HR and Information Technology (HRIS)
Introduction
Business undertaking involves various pitfalls such as poor organizational traditions, the big squeeze, identity crisis, and organizational failure. These pitfalls continue to be inevitable in an organization until effective HR is adopted. Research has established that the creation of consistent and sustained competitive advantage is achievable through effective HR (Pouransari, Al-Karaghouli, & Dey, 2016). Human resources must be managed well for the success of an organization. Every individual working in an organization plays a contributory role in its management. Tarawneh (2012) argued that since human resources are needed in all aspects of business operations ranging from production to marketing, effective HRM is vital to organizational success. The application of various tools in the management of human resources has become vital in the modern competitive business environment. The use of traditional approaches to deal with human resources requires a high level of awareness and sensitivity of these techniques to people’s relationship.
HRIS (Human Resource information System) is concerned with the approaches and systems that exist at the intersection between IT (Information Technology) and HRM (Human Resource Management). According to Lee (2009), the strategic and economic advantage for business organizations will depend on their capacity to attract and retain a diversity of the workforce. Most HR managers and executives are busy executing their daily chores, which are mostly administrative. As such, they tend to forget the essence of integrating IT into their operations. This paper will present a literature review of HR and information technology to describe what various scholars postulate about HRIS.
What HRIS entails
HRIS, which is also referred to as HRMS (human resource management systems) refers to the point of intersection between HR and IT through HR software. This software allows HR managers and executives to undertake their role electronically (Rietsema, 2017). DeSanctis (1986) viewed HRIS as the manner in which business organizations take care of various HR-related activities electronically by the aid of HR software.
Solutions offered by HRIS systems
HRIS systems enable business organizations to solve numerous issues related to human resources. A company using HRIS systems is able to plan and manage its HR costs efficiently without allocating excess resources to HR activities (DeSanctis, 1986). Weeks (2013) established that the use of HR software in business organizations increases the efficiency of decision making as well as the productivity of managers and employees. Organizations that have embraced the use of HRIS systems benefit from various solutions that these systems offer. Some of the solutions offered by HRIS systems include payroll management, training, recruiting, and regulatory compliance ( Tarawneh, 2012). Most of the designs for quality HRIS systems include integrated databases that provide various features and flexible designs. Ideally, HRIS also increase the capacity of HR managers and executives to create, analyze, and report information accurately and quickly (Khashman, A. M., 2016).
Rietsema (2017) postulated that HRIS increases the efficiency with which HR administrators can improve the quality of their management strategies. HR executives spend less time when dealing with non-strategic issues. As a result, the efficiency of strategy formulation increases.
Payroll and HR components of managerial functions go hand in hand. Therefore, investment in HRIS results in increased capacity of handling the workforce. Moreover, studies have indicated that organizations that invest heavily on HRIS are able to integrate various management methodologies that enable them to enhance the productivity of their personnel by growing the talents, skills, and experience of their staff (Karikari, Boateng, & Ocansey, 2015).
Information Technology and Human Resource
IT has been found to have fundamental impacts on organizational management, particularly the management of human resources. IT also affects human resource function of managers by influencing how they perform their tasks. It increases the speed and accuracy with which managerial functions are executed (Mukherjee, Bhattacharyya, & Bera, 2014). The integrity and transparency of the system design as well as rapid evaluation, timely feedback, and effective virtual training has become possible with information technology (Pouransari, Al-Karaghouli, & Dey, 2016).
Some important positive impacts of integration of information technology in human resource management
Research has revealed that organizations continue to integrate IT systems in their management activities due to various benefits associated with IT. Integration of IT in human resources management has several important impacts on the performance of business organizations. Some of these benefits include:
Increasing the speed and accuracy of performance
As competition continues to become stiff, the survival of organizations depends significantly on the speed and accuracy of information processing to adjust their business strategies. HR executives are compelled to make changes in their organizational structure. For example, the use of IT facilitates the mechanization of different old processes which results in increased speed and accuracy of information processing (Weeks, 2013). Besides, various scholars have linked the integration of IT in HRM with significant changes in job satisfaction and specialization of the personnel which increases workforce productivity (Powell & Dent-Micallef, 1997). The smooth flow of information achieved through IT in business organizations supports the management’s role in facilitating the realization of corporate objectives of firms.
Enhancing integrity and transparency in system design
In the modern age of IT, the access to information by business organizations is crucial to their success (Bhuiyan, Rahman, & Gani, 2015). Human resource executives and managers need to use quality information to minimize resources used in various processes. Additionally, cost reduction to increase the profitability of organizations requires increased efficiency which can only be achieved by speeding up processes and increasing their accuracy (Bhuiyan, Rahman, & Gani, 2015). The integration of efficient IT systems in different managerial aspects results in the production of information that is transparent, concise, easily accessible, and easy to analyze.
Reducing routine transactions and traditional human resource activities
The modern business organizations are increasingly becoming focused on methodologies for reducing traditional HR practices as well as routine transactions in order to deal with transformational and complex management activities (Lee, 2009). As such, HRIS has become necessary as integral part of management activities since the automation of processes is needed to achieve a specialized HRIS. Human resource information system helps in the acquisition, storage, manipulation, analysis, retrieval, and distribution of information concerning the human resources of an organization (Rietsema, 2017). An integrated HRIS system entails the database that all human resource functions share to integrate all services related to HR as well as creating a common language to facilitate the execution of HR functions. Technological advancement is one of the popular salient factors that affect organizations. It has been established that technological changes such as organizational structure, labor structure, and computer-supported managerial activities have significantly contributed to positive transformations of business organizations (Rietsema, 2017, Powell & Dent-Micallef, 1997).
Research activities have proved that the use of IT technologies in organizations is one of the central pillars that contribute to the realization of organizations’ corporate objectives (Tarawneh, 2012). IT techniques enable business organizations to upgrade their internal processes such as communication, markets, organizational structures, and core competencies on a global scale. The use of HRIS has important implications for HR functions. Computers have increased the simplicity of task performance by facilitating the analysis of huge amount of information. Some HR functions such as retention of records and payroll processing have been enhanced by the integration of IT in organizations’ structures. IT as an instrument and a structural factor can easily be integrated into business processes and HRM to improve the role of HR executives (DeSanctis, 1986). According to Pouransari, Al-Karaghouli, & Dey (2016), the significance of human capital and knowledge increases the expectations for increased HR competencies. Besides, the HR functions have become more complex requiring the aid of sophisticated equipment. Therefore, the advancement of technology to incorporate IT in HR roles has undoubtedly led to significant changes to HR practices.
Karikari, Boateng, & Ocansey (2015) stated that the idea of e-HRM (electronic human resource management) involves adopting technology to facilitate the delivery of HR services. Due to the digitization of various activities, the contemporary business organizations are constantly adopting HRIS to improve HR functions. Companies that have HIRS integrated into their structures have been able to manipulate the behavior and performance of their people in to increase their productivity and competitiveness. The incorporation of IT in HR functions is associated with increased and sustained competitive advantage, efficient work processes, and improved decision-making (DeSanctis, 1986).
The impact of HRIS on organization performance
The emergence of HRIS has increased the capacity for essential information analysis to enable HRM practices to be conducted with efficiency (Mukherjee, Bhattacharyya, & Bera, 2014). Thus, HR practitioners are being encouraged to embrace the use of IT since the incorporation of IT in HR results in increased efficiency with which strategies for HRM are formulated (Powell & Dent-Micallef, 1997). Although some researchers have presented contradictory evidence regarding the efficacy of HRIS, substantial evidence has demonstrated that HRIS has numerous impacts on the performance of an organization (Weeks, 2013). HRIS was first introduced by GE (General Electric), and since then, it has continuously been transformed. The system has gone beyond the basics of converting manual information storage to more advanced computerized systems (Tarawneh, 2012). Due to the intensiveness and complexity of HR functions in the modern organizations, companies are considering the automation of HR functions.
IT brings various improvements to business organizations. Empirical research has supported the literature on HRIS which argues that it increases the capacity of organizations to lower administrative and other costs (Bhuiyan, Rahman, & Gani, 2015). Additionally, the integration of IT in HR functions promotes the decision making and personnel productivity. It also enhances the customer services which contribute to market growth and increased firm’s competitiveness (Powell & Dent-Micallef, 1997). The profitability of firms depends on their cost structure. Therefore, by lowering the operation costs, HRIS promotes the profitability of organizations as well as the design of effective business strategies. The effectiveness of the management of human resources also plays an important role in improving the performance of an organization. However, although scholars have presented evidence to support their contentions regarding the impact of HRIS on the performance of business organizations, theory development in this area has been very little to demonstrate the impact of IT on HR in organizations from various sectors. This is due to little attention paid to research on this area (Karikari, Boateng, & Ocansey, 2015).
The selection, design, and use of HRIS in organizations are useful procedures that give meaning attached to technology that highlight the perceived value and importance that affect the extent to which IT is used in a more administrative and strategic fashion. Recent studies on HRIS have highlighted the significance of social contexts and seek to establish frameworks that acknowledge both material and social character of IT including HRIS (Rietsema, 2017). Theories that can be viewed as social constructivist explicitly recognize technologies such as HRIS as important in improving the comprehension, interpretation, use, and engagement in technology.
Sophisticated HRM system software existing in the form of ERP (enterprise resource planning) and stand-alone products offer HR departments in different organizations the capacity to efficiently and effectively perform data administration in various areas such as compliance with regulations and staff training. The literature on HRIS suggests that HRIS impact HR in different ways across various organizations. However, this literature fails to provide a solid explanation of reasons for varying impacts of HRIS across organizations (Karikari, Boateng, & Ocansey, 2015).
HR professionals started to evaluate the possibility of new computer applications with the idea that the integration of these applications on HR functions would make them different (DeSanctis, 1986). The result of this integration is the existence of the third generation of computerized HRIS, feature-rich, self-contained, and broad-based HRIS system. This generation has taken HRIS beyond being a mere repository of data to include sophisticated tools that facilitate the role of human resource professionals (DeSanctis, 1986). HRIS enhances organizations’ potential to assist the function of HR in the development of strategies and improving organizational performance. Further, HRIS system is used in the acquisition, storage, manipulation, analysis, retrieval, and distribution of information pertaining to organizations’ HR. It provides HR professionals with the time they need to concentrate their attention on strategic and critical level tasks like talent management and leadership (Bhuiyan, Rahman, & Gani, 2015). As a result, organizations are able to develop human resources which create an opportunity for HR to engage in the strategic role through their capacity to design metrics that promote the formulation of strategic decisions.
Most scholars have identified the freeing of HR staff from playing intermediary roles in organizations as an important impact of HRIS on organizations’ performance (Lee, 2009). This enables HR staff to focus on strategic planning in the development and resource organization. Additionally, researchers have observed that HRIS helps to automate various routine tasks such as payroll, transactional activities, and administration of benefits (Rietsema, 2017). This automation of tasks creates more time for HR executives to focus on strategic matters like promoting organizational productivity.
The literature has shown some variations in the analysis of HRIS usage with two main extremes of uses. In this respect, some researchers argue that HRIS system cannot be used for administrative functions that reduce both time and cost. Instead, HRIS system is used to support more analytical decisions (Powell & Dent-Micallef, 1997). Further, studies have identified the various uses of HRIS based on the degree of its sophistication. Some uses of HRIS system such as payroll processing, keeping of employees records, and administration of benefits are classified as unsophisticated HRIS functions while selection, recruitment, training and development HR functions are described as sophisticated (DeSanctis, 1986). However, these all these functions promote the productivity of business organizations. Therefore, HRIS is found to contribute significantly to the overall performance of business organizations by supporting the HRM decisions.
IT plays a central role in complementing and leveraging business and human resources. The significance of using HRIS has been expressed as promoting the need for technological advancement that increases efficiency and productivity of firms (Khashman, 2016). Besides, HRIS system has been associated with positive transformations of organizational culture by influencing HR executives to abandon traditional approaches to human resource management and embrace new HRM methodologies. However, some researchers have established that some organizations are hesitant to adopt HRIS despite its numerous benefits until they are fully convinced about these benefits. Some important impact of HRIS besides increasing the accuracy and access to information are related to the idea that HRIS allows organizations to achieve greater competitiveness through the development and enhancement of HR activities and procedures (Powell & Dent-Micallef, 1997). It helps to re-engineer the entire HRM department and facilitate the evaluation of organization’s policies to ensure that they support its vision statement.
Empirical studies have proved that HRIS usage results in increased operational efficiency. It helps to reduce the operational overheads, enhance the data accuracy, and eliminate the cost of information dissemination (Bhuiyan, Rahman, & Gani, 2015). The minimization of technology infrastructural costs helps to move an organization towards a common HR service platform and enhance its capacity to distribute HR service and information globally. Moreover, HRIS has a transformational impact on business organizations. It helps to transform the role of human resource into that of an important business partner and add value to the organization by increasing the influence of HR on customers, resulting in the creation of more responsive and flexible methods of delivering customer service.
The Purpose of HRIS
HRIS is meant for facilitating the provision of services in the form of timely and accurate information. Since there are various users of information related to human resource, HRIS can be used for operational, tactical, and strategic decision-making (DeSanctis, 1986). For example, different organizations use HRIS to make plans concerning the welfare of their employees, program evaluation, and evaluation of practices and policies to test their effectiveness. Besides, HRIS is used for the purpose of supporting daily operations in organizations such as helping managers to monitor attendance and time usage.
Some Challenges of HRIS
The literature regarding the usefulness and implementation of HRIS indicates that due to various barriers associated with technological advancement, some organizations encounter challenges when implementing HRIS. Some barriers identified include cost of maintenance as well as setting up HRIS, lack of enough skills and capital, insufficient HR knowledge by the designers of systems, inadequate HRIS budget, and lack of IT support (Tarawneh, 2012). Furthermore, some organizations do not have qualified HRIS staff to use the new technology while others do not have space and time required to operate thoughtfully and quietly with web-based HR tools. Organizations can use various strategies to overcome these challenges. Some of the useful methods in addressing HRIS challenges include redesigning and streamlining HR processes during the implementation of HRIS system, ensuring effective communication with employees so that they support the incorporation of HRIS and understand how it works. Also, the balancing technology with other important tasks within organizations to ensure that technology does not dominate the relationships between employees is vital to minimizing the challenges of HRIS system (Powell & Dent-Micallef, 1997). Additionally, organizations should not entirely use technology in all aspects, but should also use non-technological approaches where appropriate to avoid technology domination in their operations.
Conclusion
Globalization has made it a requirement that organizations should consider the essence of HRIS system integration in their structure. IT contributes to the growth of organizations in various ways. HRIS allows organizations to meet their HRM strategies that contribute to organizational competitiveness and excellence. The integration of IT in HR promotes the manipulation of critical information for business organizations, resulting in increased productivity. Both literature and empirical studies have highlighted various important impacts of HRIS on organizational success. Therefore, although the implementation of HRIS is associated with various shortcomings, an organization seeking to achieve managerial and other corporate goals should contemplate the adoption of HRIS in its structure.
References
Bhuiyan, F., Rahman, M. M., & Gani, M. O. (2015). Impact of Human Resource Information System on Firm Financial Performance. International Journal of Business and Management, 10(10), 171-185
DeSanctis, G. (1986). Human resource information systems: a current assessment. MIS quarterly, 15-27.
Karikari, A. F., Boateng, P. A., & Ocansey, E. O. (2015). The Role of Human Resource Information System in the Process of Manpower Activities. American Journal of Industrial and Business Management, 5(06), 424.
Khashman, A. M. (2016). The Impact of Human Resource Information System (HRIS) Applications on Organizational Performance (Efficiency and Effectiveness) in Jordanian Private Hospitals. Journal of Management Research, 8(3), 31-44.
Lee, C. H. (2009). Effects of HRM practices on IT usage. Journal of Computer Information Systems, 50(2), 83-94.
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Tarawneh, H. (2012). The effect of applying human resources information system in corporate performance in the banking sector in Jordanian firms. Intelligent Information Management, 4(2), 32-38
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