Friday, February 3, 2012

HR goes the Technology Way!


A function that is all about managing the needs of people uses a significant amount of technology to service its need. This article presents the role of technology in the HR function.


Traditionally, HR was about managing people, but not any more. The magnitude of information that HR has to manage regarding people and processes can no longer be carried out without the support of Technology. Technology made its presence in HR in the early and mid 90s through the advent of ERP in taking over the administrative functions of HR. Overnight, HR professionals realized the value of technology in reducing the time spent on all forms of data management. 

The HR function has three important roles to play – Administrative, Developmental and Advisory.

HR Administration & Technology:  

The use of technology has virtually replaced the administrative part of HR, which is related to HR data maintenance, Wage and salary administration, Employee welfare activities like medical insurance etc. Through this, the efficiency of HR in managing business-critical information has increased manifold. 

Efficient payroll management applications have ensured accurate, efficient and timely processing of compensation. The ease of analyzing salary data has helped in making benchmark studies and offer the right kind of salary to high-performers. The latest use of technology in HR is the usage of the online employee self-service modules (ESS), which enable the salary and other data to be available to the employee at the click of a button. This ensured more transparency and less ambiguity in what has traditionally been one of the more confidential areas of HR. 

For example, a leading company in the travel and tourism industry uses technology to optimize business processes. In fact, they introduced SAP in all areas including HR and even won the prestigious SAP ACE award in 2006 for best SAP implementation in service industry. The company claims that IT has moved from being a support system to a Business enabler.

HR Development & Technology:  

In the role of a Development catalyst, HR focuses on the key areas of Talent acquisition, development and deployment. Here, the impact of technology is greatly felt in the areas of recruitment, performance management and training and development. 

Technology has revolutionized the recruitment processes – sourcing has been made very easy through online job portals. Data is available at the click of a button for both employer and job-seeker. Social media has also impacted HR operations to a large extent, which makes use of this opportunity to network with candidates and the HR community. In the area of performance management, technology has facilitated the analysis of historical data for effective decision-making. Past data on performance, potential and achievements makes promotion and fast-tracking decisions easier. And online and e-learning solutions have completely revolutionized the way HR plans, delivers and implements its learning and development strategy in the organization. Virtual classrooms have become the order of the day, and this has helped not only in maintaining global standards, but in keeping up with the fierce competition in the global arena. 

In fact, the business of designing recruitment software to manage the entire selection process has become a very profitable business. Known as RMS or Recruitment Management Software in common parlance, the tool is used for maintaining a resume repository, screening, contacting the shortlisted candidates, and also sends the candidate information to the regular HR MIS for offer letter generation and payroll.

HR Advisory & Technology:  

In the advisory role, HR is now empowered with enough information to guide top management decisions on business. This is very evident when we see that the latest trend in HR is Analytics or the management of business-critical information. Sophisticated methods are used to analyze complex sets of employee related information to make meaningful decisions regarding selection, placement, performance and retention decisions. HR no longer provides just intuition-based data on people trends, their propositions are backed by rigorous analysis of historical data. In this, Technology has become the backbone for HR decision-making. 

Technology has taken over HR management too, as it has every other function in the organization. When we analyze some of the downsides, we see that there is grave danger in allowing technology to replace some of the human-intensive processes, like employee engagement, employee management and potential analysis and grooming. This is more critical for HR than any other function because HR is the custodian of human processes in the organization. The danger that the HR manager faces is the substitution of analyses and objectivity in the area of employee engagement, where empathy and intuition are required to manage what is essentially human.