AnExaminationofeHRMPracticescarriedoutbySMEsatAnkleshwarBelt

By

Mr.MehulD.Mehta,AssistantProfessor,

S.R.LuthraInstituteofManagement,Surat.

EMail:mehtamehuld@yahoo.com,Mobile:9409117355

ABSTRACT

Nowadays,HRisnottreatedassingledepartment/function,ithastoperformmultipleroles

becauseofincreasingpressurefromexternalaswellasinternalenvironment.Thetechnology

advancementisthebiggestchallengesforallkindsoforganizationandtheyhaveunderstood

itsimportanceofInformationTechnology.

Enormous Organizations are adopting technology to offer better HR Services to different

functioningofanorganizationandtheysucceedalso.Bylookingtothesuccessstoryofthese

organizations,Small andMediumScale firmsarealso trying to incorporate ITwithHR to

copeupwiththechangesthatarecomingintheindustry.

Themain objective of the study is to examine the adoption of technology in carrying out

different HR Functions by SMEs & to identify the drivers for eHRM. The challenges,

attitudesofemployeestowardseHRM.Toconductthisstudyprimarydatawillbecollected

from Small and Medium Scale firms operating at ankleshwar belt. Field Survey will be

carried out to gather primary datawith the help of StructuredQuestionnaire. The present

studyrevealthatEHRMpracticesarecarriedoutforrecruitment,selection&dataretrieval.

Employees attitude towards EHRM is positive and they also accept that it help and

organizationtoreducecost&providespeed.Lackofcommitment&lackofexpertiseinIT

aremajorbarriertoEHRM.

KEYWORDS:eHRMEmployeesAttitudeDriversandChallengestoeHRMatSMEs

Introduction

With an area of globalization, market structure of Indian economy has changed which

increased competition for business aswell as for labour.Tomakepresence in these hyper

turbulent scenario organization of all kind whether MNCs, Big Giants or SMEs have to

produce products and services at cheaper rate than their competitors. To do this, HR

departmenthastoperformthestrategicrole.TransformationhastakenplaceintermsofHow

Human Resources are managed in recent years and these can be achieved by using

informationtechnologyindeliveringHRMPractices.

EHRM can be understood as (planning, implementation) application of IS for both

networking and supporting actors in their shared performing of HR activities (Strohmeier

2007).EHRMwillhelpanorganizationtocontinuouslyflowtheinformationaboutpayroll,

employees personnel data, recruitment & strategic orientation and also reduce the paper

work.

ReviewofLiterature

Electronic Human Resource Management is relatively new concept and it needs proper

understanding otherwise it create a misconception in the mind of HR Professionals.

According to Ruel, Bondarouk & Looise (2004), eHRM is the use of webbased

technologiesfortheimplementationofvariousHRMstrategiesorpractices.(2)

EHRMreferstoconductingHRMtransactionsusingtheInternetandotherIT.Althoughthe

epartisareflectionoftheelectronicmeaningthatithasinebusinessorecommerce,

itreallymeansonlineHR.AneHRsystemaimstoprovideusefulinformationtomanagers

andemployeesanytime,anywhere.Forinstance,itallowsemployeestotakeoversomeofthe

administrative roles of the HR department, by controlling their personal information,

updatingrecordsandkeepingcontroloftimingandagenda.Asformanagers,ithelpsthemto

access information and data, conduct analyses, and make HR related decisions without

consultingtheHRdepartment(1).

EHRM have three drivers / types: operational, which involves strictly administrative

functions (salary andpersonnel data administration), relational concernedwithbusiness

processes(suchasrecruitment,trainingandperformanceappraisal)andtransformational

relatedtostrategichumanresourcesactions,suchasorganizationalchangeandstrategically

reorientation(Snell,Stueber&Lepak,2001Ruel,etal.,2004).(3)

DIMENSIONANDINDICATORSOFEHRM

Variable Dimension Indicator

ElectronicHuman

ResourceManagement

ERecruitment

Pagesrelatedtotherecruitmentagencyswebsite

x UseSpecificwebsitesaimedatrecruitmentx Interactive tools for processing requests fromapplicants

ESelection

Responsibilities&Transparencyof theESelection

Process

x Easeofuseandaccesstothewebx Fundingmechanismforprocessandsystem

EEducation

xUsingsatellites,audioandvideomedia,computers,multimediafacilities

x Fundingforeducationaltrips,staffaccommodationcosts & lost work time for employees to attend

trainingcourses

EEvaluation

xAssessmentprocessthroughawebbasedchannelx To recognize the importance of the electronicevaluationsystem

EReward

System

The organizations ability to collect, store, analyse,

applyanddistributedataand informationrelating to

therightsandbenefitselectronically.

BasedonthecurrentliteratureavailableineHRMgivehintsaboutimprovedproductivityas

aresultofadoptionofeHRMPractices.TheliteratureindicatesareductioninHRstaff,cost

savingsandlessadministrativeburdenduetoautomation(Hawkingetal.,2004Rueletal.,

2004citedinStrohmeier,2007).However,thesavingsintimeasaresultofeHRMcannot

bedirectlytranslatedintofinancialbenefits(Dias,2001).Variouscompanieshavelookedfor

anInternetbasedHRfunctiontobringaboutthemuchdesiredcostsavings(Hawkingetal.,

2004).Walker(2001)hintsthatforsuccessoftechnologyintheHRdomainthereneedstobe

adramatic improvement in the levelof service, reducingcostsandallowingmore time for

higher value tasks. In present scenario, theHR function is expected to provide a strategic

direction to the human capitalmanagement in an organization and be a strategic player in

achieving organizational objectives (cited inHawking,Stein, Foster, 2004 cited inLepak,

Bartol, Erhardt, 2005). The literature mentions terms like global HRIS, GIS (global

information system) (Akmanligil and Palvia, 2004), IHRM (Sparrow, 2007). The synergy

betweenITandHRMhelpstoestablishthesharedservicescentresforHRdomain.

There are concerns over change management and technology acceptance by the end user

(Reddingtonetal,2005Rueletal,2004,Martinetal.,2006).Changeissituationboundand

often a complex process in which receptive contexts play an important part, especially in

transferring practices across international boundaries or even corporate ones. A change

management model will focus on a complex set of events, activities, linguistic practices,

emotions and reactions that help explain what would be needed for successful change to

occurandwhymostsuchinitiativesarelessthansuccessfulinproducingsustainablechange

(Martin & Beaumont, 2001). Nevertheless, one of the most important factors shaping the

successoftechnologicalchangeisuseracceptance(Fisher&Howell,2004).

Needs/Importanceofthestudy

Various studieshadbeencarriedoutbydifferent researcheronEHRM, thedrivers forE

HRM,challenges.ButvaryfewauthorhastriedtoidentifythepracticesofEHRMCarried

outbySmall&MediumEnterprise.AnkleshwarwhichisconsideredasAsiaLargestGIDC

in termsof units is havingmoreSMEs.This studywill help all thoseSMEs in termsof

advantagewhichcanbegainandwhatarethedifferentareaofHRwhereEHRMpractices

canbeimplementedthatultimatelyproduceefficiency&competitiveadvantages.

StatementofProblem

Whyorganization exits?What are the objectives of organization?The simple answer is to

createwealth. This objectives can be achieved by generating revenue or profits and to do

these organization must be effective and efficient. HRMwith the use of IT can help the

organization. This study has been carried out to find out the reasons of adopting EHRM

practicesinSMEs,alsotofindoutpracticeofEHRM.Organizationwill

Objectives

ToidentifydrivingforcesforEHRMinSMEs.

To examine the extent to which SMEs have adopted technology to carry out HRfunctions.

TostudyemployeesattitudetowardsEHRM.

TounderstandthebarriershinderingEHRMpractices.

TosuggestvariousstrategiesforeffectiveimplementationofEHRMatSMEs.

Hypothesis

Ho:HREmployeeshavepositiveattitudetowardsEHRMwithrespecttosavingtime.

H1:HREmployeeshaveNegativeattitudetowardsEHRMwithrespecttosavingtime.

ResearchMethodology

Adescriptive research design has been adopted in this study to find outEHRMpractices

carried out in SMEs. To collect the primary data, survey method has been adopted and

questionnairewasusedasatoolstoelicitfirsthanddatafromtherespondents.Convenience

random sampling were used to collect the data. 67 employees from different SME units

operating in the field of chemical, pharmaceuticals, pigments, pesticide were taken as

samples. Percentage methods and SPSS had been used to analysis the data and to check

hypothesisfortheresearch.

DataAnalysis

No. DemographicCharacteristics Respondents Percentage1 Gender

Male 43 64Female 24 36

2 EducationalQualificationPostGraduateDegree 38 57GraduateDegree 24 36

Diploma(ISTD,DiplomainHRM) 5 73 WorkExperience

13years 25 3746years 32 48Morethan6years 10 15

4 HRPracticesCarriedoutTraditional(Paperwork) 9 13EHRM/HRIS 30 45CombineApproach 28 42

Fromtheabovetableitcanbereviledthat64%ofrespondentsaremale,majorityofthemthatis57

% respondents are Post Graduate followed by 36% Graduate respondents. 48% respondents are

having the experiencebetween4 6 yearswhich identified that employeesworking inSMEs are

experienced.Inthelastitcanbeinterpretedthat45%SMEsareusingEHRMpracticestocarryout

HRMfunctions.

EmployeesAttitudetowardsEHRMPractices

KMOandBartlett'sTestKaiserMeyerOlkinMeasureofSamplingAdequacy. .604

Bartlett'sTestofSphericity

Approx.ChiSquare 177.369df 36Sig. .000

RotatedComponentMatrixComponent

1 2 3itisdifficulttoimplementEHRM .798EHRMisuserfriendly .711

EHRMhelpsinincreasingefficiency&productivity .705EHRMimprovesclientservice .586EHRMhelpsinsavingtimes .873EHRMincreasespeedofRecruitment&Selection .654itenablebettercommunicationamongstdepartments .627EHRMenablequickretrieval&dataprocessing .764EHRMprovidessecurityforDatabase .750

ComponentTransformationMatrix

Component 1 2 31 .790 .509 .3432 .601 .526 .6033 .127 .681 .721

In research of EHRM,

thevariablesconstitutingComponent1are:

x EHRMisdifficulttoimplement.x Itisuserfriendly.x EHRMhelpsinincreasingefficiency&Productivity.x EHRMimproveClientService.

TheVariablesconstitutingcomponent2are:

x EHRMhelpsinsavingtimes.x EHRMincreasespeedofRecruitment&Selection.x EHRMalsofosterbettercommunicationamongstdepartments.

TheVariableconsistingcomponent3are:

x EHRMenablequickretrieval&dataprocessing.x EHRMprovidessecurityforDatabase.

The resultofPrincipalComponentAnalysis reveal thatemployeesattitude towardsEHRM

practicesare:

1.EHRMEfficiency.

2.Costsaving&fostercommunicationspeed.

3.Quick&Securedataretrieval&processing.

ONESAMPLETTEST:

Ho:HREmployeeshavepositiveattitudetowardsEHRMwithrespecttosavingtime.

H1:HREmployeeshaveNegativeattitudetowardsEHRMwithrespecttosavingtime.

OneSampleStatistics

N MeanStd.

DeviationStd.Error

MeanEHRMhelpsinsaving

times67 3.7015 .93768 .11456

OneSampleTestTestValue=4

t DfSig.

(2tailed)Mean

Difference

95%ConfidenceIntervaloftheDifference

Lower UpperEHRMhelpsinsavingtimes

2.606 66 .011 .29851 .5272 .0698

TheresultofOneSampleTesttableshowthatthereisasignificantdifferencebetweenthe

hypothesizedmeanandthesamplemean,sincetstatisticis2.606andtheassociatedpvalue

us 0.011 which is less than 0.05, Study failed to accept null hypothesis and it can be

interpretedthatHREmployeeshaveNegativeattitudetowardsEHRMwithrespecttosavingtime.

DriversforEHRM

FromtheabovegraphitcanbeinferredthatImproveDataAccuracy,ReducePaperworkand

ImproveEmploymentServicearethemajordriversforEHRMpracticeinSMEs.

ChallengestoEHRM

Major factors that hinder effectiveness of EHRM Practices at SMEs are Lack of

Commitmentbyemployees,FearofLosingjobsandlackofexpertiseinIT.

x ThemajorareaswhereEHRMPracticesareextendedinHRMFunctionsare:a)DataMining&Analytics

b)FileMaintains&AbsenceMonitoring

c)PerformanceAppraisal

d)Recruitment&Selections

Conclusion

EHRMpracticesareadoptedbymajorityof theSMEsinoneoranywaytocarryoutHR

Functionseffectively.EHRMisusedtocarryoutfunctionslikeRecruitment,Selection,and

DataProcessing&Retrieval.Themajordrivers for theEHRMpractices areReduction in

operational cost, quick data processingwith enough securitymeasurement. The attitude of

employees towards EHRM is positive for Cost Saving, efficiency and speed. Lack of

Commitment from employees, fear of losing jobs and lack of expertise in IT are major

barriers to theeffectivenessofEHRM.ToimprovetheefficiencyofEHRM,organisation

canbuildHRPortalthroughwhicheveryoneintheorganisationwillbeconnectedandthey

canshare thenewcontentswith thefacilityofHelpDesk toanswerquestions toresolve

queriesofusers.

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