E-HRM

Submitted in Partial Fulfillment for the Award of the

Degree of MBA-HR
2018-2020
3rd Sem

Submitted By: AAYUSHI RELIA

University PRN-1828100607

BHARATI VIDYAPEETH DEEMED UNIVERSITY SCHOOL OF DISTANCE EDUCATION

Academic Study Center - BVIMR, New Delhi
An ISO 9001:2008 Certified Institute
NAAC Accredited Grade “A” University
 Undertaking Certificate

I Aayushi Relia-MBA(HR) would like to declare that the project report entitled “E-HRM
Submitted to Bharati Vidyapeeth University Pune, School of Distance Education Pune,
Academic Study Centre BVIMR New Delhi in partial fulfillment of the requirement for the
award of the degree.

It is an original work carried out by me under the guidance of Mr./Mrs.

All respected guides, faculty member and other sources have been properly acknowledged and
the report contains no plagiarism.

To the best of my knowledge and belief the matter embodied in this project is a genuine work
done by me and it has been neither submitted for assessment to the University nor to any other
University for the fulfillment of the requirement of the course of study.

Aayushi Relia
CONTENTS
 EXECUTIVE SUMMARY

'E-HRMet is the (planning, implementation and) application of information technology for both
networking and supporting am least two individual or collective actors in their shared performing
of HR activities.

E-HRM is not same as HRIS (Human resource information system) which refers to ICT systems
used within HR departments. Nor is it the same as V-HRM or Virtual HRM - which is defined
by Lepak and Snell as "...a network-based structure built on partnerships and typically mediated
by information technologies to help the organization acquire, develop, and deploy intellectual
capital."

E-HRM is in essence the devolution of HR functions to management and employees. They

access these functions typically via intranet or other web-technology channels. The
empowerment of managers and employees to perform certain chosen HR functions relieves the
HR department of these tasks, allowing HR staff to focus less on the operational and more on the
strategic elements of HR, and allowing organisations to lower HR department staffing levels as
the administrative burden is lightened. It is anticipated that, as E-HRM develops and becomes
more entrenched in business culture, these changes will become more apparent, but they have yet
to be manifested to a significant degree. A 2007 CIPD survey states that "The initial research
indicates that much-commented-on development such as shared services, outsourcing and e-HR
have had relatively little impact on costs or staff numbers
 INTRODUCTION

E-HRM is the use of web-based technologies to provide HRM services within employing
organizations. It embraces e-recruitment and e-learning, the first fields of human resource
management to make extensive use of web-based technology. From this base e-HRM has
expanded to embrace the delivery of virtually all HR policies. Within a system of e-HRM, it is
possible for line managers to use desktop computers to arrange and conduct appraisals, plan
training and development, evaluate labour costs, and examine indicators for turnover and
absenteeism. Employees can also use a system of e-HRM to plan their personal development,
apply for promotion and new jobs, and access a range of information on HR policy. Systems of
e-HRM are increasingly supported by dedicated software produced by private suppliers.

E-HRM is the (planning, implementation and) application of information technology for both
networking and supporting at least two individual or collective actors in their shared performing
of HR activities.

E-HRM is not the same as HRIS (Human resource information system) which refers to ICT
systems used within HR departments. Nor is it the same as V-HRM or Virtual HRM - which is
defined by Lepak and Snell as "...a network-based structure built on partnerships and typically
mediated by information technologies to help the organization acquire, develop, and deploy
intellectual capital."

E-HRM is in essence the devolution of HR functions to management and employees. They

access these functions typically via intranet or other web-technology channels. The
empowerment of managers and employees to perform certain chosen HR functions relieves the
HR department of these tasks, allowing HR staff to focus less on the operational and more on the
strategic elements of HR, and allowing organisations to lower HR department staffing levels as
the administrative burden is lightened. It is anticipated that, as E-HRM develops and becomes
more entrenched in business culture, these changes will become more apparent, but they have yet
to be manifested to a significant degree. A 2007 CIPD survey states that "The initial research
indicates that much-commented-on development such as shared services, outsourcing and e-HR
have had relatively little impact on costs or staff numbers".

Kehoe, Dickter, Russell and Sacco (2005) points out that the organization’s overall culture and
HRM strategy determine the manner in which organizations will implement their e-enablement
systems. The e-enabled programs can either be implemented as part of a broad e-enablement of
HR processes and systems, or implemented independent of other HR processes and systems. It is
even possible that specific e-enabled assessment applications may be implemented independent
of each other. No matter what, organizations need to develop guiding principles regarding the
following issues on the management of an e-enabled HR environment:

* Risk management relating to employment discrimination

* Buy versus build and the roles of internal HR IT and third party providers

* HR expertise versus automaticity in the e-enabled assessment process

* Whose functions the system will be designed to support

* Ownership

* The integration of e-enabled assessment with other HR systems and process

* “Free market” versus “regulated” processes

 BACKGROUND OF E-HRM

Since the mid 1990s, organizations increasingly introduce electronic Human Resource
Management (HRM). It has different names, for example e-HRM, digital HRM and web-based
HRM. The rapid development of the Internet during the last decade has also boosted the
implementation and application of electronic Human Resource Management (e-HRM). Surveys
of HR consultants suggest that both the number of organizations adopting e-HRM and the depth
of applications within the organizations are continually increasing (e.g. CedarCrestone, 2005) in
world wide. In addition, an escalating number of practitioner reports provide anecdotal evidence
that e-HRM is becoming increasingly common and may lead to remarkable changes (e.g.
Anonymous, 2001). Consequently, academic interest in e-HRM has increased, as several special
issues of HR-related journals demonstrate (Stanton & Coovert, 2004; Townsend & Bennett,
2003; Viswesvaran, 2003). In the interim, there is an initial body of empirical research in e-
HRM. However, since this research stems from several disciplines and is scattered throughout
numerous journals and since initial reviews are not encompassing (Anderson, 2003; Lievens &
Harris 2003; Welsh, Wanberg, Brown, & Simmering, 2003), the results of these studies remain
unclear at present.

Furthermore, changes in the role that HR fulfills in the organization and the implementation of e-
HRM are related to each other, and should not be considered separately (Gardner et al., 2003;
Fletcher, 2005). The implementation of e-HRM should fit well with strategic organizational
needs regarding personnel in general and HR redesign in specific. Little is known about this fit,
however. In relation to this point, the possible perception of e-HRM as an attempt by the
strategic level within the organization to offload operational HR work onto employees
respectively managers should be taken into account when analyzing acceptance of e-HRM
systems.

In the last decade the Internet has radically changed our social and economic lives, and has had a
profound effect on the way organizations are managed. For example, it has altered human
resource (HR) practices and changed strategies for attracting and retaining employees. The same
strategies have become particularly important because organizations increasingly depend on
workers’ knowledge, skills, abilities, and other attributes (KSAOs) to compete in today’s
economy (Ulrich, 2001) in Oman. In addition, the Internet has enabled organizations to become
more collaborative, connected, and responsive to the changing needs of the workforce. For
instance, new electronic human resource (e-HR) systems allow individuals to apply for jobs,
change their job-related benefits, and enhance their knowledge, skills, and abilities (KSAs)
through web-based training systems. The type of information technology adopted by HRM has
been phrased, as it has evolved, differently over the years, for example: Human Resource
Information System (HRIS), Human Resources Management System (HRMS), Human Resource
Development And Information Technology (HRDIS), and the most current and popular
“electronic HR” (e-HR). The use of IT by HRM is growing especially critical to the business
nowadays when discontinuities (mergers, acquisitions, restructuring and downsizing) are altering
the industry landscape in a drastic way. HRM executives, the key figures in organizations
responsible for fine-tuning a capable workforce, must have the right and real-time information to
measure, manage, and predict how workforce should be allocated and reconfigured effectively.
With the analyzed information produced by the IT, HR professionals, more than ever, are able to
align their management goals and the goals of individual employees with corporate strategy to
deliver strategic plans with quantifiable results, and, ultimately, be able to deal with changes
proactively. With the help from the information technology, HRM professionals are also able to
demonstrate the HRM’s benefit to the bottom line by effectively managing knowledge, skills and
abilities (KSAs) that create winning companies.

Human resource management (HRM) departments using information and communication

technologies (ICTs) is becoming an increasingly important phenomenon commonly referred to
as e-HRM. Automating HR tasks and practices is transforming the traditional paper-and-pencil,
labor-intensive HR tasks, into efficient, fast-response activities that enable companies to
anticipate and profit from environmental shifts to create a much needed competitive advantage
(Marler, 2006; Watson Wyatt, 2002).

Even though the e-HRM concept is widely used today, there are hardly any explicit definitions.
The few detectable definitions (Lengnick-Hall & Moritz, 2003; Ruël, Bondarouk, & Looise,
2004) are rather general and emphasize the Internet-supported way of performing HR policies
and/or activities. Leaning on these intensions, the following definition of e-HRM can be
specified: e-HRM is the (planning, implementation and) application of information technology
for both networking and supporting at least two individual or collective actors in their shared
performing of HR activities. This concept highlights several crucial aspects of e-HRM. At the
outset, e-HRM utilizes information technology in a twofold manner: First, technology is
necessary to connect usually spatially segregated actors and enable interactions between them
irrespective of their working in the same room or on different continents, i.e. technology serves
as a medium with the aim of connection and integration. Second, technology supports actors by
partially – and sometimes even completely – substituting for them in executing HR activities.
Hence, information technology serves additionally as a tool for task fulfillment. The planning
aspect accentuates the systematic and anticipated way of applying information technology. The
shared performing of tasks through at least two actors’ points out that the sharing of HR
activities is an additional feature and underlines the aspect of interaction and networking. The
consideration of individual and collective actors takes into account that e-HRM is a multilevel
phenomenon; besides individual actors, there are collective actors like groups, organizational
units and even whole organizations that interact in order to perform HR activities. Beside e-
HR(M), there are some further concepts which obviously refer to the same phenomenon. Widely
accepted are such terms as virtual HR(M) (e.g., Lepak & Snell, 1998), web-based HR(M) (e.g.,
Ruël et al., 2004), or business-to-employee (“B2E―) (e.g., Huang, Jin, & Yang, 2004).
“Virtual HRM― refers to technological mediated networks of different internal and external
actors providing the firm with the HR services needed without the further existence of a
conventional HR department which therefore becomes “virtual―. E-HRM is additionally
open to less developed varieties of technology application, e.g. the shared performing of an
application process by a conventional HR department and an applicant via the Internet. “Web-
based HRM― couples the concept to Internet technologies. E-HRM, as well, is particularly
web-orientated, but also comprises additional technologies like networked ERP-Systems.
Finally, “business-to-employee― reduces the concept to the internal actor categories of
“business― (presumably line managers and HR professionals) and “employees―. In
contrast, e-HRM is open to further relevant actor categories like applicants or consultants. To
sum up, these further terms undoubtedly direct attention to main characteristics of the same
phenomenon but are of somewhat narrower intensions. Thus, in order to comprehensively
embrace relevant aspects, the e-HRM term is used.

Fundamental definition of HRM offered by numerous scholars remains to be “the managing of

people who work in an organization” (Gomez -Mejia, Balkin & Cardy, 2001). Another popular
definition of HRM specified the “top management of the corporation” as the only employer of
the HRM staff (Renckly, 1997). Based on this thinking, HRM is “to essentially establish,
develop, maintain, and communicate personnel policies to the entire company”, and thus, “to
represent, help, advise, and consult with the employees of the organizations”. It is apparent that
HRM was defined from an employer perspective, and was expected to serve and represent “first,
last and always” the best interests of their “only employer”: top management.
Beer and Spector (1985), representing another group of researchers and HRM practitioners,
defined HRM from the “relationship” perspective as the management of this relationship
between employees and the organization which, more specifically, “involves all management
decisions which affect the nature of the relationship between the organization and employees—
its human resources”. Nadler (1990), on the other hand, defines HRM from an organizational
learning point of view as: the “organized learning experience in a definite time period to increase
the possibility of improving job performance and growth”.

As human resource (HR) management departments continue to move to internet or web-based

technology (The Hunter Group, 2001), more research evaluating the use of web-based HR, or
electronic human resource management (e-HRM) is needed. The fastest growing trend in the
delivery of HR information is employee self-service (ESS) (Gueutal, 2003). These applications
give employees the ability to access and maintain their personal HR information via the web.
Another growing trend is the adoption of managerial self-service (MSS) which provides
managers access to a variety of HR tools and information via the web (Gueutal, 2003). Most
manager HR-related tasks can be completed via MSS applications including pay
administration/compensation, performance management, staffing, and employee development
(Gueutal, 2003). Another term used to describe these tools utilized within a given organization is
human resource information systems (HRIS), which Kavanagh and Thite (2008) define as
“the system used to acquire, store, manipulate, analyse, retrieve, and distribute information
regarding an organization’s human resources.

Lepak and Snell (1998) refer to the four ‘pressures’ of virtual HRM. First of all, HRM
departments are asked to focus on strategic questions. Secondly, these departments need to be
flexible in terms of policymaking and practices. Thirdly, HRM departments should work
efficiently and be aware of costs. Fourthly, HRM departments should be service-oriented
towards management and employees. In short, HRM departments must be strategy-focused,
flexible, efficient, and client oriented; and all at the same time (Lepak and Snell, 1998). Ruël et
al. (2004) highlighted an aspect that is fairly well covered by the above but that is nevertheless
interesting to spell out, namely the changing nature of the employment relationship. With the
supply shortage in the labor market (during the economic upturn of the 1990s), the
individualization of society, and the increased educational level of citizens (and thus of
employees), the power balance in the employment relationship has shifted in the direction of the
employees: they want to steer their own career paths. In the view of Ruël et al. (2004), a move
towards e-HRM can provide the tools to support this development. This aspect fits into earlier-
mentioned drivers such as improving service towards internal clients, but has an external societal
drive. Yet another goal of e-HRM was stressed as the outcome of the case study research
conducted by Ruël et al (2004): it is necessary to recognize that to improve a company’s global
orientation can become a strong drive to start with e-HRM. Theoretical debates suggest three
goals of e-HRM are cost reduction, improving of HR services, and improving strategic
orientation (Brockbank, 1997; Lepak and Snell, 1998; Stanton and Coovert, 2004). Few
empirical findings supplement these goals with globalisation as a driving e-HRM force in
international large organisations, but also show that those goals are not clearly defined in
practice, and that e-HRM mostly directed at cost reductions and efficiency of HR services, and
least – at strategic orientation of HRM (Gardner et al, 2003; Ruël et al, 2004; Ruta, 2005).

HRM effectiveness is often mentioned as HRM contribution to firm performance (see, for ex.,
Kane et al, 1999; Ostroff and Bowen, 2000; Wright et al, 2001). Especially during the past
decade the HRM literature made attempts to show that progressive HR practices result in higher
firm performance (Wright et al, 2005; Hope Hailey, 2005). Huselid’s (1995) pioneering study
has shown that a set of HR practices labelled High Performance Work Systems were related to
turnover, accounting profits, and firm market value. Since then, a growing number of studies
have attempted to empirically test the relationships between HR practices and firm performance
(see elaborated overviews by Delery and Doty, 1996; Ostroff and Bowen, 2000; Boselie et al,
2001; Tsui and Wang, 2002; Wright et al, 2005). For example, MacDuffie (1995) has found that
bundles of HR practices were related to productivity and quality in his sample of auto assembly
plants. Delery and Doty (1996) found significant relationships between HR practices and
accounting profits among a sample of banks. Youndt et al (1996) discovered that certain
combinations of HR practices in their sample of manufacturing firms were related to operational
performance indicators. More recently, the study of Batt (2002) examined the relationship
between HR practices, employee quit rates, and organizational performance in the service sector,
and revealed that quit rates were lower and sales growth was higher in call centers that
emphasized high skills, employee participation, and human resource incentives like high
employment security.