledge is one of the top- level motivational factors for a person that has covered his basic existential needs, therefore as it a key success factor for an individual it is also critical for successfulness of organization as a whole. Internet-based technology offers numerous possibilities for getting hold of new knowledge and skills. Firstly, company wise, it offers much quicker access to latest scientific and technological innovations of other companies and research institutions (Jerman-Blazic, 1996). For each individual it offers itself as vast searchable database of web pages, newsgroups, mailing lists, online courses, forums, etc.

Effect of ICT and Internet on Organization

Information and communication technology and the Internet have not affected only the IT professionals and those employees that use IT for their work on a regular basis but also the environment of the organization, organization itself and the "social universe" (Drucker, 2001). Managers need to be aware of these changes, try to sense them in advance and adapt to them appropriately.

Especially in the field of employee-motivation we can expect essential changes. Even though visionaries predict deep and fundamental shifts in society, authors believe that first and foremost task of managers will remain motivating employees: firstly to arouse needs in employees and secondly to show them the way how to satisfy those needs in a manner, which contributes to achievement of organizational goals.

Yet if the fundamental concept remains the same, the changes will most definitely occur in employees' values and consecutively in their needs and in a manner in which their needs are satisfied. It is expected that "traditional" needs, i.e. salary and benefits, guarantee for permanent situation, loyalty to the company etc., will gradually lose their meaning. Infoworld's research (2000) that was undertaken between IT professionals, reveals that most of them feel that the most important benefit, expected from a company, is possibility to work from home, with salary and chance for promotion being less important (Battey, 2000). IT professionals are, naturally, more susceptible to novelties, therefore the cited research cannot be taken as representative situation in other professional fields, yet very similar changes can be expected elsewhere as well.

We can compare this finding with a survey of Slovenian employees (Siok, 2002). 51 different companies and over 5.100 employees (mostly middle management positions) participated in the study. The most interesting finding is that employees- out of 13 possible categories - ranked salary and chances for promotion as categories, which they were least satisfied with. Although the results cannot be directly compared with the Infoworld's survey due to different methodology and structure of population surveyed, this possibly shows that Slovenian companies as yet lag behind their US counterparts in that area and that the goals of Slovenian employees (higher salary, better chances for promotion) are still different (and more "traditional"). However further changes in the values and needs of Slovenian employee could be expected in the near future as we make further steps in knowledge economy.

Additionally, individualization will be evident - the needs will become specific to employees and will differ amongst them:

"What motivates… knowledge workers… is what motivates volunteers. Volunteers, weknow, have to get more satisfaction from their work than paid employees. They need,above all, challenge, to know organization's mission and to believe in it, continualtraining, to see results. Implicit in this is that different groups in the work populationhave to be managed differently, and that the same group… has to be managed differentlyat different times," (Drucker, 2001).

Furthermore, employees that will only be subcontracted for a specific project, and probably also those that will be working from home, will identify themselves with the company and its goals to a much lesser extent than in traditional environment. Finally, productivity, efficiency and successfulness of intellectual work are much harder to quantify measure and analyze, than they are with physical labour.

All that indicates that the crucial challenge for companies will be to ensure that tasks can be carried out at any time by the best (or at least good enough) employee or subcontractor. Since people are of vital importance in information society, it is clear that the companies, which answer to the challenge properly, will be the ones that not only survive but also thrive; as Drucker suggested, "we need an economic theory that puts knowledge in the centre of the wealth-production process," (Drucker, 1993).

How to Manage Changes?

So it is evidently that "lump sum" manner of rewarding people with money, position or other tangible benefits is not going to be appropriate any longer for more and more employees (speculatively said, "possibility for promotion" is transformed from motivating into "hygiene factor", as Frederick Herzberg called it in his 1959 book "The Motivation to Work"). Besides, authoritative leadership style grows to be inappropriate due to the fact that employees with more and more knowledge don't want to 'bend under tyranny of dictator', if they can simply - change jobs. According to a research (Battey, 2000), dissatisfaction with the manager is the principal reason for changing the job.

Organizations will have to adapt in several areas to the coming changes. Initiators of changes will probably be employees themselves, yet the success of adaptation is in hands of managers. Some of possible changes - and by no means all or even majority - in specific areas are discussed below, together with possible solutions for managing those changes.

Change of leadership style

Using any other leadership style than the authoritative one can represent a major challenge for any manager, since he has to rely on leadership based on expertise and personality. The gap between the fact that her work and results are progressively dependent on "her" employees on one side, and higher degree of work- inter disciplinarily (being a project manager with team that consists of various highly skilled experts) and lesser "power of authority" with not as much of possibility to influence subordinates with "power-rising-from-position" on the other side, can be frustrating.

The personality of the manager will therefore become the manager's lever to enrapture employees for reaching common organizational goals. Firstly, manager will have to motivate employees appropriately, in order to make them work without need for supervision. Secondly, he will have to ensure appropriate working conditions and act as a support to the specialists in those areas, for which they are, not qualified (i.e. management skills like planning or organizing).

"Their [manager vs. employee] relationship…is far more like that between the conductorof an orchestra and the instrumentalist than it is like the traditional superior/subordinaterelationship. The superior in an organization employing knowledge workers cannot, as arule, do the work of the supposed subordinate any more than the conductor of an orchestracan play the tuba. In turn, the knowledge worker is dependent on the superior to givedirection and, above all, to define what the "score" is for the entire organization…Andjust as an orchestra can sabotage even the ablest conductor - and certainly the mostautocratic one - a knowledge organization can easily sabotage even the ablest, let alonethe most autocratic, superior," (Drucker, 2001).

Thus we can expect a downturn of the hierarchy in the organization - employees (specialists with their knowledge) as a critical success factor, managers as support for the specialists. Proper management support is also one of the key things for work of specialists: this work should not be only efficient and successful for employees personally, but it should simultaneously contribute to overall success of a company.

Changes of personnel-function

Employees that are critical for success of a company are the workers with (proper) knowledge. Even though "no other decisions are so long lasting in their consequences or so difficult to unmake… at most one-third of such decisions turn out right," (Drucker, 2001). As people determine the capacity of the organization, the staffing (and promotion) decisions should (at least try to) be flawless.

The personnel function will grow its importance and might even become the central function in many organizations. For the staffing purposes it will - most probably using the Internet - constantly have to monitor the "supply-side" of work on the market and compare it with current "gap" in company's needs and disposable human resources.

Other scenario is also possible: due to the growing importance of the personnel decisions, the personnel function as we know today might disappear from the organizations' structures. Such tasks would be performed in collaboration with external contractor, who would, 1) using their knowledge and information and communication technology automate simpler and routine operations, 2) supply managers with relevant database (with much wider scope than the company could reach by itself) of appropriate candidates, 3) with their knowledge act as manager-consultants in important decisions.

Changes in employee-control

The importance of control as continual observation of work performed by employees will be lower. On one hand, due to the fact that such traditional control is impossible or at least very difficult (how to control teleworkers?), and on the other hand, because of individualization of employees that will also bring demand for higher level of autonomy in their work; ceaseless control would demotivate them.

The solution for the problem is, according to (Drucker, 2001), management by objectives and self control. Business performance depends on how each task is directed toward the objectives of the whole company. The number of highly educated specialists will increase dramatically and at the same time, the new technology will demand much closer coordination among specialists. Furthermore, the performance of the manager is also measured by the contribution he makes to the success of the enterprise; "the greatest advantage of management by objectives is perhaps that it makes it possible for a manager to control her own performance" (Drucker, 2001), with help of state-of-the-art technology that enables fast gathering, analysis, synthesis of data and retrieval of relevant information. Additionally, managers will have to tolerate that employees "waste" some period of time when they perform activities, non-related with main goals of the organization (i.e. playing chess via Internet). If these activities prevail, employees' satisfaction will be at high level yet the goals of the company would not be achieved.

The recommended way to control employees is therefore to check the final results of each individual project and to set goals according to the results of those projects. It is especially important that those goals are set objectively. Therefore it has to be assured that the employees will have enough intrinsic motivation to set adequately demanding goals.

Changes in employee motivation

The differences between different employees and their needs will probably increase in the future. If the company would try to cover those needs with a unified motivational scheme, this scheme should be very broad. Offering such a scheme would be very expensive and inefficient, since the company would offer a variety of benefits to each individual. This individual would consider many of those benefits as less important.

The possible solution is to adapt the motivation system to each individual employee and offer her only those benefits that stimulate her to perform better and more efficiently. It is hard to find out the best possible way of motivation without the cooperation of that employee. The employees will have to play a more active role in the motivation process and should have a clear picture about their own goals and especially about that what they expect from a company where they are employed (full or part time). It is in the best company interest to encourage the development of this clear picture about individual goals with improved communication (for example with different seminars or workshops).

The main goal of this kind of motivation is that every employee would set her own goal that would be demanding enough. The employee should have a strong enough motivation to fulfill those goals - not because of company goals or supervisor's orders but due to his own interest. The task of the manager is to assure that those individual goals are harmonized with the goals of other employees in this department, across different departments and with the goals of the company as a whole.

Changes in information management and exploitation of knowledge

"Managing your company's knowledge more effectively and exploiting it in the marketplaceis the latest pursuit of those seeking competitive advantage," (Skyrme, 1998).

Acquisition of knowledge by individual is relatively easy compared to successful exploitation of all the knowledge that resists in organizations' employees' minds. According to American research (Gopal, 1995); companies take advantage of only 20% of the knowledge that exists inside their employees. Information and communication technology offers numerous possibilities to improve information management in organizations and therewith make better use of employees' knowledge. One of such options is use of intranet as internal information system of a company, which is based on Internet protocols and services (Turk, & Jaklic, 1998). It enables relatively inexpensive and simple storage, organization, processing, maintenance and sharing of information between organizations' members; all these tasks are essential for good information management, according to (Marchand et al., 2001). At the same time such information is (in technological manner at least) securely kept from the outside world.

There are many other ways besides intranet for better use of stored knowledge (and for processing of information from piles of data), i.e. data warehouses, data mining, expert systems.

Contemporary state-of-the-art soft- and hard-ware solutions offer support for knowledge-use, yet the main obstacle is the one of the content and of the people - how to achieve that existing knowledge will be shared, stored and transferred organization-wide with help of IT in the best way. Better business performance, according to a twenty-eight month research which included over 1.000 senior managers worldwide, comes not just from information technology but also from information management and management of organization's people (Marchand et al., 2001).

Enhancing the women productivity

According to Dilevko and Harris (1997) women are depicted as passive users while men are active agents in the computer world. This may be debatable in some circles, however, Hovendrick (2002) supports the outlook by asserting that the IT industry is male dominated. Coyle (2001) builds on this belief by acquiescing that questioning the masculinity of computers is tantamount to questioning our image of masculinity itself. She goes further to say that computers are power, and power in our world must be the realm of men. She advises that women librarians should take advantage of information technology to step into positions within libraries that would afford them access to this power. Undoubtedly, librarians are changing in nature, in the essence of their job and in their image due to the impact of information technology (Harding, 2002).

The same Hovendrick (2002) while analyzing how digital technology has transformed librarianship asserts that women librarians do create web pages, pathfinders, web-based tutorials, CD-ROMs, and databases so as to bring together useful and organized information. This can be confirmed with such web sites as cybergrrl.com; webgrrlls.com and the coining of such concepts as “cyberfeminism”. Women are also known to be forming such organizations as Joan's Centre for Women and Information Technology, or Women in Technology International (WITI). These all go to show that technology has positive qualities which can promote the empowerment of women worldwide.

Even though it is difficult to get reliable statistics on women's internet use in developing countries because of lack of data, it is clear that the number is small and the distribution limited (Hafkin and Taggart, 2001). Africa being a continent of developing countries depends on the developed countries of the world for most of its needs including information need. One can image a situation where much of Africa's food, drugs, weapons, human resources, market, goods, raw materials, finance, technology, books, journals etc. come from outside the continent. This means that even though African countries are politically independent, yet, for them to survive, they depend heavily on their former mentors. Zulu (1994) asserts that about 90 per cent of data on Africa resides in databases in the West and for Africans to get reliable and sufficient information about their continent they must source for the data outside their continent.

This may sound pathetic, but the dawn of information and communications technology (ICT) and especially internet services has broken down the barriers against such achievement. Information acquisition, storage, retrieval and dissemination have become so revolutionized that information on the African continent and elsewhere can be accessed easily, timely and stress-freely at any time and from any part of the globe.

How feasible this is in developing countries and especially in the African continent is another matter because there is low application of ICT in the African continent. A study conducted by Internet World Statistics (IWS) asserts that there is no country in Africa whose internet usage is up to 7 per cent and that more than 99 per cent of all users are in main urban centers (Fadeyi, 2004). This means that the rural areas of Africa have no internet services and as a result, no internet users. This situation can be compared to that in the UK where, according to Fadeyi, almost every home has a computer which is hooked on to the internet. In the African continent, most homes have no computer, let alone being hooked to the internet. The digital divide in this comparison is very glaring.

Barbu et al. (2001) note that in the satellite technology market, the African continent has the lowest teledensity. No wonder many African countries are currently investing heavily in their ICT infrastructures, at least, to qualify to attract such IT assistance as the Digital Freedom Initiative (DFI) which has already been awarded to Senegal as a result of its technological infrastructure already in place.

International Labour Organization Report (2001) records that there is a digital gender gap in many parts of the world including some OECD countries. One is not surprised at this report because women are internationally regarded as a disadvantaged group, which includes low-income families, rural populations, minorities and the elderly (World Bank, 2002). Moreover, the empowerment of women through education, which was instituted by the United Nations as a strategy to reduce such gaps, is yet to be fully realized. However, in spite of the fact that a developing country such as Senegal in the African continent has only 12 per cent women internet users, countries such as Taiwan, China and Korea can boast for near parity in internet use amongst male and female citizens.

A survey of cybercafes in Delta State of Nigeria conducted by Adomi et al. (2003) shows that females make greater use of internet services than males in seven of the cybercafes studied. Even though this may not be representative of women in the country as a whole, in other words, one cannot generalize that it is the same situation in all the cities of Nigeria, yet, one thing is clear from the result of the study - that Nigerian women are interested in information sourcing through the internet and need to be encouraged.

While acquiescing that IT has become a potent force in transforming social, economic and political life globally, Hafkin and Taggart (2001) assert that it can also become an important tool in meeting women's basic needs by providing them with access to information which can salvage them from their disadvantaged position and enhance their productivity.

CHAPTER3

RESEARCH METHODOLOGY

NATURE OF STUDY

In this study researcher try to explore the impact of computer based information technology on the efficiency of employees working in an established multinational company ICI Pakistan Limited. So it is an analytical study.

TYPE OF STUDY

In this study the relationship between dependent variable i.e., employees efficiency & independent variable i.e., data processing, record keeping, work burden, recruiting and training of employees etc is analyzed.

UNIT OF ANALYSIS

Researcher selected the sample of 40 employees of ICI Paints. So the unit of analysis is each employee of ICI Paints.

METHODOLOGY USED

A primary data is the one which is collected by a researcher for the particular marketing research project currently being undertaken where as secondary data is the one which is collected by an individual other then the researcher for a project different from the one currently being undertaken.

In this project the data collection method which we have used is primary. The reason for emphasis given to primary data is that it is specifically collected for this project which is tailored to meet the exact impacts of I.T on H.R. I as researcher have a direct control over the data collection process so it is more likely to result in impact information that is more accurate, current, sufficient, available and relevant then secondary or commercial data.

Out of two general forms of primary marketing research data, researcher is using overt primary data which results from asking questions of study participants. Researcher has collected the information by asking written questions to respondents.

Ethical Methods / Issues

By having overt primary data, it enables us to understand the reasons for the behaviors of respondents. Moreover this is an ethical method of data collection in the sense that the researcher cannot get the information from respondents without their willingness and knowledge.

In this research, results have been collected be survey method, because it describes the relationship between different variables. It is specific which means it specifies the methodology the procedure of doing research.

Primary Data

To find out the impact of information technology on Human Resource, researcher has adopted survey method. Organization of my choice is ICI Pakistan Limited. Infact ICI Pakistan Limited is a very wide company. So researcher takes only ICI Paints which is situated on Ferozepur Road Lahore for convenience. First of all researcher prepare questionnaire which contains 20 questions. The questions are very simple & straight forward. Most of the questions are based on Likert Scale. While in start some general questions are asked about the employee.

Secondary Data

To find out above topic researcher has also collected secondary data from ICI Pakistan Limited and from books, magazines, internet, journals and articles for literature review.

THE BACKGROUND OF RESEARCHER

This research has been selected for this, because researcher deals with H.R and Accounts. Researcher saw the problems of H.R and Accounts. Researcher knows about the use of information technology. Managers want to take the quick decision about H.R and Accounts. Researcher thought when the managers will use the Information Technology (I.T) in H.R, Accounts and Finance Departments. They can get important reports of H.R and Accounts and then they can take good decisions in short time.

SAMPLE SIZE

Researcher took only 40 employees & they simply fill the questionnaire.

ANALYSIS OF QUESTIONNAIRE

Then the analysis of questionnaires are done that how many are agree and how many disagree. Each number of responses are counted and then presented in a tabular form.

THEORETICAL FRAMEWORK

The dependent variable, employee efficiency depends upon independent variables which are Data processing, Record keeping, Work burden, Recruiting and training of employees.

In recent years, information technology (IT) has played a critical role in the services provided by the private and public industry. However, no empirical research has evaluated the impact of IT on private and public firms.

Advances in information technology (IT) have transformed many firms in professional services industries but perhaps none as much as those in the accounting industry. Once a slow paced and conservative industry, accounting underwent tremendous changes at the turn of the millennium, sparked largely by the rapid changes in it if environment (Elliott 2000). Audit software and knowledge-sharing applications are two crucial components of these changes. Automation of audit tasks and use of specialized audit software has substituted IT for labor and changed the structure of audit teams. Equally important is the use of advanced systems to share knowledge bases across different parts of the organization that has enabled professional services firms to leverage the


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