The Development Of E HRM In Organisations Commerce Essay

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Organisations today face a constantly changing business environment. Increasing global competition and quickly advancing technology are creating an economy requiring organisations to build a flexible and develop highly skilled workforce (Vicere, 2000) as cited in (Long and Smith, 2004). The strategic role of the HR function means being involved in strategic planning from the outset and matching employee resources with business needs ( Panayotopoulou et al., 2007).

Technology comes to the rescue in reducing the tension between the strategic and administrative responsibility (Ellig, 1997) as cited in ( Panayotopoulou et al., 2007) Not only is the technology changing rapidly, but the rate of change is increasing noticeably (Sampson, 1998).Previously, internet was used just to obtain and share information. However, organisations started realising the importance of technology and internet became the main tool for management and operations everywhere.

2. HRIS in a nutshell

In an organisation, there is always a need to cope with the increasing volume of information and maintain it. The earlier manual systems of operations make it very difficult to manage such load. Also, manual maintenance hampers the efficiency.

Changing legal environments and the growing percentage of white-collar workers created an increasing demand for the Information systems (Hennessey, 1979) and since then many organizations began to develop externally facing internet sites that included static content as the mission statement, description of products and services, profiles of senior managers, and contact information for customers, suppliers, investors, job seekers, and the press (Christie, 2002).

Human Resource Information System (HRIS) is a part of the many available Information systems in an organisation. It can be can be defined as:

The composite of database, computer application and hardware and software necessary to collect/ record, store, manage and deliver, present and manipulate data for Human Resources (HRs).

(Mohanty and Tripathy, 2009)

E-HRM: Significance and Growth

E-HRM refers to conducting the HR activities and functions through HRIS. The basic usage of e-HRM started during the 1990's. Many organisations developed the HR intranet sites for the internal communication of employees. Apart from communication, intranet is also used regularly to give regular updates to the employees about the organisation and its functioning. The HR groups in the company AlliedSignal have been developing websites since 1997 that focus on benefits, learning and other employee areas (Christie, 2002).

E-HR is not just cost-effective but it also has speed and accuracy. E-HRM is getting accepted world-wide because of it advantages. It aims at making information available to managers and employees at anytime and anywhere. E-HR has an impact on every area of HRM and hence it eases its functioning. More and more companies have started using the function of eHRM, to actively support their HR their business management (Shrivastava and Shaw, 2004; Hussain et al., 2006; Lepak et al. 2007) cited in (Beulen,2009).

Table 1: Percentage of time spent by staff on HR activities

(as adapted from Sleezer et. al, 2002) (Pg. 44)

The above pie-chart brings to our notice that previously, around 74% of the HR staffs time was spent on managing the administrative activities which left them with 12% time for the strategic HR planning and for HR consultancy. However, the shift from the traditional HRM to e-HR helped in taking care of the day to day administrative activities practices give rise to several effects on the role of HRM. Various databases were created for every HR activity which not just increased the efficiency but also brought up the productivity.

A major effect of the shift from traditional HRM to e-HR is that is enables HR employees to focus more on the strategic, value-added activities. Less administrative and paperwork and it allows the HR professionals to devote more productive time to other strategic functions of their profession. On the other hand, this may also mean that with the use of e-HR, fewer HR professionals are needed, because e-HR eliminates the "HR middleman" (Lengnick-Hall and Moritz, 2003) as cited in (Panayotopoulou et. al, 2007)

E-HR was adopted to get the following fundamental rights: increased operational efficiency, lower costs and better service to the end users of HR information and processes and all this to be done with just the click of a button (Christie, 2002). HR transformation efforts in organizations have produced process efficiencies and have shifted administrative work into shared services or outsources service centres. (Christie, 2002). However, the primary nature of work remains unchanged. Dell computers is a classic example of such system as they have undertaken the model of e-HR through which they can hire, transfer, promote and change pay for individual employees- all on-line, all on their own. Controls for the most are built into the system, rather than onto the HR staff. (Christie, 2002)

Functioning of e-HRM

The main use of the HRIS is basically done by the HR staff as compared to the other employees in the organisations. It is the HR department in an organisation that has to keep a track of the employee data. Because of the technological changes and the new company benefits, all staff may not be on site everyday of the week. Rather, employees can work more independently as the information is literally at their fingertips; however, with technology, managers have the ability to run reports and use tracking devices to "see" what employees are doing during their daily routines. Individuals can be monitored on everything from how many files they open to how many changes they actually make in only one file (Lawson and Sleezer, 2002)

The Human resources department in any organisation manages most of its functions through these HRIS. Recruitment & selection, training & development, performance management are all considered and looked upon by the HR officials regularly in order to keep themselves updated and provide benefits to rest of the employees. Let us go through some of the prominent HR functions managed and let us try to understand how the usage of e-HRM has helped to manage these functions effectively.

4.1 Acquiring HR ( recruitment & selection)

Recruitment and selection is one of the most important activities that are being looked after by the HR staff. The internet can ease the selection of the employees, especially where long distances are involved. Furthermore, online recruitment brings substantial benefits in terms of cost, time, candidate pool and quality of response. The use of technology can also improve the sorting and contacting of candidates. The possibility of online recruitment has been much debated as a unique way to recruit passive job seekers. ( Panayotopoulou et al., 2007).

The practice of online recruitment is one of the most widely discussed functions of e-HR. Online recruitment refers to posting vacancies on the corporate website in some cases, also on an online recruiter's website, and allowing applicants to send their resumes electronically via e-mail or in some electronic format (Galanaki, 2003) as cited in ( Panayotopoulou et al., 2007). It also includes the active search of the internet and the location of the resumes. Some organisations, allow the applicants to upload their resumes directly after checking the vacancies. Candidates are shortlisted by the employers after checking their resumes and the available job profiles. Apart from this, Video conferencing and online tests, for example, have been extensively used at the early stages of the selection process and can achieve spectacular cost and time savings ( Panayotopoulou et al., 2007). The results are then communicated to them through e-mails. Once they are through with this 1st stage, the candidates are then called in for a formal interview.

Cisco offers a slight different approach to eRecruiting. Apart from updating their resumes on its corporate website, job seekers can enter data about themselves-name, previous company details, job interests, desired geographic locations, etc. Based on the information in the job seekers' profiles, the site asks pre-screening questions designed to round out information about their work experience (Christie, 2002).

4.2 Web- based employee training

Changes definitely happened in the HR activities in the organisations including the reality of online learning that is now available in most of the organisations 24 hrs a day and 7 days in a week, the Internet as a supplement or alternative to classroom instructions, and accreditation for all the organization's training (Lawson and Sleezer, 2002)

Various reasons have been offered to increase the usage of web-based (online) training. Online training can be completed at any point of time and from anywhere. Whenever the employees need it, they can just take it (Herther,1997).Organisations that continuously provide training and development opportunities to their employees can develop employee knowhow, thus building a strategic asset that can lead to a sustainable competitive advantage (Long and Smith, 2004).

The HR generally puts up a list of trainings available in the organisation on its website. However, employees need not necessarily complete all of them. Web helps in reducing the unnecessary trainings by choosing the appropriate one. The rate of employees undertaking such trainings has also gone up because online trainings can now be taken at any point of time and from any place. It can be taken as per the employee convenience. However, the primary reason for embracing web-based training is to reduce the costs of travel for trainees and instructors and for time off the job to such travel (Russ-Eft, 2002) as cited in (Sleezer et. al. 2002).

Globalisation has increased competition. An organisation in one country has to deal with its delegates and customers sitting in other parts of world. Services are now outsourced globally. This has mainly resulted in the improved growth of call centres everywhere. Because of dispersed workforce, the training started taking place using web-based training, supplemented by coaching, Web meetings, and quarterly group meetings (for the trainees who are based in remote locations). Employees hired and promoted for customer service are not always trained for the required skills. This situation led to somewhat reduced employee satisfaction and somewhat higher than expected employee turnover. Also, training the employees regularly is very important in such cases as employees in interact with customers constantly. Customers expect to get their queries solved without wasting much of their valuable time and get better treatment every time they call up but they had not received training.

Various online leadership programs are now introduced which help in improving the employee skills and efficiency. The purpose of leadership programme was to provide HRD opportunities to employees regardless of their location. In addition to improved leadership skills, upper management hoped that the use of learned skills would lead to greater stability within the organisation and that results could be realized through less costly, more efficient and effective ways of delivering training. User acceptance of training is important, but equally important is whether or not the trainee uses the learned skills on the job.

An immediate feedback could be given about the training. E.g. How useful is the training, any improvements suggested, etc.

4.3 Performance Management Record

Maintenance of employee performance is vital not just for the growth of an employee but also for the growth of the organisation. Now a days every organisation tries to promote and motivate its employees by giving them a feedback on monthly or quarterly basis. Appraisals are undertaken twice a year (in most of the organisations) and the employees get to know the areas where they are good at and where there has to be an improvement. The manager can feed in the performance related feedback of its employees at any point of time through the online database by the superiors and also by the HR managers not just during the appraisal period but at any point of the year.

Quality management is customer driven. It is a common way of companies work towards this objective is to provide systems together feedback from customers (Sampson, 1998). The customers are given an option to upload the online feedback or can also send an e-mail for the service provided to them. This also helps in tracking the performance of an employee. The feedback can be a general feedback as well as a specific feedback. E.g. product specific feedback, employee specific feedback. Apart from this, employees have to undergo a self-assessment. All this was done previously on hard papers but the introduction of information systems has made this evaluation very easy and less confusing. No separate files need to be maintained for each and every employee and all the data, the date of joining, the performance, the feedback received can be check at the click of a button.

Performance Appraisal is the social and communication process in which a supervisor evaluates an employee' s behaviour in the workplace and communicates those ratings and feedback back to the employee (Murphy and Cleveland, 1995) as cited in (Payne et al., 2009) An online Performance Appraisal (PA) system is a software program that facilitates the completion of performance evaluations online (Payne et al., 2009). It also keeps stored the past data which is used in making the comparisons of the past and the current evaluation. Such systems also offer the HR managers the opportunity to readily monitor the extent to which supervisors complete their employees' PA on time, in addition to making it easier for them to examine trends in performance ratings (Payne et al., 2009). Employee reactions to PA can influence employee motivation, productivity and organisational commitment. The traditional methods of storing the information was highly risky as the employee data was stored in paper files, whereas the online PA/ evaluation forms store data in the special systems created. Such forms contain lot of information and hence are strictly confidential which are accessible to only selected people in the org. Employees can view only their data and the managers can view the data only of the employees who report to them. Restricted access with the help of unique usernames and passwords is provided.

E-HR allows the whole performance appraisal (PA) to be conducted online, on the corporate internet interface. This means that the manager and the employee are able to submit the performance data directly to the HR department in electronic form. ( Panayotopoulou et al., 2007). The self-service application allows managers to immediately enter PA results and employees to manage their performance goals and results and plan their performance on their personal HR page ( Panayotopoulou et al., 2007)

4.4 Employee Self-service

The fastest growing trend in the delivery of HR information is employee self-service (ESS) (Gueutal, 2003) as cited in (Payne et. al, 2009) Employee self service is a function of the information systems which helps an employee to access his personal information via the web. The employee can check and print his payslips, can update his leave record, check the feedback or any comments uploaded by his manager or any other superior. The HR team in an org. has a direct access to this employee information as they are the ones responsible taking care of all these functions.

Another growing trend is the adoption of managerial self-service (MSS) which provides managers access to a variety of HR told and information via the web (Gueutal, 2003) as cited in (Payne et. al, 2009) Most HR-related tasks can be completed via MSS applications including pay administration, compensation, performance management, staffing, and employee development. (Gueutal, 2003) as cited in (Payne et. al, 2009)

4.5 Managing the Pay

Traditionally, payment was made to all the employees in normally the first week of the money. Salaries were handed over in the form of cheques which the employee had to encash into his bank account. However, through e-HRM, payment is now made to the employees directly into their bank account. They can check their payment slips online through the organisation's intranet. These payment slips contain the entire breakup of an employee's salary. Apart from the regular payment of salary, bonuses and other rewards are also included in this salary slip.


E-HRM is growing literally at a fast pace. With new and better Information systems coming up everyday, e-HRM is becoming highly efficient. However, even today, the vast majority of HR's time and resources continue to be dedicated to administrative activities- whether this work is done in a centralized processing group or is distributed among the field HR staff (Christie, 2002). This shows that the usage of e-HRM is still in its formative stage. Though, the job of data maintenance and data protection is being done the HRIS software, however the initial feeding of the data has to be done manually by an HR employee. Efficient use of Information systems should be done