Ehrm Refers To Conduct Business Human Resource Management Transactions Business Essay


E-HRM (Electronic Human Resource Management) refers to conduct business transactions particularly Human Resource Management transactions, using the internet along with other technologies (Lengnick-Hall and Moritz, 2003). It was inspired by the popular term of e-commerce. As per the literature, it can also be called as online HRM, web-based HR, virtual

HR (M), HR intranet, e -HR, HR portals and computer-based human resource management systems (CHRIS). The term e-HR was first used in the 1990's, when e-commerce was speeding the business world.

It is an advance business solution which provides a complete on-line support in the management of all processes, actions, data and information required to handle human resources in an advance company. It is an effective, consistent, easy-to-use system; accessible to a large group of different users. It is an application of technology allowing managers and employees to have direct access to HR and other departments of the organisation. It consists of HR functional application, extranet applications, intranet, wireless and mobile HR applications (Wyatt, 2002).

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According to Ruël Huub & Bondarouk Tanya, E-HRM helps to execute HR policies, strategies and practices in the workplace by using of web technologies. The objectives of an organization to take e-HRM are:

1. Developing the strategic orientation of HRM

2. Reduction in cost and effective gains

3. Improvement in client servicing and helping management and employees.

The choices of HRM strategies in an organization can be divided into three types (Beer et al.): the bureaucratic policy, the market policy, and the clan policy. Each category has its own specific characteristics about the HRM policy areas.


Based on the current literature, e-HRM can be distinguished into 3 categories in the companies as per their focus areas, which are: operational; relational; transformational e-HRM (Lepak&Snell, 1998, Wright &Dyer, 2000).

• Operational e-HRM: - this area involves the basic HR activities. In some organizations, the HRM give importance to administration and registration. Operational e-HRM gives the choice to the employees either to keep their own personal data up-to-date through a HR website or to have an administrative power in place to do this for them.

• Relational e-HRM: - this area, concerns on more advanced HRM activities. The helps the HR techniques that support basic business processes such as: recruiting and selecting of new personnel, training of new employees, performance appraisal, and rewards. It gives the option either by supporting in recruitment and selection through a web-based application process or using the manual application processes.

• Transformational e-HRM: - this area involves HRM activities with a planned character. Here the emphasis is about the activities regarding organizational change processes, strategic re-orientation, strategic competence management, and strategic knowledge management. Transformational e-HRM is an integrated internet technique that enables the workforce to develop in line with the organizations strategic choices.

The intranet is a powerful system which can encourage communication and collaboration in the firm, streamline procedures and provide staff with permanently updated information regardless of physical location. It may be used for collecting information, communication and sharing information with employees. It gives automatic access to and administration of databases. It simplifies distribution of complex information presenting it much more thoroughly and graphically.


It covers all aspects of human resource management like personnel administration, training, career development, corporate organization, job descriptions, selection and hiring process, employee's data base etc. Therefore e-HRM is a method of doing HRM.

By following the path of e-HRM, an organization expects to achieve certain targets such as; an development in the HR's strategic orientation, an improvement in client focusing, and a decrease in costs or increased efficiency.

Improving HR services:

Use of E-HRM, leads to higher level of engagement and satisfaction with HR. it increases flexibility in work, promote innovation and allows the employees to increase development, and motivation. Furthermore, it reduces the repetitive questions of employees and allows consultations at any time and place and provides reference materials. e.g. training packages, policy guidelines etc. It can be used for announcing vacancies for jobs within the organization, for recruitment and announcing important events. This improves opinion of management and employees on the HR function.

Cost reduction;

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E-HRM enables HR to provide their services to customers more efficiently, with little constraint on time, place or availability (Alleyne, 2003). It diminishes HR transaction costs by providing HR information to a large number of people on a virtual basis.

It not only involves transactional tasks like pay, training, holiday/leave entitlements which can be handled by employees themselves or by their supervisors using technology mediated processes. It lowers cost of doing HR; improves response time; and improves quality and consistency of HR information.

Redefining employee responsibilities in HR:

In recent years, it can be seen that there is a significant change in the role of managers in the organizations due to some of the market developments and new technologies used by the organizations in which they work. As a result, the duties that were performed by HR Professionals earlier are now performed by managers and employees (Ruel et al, 2004, Ruta, 2005, Martin, 2005)". These include: performing appraisals, appraising employee costs, generating HR reports on turnover, absenteeism, processing training requests and overseeing competence management. E-HRM turns it easier for managers to be able to combine these roles with their other roles more efficiently and also gives them greater accountability for people management.

"A move towards e-HRM can help employees to manage their information, accessing it directly and updating it refers to: training, appraisal or even transfers. This is called employee self services. This increases motivation and contributes to their employability. It means that employees have access to anything they need to change and manage in their personal files. They can plan their development, process financial documents and even apply for new jobs ( Roehling et al. 2005)".

Moving responsibility to employees indicates increased regonisation of employees to their development; improved talent management through self selection, self assessment and performance management.

Improving HR strategic orientation:

Use of E-HRM can establish more practical customer relationships within the organization thus allowing it to supply strategic value. Through social networking, it can improve employee voice (Martin et al 2009). It frees HRM managers to become strategic members of the top management team ( Strohmeir, 2006) and helps to connect HRM to business. It gives HR increased credibility and power through enabling them to generate more reliable data which improves decision making.

Online recruitment is one of the most broadly functions of e-HRM. It refers to the vacancies posted on the company's web site or on an online recruitment's website. It allows the candidates to send their resumes electronically via e-mail or in some electronic format (Galanaki, 2002). It can be benefited in terms of cost, time, candidate pool and quality of response. However, over loading of resumes is always a risk with the low reputation and effectiveness of various web sites and databases, not to mention its questionable effectiveness for senior executive positions (Ensher et al., 2002). This can also help to sort and contact the candidates. The selection procedure becomes easy while using this technology especially where long distances are involved. The selection can be done through Video conferencing and online tests, and the candidates can be selected at the early stages of the selection process which saves the cost and time of the organisation.

E-HR allows the performance appraisal (PA) to be conducted on-line on the corporate website. This means that the managers and the employees are able to submit performance data directly to the HR department in via company's website. Although this function has been criticised as there would be less written evidence which reduces paperwork, however it can decrease time and cost for the HR department remarkably.

E-HRM helps the managers and employees to communicate in the organisation effectively via email. It is an useful approach to interact with the management.


Besides these objectives mentioned above, there are some outcomes of E-HRM that needs to be considered. According to Beer et al. (1984) there are four possibilities of outcomes which are: high dedication or commitment, high competition, cost effectiveness, and higher congruence.

High commitment they means that the workforce is motivated and understanding, and that they are willing to interact with the management about changes in the organisational environment and the impact that this can have on the internal organisation. High commitment implies a high level of trust between management and employees.

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High competence points towards the abilities of employees to learn new tasks and roles if the circumstances require it.

Cost effectiveness refers to the competitiveness of pay levels and employee turnover rate, and to the acceptability of costs resulting from employee resistance such as strikes.

Higher congruence refers to the internal organization, the reward system, and the 'input, throughput, and output' of personnel, which need to be structured in the interests of all stakeholders.

Below is the E-HRM model that explains the effect of E-HRM in an organisation.


Although there are many benefits of using the E-HRM in the organisation, but there are some aspects where E-HRM has some barriers and disadvantages which needs to be considered.

According to the findings of Ruël Huub & Bondarouk Tanya, if an organisation wants to become a global, then globally their HR practises, policies should also be the same wherever the company is present. Differences in the culture and languages, it is hard to adopt the newly introduced technology that is E-HRM.

In order to introduce e-HRM in the organisation, it is very difficult for the HR department to change their HRM practises. Implementation of E-HRM can reduce the HR staff. It is hard to change the mindset and behaviour of HR personnel, employees and line management.

E-HRM helps the employees to update their databases, performance charts, take part in online discussions and choose their career paths. However many employees are not willing to accept this change. Some studies shows that the employees are rely on their managers to develop their carrier paths.

It can produce loss of privacy and confidentiality.

If these points can be considered, E-HRM would be very useful for the organisation to grow.