Adoption of E-HRM in Large New Zealand Organizations

Adoption of E-HRM in Large New Zealand Organizations

Gloria Lau (Victoria University of Wellington, New Zealand) and Val Hooper (Victoria University of Wellington, New Zealand)
DOI: 10.4018/978-1-59904-883-3.ch006
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Abstract

Human resources are usually the most expensive resource in any organization. They thus need careful management. The aim of human resources management (HRM) is to Ensure that a firm has the right number of people with the required knowledge, skills, abilities and competencies, in the right place, at the right time, at an affordable cost and who are motivated and committed to achieving the current and strategic need of a firm. (Macky & Johnson, 2000, p. 3) Information communication technologies (ICT) have changed the way organizations conduct their business. The use of ICT in HRM is often referred to as e-HRM, Web-based HR, or virtual HR, which Lepak and Snell (1998) define as “a network-based structure built on partnership and typically mediated by information technology to help organizations acquire, develop and deploy intellectual capital” (p. 216). ICT has made e-HRM applications not only possible, but also economically viable (Watson Wyatt, 2002). However, the adoption of e-HRM in New Zealand does not appear to have progressed as speedily as the adoption of technology in many other functional areas of the organization. Although most organizations utilized basic ICT applications such as e-mail and the Internet in the HR department, the majority do not appear to have moved far enough into actual e-HRM development, such as e-recruitment and e-benefits (Watson Wyatt, 2002).
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Introduction

Human resources are usually the most expensive resource in any organization. They thus need careful management. The aim of human resources management (HRM) is to

Ensure that a firm has the right number of people with the required knowledge, skills, abilities and competencies, in the right place, at the right time, at an affordable cost and who are motivated and committed to achieving the current and strategic need of a firm. (Macky & Johnson, 2000, p. 3)

Information communication technologies (ICT) have changed the way organizations conduct their business. The use of ICT in HRM is often referred to as e-HRM, Web-based HR, or virtual HR, which Lepak and Snell (1998) define as “a network-based structure built on partnership and typically mediated by information technology to help organizations acquire, develop and deploy intellectual capital” (p. 216). ICT has made e-HRM applications not only possible, but also economically viable (Watson Wyatt, 2002).

However, the adoption of e-HRM in New Zealand does not appear to have progressed as speedily as the adoption of technology in many other functional areas of the organization. Although most organizations utilized basic ICT applications such as e-mail and the Internet in the HR department, the majority do not appear to have moved far enough into actual e-HRM development, such as e-recruitment and e-benefits (Watson Wyatt, 2002).

This study thus sets out to examine the adoption of e-HRM in New Zealand and to identify a comprehensive set of potential factors influencing the adoption of e-HRM. The objectives of the research were:

  • 1.

    To identify the e-HRM applications that have been deployed.

  • 2.

    To determine the HR business functionalities supported by those e-HRM applications.

  • 3.

    To determine which factors influence the adoption of e-HRM applications.

  • 4.

    To determine what the challenges are in the adoption of e-HRM applications.

  • 5.

    To explore the organization’s future plans in adopting e-HRM applications.

The study focused on large organizations because smaller ones had not moved far enough into e-HRM development to provide useful responses (Watson Wyatt, 2002).

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Background

Functions within the HR department have historically been both transaction- and information-intensive with approximately 60 to 80% of the department’s time being spent on “adminstrivia” or “blocking and tracking” procedures (Rodriguez, 2003).

However, greater globalization and outsourcing pressures (Rodriguez, 2003), decentralization of HR functions (Wyatt Watson 2002), and the need for multiple point applications supporting market requirements (Ashbaugh & Miranda, 2002) have changed demands made on the HR department. In addition, while HR processes become increasingly IT-dependent, at the same time the technology is changing rapidly. Consequently, a skills shortage of technically competent employees develops and companies are thus required to invest to upgrade employee skills (Ashbaugh & Miranda, 2002).

The emphasis on attracting and retaining the right people and skills has increased pressure on HR departments to focus on strategic HR functions (i.e., recruiting and retention) to drive organizational success (Rose & Kumar, 2006; Wild, 2001) rather than administration. In New Zealand, as is in the rest of the world, organizations’ HR functions are expected to adopt a more advisory, efficient, flexible, and customer-oriented role (Johnson, 2002; Lepak & Snell, 2002).

Key Terms in this Chapter

Benefit: The positive outcome of a decision or activity; an improvement attributable to some decision or activity.

Adoption: Understanding and acceptance of a concept, and its acquisition and use with an implied eventual positive outcome in mind.

Application: The type of usage—defined by purpose—often used to describe software packages.

E-HRM: A network-based structure built on partnership and typically mediated by information technology to help organizations acquire, develop, and deploy intellectual capital (Lepak & Snell, 1998, p. 216 AU21: The in-text citation "Lepak & Snell, 1998" is not in the reference list. Please correct the citation, add the reference to the list, or delete the citation. ).

Success: The achievement of an objective.

Objective: The target, goal, or purpose, which drives and guides decisions and activities.

Organization: A group of two or more people who work together towards a common goal.

Challenge: An issue that arises that can provide potential obstacle to achieving an objective but which can act as a spur to achieving an objective not previously considered or not considered achievable.

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