The following essay deals with the use of Information Systems in the present HR world and its strategic importance in today's Human Resource Management. It also discusses the impact of Human Resource Information Systems in the present business world and why the organisations should be concerned about the use of HRIS in various Human Resource Management activities. It also shows how HRIS can be used to achieve business goals. The essay also includes some company examples and their best HRIS practises to show the strategic importance of HRIS and wether the companies have achieved their business goals by the use of HRIS. The essay also includes a case study to demonstrate the strategic importance of the HRIS. The essay also provides a brief background of the organisation involved in the case study and explains how the organisation manages its HRIS to improve their Human Resource Management.
Human Resource Information Systems (HRIS) are being used in HR departments for the past many years now, not until more recently that their use has been changed to play a more strategic role in order to support HR staff, which particularly includes HR managers. The job role and the potential from HR managers have been changed over the last few years. This is due to the increase in the functional and strategic pressures on them (Armstrong 1984, 1994; Kinnie and Arthurs 1996; Ball 2000; Mabey et al 2000). Economic pressures have resulted in structural changes within organisations. The past image of HR role was that it is not a job that no one wanted nor had the skill to do. Senior management used HR managers to straight line the instability of organisational change, by doing so they were left free to go ahead with the strategic work of the business. The position of the HR manager gained status in organisations when compared to the previous years (Personnel Management 1993). HR actions have been distinguished both in terms of uniqueness and added value. Organisations can easily estimate this added value. In most of the cases, this does not just lead to the narrowing of the HR functions while many processes are being undertaken by line management, but what it does is that it fundamentally changes the role of HR specialists. This created a realisation that the new role of HR specialist's is developing into a strategic provider to the business (Personnel Management, 1993). Despite this positive outlook some of the evidence from UK confirmed small use of IT in relation to analytical decision support activities (Kinnie and Arthurs 1992; Ball 2000).
In contrast to this, other evidence argues that the developments in HRIS is a close match to the ever changing need of HR managers and can assist by providing strategic level support to organisations (Soft world Report 1996, 1997; Robinson 1999). This identifies as an increase in need of adopting HRIS for the benefit of HR departments.
HR managers highlight the ever changing role of HR directors and managing directors. The evidence shows us that that this change in trend is taking place at an increasing pace and that HR managers would make use of HRIS in order to achieve improved performance and that "removing routine administration allows them to become professional consultants to the rest of the organisation" (Soft world Report 1996,1997). This enables HRIS to present quality information to the board which enhances informed decision making (Soft world Report, 1996, 1997).
This research also considers new roles which are emerging such as consultancy. Edward (Soft world Report 1996) believes that by giving importance to HRIS it will facilitate strategic working and also lower-level workings which include the designing of employee reward systems. Different levels of the use of HRIS have its own issues which are associated with it which includes input errors which are made by users when compared to the system design errors (Liff 1997; Laudon & Laudon 2002). The call for information varies with the different levels of organisational chain of command. The information that is required by senior managers is entirely different from the information required by the operational level workers such as the board of directors and senior managers require information such as executive reports and summaries where as managers at operational level need more day-to-day information, and HRIS provides them with the information required for this.
Edward (Soft world Report, 1996) mostly places her emphases on the tangible benefits of HRIS this includes much faster response of HR managers to the organisational management while some companies have resorted to the more long-term view. She believes that HR managers could improve their company's performance as well as their own performance and status within the company. By increasing their knowledge on the various packages which are available on the market and by knowing what they are capable of delivering (Soft world, 1996).
Both Edward and Rees (Soft world Report, 1996), have concluded that the use of HRIS should be seen as a platform for HR managers to improve their performance of their job roles more effectively and efficiently in the organisation. This issue was also argued by earlier authors (Gallagher, 1986: Broderick and Boudreau, 1992).Gallagher (1997) argues that the influence of HRIS on effectiveness is in four ways: Firstly, the emphasis is on the increase in productivity from the workforce, short term working, recruitment, transitory, and less redundancies. Secondly it lays emphasis on dealing with the increasing demands made by legislation these demands are related to HR practices and also the increase in need to put forward statistics for government. The third factor is the rate at which the computer technology is developing. The final factor is the increase in availability of HRIS at much lower costs. The professional body argues that the effective use of HRIS leads to efficiency (CIPD, 1999).
Speedy changes in the field of information systems (IS) in the last fifty years have had a strong influence on many of the modern organisations (Avison and Shah 1997; Chaffey 2003). Many organisations today are using IS to enhance the efficiency of the organisation. The writings of many IS writers such as Edwards et al (1995), Laudon and Laudon (2002), Renkema (2000), and, Elliott and Starkings (1998) say that the use of IS includes systems such as HRIS which have become widely spread in many organisations and most of the employees and also the departments of all types and levels of organisations have become heavily reliant on such systems. It is also reported in Soft world (1996/7) that there was a rise in the use of HRIS in the UK. The reduction in the cost of personal computers provided smaller businesses to gain access to both hardware and the hardware required for the use of HRIS (Ball, 2001). The efficient use of IS in an organisation will help them to increase efficiency, integration and effectiveness. There are three general uses of Information Systems in an organisation they are A) Business operations: This includes day to day actions of the organisation which includes actions such as producing its products or delivering its services. B) Management of organisation: This includes activities which are required for controlling and monitoring the everyday activities of the organisation in relation to its aims and goals. C) Strategic objectives: This includes the long-term goals and objectives of the organisation. A present-day use of Information System's is more advanced which enables the organisation's to make use of them in a very strategic way, as noted by Tyson and Fell.
The different types of systems available and their use are: Transaction Processing Systems (TPS): these are used to take on the day-to-day activities such as functions and transactions at the operational level. These systems also help in making decisions related to Operations such as stock control. Management Information Systems (MIS): MIS is used for forecasting or predicting the financial operation and also the give the graphical models which will provide a visual picture of the information. These systems help in making Management Control Decisions which include comparing of data or budget data. Strategic Information Systems (SIS): These "systems provide information to senior executive managers on strategic areas of a business organisation's activities, to aid strategic decision-making" (Lucey 1997). These systems help in making Strategic Decisions which involves decisions that are based on the ill-defined problem.
This show that IS, which also includes HRIS, could be made use of at different levels of the organisation in order to achieve various tasks employees at different levels of the organisation (Chaffey et al., 2003). There are three different levels at which IS can be used they are: a) strategic, b) tactical/middle and the third level is operational the operational level, due to which there are three different types of IS (EIS, MIS and TPS) which are used by workers at the three levels (strategic, middle management and operational). The number of people who are actually making the strategic use of IS is usually low and is mainly concentrated with senior managerial positions which are much higher in the organisational hierarchy. This demonstrates that senior officials in the organisation are much less in number than that of the employees at the bottom of the hierarchy and these employees have to deal with only shorter making decisions than people at operational levels. This lays emphasises that the authority of decision making at the top of the organisation is much higher and the more uncertain which requires more authority than the employees at the bottom of the organisation. Decisions that are made at higher levels of management are usually more challenging and the problem range is much wider and these decisions are a rare occasion. In respect to the employees which also includes employees at professional grades which includes HR managers will have to make use of them at different levels in order to attain maximum payback from them. The main criteria that has not been able to be explained is the level at which they are using HRIS in day to day work, as these systems are being made use of at different levels. The early use HRIS is at operational level in the early days not until recently that it is being used at a much more strategic level as the functionality of this level has become more advanced.
The much more advanced usage of Information Systems at the strategic level work will be happening which is due the fact that the technology is advancing (Laudon and Laudon 2002; Lucey, 1997; Avison and Shah 1997, Chaffey et al 2003, Robson 1997). HRIS are being used at various levels in order to help HR managers accomplish various levels of tasks which make the influence of HRIS on a HR manager to be a major one.
HRIS is being used at three different levels of the organisation as it offers a very wide-ranging set of functionality which includes functions such as training, career shaping and reimbursement analysis (Laudon & Laudon 2002). However in the recent years the requirements of HRIS have been changing (Gallagher 1986; Soft world 1996, 1997). A complete version of HRIS gives the organisation a wide range of modules which ranges from operational to strategic. When the term HRIS is used it implies a fully developed version of HRIS. Most of the vendors usually offer fully developed systems but there are some vendors who also offer partial systems along with the complete version. Soft world report also identified a universal increase in the usage of HRIS. The modules that are being offered by the current system are
- Personal Records and Report generation
- Holiday management
- Disciplinary control
- Shift schedule management selection
- Time and Attendance
- Company car management
- Recruitment management
- Performance assessment
- Organisational charting
- Personal Developments & need assessment
- Testing of aptitudes and skills
- Data interface
- Job Evaluation
- Permit processing and Nationalities
- Grievance Procedure
- Absence Monitoring
- Buildings Management
- Flexible benefits
- Success Planning
- Self Assessment
- Job Analysis
- Evaluation and Test development
- Training management and expenses
- Safety records and Health.
Norman and Edwards (Soft world 1997) highlight that some modules are more popular by HR departments. An attempt is being made in order to convince the line management to increase the usage of HRIS in their companies. Management Today (1993) found out that the line management hold an undesirable opinion about HRIS which has to be changed if HR professionals were to improve their status and efficiency.
Soft world (1996/7) carried out a survey on people who other than HR professionals use HRIS. The evidence revealed that majority of the users are HR/Personnel department's staff (87.9%) which was followed by the directors department (56.9%), training managers (54.3%). The future users of HRIS are identified who happened to be line managers (66.4%) followed by HR/Personnel directors (38.8%). The considerable growth of use of HRIS by line managers was up by 48.3% (Soft world 1997). This increase in the use of IS showed that it can empower HR professionals.
Many of the major companies in the present world are making use of HRIS in order to improve their company's performance which comes only by improving their employee's performance and efficiency. The examples of some of the company's who have benefited from the use of HRIS are as follows Ameriprise Financial which suffered a serious customer data losses in 2005 made use of HRIS which helped them to implement new, prepared "layers of protection" which helps in preventing any repeats of such overwhelming security breaches in the future. Shaw's Supermarkets consists of a diverse workforce which is made up of part-time employees up to 70% which consists of, senior citizens, students, career part-timers and second-job part-timers. Due to which they needed a much efficient system of management. By the use of HRIS they were able to establish an employee self-service solution which helped employees to follow of their own options and benefit information online. CS Stars LLC In 2006 have failed to report a breach in security which approximately affected 540,000 New Yorkers. This mishap costed them over $60,000 in settlement. Since then they have agreed to implement new and improved security measures which will be done only with the use of a well-organized HRIS. WORK Source Inc made use of HRIS When there were 100 new employees who were suddenly added to the payroll system, a competent HRIS system provided them with all the tools necessary which included electronic paystub and timesheet software which helped the company to incorporate those employees into the existing system in a smooth and orderly fashion. Toshiba America Medical Systems Inc, which by modifying a much streamlined and functional HRIS were able to move their entire benefit information online. They created a collection of documents and forms which were related to their Human Resources portal which also included their benefits guide earned them an 2004 Apex Award for their excellence in publication. They were also able to gain the 2004 Electronic Benefit Communication award which was given by the Business Insurance Magazine for their outstanding accomplishment in communicating their benefits for employees programs over the Web.
Terasen Pipelines for example made use of HRIS when they relocated their company headquarters. This relocation created a rapid growth spurt due to which they upgraded to using an HRIS which helped them to maintain a much more precise and convenient human resource records.
I chose IBM as the case study for this essay. IBM is one of the major global organization's which offers software, research, IT, hardware, business, consulting, management consulting, financing and ring. It consists of around 340,000 people who speak 165 languages. It spreads across 75 countries which serve clients in about 174 countries. In January of 2007 IBM established a brand new wing known as the "new media" function inside its business communication department. IBM's main aim is to support, educate and also promote programs which make use of the social media. Its paperless online enrolment system which was introduced in 1999 proved to be a victory for the 135,000 active U.S. employees and as well as the company. Cathleen Donnelly who is the senior communications specialist in the company's headquarters which is located in Armonk, N.Y. says that the company saves about $1.2 million on an average per year on mailing and printing costs alone. Donnelly also says that the employees could make use of a variety of technologies in order to learn about the issues, research the program information and also access the tools for decision support on their desktop computers. (Heuring 2002)
The Response was that one of these tools which is a personal tool that estimates medical cost enabled the employees to calculate their potential out-of-pocket expenses of health care under each of the plan and provides them with various options which are available to them says Donnelley. Employees were able to login personally and are greeted by their name and are provided with all the important information which is related to their enrolment benefits that is information such as deadlines and the time and date about when changes could take effect. They get access automatically to all the available health plans to them. The calculator also helps them to compare and estimate all the benefit amounts for all the plans that are available."Employees can select the health care services they expect to use in a particular year, estimate expected frequency of use, and calculate potential costs under each plan option," (Heuring 2002) says Donnelley.
"The feedback that we've received from employees tells us that this tool has really helped them to make a comparison between plans based on how they consume medical services." The calculator showed both the IBM and the employee's the costs that occurred to them. (Heuring 2002)
The Outcome of this was that "Since we began offering online enrolment, we've learned that employees want web access" says Donnelly the senior manager of the communications department. By the use of this the employees were able to logon at the comfort of their home rather than working on the company's intranet. Due to this IBM had been working to put in to action an enrolment system which was web based so that both the employees and as well as the retirees could access it from anywhere or anyplace. By the use of the completely organised HRIS tool employees were able to get the complete information on the plans, they can scan down to the very exact details and then follow the links of the providers of health care for research. Donnelly the head of communications also says that the system received high remarks for all the convenience that the tool provided to the employees which helped them gain access in and out very quickly.
This essay shows the effect of HRIS on supporting HR managers to perform at their highest levels and also perform more professionally. It also shows the impact of HRIS on the HR managers' role that is both the conventional and also the newly emerging roles. The results also revealed that the use of HRIS is playing a very important part in order to help HR Managers. Most of the employees and many of the big companies are using HRIS at the performing the operational level tasks and some of them are making use of it to perform the strategic level tasks. However the use of HRIS at the strategic level was much smaller. Many of the employees believed that the use of HRIS is very important which allows them to perform at their highest level and more efficiently on the work given to them and also perform much more effectively and professionally in the company. This makes us sure that the use of HRIS is very important in helping the HR managers meet their everyday increasing demands of their work and the level of quality of service. The essay also shows us that the use of HRIS is leading way to many of the changes that are involved in the working of HR managers such as involving the learning of all the new technical skills while also focusing on flow of the HR information from all of their organisations and departments.
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