Proceedings of 26th International Business Research Conference

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Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
An Analysis of the Implementation of E-HR Practices at TNT
Business Solutions Ltd
Gulshanrai Babajee, Ram Goolaup and Naushad MamodeKhan
Organisations are operating in a fast and constantly changing environment
and have, to become competitive to ensure their survival. TNT Business
Solutions Ltd, one of the main actors in the BPO sector in Mauritius with an
increasing workforce every year, has started e-HR practices with a view to
reduce cost and processing time of operations. Today, Information
Technology (IT) is rapidly changing the face of corporate world. Each
profession is now using IT to enhance their work life and to provide better
products and services to their customers, both internal and external. The HR
function which was formerly associated with administrative duties has proved
to be a very important function these days. More importantly, HR area is
proving to be role modeling the organization by going for low cost strategy and
greater efficiency. The objectives of this study were to identify the main factors
associated with the successful implementation of eHRM practices at TNT
Business Solutions Ltd and determine the challenges related to its
implementation. Data has been collected through a survey whereby
questionnaires were administered to a sample size of 220 respondents. Data
has been analysed using SPSS. Based on the findings, some essential factors
for an effective eHRM implementation have been identified. They are cost
effectiveness, speed and accuracy of transactions, better communication,
boost in employee’s efficiency and a considerable reduction on the time
consumed and errorproned HR paper work amongst others.
Keywords: e-HRM practices, cost effectiveness, challenges, employee‟s efficiency
Field of Study: Human Resource Management
1. Introduction
The fast growth of the World Wide Web during the past decade has propelled the HR functions
towards a new concept, the e-HRM approach. Imperatori and DeMarco (2009) argued that for
many organisations, e-HRM applications are a way to enable their business to be more versatile
and to promote knowledge-sharing, while for employees who are fans of technological
innovation, e-HRM solutions allow them to manage their working preferences.
In this chapter, we start by comparing distinct views from various authors on e-HR/e-HRM; we
then present some benefits of e-HRM practices, possible obstacles and challenges in
implementing e-HRM systems, followed by future trends in this field.
_______________
Gulshanrai Babajee, Software Engineer, TNT Business Solutions, Email: [email protected]
Ram Goolaup Lecturer, Faculty of Law and Management, University of Mauritius,
Email: [email protected]
Naushad MamodeKhan, Lecturer, FSSH. University of Mauritius, Email: [email protected]
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
1.1 E-HRM Implementation: Different Views
E-HRM can be defined as “a way of implementing HR strategies, policies and practices in
organisations through a conscious and directed support of and/or with the full use of webtechnology-based channels” (Ruel et al., 2004). “E-HRM can be used for transactional activities
(i.e. those that involve day-to-day transactions and record keeping); traditional HRM activities
such as recruitment, selection, training, compensation and performance management; and
transformational activities that add value to the organisation.” (Thite and Kavanagh, 2009).
Ulrich (2000) states that e-HR, through self-service, requires additional involvement of
employees and managers in HR practices. The employees and managers become more familiar
about HR practices and HR devolvement becomes a reality. This distributed knowledge poses
the challenge for HR professionals to consistently keep up with new developments in their field,
in order to maintain their advisory-consulting role.
According to Noe et al. (2000) HR functions can become essential allies in generating business
success, however, in order to attain this objective, HR needs to review its target, its role and
delivery capabilities. E-HRM represents the handling and transmitting of electronic data and
information used in Human Resource Management (HRM) from one machine to another. It is
capable of changing all the classical HRM functions allowing employees to work remotely from
different locations and still doing their work as expected as if they are working close to each
other. For example, with the use of internet, organisations can search for skills without
geographical restrictions. Online job applications as well as screening of candidates from the
company‟s website or from websites of companies which specialise in online recruitment can be
done instantaneously during recruitment phase. With regards to training and development
needs, employees from different sites of the same organisation can receive the similar training
via the company‟s intranet without the need to move to another location or any training venue.
Walker A.J (2001) stated that if HR innovation technology is to be considered effective, it must
amend the work performed by the HR staffs by considerably improving their level of service,
enabling more time to perform work which brings greater value, and decreasing their expenses.
People often says that the implementation of HR systems, leads to a reduction in HR personnel
and outsourcing but Walker argues that over the past ten years, study results illustrate that, in
general HR departments have increase their number of employees to do the same work.
Moreover, Walker highlights that there need to be a complete business process re-engineering
of the HR functions prior to e-engineering the HR activities.
Electronic performance management system (E-PMS) and e-recruitment are two of e-HR‟s
latest trends, more out of convenience than pure need: “managing of appraisal forms and
resumes are one of the biggest headaches for HR professionals and managers. Something like
e-leave, on the other hand is already history”, based on Varma study (2010, cited Wong 2003).
As a more general trend however, Wong suggests that any e-HR usually reaps quick benefits,
including a paperless and more efficient working day for many HR practitioners: “as
organisations become more knowledgeable in e-HR, they begin to see the benefits almost
immediately.”
On the basis of work by Mitchell (2002), the rationale for implementing Employee Self-Service
(ESS) systems suggests that delegating these administrative HR activities to employees and
managers increased data input precision and reliability, speeds up HR processes and decision
making process. It also supports business integration, increases organisational flexibility,
customises HR service delivery, produces innovations in HR, improves organisational and HR
efficiency and reduces overall firm cost.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Keebler & Rhodes (2002) reported that e-HRM technological innovation should not only be
developed to make the HR procedures as effective and inexpensive as possible, but the e-HRM
system should meet the functional requirements of the company too, to improve the service
experience of management and non-management employees.
Michael Armstrong (2006) argued that “e-HR provides the information required to manage HR
processes.” These may be primary workforce data and pay-roll systems but can be prolonged to
consist of functions such as performance management, compensation and reward, training and
recruiting. All these can be made available via a web-based platform, thus allowing remote
access anywhere and anytime. The details provided by the e-HR process can be conveyed
across the organisation. It can consist of links that enable managers as well as employees to
interface with HR programs and make changes or inquiries directly and obtain immediate results
and feedback.
The HR function is becoming more strategic with the growth of e-HRM practices. This is
noticeable by the fact that at present time employees are asking for advice rather than
administrative assistance, which is the opposite scenario compared to late 1990s. Hun Nam
Chung (2003) argued that today companies have less, but more qualified HR staffs whereas a
few years back the reverse applied. At present, there is a drift towards the adoption of metricsbased management with emphasis on performance measurement to ensure that organisational
objectives are being met. E-HRM applications that embed such features together with best
practices should be able to deliver those outputs. Once this HR infrastructure is set up and
ready for use, people may adopt virtual work place initiative to sustain the increasingly mobile
and dynamic personnel.
A more recent study by Foster et al. (2004) has shown that the integration of internet in Human
Resource function constitutes of two elements: one is the use of digital media while the other is
the effective contribution of employees in the process. These two components drive the
technological development that helps companies reduce their administration costs, provide realtime access to information, decrease processing time and enhance employee interaction and
satisfaction.
investments in e-HRM, students are more reluctant as evidence of these benefits until now is
inadequate.
Ruël et al. (2004) observed signs of a shift in responsibility from HR staffs to line managers and
employees. They also noticed that from the employees‟ point of view, an e-HRM system brings
more autonomy of information and leads to better information responsiveness. Through HR
practices employees develop knowledge, skills and motivation to contribute to the company‟s
strategy. According to CedarCrestone (2005) survey, HR consultants advocate that many
organisations are adopting e-HRM system and number of applications is still increasing.
Fletcher (2005) stated that "HR has moved from an administrative, support function to the heart
of strategic management and the use of technology is the key to that transformation." She also
claimed that companies have to embrace a „Human Capital Management‟ strategy to benefit
from any company's biggest asset: the expertise, know-how and experience of its employees.
Moreover, she described how big companies incorporated HRIS twenty years back, which
allowed them to automate old time-consuming procedures.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Dr. Aravind & Dr. Paramashivaiah (2006) contended that human resource is no more regarded
as a business requirement; instead it has differentiated itself as one of the primary assets of any
company. With such a great focus on human capital, it is crucial for every organisation to
identify approaches that provide high quality recruitment solutions at low costs. This is where
the world of e-recruitment begins. The internet is no more just a craze; it has now become a
very useful device at everyone's convenience. E-recruitment is simply using internet to seek the
services of the preferred individuals.
Sacht (2007) noticed that due to significant changes in the employment market, Human
Resources are compelled to change their usual ways of working and their strategic role in order
to help businesses succeed. Moreover, with the growing importance of technology and the
volatile business environment, companies must always be ready to take immediate measures
and require smart thinking so that they are able to adapt to change. This new business process
implies leaving behind old ways of working.
1.2
Types of e-HRM
Following research work done by Lepak and Snell (1998), it has been identified that IT can
greatly influence the incorporation of HR functions, when the responsibilities for carrying our HR
tasks are split into three main areas; transactional, relational and transformational. This concept
is used by Ruël et al. (2004) to categorise e-HRM technology into three types, namely:
Operational e-HRM, Relational e-HRM, and Transformational e-HRM.
Lepak & Snell (1998) stated that operational or transactional e-HRM consists of optimising
operations. It includes basics HR activities in the administration area such as recording of
employee‟s data and payroll. Operational e-HRM reduces the use of paper work significantly,
thus is environmental friendly. However, Lengnick-Hall & Moritz (2003), highlighted that the
quality, usability and quantity of information could hinder the effectiveness of these initiatives.
Relational HRM, which is normally considered as the second more complex form of e-HRM, is
about the interactions and networking of the various HRM stakeholders, said Strohmeier (2007).
Martin et al. (2008) pointed out that in this kind of HRM, there is an option of whether to conduct
more advanced HR practices, like assisting in the computerisation of HR activities via the
intranets, in the recruitment and selection process through an online system, HR portals,
employee self-service and manager self-service, and operates with several applications.
Transformational HRM relates to HR activities with a strategic character. It requires the
transformation of the HR function. Ruël et al. (2004) pointed out that transformational HRM
refers to activities like strategic competence management, information management and
knowledge management. Here a company can select for versatile employees through a set of
web-enabled tools that allow the employees to develop themselves in line with the company's
strategic objectives. According to Lengnick-Hall & Moritz (2003), it's only when the HR functions
are re-routed towards more strategic initiatives while at the same time relieved from the
operational tasks, and then there will be the shift from a transactional to a transformational
focus.
1.3
Benefits of e-HRM
Moving from a paper-based process to an automated one brings lots of value to an organisation
as there will be an improvement in quality and speed. Below are some of the main benefits of
implementing e-HRM in an organisation.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Ease of administering employee records: The number of queries directed towards HR
department and the need for HR to key in employee records will decrease significantly by
offering employees with immediate access to their personal data, for example, the number of
local and sick leaves, personal details, insurance claims and so on. As stated by Adamson &
Zampetti (2001), since employees are allowed to amend their personal information, the HR
record-keeping benefits higher precision and information quality.
Simplification of recruitment and selection: In addition to normal paper-based recruitment
task, the organisation will get an extra possibility to recruit and select people via the web in an
online-application process, though there will always be a need for human intervention. However,
e-HRM techniques can streamline the process and decrease mistakes. Interestingly, a recent
study showed that 100 percent of large firms in the United States use e-HR systems for
recruitment (Cedar, 2002; Gueutal, 2003).
Assessment of employees: With the introduction of IT into HR function, organisation benefits
from online performance management of its employees by using the company's intranet.
Furthermore, the employees can do e-filing of 360 degree feedback form, which can later be
analysed through the generation of charts and metrics. Adamson & Zampetti (2001) indicated
that e-HR can also provide managers with information on how to conduct a performance
appraisal, the distinct requirements and metrics of given positions and roles as well as
examples and models of effective appraisal process.
Training needs and development: With the use of computer based training, employees can
identify and plan their own training programs. In the opinion of Sambrook (2003), E-learning can
propose a solution to training as well as tailor-made learning that fits the particular needs of the
learner, but it can also create barriers to learning, due to lack of hardware, fear of technology
and learner isolation. There is also distance learning which is an extension of the e-learning
concept. “Because of its flexibility, distance learning offers several benefits over traditional forms
of instruction, including the ability to train employees quickly and efficiently around the globe,
use the most knowledgeable instructors for high-quality training, provide updates to training
material as necessary”, (Burgess & Russell, 2003).
Reductions in cost, time and labour: Through Employee Self Service, there is very little or no
paper work at all since all entries can be done electronically hence reduces the time spent for
validating input and fixing errors. This means that not only manpower can be saved, but the
handling time also can be decreased. With this new way of working, e-HRM gets to the primary
goal of cost effectiveness. For example, employees can log in online anytime without being in
office, request for leave which will be sent directly to his/her line manager for approval. Upon
acceptance the leave balance is instantly updated. This will significantly reduce the workload of
HR department.
1.4
Possible drawbacks / obstacles of e-HR implementation
Although there have been many positive talks about the benefits that e-HRM systems can bring
to a company, there is also the opposite side of the coin. The introduction and adoption of new
systems often poses challenges for many organisations and comes with some risks like
integration failures due to incompatibility, high set up cost or decline in personal contact.
Trapp (2001) highlighted that individuals might lose the human contact which they would
normally have following a visit to the HR department. Hallowell (1999) also added that with
increasing reliance on IT, there is a risk of dropping the 'human touch', an authentic
psychological encounter that can happen only when two people share the same physical space.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
According to a United Nation (2002) report, the challenges against an IT initiative can be
categorised as human and technological. The lack of necessary IT skills, lack of nonapplications of good Information Communication Technology (ICT) policies and strategies are
classified as human obstacles, while technological barriers consist of the weakness of ICT
infrastructure and low rate of adoption.
Hebert and Vorauer (2003) identified that there are more negative points that positive. In their
scientific research they discovered that assessors offer better and more beneficial reviews
during personal contact compared to computer system interactions. This imply that there will be
bad ratings from participants if they are not going to provide their opinions other than through a
face-to-face interaction Hawking et al. (2004) classified lack of privacy and security as a main
barrier. Guaranteeing the security and confidentiality of data input is an important issue if we
want to convince employees that their personal data is „safe‟ when they are using web-based
HR tools (Ruel et al., 2004).
It has also been observed that when employees are under pressure it leads to less quality. For
example when people feel that each of their mouse clicks would be recorded and that they are
being watched closely, this creates a sense fear, which eventually reduces focus on work
(Cardy and Miller, 2005).
According to the Society for Human Resource Management (SHRM) survey report (2005) on
HR Technology, the top 3 obstacles that make it difficult to introduce an HR technology system
in an organisation are: Resistance to change, financial approval and an infrastructure that has
not been properly prepared.
Price could be another hurdle when considering e-HR. E-HR systems need preliminary cost
expenditure when you have to set them up. Cost can be estimated and budgets prepared but as
with any IT project, there will be unavoidable extra expenses that one did not anticipate.
Last but not least, similar to any computer programs, e-HR systems can fail causing data loss
and result in financial loss of an organisation. Another limitation could be the misuse of data.
Since employee records are electronically stored on servers or any other accessible device,
confidential information could be leaked out and misused.
1.5
Overcoming challenges during e-HRM implementation
According to the United Nations Report (2002), resistance by different groups should be dealt
by incentives, awareness and training. Hawking et al. (2002) is of the same view when they
explained that as part of the change management process, HR departments should conduct
training sessions.
With regards to security, HR team members must be very strict in protecting employees‟ records
and business information. Davidson (2003) stressed out that frequent back-ups of data and
assigning unique security password are two primary actions that can be taken. He also
recommended that regular computer systems security workshops are scheduled with
employees, especially with HR staffs to advise them on security aspects and risk management
as it is vital for HR department to understand the risks it faces.
Communication is another important aspect that needs to be taken into consideration, when
implementing major change in an organisation. Everyone must be kept informed of the changes
happening within their respective department. In the opinion of Whittington et al. (2005)
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
communication must be two-way and that interaction must be multi-channel, involving top
management, employees and external stakeholders.
According to Ruel et al. (2004), HR department can start marketing campaigns to encourage the
use of web-enabled HR tools. Employee‟s trust and confidence can be increased if HR staffs
clearly mention the usefulness and efficiency of e-HRM systems and the added benefits that go
along with it when transforming HR roles. Thus, HR personnel should still meet the expectations
for usual HR administration tasks while at the same time try to prove how the introduction of eHRM gives them every opportunity to perform strategic HR more efficiently.
1.6
Recent trends in e-HRM
This section highlights the global e-HRM trends in current times.
1.6.1
Global trends in e-HRM - Highlights
According to CedarCreston (2013) HR systems survey on „Going Global with HR Technologies‟,
they suggest that practicing the following efficiency and innovation techniques may allow
companies to enhance their business outcomes.
Become more efficient through:
1
2
3
4
5
Standardising both administrative and talent management processes.
Moving to consolidate human resource management systems (HRMS).
Serving more workforces from a single HRMS and single payroll solution.
Consolidating talent management automation support onto the HRMS platform.
Reducing customisations.
Become more innovative through:
1 Working to expand the percentage of the workforce using self service and adopt
regional shared service centers.
2 Adopting a software-as-a-service (SaaS) HRMS.
3 Adopting an integrated talent management solution (consolidated on the HRMS
platform)
4 Adopting business intelligence tools and rolling these solutions directly to managers.
5 Adopting social tools strategically.
Moreover, based on CedarCrestone (2013) survey which tracks many HR applications, it has
been noticed that these applications can be divided into the following six categories:




Administrative: The core HR, payroll, benefits record keeping systems, and
workforce management (time management and absence management).
Service Delivery: Those self service transactional services that improve service
delivery, reduce costs, and enable employees, HR, and managers to spend less
time on administrative tasks.
Talent Management: Performance and learning management, planning and
career development. Those talent management applications that enable an
organisation to plan, attract, develop, and retain key talent.
Workforce Management: Labour scheduling, absence management and time
reporting. These tools are essential for getting the right people, with the right
skills, in the right position and time, at an optimal cost.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7


Business Intelligence and Workforce Optimisation: Applications and
technologies that when combined, enable a company to move towards metricsbased management.
Social, Collaboration and Mobile: Publicly available social medial tools such as
Facebook, Twitter as well as corporate social network are tracked.
The CedarCrestone (2008-2009) survey on the state of HR technology adoption covering
several organisations across the world, created a roadmap followed by most companies that
have an ERP-based HRMS as their foundation as described in Figure 1 below.
Figure 1: CedarCreston Application Blueprint, (2008-2009)
Administrative Excellence
Core HRMS/ERP Foundation: Companies start their journey with the aim to achieve Human
Capital Management (HCM) quality with the implementation of core documentation systems usually the latest and most advance HRMS along with payroll and possibly benefits
administration.
Workforce Management: This classification includes functions for time and attendance, task
management, leave management, labour cost management, forecasting and scheduling.
Ensuring these elements are kept at a best practice level through upgrading to latest vendor
releases allows companies to reach Administrative Excellence.
Service Delivery Excellence
Companies which are achieving Service Delivery Excellence are those with self service
programs, gradually switching to portal technologies, moving toward a help desk approach and
enhanced by call-center technology.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Self Service and Workflow includes Pay, Personal Data and Benefits; Salary Actions, Transfers
and Promotions.
Portal Framework incorporates Single Sign-On and Identity Management.
Performance Excellence
Companies having strategic HCM applications (talent management) together with a data
warehouse that brings information in from various sources and analytics to allow measurement
and reporting of employee‟s performance are acquiring Performance Excellence.
The talent management components are programs that allow companies to acquire, to grow
and to retain its employees through compensation, career planning, etc.
1.6.2
Software as a Service - Trends, Rationale, Concerns
CedarCreston (2012-2013) HR Systems Survey done worldwide with more than 1200
responses on HR technologies and deployment approaches states that SaaS HRMS growth
surpassed the prediction for the year 2011 by 24% and will keep growing above 30% for the
coming years. Use of licensed softwares will decrease, but CedarCreston does not see SaaS
HRMS hitting parity with licensed solutions until at least 2014.
Reasons for moving to SaaS HRMS
According to that same survey, the main reason companies are moving to SaaS HRMS is to
develop the user experience across the organisation – not just for HR, but for managers and
employees as well. HR and executives understand that user experience from a SaaS HRMS
solution drives use and usage drives value for the organisation. However, the most important
reason for IT to move to SaaS is to reduce the need for internal infrastructure, followed by a
reduced total cost of ownership.
From Figure 2 below it can be found that the prime reason respondents are moving to SaaS
HRMS is to improve user experience across the organisation.
Figure 2: Reasons for moving to SaaS HRMS; Sources: (CederCreston, 2013-2014)
Concerns about moving to SaaS HRMS
On the other hand, participants of the survey raised some concerns such as security and data
privacy, integration complexities with existing systems and customisation issues as illustrated in
Figure 3 below. Hence, solutions providers need to pay more attention to these issues if they
want the transition to SaaS HRMS to happen smoothly.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Figure 3: Concerns for moving to SaaS HRMS; Sources: (CederCreston, 2013-2014)
2.6.3
Mobile HR Applications
Furthermore, from CedarCreston (2013-2014) HRS survey, it has been noticed that the
adoption of mobile-enabled function ramped up to 67% since 2012! The most used mobileenabled functions are performance management, recruitment and payroll as shown in Figure 4
below. It has been forecasted that the acceptance of mobile-enabled processes will almost
double by 2014!
Figure 4: Key Mobile-Enabled Function Adoption by the Workforce; Sources:
(CedarCreston, 2013-2014)
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
2.7 Conclusion
As stated in the research work described above, it is clear that the introduction of e-HRM
practices is not an easy project. Like any other project, the introduction of an e-HRM system will
have both its pros and cons. Several factors have to be taken into consideration prior to starting
this transformation process, which can bring lots of benefits to an organisation if all the steps
are followed correctly and with proper mitigation strategies to reduce any risks or issues.
In the next chapter we give an overview of TNT Business Solutions Ltd, on which the research
is being done.
Results
We first provide information pertaining to the demographic variables. As for age, out of the
sample size of 220 respondents 30% of them are in the age group 18-29 years. The age group
30-39 years is highest with more than 40% respondents. We have approximately 25%
respondents for age group 40-49 and finally only 2% for the age group „>= 50‟ years. In general
we notice that there is more or less a right balance of age groups at TNT Business Solutions.
This is because in the BPO / ICT sector, age is not a constraining factor with regards to the
nature of work. In fact, the majority of the respondents were from Customer Service department
with 45% response rate followed by 30% from the Data Management department. The
remaining were from the HR, Finance, Business Development and IT departments with a
response rate varying from 5% - 8%. Moreover, the respondents were secondary school
graduates accounting with a total of 76.8%, followed by 15.4% for University under graduates.
The remaining interviewers have very few respondents with 6.3% and 1.4% for post-graduate
and technical certification respectively. This can be explained by the fact that most of the jobs at
TNT Business Solutions require a minimum qualification of either school certificate or higher
school certificate. For school certificate holders mainly typing skills are needed whereas for
higher school certificate holders, people are required to perform more complex tasks and logical
thinking is needed as well. On the other hand, it may be inferred that TNT Business Solutions,
although being an equal opportunity employer, is predominantly staffed by female as 65% of
respondents are females as compared to 35% who are males. It is to be noted that male
employees are those who like to work on night shifts. We next present the tableau of results
pertaining to the Likert Scale questions. Overall, we have had four questions based on the Likert
Scale and they were each analyzed using factor analyses. For simplicity, we have shown the
table of the Variance explained by each component in the questions followed by interpretation of
each of the significant factors.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Component
Initial Eigenvalues
Total
% of Variance
Cumulative %
1
2
3
4
4.656
1.751
1.247
.945
46.561
17.514
12.466
9.451
46.561
64.075
76.541
85.992
5
.599
5.994
91.986
6
.392
3.922
95.907
7
.199
1.991
97.899
8
.118
1.176
99.075
9
.070
.695
99.770
10
.023
.230
100.000
Extraction Sums of Squared Loadings
Total
%
of Cumulative
Variance
%
4.656
46.561
46.561
1.751
17.514
64.075
1.247
12.466
76.541
Table: Total Variance Explained for Question 1
Following the eigenvalue criterion, the factors relating the variables in question 1 may be
expressed as:



Cost savings
Improve productivity
Speed up HR transactions
In fact, any e-HR system allows companies to store, process lots of information, reduce costs of
maintaining employee's data and provide up-to-date information about their employees
anywhere and anytime. Moreover, existing applications can be integrated with the new e-HR
system and the output generated by each of the subsystems is maintained in a single HR
database. Therefore, whenever a particular employee's data is updated, such a change is
replicated in each of the subsystems automatically.This is confirmed as well by Foster et al.
(2004), who stated that use of electronic media and the valuable involvement of employees in
the process, force the technological improvement that helps companies reduce their
administration costs. Aravind and Paramashivaiah (2006) supported the fact that e-HR will
definitely bring cost savings to organizations through e-recruitment. With regards to increase in
productivity and HR transactions, if employees are provided access to all their HR processes via
a single window web-based application, this can considerably decrease time spent on
administrative tasks and can therefore improve individual and business efficiency. Following
Dessler (2004), technology boosts up the operations of HR department in four main ways: work
productivity, self service, outsourcing and call centers. Using the company's intranet, employees
can self-service many of their HR activities such as updating personal record, changing
insurance benefits and so forth.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Component
Initial Eigenvalues
Total
% of Variance
Cumulative %
1
2
3
4
2.679
2.493
1.539
.921
26.790
24.931
15.386
9.208
26.790
51.721
67.107
76.316
5
.835
8.355
84.671
6
.534
5.343
90.013
7
.464
4.645
94.658
8
.272
2.720
97.378
9
.207
2.072
99.449
10
.055
.551
100.000
Extraction Sums of Squared Loadings
Total
%
of Cumulative
Variance
%
2.679
26.790
26.790
2.493
24.931
51.721
1.539
15.386
67.107
Table : Total Variance Explained for Question 2
Usually, the introduction of technology to any organization comes with its inherent risk such as
loss of „human touch‟, high set up cost, data protection, sufficient know-how and expertise,
resistance to change, etc. As per the results obtained, we found that Question 2 can be
summarized into 3 factors as well and they are:
 Data security
 IT skills
 Resistance to change
Companies should protect themselves from any leak of private information and the subsequent
misuse of these. Handling the large amount of information produced via e-HRM system is
somewhat challenging for companies. Ruel et al. (2004) are on the same wavelength when they
affirm that ensuring the protection of data and information is critical for employees such that
they feel „safe‟ when using web-based applications. The implementation of a full-fledged e-HR
system is not something that can be completed in a few days. It requires a strong
implementation team that will need to work together with the vendor to ensure a smooth
transition to the new system. E-HR users also must grow their knowledge, especially their IT
skills that will ensure positive contribution to business process. They would often require playing
with, analysing, interpreting data and communicating outputs. Likewise, Trapp (2001)highlighted
that one of the critical success factors for introducing e-HRM is that the workforce should have a
good knowledge of IT. Third factor is resistance to change. This is very common in many
organisation as it is human nature to resist change. This is probably because of fear of failure or
of being redundant and uncertainty about what will happen. So, if not properly handled can
result in a failed or flawed e-HRM implementation. At times employees do not co-operate during
the change process. Similarly, Gueutal (2005) mentioned that with the implementation of MSS,
there is resistance from managers/supervisors who perceive the new e-HR system as pushing
'HR work' towards them.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
Component
1
2
3
4
5
6
Initial Eigenvalues
Total
%
of Cumulative %
Variance
16.487
54.958
54.958
3.440
11.466
66.423
2.307
7.691
74.115
1.506
5.020
79.134
1.222
4.074
83.209
.947
3.156
86.365
7
.891
2.968
89.333
8
.683
2.275
91.609
9
.603
2.011
93.620
10
.502
1.673
95.293
11
.404
1.346
96.638
12
.343
1.143
97.781
13
.291
.969
98.750
14
.181
.603
99.353
15
.117
.390
99.743
16
.077
.257
100.000
17
4.836E-016
1.612E-015
100.000
18
4.159E-016
1.386E-015
100.000
19
2.859E-016
9.531E-016
100.000
20
2.410E-016
8.032E-016
100.000
21
1.285E-016
4.283E-016
100.000
22
9.165E-017
3.055E-016
100.000
23
6.869E-017
2.290E-016
100.000
24
1.297E-017
4.323E-017
100.000
25
-5.617E-016 -1.872E-015 100.000
Extraction Sums of Squared Loadings
Total
%
of Cumulative
Variance
%
16.487
54.958
54.958
3.440
11.466
66.423
2.307
7.691
74.115
1.506
5.020
79.134
1.222
4.074
83.209
Table : Total Variance Explained for Question 3
From results obtained in question 3, we conclude that there are five factors that play a
significant role towards e-HRM implementation:
 Easy access to information
 Up to date information
 Online training
 Personal development
 Motivation
Information is vital in any business as it facilitates the decision making process and can
therefore help achieving competitive advantage and strategic business goals. In my opinion, the
implementation of an e-HRM system can facilitate employee‟s access to real time information
and this can be made possible via the company‟s intranet, ESS or MSS. In line with Wyatt
(2006) who advocated that e-HR represents the wide access of employee‟s data, transactions
and tools available instantly via the web in most working environment. He also stated the
stunning impact web technologies has had on the way employees now obtain employmentrelated information through built-in self service systems. Training is no more considered as a
cost, instead, an investment for the future. With the introduction of e-HRM system, employees
can identify their own training needs and development, check for training programs availability
and enroll online within few mouse clicks. This can eventually help in self development of
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
employees and motivate them to work efficiently. As per Burgess & Russell (2003) literature,
they affirmed that due to the flexibility of distance learning, employees can be trained quickly
around the world using the most experienced tutors for high-quality training and can be provided
with up-do-date coaching material as necessary.
Component
1
2
3
4
5
Initial Eigenvalues
Total
%
Variance
5.498
45.816
1.815
15.127
1.419
11.825
.726
6.547
.667
5.561
6
.515
4.289
91.164
7
.364
3.037
94.201
8
.333
2.776
96.977
9
.185
1.544
98.522
10
.003
.023
100.000
of Cumulative %
45.816
60.943
72.767
81.315
86.875
Extraction Sums of Squared Loadings
Total
%
of Cumulative
Variance
%
5.498
45.816
45.816
1.815
15.127
60.943
1.419
11.825
72.767
Table : Total Variance Explained for Question 4
With regards to question 4 from the survey, there are three factors that have been extracted as
stated below:
 Paper work
 Workload
 Communication
With the digitization of many HR activities, there will be a reduction in paper enrolment process.
Consequently, work will be less error prone as well. According to a research by Varma (2010
cited Wong 2003), e-HR generally brings immediate benefits, including a paperless and more
efficient ways of working for many HR professionals. As for the amount of work required,
Gueutal, (2005) highlighted that one of the promises of self-service is that routine transactions
will occur without HR intervention, thereby reducing the workload on HR staffs significantly
which is in-line with the survey result.
On the communication aspect, Mayfield et al. (2003) recognized that “Information Technology
facilitates communication freely. Such information sharing is crucial to learning organizations
that view employees as their main competitive advantage”.
6.1
Conclusion
With today's ever changing and competitive business environment, nearly all companies need
to keep pace with technology if they want to survive and remain profitable on the market. Thus,
an e-HRM system if implemented correctly can bring success to those companies. E-HRM
facilitates the development and integration of a wide range of activities of organisations by
connecting different business functions and offering up-to-date information about its employees
on-line, anywhere and anytime. E-HRM considerably decreases reliance on paper transactions
which are very error-prone and time consuming. Modern e-HRM systems provides more and
more advance functionality allowing the companies to automate complex and demanding
processes and delegate routine transactions to line managers and employees. This will
subsequently leaves HR staffs with more time to better manage the company‟s main asset - its
employees and focus on strategic activities.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
There is also improvement in performance of HR activities, increase in productivity of
employees and cost effectiveness in the long term. Furthermore, e-HRM promotes computer
based training where employees can be self-trained and can also learn at their own pace with
latest training materials available on the internet. This promotes personal development and
inspires staffs to work harder and always have a can do attitude.
However, there are also some concerns identified such as resistance to change, fear of
implementation failure, decline in human contact, security of information and lack of IT culture. I
would therefore suggest putting into practice above recommendations so as to reduce or even
eliminate those barriers. Also it is essential for the HR staffs to familiarise themselves with the
technology before they start engaging other employees and make them see the value of such
systems.
Proceedings of 26th International Business Research Conference
7 - 8 April 2014, Imperial College, London, UK, ISBN: 978-1-922069-46-7
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