In many organisations, Information Systems (IS) affects every aspect of business operations (Harrison, 2003). Klaus et al., 2000 cited in Hasan et al., 2011 stressed that the corner stone of success in these fast-changing environments is to understand and improve business processes. To modify how they conduct business, major companies are taking full advantage of a variety of packaged information system (IS).
The widespread use of Human Resources Information Systems (HRISs) and web-based applications in global business raises the question regarding the new competencies required for Human Resources (HR) professionals.
Human Resource Information Systems (HRIS) refers to software packages that address HR needs with respect to planning, employee information access, and employer regulatory compliance. HRIS have become one of the most important tools for many businesses. It is advancing to become its own information technology (IT) field which allows companies to cut down costs and offer more information to employees in faster and more efficient way (Fein, 2001). Any transformation of HR, or of People Management or of Performance Management without paying attention to their HRIS capability and needs will be unable to handle their strategic role and measure their contribution to the organisation, and run the risk of letting the traditional functions of HR administration to fall behind.
This essay will consider the case study of a large company implementing the HRIS element of an Enterprise Resource Planning (ERP) – HR SAP software.
In this company the ERP project was considered to be one of the most important change events in the history of the organisation,
HR data are wide in their variety, and include job history (transfers, promotions, etc.), current and historical pay details, inventories of skills and competencies, education and training records, performance assessment details, absence, lateness, accident, medical and disciplinary records, warning and suspensions, holiday entitlements, pensions data and termination records (Tensley, Newell and Williams 2001).
An HRIS provides an electronic database for the storage and retrieval of HR data that is at least potentially available to anyone who may want to access it. The important issue is how these IT systems are actually used in the HR task (Hejazi, Halpin and Biggs, 2003).
Using an HRIS to automate HR information management practices can therefore enable both greater efficiency in current HR practices and, at the same time, reduce overhead costs via task mechanisation and process automation through the substitution of the human agency of HR specialists. Handled with care, this can result in an improved HR service, by offering a faster service and improved quality and consistency of information (Hall and Torrington, 1989).
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However, while the automating potential of IT can improve efficiency in transforming HR practices, it does not alter the fundamental role of HR. It is merely used to support more effectively the “direct control” approach (Watson, 1994) to employee relations making the employees’ activities and levels of productivity more “transparent” to the line or HR manager, to facilitate close supervision and monitoring of tasks. de Pablos, 2004; Katou and Budhwar, 2006 as cited in (Troshani, Jerram and Hill, 2011) pointed out that at the strategic level, HRIS can improve organisational performance and change the way in which organizations are managed through the use of SAP.
To explain more on how SAP software of ERP enhances the company’s HR practices, Zuboff coined the term “informate” to explain how IT “tools” can generate new sorts of information, where “information is yielded as a by-product, thus generating new streams of information” (Zuboff, 1988, p. 9 cited in Tensley, Newell and Williams 2001). In HR, reports can be generated from data input into an HRIS database via previously programmed report generators, thereby making “transparent” HR collective data from the aggregation of the personal data actually input. Thus attempts to develop from an automate style of information management towards one that is more informating is clearly one that is possible and enables HR specialists and others to strategically “act on” HR information in their organisational decision making.
The one area where there was common agreement was that SAP could potentially encourage much greater knowledge sharing across the HR function itself. The HR functions include payroll, time management, training and development, recruitment, personal management and workforce (Anna and Lai, 2009).
Payroll is an important aspect in the HR department. The process of determining the pay is called a payroll run. In the payroll run, the HR SAP system assesses the input data and notes any differences in an error log (Monk and Wagner, 2009). If any error is found, the payroll staff reviews the error until the corrections have been made. The information (including employee’s pay and, statutory and voluntary deductions) generated are forwarded to the Finance department.
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Hourly employees, who are paid for each hour worked, must record the time that they work so that they can be paid. Though salaried employees are not paid based on hours worked, their time must equally be recorded and tracked. The system uses a Cross Application Time Sheets (CATS) to record employee working times and provide the data to the Finance department (Monk and Wagner, 2009).
The personnel development component of the HR SAP system supports the planning and implementation of employee development and training activities. Using the system allows the HR professional compare an employee’s qualification with the requirements for a position. The comparison enables the HR professional to identify gaps and to plan development and training needs to close gaps. The system maximises an employee’s ability to contribute to the organisation. Without an effective human resource information system, managing the training, development, and competencies need for a company’s employees can be both time consuming and error-prone (Monk and Wagner, 2009).
Another HR function in using HR SAP according to Schweyer, (2004) has to do with recruitment. The system collects and processes different types of information needed to construct the recruitment plan, including a list of unfilled positions, the duties and requirements of these positions, person specification and job description. The system basically provides the HR professional with necessary data on vacant positions, the educational requirements to facilitate both internal and external job posting (Kandula, 2005). The HR SAP helps to attract the right people, develop and leverage their talents, align their efforts with corporate objectives, and retain top performers (SAP, 2011). This information links with the line managers and the human resources in the organisation. As well as enabling them to handle company’s applicant tracking activities, SAP e-recruitment ensures that you drive up-to-date human resources management by proactively maintaining contact with applicants, potential candidate and consequently, with the employees. It enables them to set up a talent pool to put the right people in the right place at the right time; this has to do with succession planning. Thus, the application links recruitment and succession planning with the internal HR infrastructure (Schweyer, 2004).
The HR SAP offers HR professionals options in reporting and analysis that provide real-time insight into workforce. The system identifies trends at an early stage and makes well-informed decisions, enabling them manage human capital more effectively, predict human-capital investment demands, and track workforce costs and the Return on Investment associated with HR projects (SAP, 2011). The information that HRIS deliver can help strategic planning by forecasting future workforce demand and supply requirements, thereby becoming an invaluable tool for employers in improving their ability to respond swiftly to changing competitive landscapes and helping them craft suitable strategies, including tailoring remuneration packages, making suitable training investment and accurate salary forecasts as market condition changes (Lippert and Swiercz, 2005).
Finally, HRIS could never think by itself on what kinds of data are essential on strategic decision making and what kinds of analysis should be done to support decision making.
It is important to understand to SAP helps to meet the needs of the company
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