Impact of Information Technology on a Career - Term Paper Example

Information Technology in Human Resources Management There is movement today for improved uses of information technology in the field of Human Resource Management. I will investigate how companies are influenced by information technology in Human Resources Management (HRM). I first will examine the current state of how Information Technology (IT) is applied in HRM. Second, I will examine how information technology has impacted HRM. Third, I will examine what IT in HRM will have to do for the future in order to remain competitive. I will attempt to show how information technology is a developing field that relates to the future of HRM. I also propose that all companies should raise awareness of how information technology in HRM is needed in order to remain competitive. I first examine the current state of how IT is applied in HRM today. HRM today is becoming more influenced by Information Technology, but some companies are still using IT to cover older HR functions that have been in place for many years, and have not made use of best practices by fully utilizing IT. In the article “An Exploratory Analysis of E-HRM in the Context of HRM Transformation”, the author mentions how the focus for use and investment in IT with HRM has been for a limited number of functions such as basic database and spreadsheet uses, payroll, or other standard administrative functions but overlook better uses of IT such as using technology for corporate strategy (Foster, 3). As mentioned in a publication by the U.S. Office of Personnel Management, some traditional ways of measuring employees by HR will always be needed despite the IT system involved, as in the case of personnel performance reviews. Yet, it is shown that the strategies of employee performance do not always match with departmental goals. This is an area that could be corrected through the use of IT. The article mentions that HR does not normally compile hard statistics or data to prove departmental successes, and hence there may be a lack of clear and documented evidence the benefits that IT provides. Also, HRM’s concentration on internal operations can have limiting effects in the way that senior management decides to use scarce IT investments (U.S. Office of Personnel Management, p. 22). In the article “The Future of Human Resources”, the authors outline how some companies are still in a traditional viewpoint with the role of Human Resources. Several key items mentioned are that the HR department is associated with processing activities (Dattner and Rothenberg, p.5). This would primarily include only items such as staffing, compensation, and benefits. Along with processing activities as listed, HR is often thought of as ‘transactional’ in nature (p.5). These are all standard uses of applying information technology, but are proving more outdated with each passing year since leading companies are changing the role of HR. Other key points that the article mentions is that HR is viewed by many to be simply the ‘police’ of the organization and are merely reactive in how they handle their professional roles instead of being proactive in how they utilize information in the company (Dattner and Rothenberg, p.5). This is yet another item that I will later attempt to show that is quickly changing in the field among competitive and leading organizations. A survey method with HR managers and line managers was performed to see the current state of IT in regards HRM. The survey found an agreement that change is not rapidly progressing in the area mainly due to monetary limitations, and IT investment being spent in other areas of the organization besides HR that are deemed by some to be more critical (Foster, 2-3). Another study into how IT is being applied to HRM found that a lack of perceived value. The study found three items in particular that prevented companies from moving more rapidly in the area of IT and HRM. The areas noted were: (1) a lack of awareness by top executives; (2) a barrier with the traditional mindset of organization management to make any significant IT outlay or investment; and (3) IT being generally deemed non-critical by senior managers in regards HRM (Dery, Grant, and Wiblen, 5). How IT has impacted HR is next examined. A study to find out how organizations are now using their information technology was performed. The authors sent out surveys to various companies in the UK to inquire how they were currently making use of strategy in HRM. Positive results were found in that all but 6 percent of the companies are either now using IT with HRM, or will be at some point in the near future (Hussain and Prouse, 11). According to the article “The Future of Human Resources”, the authors feel that the current state of HR will more fully change to a focus on strategy with information technology playing a larger role by permitting other department managers and HR to partner in the use of company knowledge (Dattner and Rothenberg, p.6). The authors further state that HR is rapidly increasing in importance in the new economy we live in. A firm’s employees are now seen to be the main source of competitive advantage, while HR is coming under closer analysis (p. 6). A study performed found that employees no longer will hesitate to change companies. In fact, 48 percent of mid-level managers in the United States are either currently seeking another job or will search once the current recession is over (Dattner and Rothenberg, p 6). In addition, 64 percent of those surveyed plan on more intense job search efforts once the economy improves (p. 6). These are all the more reason for companies to be investing resources and information technology into HR and attempting to keep the best employees in today’s competitive environment. The same article “The Future of Human Resources” show IT to be an important component of ways HR is currently changing. They found that 32 percent of companies have already had an evaluation and implementation of a new Human Resources Information System (HRIS) with another 46 percent of companies planning on completing one within the next 12 months. The survey also shows that HR is well under way of changing work from the older traditional way. Of companies surveyed, 42 percent have a new HR service strategy program completed while another 42 percent plan on having one completed within the next year. Only 16 percent of companies surveyed have no plans for change in the near future (Dattner and Rothenberg, 7). A survey was conducted where HR directors at Universities were asked to rate their current IT systems. Mixed results were found as 90 percent of the directors said they were satisfied with the current IT system. However, 70 percent felt that IT could be utilized in a better fashion. Reasons for satisfaction included the ability to share information easily throughout the company, along with being able to provide more useful information to top level managers. However, a majority of HR directors thought strategic use of IT was not being used to its full potential (Beadles, Lowry, and Johns, 41-42). IT has ways of becoming more encompassing for HRM. A first step is the capture and distribution of knowledge regarding employees. Other key ideas include having ways to add value to the organization, and showing ways for the company to profit and grow by improved strategic systems. Examples mentioned include an employee performance development system along with a way to track items to improve on the core processes of the company (Schoonover, 3-5). An emerging concept noted is the importance of Knowledge Management (KM). Organizations are often aware of the need to align KM strategy with IT strategy, but will not achieve effective results unless HR strategy is included. The authors gathered data from approximately 160 top ranked companies from Taiwan which support this idea of a three way alignment (Szu-Yuan and Ju, 7). If HRM has the technology to better select, recruit, and train their employees, then the organization is value enhanced. Knowledge is often overlooked in providing value since it is not a tangible asset, yet it should not be thought of as without strong importance to the organization (Plessis et al, 284). Different areas are outlined in the role of the HR management professional. The role of ‘change agent’ is a critical one for HR since they can not only be in position to understand the organization, but use their knowledge of everything from company culture to being the hub or center of critical company interactions (Plessis et al, 282-283). By HRM being central in the company, they have management responsibility for all employee groups. In this way, HRM can share information and knowledge throughout the organization. If given the proper information resources, HRM can utilize both employee ability and various level of management ability to the fullest. Greengard (as cited in Plessis et. al) states that research studies confirm that organizations using information technology in an effective manner to manage the HRM function will have a considerable advantage over the companies which do not have proper IT in place (Plessis et al, 284). HRM should be at the forefront in promoting the idea of having the best company along with the best employees. As Birchfield (as cited in Plessis et al.) mentions, HR cannot become fully utilized unless they are seen as ‘credible’. Credibility is best performed by HR avoiding been seen through a narrow lens as being HR specialists. Having the knowledge provided through effective use of IT can give the department insight into both internal and external drivers of the organization (Plessis et. al, 287). An article by Perry and Mesch mention that an effective use of strategic IT in HRM will both improve service and lower costs. The authors feel that decentralization is important, so that decision making does not rest with HR alone, but can be used by managers in other departments. A greater amount of services can be provided while HR is free to concentrate on personnel tasks, staffing needs, and other high priority HR needs that sometimes would get not enough attention if IT automation was not present (Perry and Mesch, 2-3). New ways of using HRM are presented by an article by Gregeby. The author outlined a ‘change program’ from traditional HRM to new strategic HRM. One of the first steps the author proposes is introducing HR IS software. In addition, new roles for HR staff include: global HR information handling; global HR processes; new HR roles including that of an ‘HR Advisor’; and finally a ‘service centre’ area for providing typical HR administrative functions. (Gregeby, 4-5). A third area I examine is with what IT in HR will have to do for the future to stay competitive. An example of success with IT in HRM is mentioned by Gasco, Llopis, and Gonzalez (as cited in Boateng, 2007). A Spanish telecommunications firm used newly implemented e-training for their employees. Immediate benefits were seen in the 24 hour a day and 7 days a week availability of the training modules along with their user friendly applications. Another benefit was the consistency in training that the modules could provide (Boateng, 34-35). Users today expect information to be available at all times and in remote locations which is different from previous years. A second example is given by Kanthawongs (2004) where the author shows how one institution of higher education can now drastically reduce their time spent with payroll processing. This is advantageous use of the basic IT capabilities that the HR department did not have before their IT system was in place. This was only a beginning step however and further progress for the University is now looked to with both information availability and information analysis (Kanthawongs, 1-2). In their journal article “Enhancing the Effectiveness of HR through the integration of IT”, there is little doubt that information technology is undergoing change in regards HRM, and the change is an ongoing process not to end anytime soon. A study by the Society for Human Resources Management (SHRM) pointed out that the technology is the major trend within Human Resources (Ramlall, p. 47). The article states that the future of HR will be where technology, strategy, and overall HR skills will meet or converge in the best companies (Ramlall, p. 48). The author goes on to mention that improvements are expected with the use of IT in training. By using IT, there are no travel requirements for either initial training or ongoing education, so travel costs are reduced with the ability to use those expenses more effectively for investment in the company (Ramlall, p. 48). This is an important use for the future since over 85 percent of the jobs in the United States will mandate a broad range and use of education and training for improved knowledge sharing (p. 53). In the article, other organizational changes are noted for the future with IT and HRM. Instead of the traditional view of HR as previously discussed, we will see knowledge management systems where there will be real-time interaction between HR and other departments in the company (Ramlall, p. 53). The improvements with IT will allow companies to deliver services to the right parts of the company in better measure in order to outperform competitors. The major improvement for the future will be in the multiple different ways that HR can do this in a more efficient and accurate manner. The above techniques are crucial since it has been found that up to 75 percent of values in firms are with intangible knowledge of the employees (Ramlall, p. 53). According to Plessis, et al (2007), HRM is changing and improving. Areas such as outsourcing; telecommuting; use of IT on an analytical level; and also the HR manager becoming more of an interactive line manager than in the past have been noted from research (Plessis et al, 280-281). Yet another example of progress was found by in a study by Ruel, Bondarouk, and Looise where five large corporations were looked at in how they were implementing IT and HRM. The first point the authors found was a large improvement in efficiency. A second point beyond the improved administrative functions was the improved policy to disperse responsibility of some HR functions to line managers. This was not previously possible until the newer IT systems were in place (Ruel, Bondarouk, and Looise, 5-7). Other examples of progress are found by Zafar, Shaukat, and Mat who found new trends occurring including: (1) better use of IT with recruitment including online recruiting; (2) customized training for employees with online learning; (3) new and improved performance appraisals; and (4) more time allotted for HR to partner with line managers and other departments for strategic improvements (Zafar, Shaukat, and Mat, 20). Information Technology is an area that is ever changing and improving. Most all organizations can benefit from a current evaluation on how they are using IT in Human Resources Management. IT is impacting HRM at some level in most cases, yet some companies may be underestimating the importance of applying best practices with IT. Better uses of strategy in HRM along with using knowledge management are simply two tools that the best companies are utilizing more fully. The firms that can fully employ IT for HRM will have much better opportunities of being organizational leaders for the future. Works Cited Beadles, Nicholas, Christopher Lowery, and Kim Johns “The Impact of Human Resource Information Systems: An Exploratory Study in the Public Sector.” Communications of the IIMA 5:4 (2005): 39-46. Web. http://www.iima.org/CIIMA/11%205.4_Beadles_39-46.pdf Accessed 16 November 2010. Boateng, Asafo-Adjei “The Role of Human Resource Information Systems (HRIS) in Strategic Human Resource Management (SHRM)” Swedish School of Economics and Business Administration. (2007), 1-107 Web http://www.pafis.shh.fi/graduates/agyasa05.pdf Accessed 16 November 2010. Dattner, Ben and Emily Rothenberg “The Future of Human Resources.” (2003) 1-55 http://www.dattnerconsulting.com/presentations/futureofhr.pdf accessed 16 November 2010. Dery, Kristine, David Grant, and Shavna Willen “Human Resource Information Systems (HRIS): Replacing or Enhancing HRM” University of Sydney. (2006) 1-9 Web. http://sydney.edu.au/business/__data/assets/pdf_file/0003/72273/IIRA_Dery_et_al_HRIS_Replacing_or_enhancing_HRM_final.pdf accessed 16 November 2010. Foster, Steve “An Exploratory Analysis of E-HRM in the Context of HRM Transformation” University of Herfordshire. (2008). 1-22 Web. https://uhra.herts.ac.uk/dspace/bitstream/2299/1405/1/S86.pdf accessed 16 November 2010 Gregeby, Johan “The use of Information Technology in Contemporary HRM—A practice-based Of E-HRM at Sandvik Corp” Uppsala University. (2009) 1-13 Web. http://www.edamba.eu/userfiles/file/Gregeby%20Johan.pdf accessed 16 November 2010. Hussain, Zahid and Peter Prowse “Human Resource Information Systems (HRIS) as Means of Fulfilling Job Roles more professionally for Human Resource (HR) Managers” University of Bradford. (2004), 1-26 Web. http://www.brad.ac.uk/acad/management/external/pdf/workingpapers/2004/Booklet_04-07.pdf Accessed 16 November 2010. Kanthawongs, Penjira “Does HRIS Matter for HRM Today?” Bangkok University. (2004) 1-6 Web. http://www.bu.ac.th/knowledgecenter/epaper/jan_june2004/penjira.pdf accessed 16 November 2010. Perry, James and Debra Mesch “Strategic Human Resources Management” Indiana University. (1997), 1-15 Web. http://www.indiana.edu/~jlpweb/papers/Strategic_HRM_Perry_&_Mesch%201997.pdf Accessed 16 November 2010. Plessis, Andries, Pieter Nel, L. Struthers, K. Robbins, and K. Williams “Does Human Resource Management Add Value to Organizations in New Zealand or Is It Just Another Job?” International Review of Business Research Papers (2007) 3:3, 277-296 Web. http://www.bizresearchpapers.com/Plessis.pdf accessed 16 November 2010. Ramlall, Sunil “Enhancing the Effectiveness of HR through the Integration of IT” Journal of Business & Economic Research (2003) 1:10, 47-56 Web. http://www.cluteinstitute-onlinejournals.com/PDFs/2003112.pdf accessed 16 November 2010. Ruel, Huub, Tanya Bondarouk and Jan Looise “E-HRM: Innovation or Irritation?” Utrecht School of Governance (2004): 1-7 Web. http://www.nwo.nl/files.nsf/pages/NWOP_5Y9BY2/$file/MES_eHRM_samenvatting.pdf accessed 16 November 2010. Schoonover, Stephen “Human Resource Competencies for the New Century” (2003): 1-29 Web. http://www.schoonover.com/pdf/HR_Competencies_for_the_New_Century_Final.pdf Accessed 16 November 2010. Szu-Yuan, Sun and Teresa Ju “A Holistic Perspective on the Performance Implications of Strategic Alignment in Knowledge Management” National Kaohsiung First University of Science and Technology. (2007), 1-14 Web. http://www.pacis-net.org/file/2007/1324.pdf Accessed 16 November 2010. U.S. Office of Personnel Management “Strategic Human Resources Management: Aligning With the Mission.” (1999) 1-42. Web. http://www.opm.gov/studies/alignnet.pdf accessed 16 November 2010. Zafar, Junaid, Muhammad Shaukat, and Norazuwa Mat “An Analysis of E-Human Resource Management: A Case Study of State Bank of Pakistan.” European Journal of Social Sciences 15:1, 18-26 Web. http://www.eurojournals.com/ejss_15_1_02.pdf accessed 16 November 2010. Read More