With the growing adoption of technology for day to day operations of businesses, there has been an increasing need to integrate technology into the core functions of HR. Data analytics has been employed to solve issues related to business and the function has been extrapolated to other domains so as to reap its benefits there (Oz, 2008). If a company can utilize the data that it has on its employees in order to know who is the most productive and deserving of a pay rise, then such an attribute can be adopted in determining which employee to retain in case of layoffs. Mayfield, Mayfield, & Luday-to-daynce (2003) indicated that an effective IHRS ought to be installed in such a way that it is in line with the company’s vision and its business mission. This paper will be analysing how that can be achieved by looking at the informational requirement of a HRIS, IT based information systems and specific organizations that are using them in their HR departments.
2.0 Informational requirements of the HR functions at operational, tactical and strategic levels
The modern business organization is concerned with optimizing its operations so as to make profit and gain competitive advantage on competitors. With such a goal, the firm must deploy and harness all of its resources towards the realization of these goals. Human resource is very essential to each business because it is a unique non imitable source of competitive advantage for most of today’s businesses (Kavanagh, Thite, & Johnson, 2011). Businesses that have realized this have therefore sought for better methods to manage this resource. With the adoption of technology in business and the integration of information technologies in businesses, the field of Human resource has not been left behind. Human resource managers have too realized that with a better knowledge and management of data from their personnel they can be in a position to streamline operations through analysing data so as to make the right decision.
2.1 Operational requirement of an Information system for HR functions
For a modern HRIS to be considered as efficient some of the operational features that it should have include; a centralized database, a payroll, an employee self-service system, a time and absence management system, a talent management system and a recruitment, training and succession planning system (Dessler & Varrkey, 2005). The role of a centralized database is to collect, store and display consistent and up-to-date information about human resource, procedures and policies within the organization. In the era of cloud computing most organizations are having their confidential data stored in a centralized cloud based HRIS software where the data costs are reduced, there is data integrity, there is little or no data redundancy and improved productivity and efficiency. According to Oz (2008) a central database that is seamlessly integrated with other HR functions not only facilitates virtualization but it also offers a great accessibility to all users who access the system. A payroll system on the other hand automate the payment process, it auto-compute taxes so that employees can have their taxes remitted as per the legal frameworks, it also ensures that there is statutory compliance and it extends the employees self-service options. A time and management system is part of the HRIS system that auto captures and submits timesheets entries. It also performs workforce scheduling, performs leave tracking and management while also integrating with payroll and other accounting functions.
2.2 Tactical requirements of a HR information system
In most organizations the HR department roles mostly consist of hiring and recruiting, training and development, handling employees’ compensation, employees’ relations and benefits and legal responsibilities (Bal, Bozkurt, & Ertemsir, 2012). Most of these functions are in many ways related to processing data. A case in point is when a company is recruiting new employees. In such a scenario a company will have vacancies that require people with certain specified credentials to take them up. In a pool where there are many applicants ready to take up the position the HR department should come with a system that has the requirements of the job measured against those of the job seekers. This means there should be a system within the organization that can allow for job seekers to enter their data in form of curriculum vitae and other such testimonials. The system should then process the data so as to give the HR manager tasked with recruitment the most suitable candidates for the positions. Bal et al., (2012) noted that the system can also have a database on the existing employees of the organization where information on their training, competencies and level of experience is kept so that in case of promotion the system can be consulted to give the most qualified candidate for the position. The advantage of such a system is that it removes the tendency for favouritism that usually occurs when the organization is huge with more people who can be considered for the same position.
2.3 Strategic requirements of a HRIS
On the strategic requirement of a HRIS system the concern is on the features of a HRIS system that give businesses competitive advantage over other businesses that do not use the system. The first of these is talent management (Stair & Reynolds, 2012). A talent management system can be envisioned as a system built with considerations that personnel in the company are the most valuable resource in the organization. The system therefore admits that the process of engaging, hiring, developing and retaining talent is complicated (Mayfield et al., 2003). The other strategic feature of a HRIS system is a recruitment portal. This feature is considered as important as it has a tracking system with a reporting engine and can analyse the trends and patterns in recruitment. It also integrates with job portals, employment service providers websites so as to reduce chaos in hiring (Perrin, 2008). The other feature is that of training. An efficient system must incorporate a training program that is directed towards increasing the skills of the employees. Such a system can be in form of a portal that is maintained on the company’s website where employees can plan, track and monitor their training so as to gauge on the impact and effectiveness of the training (Bal et al., 2012). The other feature should be on succession planning. This feature is concerned with anticipating what can happen in case of the departure of some individual from a role that they perform. There should be a workable plan that shows a clear cut out roles that those in the chain of command can take.
3.0 IT based information systems that help in dispensing HR functions
Today, most of the HR functions have an imprint of information systems on them. This is evident in recruitment process sub-functions that range from attracting candidates to an organization, processing applications and on boarding of those who have been hired. Information systems have also made it possible for organizations to place online job advertisements on company’s websites and on internet job boards (Oz, 2008). There have also been new trends such as online CV databases that allow HR practitioners to access a bigger pool of talents that they would want to hire in their companies. There have also been development of IS supported workflows that are used in the contracting phase of recruitment processes(Keim & Weitzel, 2009). Some of these new applications of IS in HR are discussed below.
Broadly, HRIS systems may be categorized into four classifications. That is, operational HRIS, tactical HRIS, strategic HRIS and comprehensive HRIS (Majumder, 2016). Operational HRIS are for use mainly by the HR managers as they help them in dispensing routine and repetitive HR decisions. These kind of systems are made of HR based information systems that have unique features that enable them to collect and analyse massive personal information data concerning the employees (Chakraborty and Mansor, 2013). Within this this category type of HR systems are Employee Information Systems (EIS), employee control and the performance management system. EIS help organizations to keep track of employee’s records on issues pertaining to their personal and professional details. This will mostly be the name, sex, address, minority status, citizenship and past professional experience (Bal et al., 2012). PCS on the other hand are HR systems that identify employees on the basis of the positions that they occupy within the organization. These information systems are programmed in such a way that it shows a position in the company and the employee who currently holds the position. This system enables the HR managers to effectively identify the details of each employee especially detail concerning their responsibilities and duties and position within the organisation. The PMS system on the other hand is designed to track the performance of individual employee. The system is used to appraise, track and monitor the employees performance based on the metrics set by the specific organisation (Majumder, 2016). This system is mainly used for employee grievances resolution. It is also enables the company to key HR decision such as promotions retentions and terminations of employees with certainty as such decision are usually based on fats stored in the information systems. The systems are mostly made by the company’s system developers but it can also be obtained from vendors like Rosalsoft Technologies Limited.
The Tactical type of HR Information Systems enable HR managers to make decisions on how to utilise resources provided for HR function. According to Kavanagh, Thite & Johnson (2011) these can be on matters regarding recruitment decisions, design decisions, job analysis, employee compensation plans and training and development for employees. The subgroups of THRIS include; Job design systems that help in designing job roles an responsibilities. Others are the recruitments systems and the training systems that help in training employees in the organisation (Oz, 2008). JDAIS mostly consist of systems with data from supervisors and workers where information such as affirmative action is outlined. They can also contain data from external sources such as labour organizations, competitors and government agencies. RIS is about recruitment of new employees. This system mostly includes a portal that recruiters can access for updating the vacant positions and putting requirements for the job (Zafar, 2013). The platform can also be accessed by job seekers where they can upload their testimonials and academic certificates. A CBIS system focuses on the compensation of the employees. ETDS is concerned with issues of training and development of human resource(Dessler & Varrkey, 2005). Mostly this will be a portal that can have programs and schedules on how workers are supposed to get training so that they can remain relevant and up-to-date with the skills that are needed. These systems are mostly obtained from external vendors since they are complicated for small and medium companies to develop internally. The companies therefore prefer to outsource or acquire them from vendors (Ba et al, 2012).
Strategic HRIS are systems that are designed to support labour negotiations, workforce planning, and specialized HR software. Their main aim is to make HR managers have an idea about the overall labour resources and work planning (Stair & Reynolds, 2012). According to Nagendra and Deshpande (2014) some of the major types of strategic HRIS include; the Information Systems that enhance employee planning known as ISSWP, then there is the HR resource planning software which is mostly used by companies that want to expand operations in new locations or open new factories. In such situations, these systems provide information on the type of workforce, and skills that the employees needed at the new site should possess. This reduces time spent by HR in HR mapping and also saves company’s finance while ensuring that the company is achieving its goals (Majumder, 2016).
4.0 Evaluation of organizations that are using internet based IS for HR activities
4.1 Amazon’s use of a HRIS system
Amazon Inc. is an American technology company that mostly known for its worldwide e-commerce portal Amazon.com that is used to buy goods online (Amazon, 2019). Today the company is the world’s largest internet company by revenue and the second largest employer in the United States with over 613,000 employees. Due to the huge database of employees that the company employs, the company uses a comprehensive type of HRIS system to monitor employees. The system that is dubbed as Connections was developed after there were damning reports in the media about the company’s bad working habits (Connelly, 2015). Amazon’s Connections was therefore as a HR Employee Information System for evaluating the daily operating conditions of the company from an employee’s perspective. The system requires that workers submit their daily feedback on an array of work related areas such as job satisfaction, training and leadership opportunities (Zafar, 2013). The company has developed an internet based App that is known as Amazon A to Z that is integrated into the company’s system for monitoring the progress of employees.
The adoption of Connections by Amazon has been hailed for making it possible for employees to express themselves and for providing insight and feedback into the nature of work in a non-confrontational manner (Bal et al., 2012). Prior to deployment of this system, the company was in the news with employees complaining of how the algorithmic nature of their bosses was making their working conditions tough and leaving them stressed with no job satisfaction thereby exposing them to stress (Kantor & Streitfeld, 2015). Though the implementation of Connections might not be entirely attributed to the comeback that Amazon is making from the negative media reports, it is evident that a HRIS system can be used to analyse the nature and situation of work environment with the aim of improving it.
4.2 McDonald’s use of a HRIS system
McDonald is the world’s largest restaurant chain of hamburgers fast food by revenue serving around 68 million customers daily in over 100 countries. The company is headquartered in the US where it was founded in 1940 by Richard and Maurice McDonald (McDonald Inc., 2018). The company has over 1.9 million employees making it the world’s second largest private employer after Walmart. Due to the company’s large size and the varied cultures that it operates on the company uses a ERP system that is fine tuned to work in the different environments. From 2004, the company has implemented a K/3 HR Personnel Management, Payment Management system and the Employee capacity Quality Module (Gould, 2013). The K/3 HR management system is a HRIS platform that manages personnel files, input dynamic human resource data and manage payroll.
McDonald’s K/3 HR management system is a form of Employee Information System that not only records employees transfer and transfer records, but it also captures the related workflows. That means that if an employee who had resigned came back and rejoined the company, the K/3 HR system at McDonalds can retrace the history of the staff if the ID provided is similar to the one that was used at the first time of registering the worker in the database (Gould, 2013). The system comes in handy in providing essential information that can be used for hiring or promotion of staff within the organization. Also considering the complexity and magnitude of the company, McDonald saves a lot of resources that would be used if such a system did not exist and the company had to rely on paperwork to manage its vast workforce.
The acceleration and growth that has come with the digital economy has led to the exponential growth of data. This is due to the prevalence of technological advancement that has come with the digital economy. Human Resource Information Systems provide a way through which data from employees can be harnessed so as to make the organization be in a position to exploit the full potential of this key resource. With a good HRIS, a company can be in a position to attract, recruit, hire and retain the best talent that is aligned to the objectives of the company. An organization can also make significant savings on its expenditures if they could put in place a robust HRIS system that can seamlessly integrate multiple functions that can in most cases be automated. There are other benefits too to be expected such as efficiency and cutting back on paper work that is needed in the absence of an efficient HRIS system.
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