HRIS implementation challenges

In today's rapidly changing business world, especially in large organizations with many departments and a large number of employees, it becomes even more important for the HR manager (as well as for traditional line managers) to have access to real-time employee data in order to develop a lean and efficient human resource management. Because the need for data is so critical to business success, many organizations are turning to human resources information systems, i.e., computer technologies designed to improve payroll, enhance manager-employee relationships, improve data storage and retrieval, and can even be used to connect the external environment with the internal environment through the use of electronic data systems. There are many challenges and considerations when implementing these systems, as well as the organizational improvements that human resource information systems can bring. This paper describes these challenges and disadvantages for today's HR manager.

What is HRIS?

A Human Resources Information System (HRIS) is "the set of databases, computer applications and hardware and software required to collect, record, store, manage, provide and present data for human resources management".

The advantages of HRIS

The HRIS system is a conglomerate of different electronic systems, the sophistication and price of which depends on the company or sector in question, providing HR managers and even supervisors with real-time data that can be hosted until practical HR decisions have to be made. For example, specific demographic data about employees, such as their skills, education, and even compensation, can be stored in electronic systems until the data is needed, for example, when performance information is needed in the preparation of an annual report. This access to real-time data gives HR managers the flexibility to implement new HR models or simply improve communication with large numbers of employees in an accurate and efficient manner.

HRIS Challenges

Budget-conscious organizations without significant financial capital may be concerned about the introduction of different personnel information systems. For multi-tiered organizations with more than 100 employees, the cost of implementing a system-wide software system that links the HR function to the broader business environment may exceed budget. For example, SAP is a common HR-focused system that not only provides data access for HR professionals, but also links production, payroll, and purchasing functions in a single conglomerate software package. Airbus, a major commercial aircraft manufacturer, recently integrated SAP to enhance its HRIS environment and provide self-service capabilities to its 55,000 employees. A company should conduct an internal strategic analysis of budget requirements before implementing such a sophisticated program, as the costs relative to the benefits of such a program could outweigh the additional flexibility it offers the incumbent HR strategist.

In addition, some organizations maintain environments that are so complex and so dependent on individual departments that the implementation of a new HRIS system becomes a major time issue to ensure high-quality implementation and deployment of HRIS software packages. "Do not underestimate the effort and investment required for this type of transformation". When introducing new HRIS systems, especially systems as sophisticated as Oracle or the SAP already mentioned, data from different departments are needed to map the information system architecture of the new software being implemented. This usually requires several meetings with different department heads to filter out unnecessary or redundant information and to ensure that all aspects of the function of the task areas by department are integrated into the structure of the new software package to make it meaningful for the current operating environment. The implementation of sophisticated HRIS systems can sometimes take up to two years, requiring a project team of over 30 representatives to complete the implementation. In an organizational environment where costs and time are significant, management decision-makers may question whether the introduction of new HRIS technology outweighs the long-term benefits to the human resources manager.

An organizational culture issue may also arise when implementing a new HRIS technology that responds to the inherent desire of employees to avoid change in the organization. Issues such as the benefits of the technology (ease of use), socialization with colleagues and trust in current HRIS technology should be considered from a more psychological perspective prior to implementation. In today's work environment, employees are motivated by a sense of security, as suggested by Abraham Maslow. When employees feel threatened by the introduction of new HRIS software, they often resist change and are less cooperative in providing data to support development. This is particularly true in the current difficult economic environment, where many national and international companies are finding it difficult to provide job security for their employees within the existing organizational culture. Before developing and implementing a new HRIS system, trends in human behaviour should be considered to familiarize employees with the benefits of such systems and to indicate that job security is still in place. In this case, the challenges of implementing a new system would be employee interference or lack of cooperation in modeling and would be a potential real business scenario in virtually all industries where implementing change is an ongoing issue. Therefore, long-term effects on organizational culture and labour relations need to be considered and addressed in order to appeal to the sense of security of employees who are less resistant to changes such as the introduction of a new HRIS technology. Confidence in the HRIS software is also an important aspect of successful HRIS implementation.

The need to upgrade existing HRIS technologies may also be a drawback that should be considered as part of a long-term strategic approach. It seems that many HR professionals today play a strategic rather than a supporting role. Therefore, technological advances that quickly render existing technologies obsolete could be a budget issue for the new HRIS developer. Ongoing upgrades driven by improvements in software and business technologies often create the need to improve memory or develop new applications to support new technologies. These upgrades may require the establishment of new project teams in a short period of time to ensure successful integration, and may also impose tax constraints. Therefore, the introduction of a new HRIS could lead to long-term problems regarding the maintenance of the technology or its relevance to future business or human resources objectives. The longevity of the new HRIS should be considered as a key strategy before its introduction. Ongoing software upgrades are not only fiscally restrictive, but could also have a negative impact on organizational culture, including resistance to change or the need for costly software training to make employees competent to use the systems.

The open access method for some online HRIS software can also create problems for the successful implementation of these technologies, as employees may inaccurately manipulate data to create an unrealistic competency profile. As noted above, HRIS self-service software packages can allow employees to access their demographic and performance data in the online environment or through integrated intranet systems. Therefore, the organization must consider the need to support these technologies, for example, by having the expertise to provide limited or unlimited access to employees or by developing specific passwords and identification codes to log on to these systems. From a support perspective, it is likely that the more sophisticated the HRIS software package is, the more support for access and access media will need to be considered and maintained. The HR manager will be concerned with data confidentiality and access authorization for areas such as medical records and other sensitive employee information and must be a driving force in deciding which area of the organization should have open access. If IT support is too costly or unrealistic for the company's current operating model, the question arises whether implementing these systems will add value.

In an enterprise environment that uses a flexible benefit plan, the HRIS system can have significant disadvantages for the HR manager. These are systems that "allow employees to select their preferred benefits from a set of benefits defined by the employer". Flexible benefit plans, also known as "cafeteria plans," give employees the ability to select or deselect various benefits based on personal criteria, whether or not they are performance-based. In this type of system, the HRIS software allows employees to make a self-service selection of benefits in a virtual environment, which would be of considerable benefit to the HR manager. However, in view of the large number of employees, the regular change of benefits from a core service offering could seriously complicate the role of the HR manager in implementing an HRIS system to support flexible benefits. If the system is not self-service oriented, the HR manager would have to manually enter a lot of data, which could distract him or her from other value-adding activities such as improving the organizational culture or meeting the security needs of employees. These are realistic disadvantages of implementing such a system, where employee flexibility represents an additional workload for the HR manager in an environment where employee access to performance data may not be reliable and authorized.

The implementation of HRIS software or technology could also disrupt the organizational effectiveness of the company from a social perspective. Abraham Maslow's theory of motivation also identifies that a company's employees need a sense of belonging to the organization that appeals to the need for socialization and respect from colleagues. By integrating the HR function into a single piece of software, such as a system linked to the employee intranet, it will give employees easier access to important policy changes or benefit offerings (among countless other business scenarios). This automated HR system retains the ability to eliminate some of the interpersonal aspects between the HR professional and the employee population, making the HR manager less aware of what is actually happening in the employee environment. In order to interact with employees at the interpersonal level, the HR manager may need to conduct interviews with employees, conduct observational studies of the employee's existing work environment, or conduct a number of studies when employees no longer require personal intervention with the HR manager. As mentioned above, aspects of a positive organizational culture and socialization should be considered as a potential drawback when implementing a new HRIS technology. The ability to use the ease and convenience offered by HRIS technologies can essentially create a social disconnect between the HR manager and his/her role in maintaining relationships with superiors and subordinates.

Conclusion

HRIS technology can offer a number of benefits, including the ability mentioned above to create a more accurate and streamlined system for personnel selection. Employee compensation is often at the forefront of a different motivational theory than HR and therefore needs to be taken into account because of the motivational results provided by self-service and other effective internal HRIS systems. The ability to access employee data and other evaluations in real time as part of a 360-degree feedback system is a major advantage for HRIS implementation.

Psychological benefits for the organization's employees were also discussed, ranging from improved organizational culture to areas of individual empowerment. Motivation and a sense of belonging will help the organization achieve its long-term business goals. If employees feel that they have a secure job and a sense of belonging to the organization, they are likely to be less resistant to changes associated with the introduction of new HRIS technologies. Therefore, allowing employees to actively participate in the data update and retrieval processes will appeal to their sense of belonging, which is necessary in the workplace. Any improvement in productivity or organizational efficiency is an important incentive for the implementation of these systems.

Even in the cost-conscious organization, there are still HRIS systems that are not as technologically superior as Oracle and SAP, for example, and can be purchased to meet budget constraints while still meeting business needs. Therefore, for small and even large companies, a high degree of competition for business can help the human resources manager or business leader choose an appropriate system that provides the greatest financial and operational value. However, if there is a significant need for consolidation of the company's HR, it should be kept in mind that implementation can be very costly and labour intensive. These are realistic drawbacks in today's busy and hectic work environment that could outweigh the benefits of implementation over the long term.

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