E-HRM: Definition, Advantages, Practices

Processing and transmission of digitized

HR information are called E-HRM or
electronic human resource
management.

E-HRM is the application of IT for HR

practices which enables easy
interactions within the employee and
employers. It stores information
regarding payroll, employee personal
data, performance management,
training, recruitment, and strategic orientation.

Definition of E-HRM

E-HRM has been defined as “a way of implementing HR strategies, policies and

practices in organizations through a conscious and directed support of and/or
with the full use of web-technology-based channels” or more recently, and
more broadly, as “the planning, implementation, and application of information
systems for both networking and supporting actors in their shared performing
of HR activities”.

Human Resource Management (HRM) departments using information and

communication technologies (ICTs) are becoming an increasingly important
phenomenon commonly referred to as e-HRM. Automated HR tasks and
practices are transforming the traditional paper-and-pencil, labor-intensive HR
tasks, into efficient, fast-response activities that enable companies to anticipate
and profit from environmental shifts to create a much-needed competitive
advantage.

. In the view of Michael Armstrong, e-HR provides the information required to

manage HR processes.

In other words, E-HRM is a way of implementing HRM strategies, policies and

practices in an organization through directed support of web technology-based
channels.
E-HRM is the relatively new term for this IT-supported HRM, especially using
web technology. E-HRM has the potential to change the way traditional HRM
functions are performed.

For example, in the analysis and design of work, e mployees in geographically

dispersed locations can work together in virtual teams using videos, email, etc.
Under recruitment function, job openings can be posted online, and candidates
can apply for jobs online.

On compensation and benefits issues, e-HRM will make it easy for employees to
review salary and bonus information and seek information about bonus plans.

‘E-HRM is the planning, implementation, and application of information

technology for both networking and supporting at least two individual or
collective actors in their shared performing of HR activities. E-HRM is not the
same as HRIS, which refers to ICT systems used within HR departments. It is
different from that of Virtual HRM.

VHRM is defined by Lepak and Snell (1998) as “… a network-based structure

built on partnerships and typically mediated by information technologies to
help the organization acquire, develop, and deploy intellectual capital. E-HRM
is, in essence, the devolution of HR functions to management and employees.

They access these functions typically via intranet or other web-technology

channels.

Kavanagh and Thite (2008) define as “the system used to acquire, store,
manipulate, analyze, retrieve, and distribute information regarding an
organization’s human resources.

According to Nrupa Rajhans (2012), “E- HRM costs lower and improves
efficiency by reducing paperwork and streamlining workflow, automating
redundant HRM tasks, empowering employees to embrace a self- service HRM
delivery system, keeping the company workflow fully informed about all
important HR compliance issues and corporate events, speeding up the
response time of HRM systems, ensuring that more informed decisions are
made, and improving time management.”

Elements of E-HRM
From the above discussion, it is evident that e-HRM has several crucial
elements. It utilizes information technology in a twofold manner.

First, technology is necessary to connect usually spatially segregated actors and

enable interactions between them irrespective of their working in the same
room or on different continents, i.e., technology serves as a medium with the
aim of connecting and integration.

Second, technology supports actors by partially – and sometimes even

completely – substituting for them in executing HR activities. Hence,
information technology serves additionally as a tool for task fulfillment.

The consideration of individual and collective actors considers that e-HRM is a

multilevel phenomenon; besides individual actors, there are collective actors like
groups, organizational units, and even whole organizations that interact in order
to perform HR activities.

Besides, e-HRM, there are some further concepts which obviously refer to the
same phenomenon. Widely accepted are such terms as virtual HRM, web-based
HRM, or business-to-employee.

“Virtual HRM” refers to technological mediated networks of different internal

and external actors providing the firm with the HR services needed without the
further existence of a conventional HR department which therefore becomes
virtual.

Types of E-HRM
There are three types of E-HRM.

1. Operational.
2. Relational.
3. Transformational.

These are described respectively as:

1. Operational

Operational E-HRM is concerned with administrative functions – payroll and

employee personal data, for example.
2. Relational

Relational E-HRM is concerned with supporting business processes by means of

training, recruitment, performance management and so forth.

3. Transformational

Transformational E-HRM is concerned with strategic HR activities such as

knowledge management, strategic re-orientation. An organization may choose
to pursue E-HRM policies from any number of these tiers to achieve their HR
goals.

Goals of E-HRM
Researchers suggest three goals of e-HRM are: reducing cost, improving HR
services, and improving strategic orientation.

HR managers can make a human resource plan more quickly and accurately,
make decisions faster, define jobs more clearly and enhance communication
with the employees and the external community.

E-HRM is seen as offering the potential to improve services to HR department

clients (both employees and management), improve efficiency and cost-
effectiveness within the HR department, and allow HR to become a strategic
partner in achieving organizational goals.

And finally, e-HRM creates standardization, and with standardized procedures,

this can ensure that an organization remains compliant with HR requirements,
thus also ensuring more precise decision-making. E-HRM has increased
efficiency and helped businesses reduce their HR staff by reducing costs and
increasing the overall speed of different processes.

E-HRM also has relational impacts for a business; enabling a company’s

employees and managers with the ability to access HR information and increase
the connectivity of all parts of the company and outside organizations. This
connectivity allows for communication on a geographic level to share
information and create virtual teams.
Within a system of e-HRM, it is possible for line managers to use desktop
computers to arrange and conduct appraisals, plan training and development,
evaluate labor costs, and examine indicators for turnover and absenteeism.

Employees can also use a system of e-HRM to plan their personal development,
apply for promotion and new jobs, and access a range of information on HR
policy.

Systems of e-HRM are increasingly supported by dedicated software produced

by private suppliers.

The empowerment of managers and employees to perform certain chosen HR

functions relieves the HR department of these tasks, allowing HR staff to focus
less on the operational and more on the strategic elements of HR, and allowing
organizations to lower HR department staffing levels as the administrative
burden is lightened.

Role of E-HRM
Past research has suggested that e-HRM can increase the efficiency of HR
activities, improve HR service delivery and transform the role of the HR function
into one that is more strategic.

If this is the case, then the use of e-HRM may allow the HR function to increase
its value and contribute to the competitive advantage of the firm. The more
extensive deployment of technology and systems in the HR domain could be an
additional source of rents.

However, we might expect that technological and system assets would have
lower barriers to limit ability than, say, know-how advantages embedded in
socially complex routines.

Although, it is safer to assume that even where a firm has deployed e-HRM
technologies they may derive sustained advantages from the interactions
between these, possibly imitable resources, and other more complex, path-
dependent resources.

the purpose of this chapter is to test the proposition that e-HRM can increase
its value through the more efficient management of generic labor and effective
support of differential labor.
Advantages of E-HRM
E-HRM is not suitable for organizations where employees are not prepared to
accept or use it. Major benefits/advantages of E-HRM are as follows:

 Improving quality services.

 Ensuring efficient services at an amazing speed.
 Facilitating routine tasks like record keeping, maintaining the portfolio,
collecting and storing relevant information regarding the human
resource.
 Helping the reduction of costly time and labor.
 Improving accuracy and reducing human bias.
 Making, reporting and analyzing data quickly.
 Benefiting everyone through standardization and automation.
 Handing bundles of employee data from multiple locations fairly and
quickly.
 Performing crucial functions of HRM such as recruitment, selection,
training, and development by using web-based technology.
 Playing decisive roles towards a paperless office.
 Maintaining anonymity of staff in evaluation/feedback giving.

Disadvantages of E-HRM
Demerits/Limitations of E-HRM are listed below:

1. It involves a high cost to maintain and implement E-HRM.

2. It is difficult to maintain the confidentiality of the input data.
3. Electronic media are vulnerable, which may be attacked by viruses from
anywhere on the Internet. Contracting a virus can disable your HR
management system severely enough to render it unusable for an
indeterminate time. E-HRM is subject to corruption, hacking or data
losses.
4. Computers and their associated programs are only as effective as their
human users, data entry errors can and do occur. In HR management
systems, such errors can have grave consequences.
5. Organizations need to to-invest more on training and development
before adopting e- HRM.
Functional Areas /Practices of E-HRM
E-HRM is widely used by leading firms all over the world. Its areas are widening
gradually.

E-recruitment

Online recruitment has become a common and easily accessible method of

recruitment nowadays. Recruitment through traditional advertising, print media,
booklets, and magazines are replaced or working as a substitute for online
recruitment at present (Parvin, 2013).

As the most significant internet revolutionary aspect, online recruitment has

altered the inner structure, processes, and competencies of many firms (Bell and
Sutton 1998, Freeman 1999, Day Mar 2000).

The words e-recruitment, online recruitment, cyber-recruiting, or internet

recruiting are synonymous. They imply formal sourcing of jobs online (Ganalaki,
2002). It is a complete process which includes job advertisements, receiving
resumes and building human resource database with candidates and
incumbents.

Online recruitment, also known as e-recruitment is one of the worldwide trends

for HR functions (Bussler & Davis, 2002). It has evolved into a sophisticated
interactive engine with the ability to automate every facet of the hiring process
virtually (Joe Dysart, 2006). The internet can ease the selection of employees,
especially where long distances are involved (Galanaki, 2005).

E-recruitment has grown rapidly over the past few years and is now widely used
by both recruiters and job seekers across the world (Cober & Brown, 2006). The
internet has proved to be a powerful tool for the delivery of different kind of
services like HR planning, HR evaluation, HR rewards, and HR recruitment, etc.
under the umbrella of EHRM.

Vidot (2000), suggested that e-recruitment is the use of the internet to attract
high-quality candidates, screening of suitable profiles, streamlining the
application and selection process. The internet has made an impact on the
human resource field (Bussler & Davis, 2002).
It has been argued by Caggiano (1999) & Borck (2000) that internet-based
recruiting will not replace traditional practices in recruiting, but a well-
implemented e-recruitment strategy can help the recruitment process become
more successful. Hogler (1998) gives the idea that employers can electronically
advertise jobs, scan and store resumes, conduct test and contact qualified
applicants by using the power of the internet to match people to jobs.

Advantages of online recruitment

The recruitment functions including attracting qualified applicants, screening

potential profiles, rationalizing the applications and selecting process through
the internet are known as e-recruitment (Bussler and Davis 2002).

In using the internet rather than more traditional recruitment channels,

employers and applicants will face certain advantages and disadvantages (Tong
& Sivanand; Bartram 2006, Baillie, 1996; McDougall, 2001; Mohamed, 2002,
Greengard & Thaler-Carter, 1998).

Online recruitment and the use of new emerging technologies have many
advantages for the modern recruiter. Some of those are listed below:

1. It makes the process of finding candidates and new business

opportunities quicker, cheaper and more efficient.
2. E-recruitment has enabled corporate bodies and job seekers to become
more sophisticated and interactive.
3. E-recruitment enhances the effectiveness of the recruitment process.
4. The e-recruitment has come up with a valuable method for finding
potential candidates who are not necessarily looking for a change in their
current jobs but would be open to the right opportunity.

To sum up, the general advantages of e-recruitment include shorter recruiting

cycle time, attracts the passive job-seeker, provides global coverage at a
constant basis, opportunity to address specific labor market niches, reaches a
wider range of applicants, gives the company a more up-to-date image, better
quality of response low cost, easier to apply for job, reduction of unqualified
candidates, more opportunities for smaller companies, less intrusive, candidates
are young, educated and computer literate, thereby, showing some interest in
the recruitment company.
Disadvantages of e-recruitment

However, some general disadvantages of e-recruitment include:

1. It discriminates between the internet user and non-internet user.

2. It creates a contrasting impact on ethnic minority groups leading to
limited demographic scope.
3. It is inappropriate for top management profiles.
4. It generates huge volumes of unqualified and low-quality candidates (e.g.,
one million candidates contest in the Civil Service Examination for one
thousand posts).
5. It hesitates both the employee and the organization to judge whether one
is the right choice for another.

E-Selection

E selection begins where e-recruitment ends. Gueutal and Stone (2005) define
e- selection as a process of web-based testing, face to face interviews, and job
offers.

Most organizations use e-selection to achieve some specific purposes, such as

cost reduction, maximum utilization of human resources and sustainability. To
operate e- selection properly, organizations need to consider few procedural
requirements, including design upfront, vendor selection, and project steps,
assessment steps, and protocol for the test event, and feedback to candidates.

E-learning/web-based training

Web-based training (sometimes called e-learning) is anywhere, anytime

instruction delivered over the Internet or a corporate intranet to browser-
equipped learners. There are two primary models of Web-based instruction:
synchronous (instructor-facilitated) and asynchronous (self-directed, self-
paced). Instruction can be delivered by a combination of static methods
(learning portals, hyperlinked pages, screen cam tutorials, streaming
audio/video, and live Web broadcasts) and interactive methods (threaded
discussions, chats, and desktop video conferencing).
Web-based instruction is the perfect solution to meet the needs of lifelong
learners because it is available on-demand, does not require travel, and is cost-
efficient.

Critics point out that Web-based training is a good alternative for independent,
self-motivated students, but that technical issues and the need for human
contact limit its usefulness for students with other learning styles.

E-learning includes numerous types of media that deliver text, audio, images,
animation, and streaming video, and includes technology applications and
processes such as audio or videotape, satellite TV, CD-ROM, and computer-
based learning, as well as local intranet/extranet and web-based learning. E-
learning can occur in or out of the classroom. Many firms use the internet to
deliver computer-based training.

Excellent companies transferred. many of the training materials to the CD-ROM

system. Training via the internet, distribution costs are almost zero. Delivering
training through the CD-ROM system is cost-effective

Various technologies are used to facilitate e-learning. Most e-learning uses

combinations of techniques, including blogs, collaborative software, and virtual
classrooms.

Audio

The radio has been around for a long time and has. been used in educational
classrooms. Recent technologies have allowed classroom trainers or instructors
to stream audio over the internet. There are also webcasts and podcasts
available over the internet for students and teachers to download for free.

Video

Videos allow a trainer to reach trainee who is visual learners and tend to learn
best by seeing the material rather than hearing or reading about it.

Trainers can access video clips through the internet instead of relying on DVDs
or VHS tapes. Web sites like YouTube are used by many trainers. They can use
messaging programs such as Skype, Adobe Connect, or webcams, to interact
with guest speakers and other experts.
Videoconferencing

Emery and Schubert highlighted the benefits of videoconferencing. They argue

that firms use videoconferencing to train employee who is geographically
separated from each other or from the trainer.

Videoconferencing allows people in one location to communicate live via a

combination of audio and visual equipment with people in another city or
country or with groups in several cities. Keypads allow audience interactivity.

Computers, tablets and mobile devices

Computers and tablets allow students and teacher’s access to websites and
other programs, such as Microsoft Word, PowerPoint, PDF files, and images.
Many mobile devices support m-learning.

Blogging

Blogs allow trainers and trainees to post their thoughts, ideas, and comments
on a website. Blogging allows students and instructors to share their thoughts
and comments on the thoughts of others which could create an interactive
learning environment.

E-learning has both merits and demerits. It is a user-friendly tool. E-learning is

self- paced, interactive, consistent, and easy to update. However, it is not
without limitations. It may cause trainee anxiety, requires significant upfront and
substantial investment. Top management support is a must to introduce the e-
training program.

E-performance management

E-Performance Management by its name indicates that performance

management with the help of electronic systems. E-Performance Management,
a web-based tool, has been designed to make the performance reviews easier
than ever.

An online performance appraisal system is a software program that facilitates

the completion of performance evaluations online. It may be integrated with an
employee position description module, allowing managers to pull data from the
employee’s position description and insert this information into the evaluation.
Further, it can act as a historical archive, storing past evaluations and permitting
comparisons between evaluations over time. The primary advantage of these
systems is the accessibility of the data any time from any computer with
internet access, as well as the ease and speed with which they can generate
accurate HR-related reports.

An effective e- performance management system can play a very crucial role in

managing the performance in an organization by:

 Ensuring that the employees understand the importance of their

contributions to the organizational goals and objectives.
 Ensuring each employee understands what is expected from them and
equally ascertaining whether the employees possess the required skills
and support for fulfilling such expectations.
 Ensuring proper aligning or linking of objectives and facilitating effective
communication throughout the organization.
 Facilitating a cordial and a harmonious relationship between an individual
employee and the manager based on trust and empowerment.

An effectively implemented e- performance management system can benefit

the organization, managers, and employees in several ways as depicted below:

Organization’s Benefits

It improves organizational performance, employee retention, and loyalty,

improved productivity, overcoming the barriers to communication, clear
accountabilities.

Manager’s benefits

Managers receive instant feedback on performance with drill down to individual

employee performance. With this, there is no need to rewrite performance
contracts each year. Simply they could upload and edit from a previous period
and then, development the needs emanating from performance discussions
would be automatically fed into the individual development plan.

Employee’s benefits
Clarifies expectations of the employees, self-assessment opportunities, clarify
the job accountabilities and contributes to improved performance, clearly
defined career paths and promotes job satisfaction.

E-compensation

E-Compensation represents a web-enabled approach to an array of

compensation tools that enable an organization to “gather, store, manipulate,
analyze, utilize, and distribute compensation data and information”. Unlike
previous compensation software, the e-compensation tools are web-based,
rather than a client-server-based or stand-alone PC-based.

This allows the individual’s access electronically distributed compensation

software, databases, and analytic tools by using an internet browser from
literally anywhere on the earth.

E-Compensation tools can provide HR managers with the ability to effectively

adapt compensation systems to meet the current challenges, manage and
maintain all aspects of equity in pay plan design, and to align the compensation
systems with the strategic management of the organization.

Overtime payment is one of the overheads under the compensation

management of the human resource Department. Introduction of electronic
technology in the human resource task results in better controlling and cost-
saving.

Biometrics is the latest electronic technology design for accurate attendance

maintenance of human beings with zero errors or frauds. Biometrics scan finger
of human and stores permanently as his identity and proof that he is present.

Many companies are entrusting attendance management to biometrics that

gives accurate attendance dates with an in and exit time of employment. The
time employee remained in office at work can be monitored exactly and hence
paid appropriate remuneration for his total working hours.

Biometrics are playing a very crucial role in the employee work time
management that is linked with compensation management and in a cost
saving by measuring employee work time contributed to organizing.
Lepak (2009) names three keyways in which e-Compensation tools help HRM
professionals in a dynamic and competitive environment:

1. increase access to critical compensation information (for example:

knowledge management databases, best practices internal and external,
individual equity design, competitive information) by simply on an as-
needed basis without dedicated IT staffs and sophisticated IT
infrastructures,
2. enable round-the-clock availability of meaningful compensation
information to managers and employees’ company-wide, thus making
critical compensation information more available to support decision
making,
3. streamline cumbersome bureaucratic tasks through the introduction of
workflow functionality and real-time information processing, so HRM
professionals’ productivity can be increased. E-compensation systems also
allow managers to develop budgets, model the impact of incentive
systems and ensure the fairness of salary allocation decisions.

For instance, such systems give managers access to salary data that can be used
for budgeting and modeling the costs of incentive systems with different
components (e.g., profit sharing, merit increases, stock options).

Furthermore, these systems can be linked to e-performance management

systems, increasing the odds that pay raises are based on employee
performance.

Conclusion
E-HRM is a web-based tool to automate and support HR processes.

The implementation of e-HRM is an opportunity to delegate the data entry to

the employee, e- HRM facilitates the usages of the HR marketplace and offers
more self-service to the employees, e – HRM (Electronic Human Resource
Management) is advance business solution which provides a complete on-line
support in the management of all processes, activities, data and information
required to manage human resources in a modern company.

It is an efficient, reliable, easy to use the tool, accessible to a broad group of

different users, e- HRM is a way of implementing HR strategies, policies, and
practices in organizations through conscious and directed support of and/or
with the full use of web-technology- based channels.

It covers all aspects of human resource management like personnel

administration, education and training, career development, corporate
organization, job descriptions, hiring process, employee’s personal pages, and
annual interviews with employees.

Therefore e-HRM is a way of doing HRM.