E - HR Strategy: An Electronic (E) Human Resource (HR) Strategy is attainable by small and medium sized business

E - HR Strategy: An Electronic (E) Human Resource (HR) Strategy is attainable by small and medium sized business

1. Introduction

This article is based on a review and summary of five leading research (reports) produced by thought leaders about the evolving role of HR, and how forward thinking, strategically orientated HR professionals are increasingly adopting E- HR Strategies.

Never before has the pressure on South African people management professionals been more intense. A dramatic change in the employment law arena is forcing Human Resources (HR) to transform its own operations, and its strategic role in contributing to the success of business of all size. Today’s business environment requires smart thinking, quick action and rapid adaptation to constantly changing conditions. The marketplace increasingly rewards those who respond to the demand for innovation driven by the Web and Internet, technology advances, globalisation, skills shortages, and shifting demographics. This new business landscape means leaving behind old ways of thinking and doing.

2. Technology as an E-HR enabler

" E - HR refers to the broad access to human resources data, tools and transactions available directly on the web in most workplaces today. It describes the "net effect" of the explosion in web technologies and the dramatic impact this growth has had on the way employees now receive employment-related information through integrated self-service applications. It also includes the variety of new technologies available that help connect multiple systems, tools and databases, both inside and outside organizations" (Watson Wyatt Research Report - The Net Effect).

Much has been written in the past several years about HR acting as a strategic partner. HR leaders have been told repeatedly that they must earn a "seat at the table" with top management in order to play a significant role in the development of organisational strategies and business success. But, while many HR leaders have become active participants in strategy sessions occurring in boardrooms around the world, they are continually hindered by the need to think and act strategically, while still overseeing the time-consuming administrative aspects of day-to-day HR. It is clear that HR must find a way to relieve itself of administrative burdens (without abdicating their administrative role) in order to maximize its contribution to business strategy.

Technological change is a key driver for HR transformation, providing the foundation to support HR’s growing strategic focus. In particular, Web and Internet technologies have already given workers direct access to each other, to HR, and to business information with such ease and intelligence that every worker can contribute more directly to business results.

Although great strides have been made in recent years to use technology to simplify HR, technology until now offered only partial solutions to HR’s challenges. Consider the employee self-service model that evolved throughout the 1990’s. Developed in part due to employee and manager complaints about the impersonal and inefficient services offered by outsourced solutions of the early 1990’s, self-service has proven to be extraordinarily popular.

A recent research report on E-HR people management strategies is associated with a nearly 2 percent increase in a company’s market value. E - HR helps maximise a company’s progress toward a knowledge economy and increased shareholder value.

3. Small and medium sized business realities

One of the biggest sources of frustration for small and medium sized business has been the inability to easily and cheaply use electronic technologies to better manage their business resources. Enterprise Resource Planning (ERP) solutions that rely on expensive mainframes, and high-level programming skills are simply unaffordable by HR functions in small and medium business.

Human resource functions have struggled for well over a decade to shift their focus from administration to more strategic contributions. From interactive voice response systems and multimedia kiosks to implementing an enterprise- wide HR/payroll system, people management professionals in large organisations have invested heavily in reducing the administrative load on HR. Until recently, costs were high and progress was slow.

The sudden explosion in Internet technology, however, has dramatically accelerated the transition to a more strategically orientated HR function. New resources are appearing that enable today’s employees and managers IN ANY SIZED COMPANY to complete HR- and benefits-related transactions on their own. E - HR liberates human resources from its administrative shackles and provides the foundation for a collegial, flexible workplace where employees have easy access to communication tools.

In the meantime, the general comfort level using the web has increased so steadily that it has become the preferred media in the workplace — making the introduction of E - HR a relatively ‘painless’ and cost efficient welcome event in almost any organisation.

The use of Internet and Web technology has also liberated management to re-assume its abdicated role of day-to-day people management without the endless wait for HR to eventually process requests for information, and/or provide vital reporting information needed to make swift people management decisions. Hopefully this will lead to the ‘extinction’ of the old type of HR practitioner who publicly proclaim the need to outsource HR Administration because it is too complex and arduous to handle in-house (see article in Engineering News of March 29 - April 04 2002, P 50, where the head of HR at Labour Assist, a medium sized outsourcing company, appears to support this view). The ‘smart’ thing to do would be to invest in upskilling line managers with the ability to use the new HR technologies to take on their strategic HR role, and to outsource non value-adding HR Administration.

4. Getting from here to there

To successfully make the transition from HR being an administrative cost HR becoming an E - HR strategic partner of line managment, human resource professionals must rethink their strategy for transforming the delivery of information and services to managers and employees. New, evolving standards such as extensible mark-up language (XML) are dramatically increasing the ease with which HR can integrate various systems and databases into an E - HR environment. These technologies also help present information in a user-friendly manner that is available to employees and managers at all times and from all locations.

Watson Wyatt, a USA based eHR ™ company advocates that for companies to become E – HR focussed they need to move their HR communications and transactions to the Web and Internet.

The Internet provides HR with the ability to transfer information and many common administrative tasks to employees — freeing HR personnel to pursue more strategic initiatives. Benefits information, employee data changes and other transactions that monopolized an HR department's time can now be quickly handled via the Internet.

Employees and managers are embracing this "self-service" direction. The functionality of the web is appealing for many reasons beyond cost:

>> A more mobile workforce needs access to HR information at various locations and times (e.g. electricity line construction crews working in the sticks)

>> Changes in work style resulting from the proliferation of more functional wireless devices (phones, pagers, handsets, laptops and palmtops)

Companies that are ready to adopt an E - HR Strategy and realise improved communications, reduced costs and fewer redundancies can start with the following action steps:

>> Establish solid executive support for an E – HR Strategy. Whether a company is small, medium, or mega, there is an initial investment of money and resources required to be successful. Be sure your business case states the return on the investment.

>> Understand how far the core HR systems extend today. A technology audit will help determine the effectiveness of your HR systems and databases.

>> Know the company’s IT direction and limitations in areas such as a corporate Internet, and remote computing strategy

>> Develop a formal strategy for your HR web that: improves and integrates existing content and provides a framework for seamlessly providing access to users of the systems(s).

>> Get the most effective specialised support possible (from the IT function and vendors) to deal with complicated issues such as legal, communications, and data integrity and data security.

>> Finally, build early impact into the service delivery plan by scheduling clear milestones and achieving them. Early returns on your global service delivery initiative can only help build support at all levels within your multinational organization.