Chapter 1: Electronic/Digital HRM – A

Primer
Mohan Thite

Abstract
There is an explosion of digital technologies in recent times that have fundamentally altered
business models, corporate strategies and the way we live, work, conduct business, and
communicate. The human resources (HR) function today has similarly evolved to incorporate
digital world in its design thinking, strategising and execution. However, the contribution of
technology to HR is so far mainly limited to operational and relational activities with minimal
impact on value-adding transformational activities. Further, technology proliferation has also
led to unintended negative consequences. This chapter outlines the evolution of the digital
world, digital work, and its impact on the workforce. It offers an inclusive definition of the
digital HRM and analyses its impact on various HR functions. It concludes with a preview of
the other chapters in the book.

Learning Objectives
• Highlight how the digital world today dominates the technology landscape and its
impact on the workforce
• Provide an inclusive definition of digital HRM and resultant devolution of HR
activities
• Describe the changing roles of HR in the digital world
• Explain the impact of technology on various HR functions, including unintended
consequences
• Understand the structure of the book and the key themes espoused in various chapters

Introduction
“Digital is business and business is digital” (Andersson et al., 2016, p.56).

Gollub (2016) posted this blog in social media on ‘how the future will look like’:

“I just went to the Singularity University summit and here are the key learnings:

In 1998, Kodak had 170,000 employees and sold 85% of all photo paper worldwide. Within
just a few years, their business model disappeared and they (became) bankrupt. What
happened to Kodak will happen in a lot of industries in the next 10 year(s) and most people
don't see it coming … It will now happen with Artificial Intelligence, health, autonomous and
electric cars, education, 3D printing, agriculture and jobs. Welcome to the 4th Industrial
Revolution. Welcome to the Exponential Age.

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Software will disrupt most traditional industries in the next 5-10 years. Uber is just a software
tool, they don't own any cars, and (yet, they) are now the biggest taxi company in the world.
Airbnb is now the biggest hotel company in the world, although they don't own any
properties.

- Artificial Intelligence: Computers become exponentially better in understanding the world.

This year, a computer beat the best Go player in the world, 10 years earlier than expected …
Because of IBM Watson, you can get legal advice (so far for more or less basic stuff) within
seconds, with 90% accuracy compared with 70% accuracy when done by humans …Watson
already helps nurses diagnosing cancer, 4 time more accurate than human nurses. Facebook
now has pattern recognition software that can recognize faces better than humans. (By) 2030,
computers will become more intelligent than humans.

- Autonomous cars: In 2018, the first self driving cars will appear for the public. Around
2020, the complete industry will start to be disrupted. You don't want to own a car anymore
… Traditional car companies try the evolutionary approach and just build a better car, while
tech companies (Tesla, Apple, Google) will (take) the revolutionary approach and build a
computer on wheels …

- Health: … There will be companies who will build a medical device (called the "Tricorder"
from Star Trek) that works with your phone, which takes your retina scan, your blood sample
and you breath into it. It then analyses 54 biomarkers that will identify nearly any disease.

- 3D printing: The price of the cheapest 3D printer (has come) down from $18,000 to $400
within 10 years. In the same time, it became 100 times faster … In China they (have) already
3D printed a complete 6-storey office building. By 2027, 10% of everything that's being
produced will be 3D printed.

- Business opportunities: If you think of a niche you want to go in, ask yourself: "in the
future, do you think we will have that?" and if the answer is yes, how can you make that
happen sooner? If it doesn't work with your phone, forget the idea. And any idea designed for
success in the 20th century is doomed to failure in the 21st century”.

As you can see from the above (some of which are facts while some are just predictions),
technology is all around us. It always has been. During the industrial revolutions of the last
two centuries, the industrial economy ushered in transformational change. Mechanised mass
production, the steam engine, electricity, the railway network, etc. had the same dramatic and
disruptive effect that we see in newer technologies that have emerged since the start of the
twenty-first century knowledge economy. One might argue that digital highways have simply
replaced the railway networks. But the speed, intensity, and uncertainty of disruptive change
brought about by technology today has been unprecedented and is accelerating rapidly. It has
been described as ‘the fourth industrial revolution’ (Industry 4.0), the ‘new paradigm’ and the
‘big shift’.

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Coupled with globalization and demographic changes, digital technologies have radically
altered the way we live, work, conduct business, and communicate. In the process, they are
dissolving the boundaries between personal and work life. The business management
discipline has seen structural changes in terms of business strategies, research and
development, product/service design, marketing, manufacturing, supply chain management,
customer relationship management, human resource management (HRM) and other support
services. It is now well established that traditional competitive advantages, such as market
leadership, natural resources, financial resources, and technology cannot by themselves lead
to ‘sustainable competitive advantage’ to any country or economy or business in the
knowledge economy. It is the ‘optimum leveraging of people, process and technology’
(Thite, 2004) wherein technology acts as a catalyst with a multiplier effect provided the
organisation has competent leadership along with a workforce and well defined work
processes that are optimally aligned to business objectives.

From master craftsmen to standardised processes driven by mechanisation, to adaptable and

then intelligent processes, the world of work has come a long way. Today we live in the
digital world. While digital technologies are generally used as an umbrella term for
computer-based products and solutions, in the business context, they essentially refer to
intelligent processes that use continuous real time feedback in order to make constant
improvement in the efficiency and effectiveness of work design, processes and outcome
(Thomas, Kass and Davarzani, 2013, p.2). In the process, they directly influence and enhance
customer value and organisational revenue.

What does the all-encompassing digital world mean for the HRM function? According to
Stephen (2016, p.97)

“For HR and business leaders, this digital transformation poses two fundamental
challenges. First, HR can help business leaders and employees shift to a digital mind-set, a
digital way of managing, organizing, and leading change. Second, HR has the opportunity to
revolutionize the entire employee experience by transforming HR processes, systems, and the
HR organization via new digital platforms, apps, and ways of delivering HR services”.

Despite the enormous potential of digital technologies in transforming HRM and 72 percent
of companies believing digital HR is an important priority, ‘only 38 percent of companies are
even thinking about it and only 9 percent are fully ready’ (Stephen, 2016, p.99). This shows
that globally, the HR function is far from realizing the potential of digital technologies.

This chapter is a primer on electronic/digital HRM. In that sense, this chapter is a kind of
‘curtain-raiser’ to the rest of the book. We will first look at the impact of the digital world on
digital work and workforce. We will then critically examine what we mean by digital HRM
and how it has influenced key HR functions and their outcomes. We will conclude with a
preview of the key digital HR approaches, directions, applications, and the related problems
and prospects, as covered in the rest of the book.

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Welcome to the Digital World
There is no clear definition yet of what is ‘digital’. As stated by Andersson, Lanvin and Van
der Heyden (2016, p. 52),

“It is clear that the term digital currently defies definition. Each organisation’s digital
journey is individual, with no clear destination in sight. There is no one-size-fits-all way to
‘do’ digital, nor indeed any ‘right way’ to do digital … The lack of a clear definition of the
meaning of the term suggests that issues concerning the required competences, capabilities,
talent, and resources (including human resources) are surrounded by a similar veil of
ambiguity”.

However, the business rationale for digitalisation, types of digital technologies, and the
impact of those technologies on the world of work provide important clues on what we
generally mean by digital. The primary drivers for the digital initiatives undertaken by
today’s organisations are (Andersson et al., 2016, p. 53):
• Improve engagement with customers
• Increase efficiency
• Deliver on customer expectations
• Improve product and service offer
• Grow demand, and
• Customer acquisition

Digitalisation of the global economy is mainly powered by social, mobile, analytics, and
cloud (SMAC) technologies. To understand the impact of digital technologies on the business
world in general and the world of work in particular, consider these developments:

• Illustrating the power of disruption brought in by new technologies, ‘only 12 percent

of the Fortune 500 companies from 1955 are still in business, and last year alone, 26
percent fell off the list’ (Deloitte, 2017a, p.3)
• We spend one third of the time we are awake browsing the web and apps, surfing one
billion websites online, playing with four million mobile apps, and checking our smart
devices 85 times a day (Now Comms Group, 2017)
• There are more than a billion people on Facebook, over 100 million on Google+, over
450 million on LinkedIn, and over 250 million on Twitter
• 42 percent of Americans play games online for at least three hours per week
• “The Big Six social networks (Facebook, Twitter, LinkedIn, Instagram, Google+, and
Pinterest) exceed 2.4 billion people” (Ulrich, 2017, p.1)
• People in the USA look at their mobile phones 8 billion times a day (Deloitte, 2017,
p.4)
• Thanks to automation and robotics, one in two jobs are at risk; however, due to new
technologies powered by the internet of things (IoT), cloud computing and big data
nearly half a million new technology jobs will be created by 2024 many of which
don’t even exist today (Dehaze, 2016, p.36-37).

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Digital Work & the Digital Workforce
Traditionally, people expected to do the same work for the same employer as a full time
employee for most of their career. Loyalty and tenure were key determinants of career
progression. Managers dictated what work was done, where, when, and how. Career
management, and training and development were directed by the employer and employees
were passive participants. Today in the gig economy that is characterised by a labour market
consisting of freelance workers, more than a quarter of workers in Western countries are free
agents without the constraints of where, when, and how to work (Lanvin, Evans, Rodriguez-
Montemayor, 2016, p. 11). Organisations are increasingly relying on the ‘contingent
workforce’ of knowledge workers to be innovative, agile, and flexible in order to address
business uncertainty and unpredictability. In this section, we will explore how digital
technologies have turned the world of work upside down.

As we get thrown into the whirlpool of the digital world, today’s knowledge workers,
whether employees or gig economy contractors, need to possess and continually fine-tune a
new set of skills and competencies. With an ageing population that is living longer, people
are expected to work well beyond 60 years. Rapid technological obsolescence means people
need to continually upgrade their skills. As the global economy becomes more technology-
intensive with innovation and creativity being key sources of competitive advantage, the
demand for skilled talent, especially in Science, Technology, Engineering and Mathematics
(STEM) has increased tremendously but the supply is yet to catch up.

Research shows that while 75% of the fastest growing occupations now require STEM skills
(PWC, 2015: 12-14), there is an increasing shortage of numeracy and literacy skills across
almost all Western countries (OECD, 2015). This has resulted in the shortage of technology
professionals, so vital in an innovation-driven and technology-intensive global economy
(WITSA, 2016) leading to an increasing global sourcing and ‘global war for talent’, with jobs
going where talent is (via services offshoring) and talent going where jobs are (via skilled
migration, both temporary and permanent). In the process, countries such as India and China
have become key source countries for STEM talent (Craig, Thomas, Hou, & Mathur, 2012: 2-
7). At the same time, the global search for and sourcing of talent has become a hot political
issue with some commentators declaring that an increasing reliance on foreign talent may
lead to a “vicious cycle of off-shoring jobs, losing skills and competencies from the domestic
economy and as a result moving more jobs off-shore could become institutionalized” (NIEIR,
2012: 1).

Further, developments in robotics and artificial intelligence (AI) are expected to result in
‘technology-driven unemployment’, with 40% of today’s low- and medium-skilled jobs
likely to disappear in the next 15 years. Today’s millennials will be doing jobs that don’t
even exist today (PWC, 2015). However, it is not all doom and gloom. As a result of the
combined effects of globalisation, automation and digitalisation, new business models are
emerging creating new types of jobs, such as Uber drivers, just as it happened during the
previous industrial revolutions (Lanvin et al., 2016, p. 4).

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Digital Skills: In the age of dualities, there is a ‘talent paradox’ (Evans and Rodriguez-
Montemayor, 2016, p. 70) in that employers today demand specific technical skills as well as
generic soft skills because an innovation economy demands collaboration and co-creation of
knowledge (Lanvin et al., 2016, p. 12). Andersson et al. (2016, p. 52) call them ‘e-skills’, a
combination of advanced technical skills and high-level softer skills. Colbert, Yee and
George (2016, p. 732) also highlight the importance of ‘digital fluency’ in the digital
workforce which refers to a level of proficiency that allows employees to ‘manipulate
information, construct ideas, and use technology to achieve strategic goals’. Table 1.1 lists
some of the key skills and competencies that the digital workforce is expected to have.

Insert Table 1.1 about here

Career Management in the Digital World: The career management process is caught in the
whirlpool of environmental, organisational, and HRM changes with far-reaching
consequences for both organisations and individuals in managing careers. One of the major
ironies of contemporary career management lies in the fact that the career-conscious
employee is being asked to offer more and more, while the employer is in no position to offer
the scale or the kinds of rewards that were available in the past. It is as if employers have
adapted a “help us but help yourself” attitude (Thite, 2001).

Whymark and Ellis (1999) argue that “traditionally, (the) employment relationship was
characterised by a clear psychological contract. Employers expected loyalty, respect for rules,
and commitment in return for job security, steady career progression, and training and
development. But today the relationship between the parties is viewed more as a short-term
economic exchange arrangement instead of a long-term, mutually beneficial commitment”.
Employers seem to be adopting a “here-and-now” transactional attitude to career
management rather than a long-term commitment.

Bereft of the life-support from employers, many individuals are clueless on how to manage
their careers. Their predicament is aptly described by Gunz et all. (1998): “it is hard for
someone being swept downstream in a fast-moving river to make sense of where they are, let
alone where they are going”.

As highlighted by Thite (2001), some of the fundamental changes that have influenced career
management since the start of the twenty-first century are

• ‘Networked’ and ‘Cellular’ organisational structures wherein strategic business units

(SBUs) function “independently but by networking with others to share common
knowledge and information, akin to human DNA, they learn, grow, and adapt to an
uncertain environment. Within such cellular organisations, members take full charge of
their careers and develop their careers around an agreed set of norms for self-governance
and professional allegiance” (Brent et all, 1996).
• Staffing in organisations has moved from position-centred to portfolio-centred. Under
portfolio-cantered staffing, the contract output is identified, the matching portfolio of
skills needed to complete the contract are specified, individuals with those skills are
located in the HR Information System, the contract is offered and then managed (Templer
and Cawsey,1999).

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• Handy (1996) suggests that organisations are taking on a “shamrock” configuration
whose three levels comprise core, contract and temporary employees. Core employees are
those central to the core competencies of the organisation. Contract employees are the
new “portfolio careerists” – qualified, skills-oriented individuals with a portfolio of skills
and clients. Temporary employees are those individuals needed for specific, lower skilled
tasks and are employed on a need basis.
The most important implication of the forms and features of the new economy on the career
management process is that the individual is in full charge of his/her own career. Hall (1996)
describes the career of the 21st century as “protean”, a career that is driven by the person, not
the organisation, and that will be reinvented by the person from time to time, as the person
and the environment change. The second major implication is that an individual’s career will
be in constant state of flux and will change directions many times during the career span.
Change in career directions also means change in skill components, skill levels, authority and
responsibility levels, income levels and so on. Cianni and Wnuck (1997) predict that
employees in the 21st century will periodically backtrack in their careers, moving from expert
back to novice as they are required to have new competencies that may very well be in areas
unconnected to their personal preferences. Similarly, noting that contemporary careers are
more like ‘spirals’, Gratton (2011) believes that individuals need to develop ‘serial mastery’
in being able to make lateral transitions from one career to another.

Studies also show that knowledge workers tend to have certain unique personality and
occupational characteristics, such as craving for autonomy, challenging tasks, immediate and
frequent feedback and rewards, ownership of ideas and enterprise, commitment to a
profession more than an organisation, team work/community of practices and liberal lifestyle
(Thite, 2004, p.38-42). However, HRM in many organisations still tends to be practiced in
the command and control management style and as such is out of sync with contemporary
realities of the knowledge economy.

Unpacking Digital HRM

Ever since computerisation was introduced in the HR function, many terms have been used to
describe the ‘nature, role and contribution of technology’ in managing people. These terms
include Web-based HR, e-HRM, Virtual HR, Human Resource Information Systems (HRIS),
and recently, Digital HRM and Smart HRM.

E-HRM is the most commonly used and understood term in the HR discipline to denote the
use of mainly web-based applications. According to Marler and Parry (2015, p. 2), e-HRM is
a set of “configurations of computer hardware, software and electronic networking resources
that enable intended or actual HRM activities (e.g. policies, practices and services) through
coordinating and controlling individual and group-level data capture and information creation
and communication within and across organizational boundaries.”

HRIS became prominent and popular with the increasing emphasis on information systems
and enterprise resource planning (ERP) (Thite, Kavanagh and Johnson, 2012). Hedrickson,
(2003, p.381) defines HRIS as “integrated systems used to gather, store and analyze

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information regarding an organization’s human resources”. It highlights the critical
importance of the systems development life cycle (SDLC) approach and pays attention to
planning, analysis, design, implementation and maintenance aspects of technical project
management (which is discussed at length in Chapter 3). Some of the important topics
considered by HRIS are
- Developing a business case for an HRIS
- Transformation of HR service delivery
- Determining the organization's HRIS needs
- Planning process
- Design considerations
- Vendor selection
- Implementation of an HRIS
- Evaluation of the new system (SHRM, 2015).

Discussions of HRIS have mostly revolved around large, monolithic, inflexible ERP
products. However, in recent times, with the rise of cloud computing, both large and small to
medium enterprises (SMEs) need not make heavy upfront investment in ERP products and
then struggle to implement and maintain them. Rather, they can rent HR and other enterprise
applications from third-party service providers which are scalable, flexible, and affordable.
On the other hand, Digital HRM includes the latest social, mobile, analytics, and cloud
(SMAC) technologies. It aligns with the changing dynamics in the field which is rapidly
moving away from traditional ERP to cloud-based software as a service (SAAS). Products
and applications are evolving to a point in which the service provider takes care of the
technology and the HR user is mostly concerned with the strategic use of the product as a
whole rather than the processes in particular (see Chapter 7).

Considering the overall conceptual framework adopted in this book and the definitional
expectations set by Bondarouk, Parry and Furtmueller (2017, p. 99) that “it is important to
acknowledge the significance of multiple elements that when integrated provide a direction
for future e-HRM research, and help to understand the factors that influence its adoption and
consequences”, Digital HRM can be defined as follows:

“Digital HRM deals with the nature, role and contribution of technology in
strategically managing talent in a digital world. It incorporates social, mobile, analytics,
cloud (SMAC) and other emerging technologies for efficient and effective delivery of HR
services. It covers related management trends in performing the operational, relational and
transformational aspects of HR, such as the devolution of HR administration via self-service
applications, shared services, and outsourcing as well as strategic aspects involving evidence
based on big data, predictive analytics, artificial intelligence, and managerial insights. It is
also conscious of and addresses unintended consequences of technology, including
implications for information security and privacy”.

In this book, we use the terms e-HRM and Digital HRM interchangeably. Some of the key
aspects covered in the above definition are explained below.

HR Activities covered by Technology

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Operational/Transactional HR: All HR functions involve numerous and time-consuming
‘administrative processes’ that are routine and conducted on a day-to-day basis. Examples of
operational HR activities include payroll, recordkeeping, updating policy and informational
materials, generating and disseminating internal reports, complying with legislative reporting,
benefits administration and administering labour contracts. In fact, 65 to 75% of HR activities
can be classified as transactional (Wright, McMahan, Snell and Gerhart, 1998). Because of
their routine nature, they can be standardised and automated via electronic data processing
(EDP) and in the process, save precious time of HR professionals. These activities can also
be performed using self-service applications, shared services and outsourcing.

Relational HR: These activities include ‘business processes’ relating to HR functions,

including HR planning, recruitment and selection, performance management, learning and
development, and remuneration and reward management. These functions add value to an
organisation only when they are strategically aligned to and fulfil business objectives.
Through business process re-engineering (BPR) and management information systems (MIS),
HR and IT can forge a strategic partnership to improve and enhance the efficiency and
effectiveness of these functions.

Transformational HR: Being situated at the top end of strategic HRM (SHRM), these HR
activities include strategic redirection and renewal, cultural change, learning organisation-
driven knowledge management, and leadership development. Through decision support
systems (DSS) and Executive Information Systems (EIS), HR can provide strategic support
to top management to address what-if scenarios, using advanced big data mining, analytics
and artificial intelligence.

Devolution of HR activities
Self-service Applications: One of the implications of the computerisation of HR is the
devolution or delegation of HR activities and processes to
- employees via self-services, such as accessing payslips, HR policies, leave balance
and application, benefits administration, self performance appraisal and self-
nomination for training programs), and
- managers via management information Systems (MIS), such as performing
recruitment and selection activities through the applicant tracking system (ATS),
learning and development activities through the learning management system (LMS)
performance management activities via an integrated talent management suite,
compensation and benefits administration and other HR administration activities,
including leave approval and accessing and submitting management reports.

Shared Services Centres (SSCs): The concept of shared services has been in practice since the
mid-1980s with an aim to reduce costs, improve controls and enhancing customer service.
According to Deloitte (2011, p.4), “… an SSC operates as an internal customer service
business. It typically charges the business units for services provided, and uses service level
agreements as a contractual arrangement which specifies cost, time, and quality performance
measures”. Transactional processes are the most predominant work performed by the SSCs,
with finance, HR, and IT being the most prolific users (Deloitte, 2017b, p.8). While SSCs are
a well-accepted model across the developed world, its implementation has been quite

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problematic and challenging as the optimistic proponents of the concept typically
underestimate the costs and risks of customisation and implementation caused by behavioural
factors whereas the users fear loss of control (AIM, 2011, p.2). Accordingly, experts
recommend an “integrated operating model which combines the benefits of central control,
scale, and standardization with a flexible, service-centric approach” (PWC, 2010, p. viii).

HR Outsourcing: Business process outsourcing has been one of the fastest growing trends in
management, including in HR. Specialised third-party service providers are contracted to
provide outsourcing services that are typically non-core to the organisation. The key drivers
for outsourcing are access to greater expertise and process efficiencies, improvement in
service quality, and potential cost savings. The most outsourced HR activities are payroll,
benefits administration, HR information technologies (HR-IT), expatriate relocation, staffing
and training. The advantages and disadvantages of outsourcing and the best way to manage it
are outlined in the debate section at the end of this chapter, in the context of digital talent
outsourcing. According to Reichel and Lazarova (2013), outsourcing non-core HR activities
has a positive impact on HR’s strategic position but outsourcing core HR has no impact.
Similarly, a study by Glaister (2014) concluded that HR outsourcing stymies HR role
transformation and that HR outsourcers experienced limited skill development and an
increased focus on cost reduction at the expense of their strategic position.

Subsequent chapters in this book provide a detailed analysis of big data, analytics, cloud
computing, social media, and gamification in HR. You will also find a comprehensive
account of the application of technology in different HR functions, followed by its strategic
evaluation and implications for information security, privacy, and future directions. Thus, the
book incorporates, integrates, and critically evaluates the key components of Digital HRM as
defined above. We now turn our attention to further understanding the present digital avatar
of the HRM function.

Emergence of Digital HRM

With the ever increasing innovation in and adoption of digital technologies and tools, digital
HR is waking up to the possibility of creative design thinking in HR services. Table 1.2 lists
some of the latest digital tools being adopted by leading companies in the HR space.

Insert Table 1.2 about here

However, HR needs to go “beyond digitizing HR platforms to developing digital workplaces

and digital workforces, and to deploying technology that changes how people work and the
way they relate to each other at work” (Deloitte, 2017a, p. 7). Thus, the focus of digital HR
should be on
- a digital workforce (that is agile and innovation-minded),
- a digital workplace (an environment characterised by learning organisation mindset),
and
- an inclusive culture (that is future-focused, global, culturally sensitive, ethical and
sustainable).

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HR is responding to these changing environmental demands. According to a 2017 Deloitte
Global Human Capital Trends survey (Deloitte, 2017a, p.87):

- Fifty-six percent of companies are redesigning their HR programs to leverage digital

and mobile tools.
- Fifty-one percent of companies are currently in the process of redesigning their
organizations for digital business models.
- Thirty-three percent of surveyed HR teams are using some form of artificial intelli-
gence (AI) technology to deliver HR solutions, and 41 percent are actively building
mobile apps to deliver HR services.

Technology-enabled HR Roles
As explained before, for too long HR has been stuck in the industrial economy mentality and
is yet to strategically align its role in the knowledge economy in a way that addresses the
changing world of work and the needs and expectations of knowledge workers, both inside
and outside organisational boundaries. Dave Ulrich’s research on changing HR roles is highly
regarded by HR scholars and practitioners for its breadth and depth. Let us briefly look at
how he sees technology impacting the role of HRM.

Keeping in mind the strategic nature of HR in the new economy, Ulrich (1998) proposed four
key roles of HR: Strategic business partner, administrative expert, employee champion and
change agent. Explaining the role of ‘administrative expert’, Ulrich (1998) emphasised that
“Within the HR function are dozens of processes that can be done better, faster, and cheaper.
… Improving efficiency will build HR's credibility, which, in turn, will open the door for it to
become a partner in executing strategy”. He gave the examples of shared services and centres
of expertise to leverage technology. More recently, Ulrich et al. (2013) added the HR roles of
‘Innovator & Integrator’ (who builds integrated solutions with HR latest insights & practices
that last in the long-run) and ‘Technology proponent’ (who differentiates between
administrative & strategic work to improve efficiency & effectiveness).

In his latest work, Ulrich (2017, p.1-2) argues that “digitisation is shaping HR through four
phases: Phase 1 is performing HR practices more efficiently (e.g., insourcing HR service
centers through automation); Phase 2 is the onslaught of HR innovations in all HR practice
areas (people, performance, communication, work); Phase 3 is accessing and using
information to deliver business results; and Phase 4 is forging connections among people …
But the immediate challenge of managing the tsunami of HR digitalization is to sort out
which of these many new ideas HR should invest in”. He suggests five criteria for knowing
which of these technology innovations deserve more attention (Ulrich, 2018):

- Focus outside-in (by connecting with external customers and investors)

- Build on previous practice and research (by relying on sound, time-tested principles
and practices)
- Offer an integrated solution (that impacts and integrates many HR practice areas)
- Deliver on strategy and goals (by focusing on existing strategic agendas)

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 - Fit with values and culture (by not just buying a new app but forming a relationship
with the creator of the app who will be a thought partner for future success).

See the Foreword by Dave Ulrich where he explains further on his latest work on digital HR.

Technology-enabled HR Functions
In line with digital trends, organisations need to overhaul the key HR functions, including
recruitment and selection, performance and reward management, career management and
learning and development. It’s not just about re-skilling but creating a genuine
transformational change to people management architecture and eco-system, resulting in
what Dehaze (2016, p. 39) calls ‘Human Resources 4.0’. In this new avatar, “burdensome
top-down HR processes are giving way to bottom-up digitally assisted systems to help people
help themselves, shifting the onus for managing development from the company to the
individual” (Evans and Rodriguez-Montemayor, 2016, p. 70).

Below is an illustrative, but not exhaustive account, of some of the radical changes that are
needed in the HR function to succeed in the digital world.

Recruitment & Selection: The fundamental role of HR is to find the right person for the
right job at the right time. In the war for talent, every organisation aims for the best talent but
what is best talent for one organisation need not be for another and as such, achieving the
right fit between person, task, team and organisational culture is essential. This is where
market intelligence, job analysis, competency mapping, cognitive tools, and digital
technologies, such as social media and analytics play a crucial role in talent acquisition. To
attract the best talent, the first step is to create a highly visible, compelling and enduring
‘employer brand’ using multi-media technologies across the intranet and internet. Third-party
service providers, such as LinkedIn and job portals have become indispensable partners in
spreading the recruitment net wide and far.

Gamification of recruitment tools is another innovation that is likely to appeal to millennials,

the so-called digital natives. The next step is to design and develop a robust applicant
tracking system (ATS) that creates well-defined and high quality business processes across
the talent attraction spectrum. Leading high-technology firms, such as Google, have
successfully harnessed the potential of analytics to design an optimum mix of talent
acquisition and selection strategies. For example, Google did a ‘study to find the optimal
number of times a candidate should be interviewed’ and after crunching the data settled on
four rounds of interviews (Manjoo, 2013). Digital tools can dramatically reduce time and cost
associated with talent acquisition and when strategically deployed, they can also improve the
quality of hiring.

Performance & Reward Management: In recent times, companies are focusing more and
more on providing continuous feedback rather than the traditional annual performance
appraisal cycle, future-focused performance development over past-focused performance
appraisal, improving if not abandoning the use of the forced distribution bell-curve, and
bottom-up feedback process (Deloitte, 2017a, p. 7, 67-68). Balanced score card and multi-
source (360-degree) performance assessment tools are being used more often. Thus, new

12
performance management methods are employee-centric and employee-driven. Some of the
digital tools include mobile applications for teams to collaborate, set goals, update goals and
track progress, productivity tools for continuous feedback and improvement, and big data
tools for analytics. Analytics also help companies mine data to identify best suited
performance metrics and measurement, especially for teams. However, digital technologies
are yet to catch up with the renewed focus and change in direction of new performance
management systems. It is still a work in progress. In this regard an ‘agile management
approach’ is being increasingly followed by leading organisations (see Chapter 4).

Learning & Development: As outlined in the section on career management, today

individuals are the chief executive officer (CEO) of their own career. They need to adopt a
self-leadership approach and be pro-active in managing their own careers. Many leading
companies, such as GE, have created learning platforms where employees themselves create
and share content. However, it is the primary responsibility of organisations to show direction
to their employees in terms of what skills and competencies are needed, valued and rewarded.
Their role also includes role modelling, mentoring, coaching, providing on-the-job learning
opportunities, and facilitating workforce socialisation. New digital tools provide
opportunities to companies to offer “curated content, video and mobile learning solutions,
micro-learning, and new ways to integrate and harness the exploding library of external
MOOCs and video learning available on the Internet (Deloitee, 2017a, p. 31) to create a state
of the art learning management system (LMS).While digital technologies can be effective
tools in this regard, they cannot substitute for the human touch essential in shaping employee
careers.

Employee Engagement: The motto of HCL Technologies, a premier information technology

(IT) service provider from India is ‘employee first, customer second’. While most
organisations believe in customer-centric and shareholder-centric management, common
sense and research evidence (e.g. Wright, Cropanzano, and Bonett, 2007) dictate that happy
employees make happy customers who in turn make happy investors. Therefore, there is a
compelling logic to the argument that employees should be the primary focus of the
organisation. Firms like HCL aim for total employee engagement in order to harness
employee potential and productivity. This can happen when there is optimal alignment
between employee goals and organisational goals. Organisational culture plays a vital role in
retaining talent. Trust, transparency, employee involvement, and empowerment are some of
the vital prerequisites for a happy, motivated, engaged and productive workforce.

Today digital technologies, such as ‘productivity and collaboration apps, engagement and
feedback apps, performance management apps, well-being apps and employee service
platforms’, provide immense opportunities to engage employees and enhance the employee
experience (Deloitte, 2017a, p. 56). HR can ‘feel the pulse’ of the workforce through
digitised feedback tools, such as employee satisfaction and engagement surveys. Today
people can work anywhere, anytime and make use of flexi-work options. Collaboration tools
help better connect people across functional and geographic boundaries and thus, enhance
workplace socialisation. Integrated employee self-service tools, such as performing
administrative tasks, self-enrolment in training programs and cafeteria employee benefits

13
menu selection can streamline transactional tasks, provide more flexibility through self-
selection, and offer routine HR services faster, cheaper, and better. Employee wellness and
fitness apps can promote healthy living. Automated social recognition programs (such as
employee of the month programs) promote non-financial rewards. Realising the importance
of user involvement in HR design thinking, leading companies regularly conduct
‘hackathons’ inviting employee suggestions to offer programs that best meet their needs and
expectations.

Unintended Consequences of Technology

As can be seen below, the impact of technology has not been all positive.

• The digital world is dominated by two regions in the world, namely, the US West
Coast and the East Coast of China, leading to digital divide and ‘tremendous spillover
effects on wealth, value and power’ (Candelon, Reeves and Wu, 2017, p.2).
• The introduction of new technology has not really resulted in a noticeable increase in
business productivity (Deloitte, 2017a, p.3).
• “Information overload and the always-connected 24/7 work environment are
overwhelming workers, undermining productivity, and contributing to low employee
engagement” (Schwarrtz et al., 2014, p. 1).
• “Ever-increasing gap between technological sophistication and the amount of work
actually performed (is resulting in) income inequality, wage stagnation, and social and
political unrest around the world” (Deloitte, 2017a, p.3).
• While technology is increasing at an exponential rate, human adaptability rises only at
a slower, linear rate (Friedman, 2016) and this discrepancy is going to overpower
people and fundamentally disrupt the world as we know it.
• According to Colbert, Yee and George (2016, p. 733), in a 24/7 digital world, we may
not ‘find the opportunity for reflection that increases our self-awareness’ and in
curating our social media profile, we may tend to aim for ‘an aspirational image rather
than presenting an authentic self’. They further argue that these developments affect
inter-personal relationships leading to ‘declining levels of empathy’ and blur the lines
between work and non-work domains (p. 734).
• Employees who spend a lot of time writing and answering emails tend to experience
higher levels of work overload (Barley, Meyerson and Grodal, 2011).

HR needs to be conscious of and proactively address these negative consequences. You will
find some proposed solutions to address these in the rest of the book.

Preview of what is Ahead

The book is structured around four parts, namely, e-HRM Approaches, Directions,
Applications, and Problems and Prospects.

PART 1: KEY APPROACHES TO E-HRM

14
- Chapter 2 (Strategic Management Approach to Technology-enabled HRM) highlights how
an increasing number of organisations are recognising the importance of taking a strategic
approach to managing HR. It argues that organizations that manage human resources by
smartly leveraging technology can create an advantage that is difficult for competitors to
imitate.

- Chapter 3 (Soft Systems Thinking Approach to e-HRM Project Management) highlights that
majority of IT projects fail to finish on time, within budget and satisfy users, primarily due to
lack of systems perspective and soft skills. It underscores the critical importance of systems
thinking approach, systems development life cycle and quality management framework
underpinned by people capability maturity model.

- Chapter 4 (Agile Approach to e-HRM Project Management) argues that in an uncertain

business environment, agility is the key. This chapter introduces the philosophy and
principles underpinning agile way of working and specifically highlights the critical role
played by HR that befits the overarching agile philosophy.

Part 2: KEY DIRECTIONS IN E-HRM

- Chapter 5 (Big Data & e-HRM) provides a critical perspective of big data, including the
need for big data literacy. It introduces the tools to build knowledge from big data to lay the
ground for a sense-making intersubjective communication of big data-based cognition, and to
find an ethically sound approach to the use of big data in business.

- Chapter 6 (HR Analytics) critically examines HR analytics as a way of helping encourage

evidence based decisions. It gives an overview of different analytics tools that can be used
and then raises some challenges for the HR function that a focus on HR analytics may bring.

- Chapter 7 (Cloud Computing & e-HRM) provides an in-depth understanding of cloud

technology in the form of various cloud-features along with different cloud deployment
models. It explains how cloud technology can increase the efficiency and effectiveness of
various HR functions and provides a critical review of its advantages and limitations.

- Chapter 8 (Social Media & e-HRM) outlines differences between personal and professional
social media platforms, identifies challenges associated with the rapidly changing nature of
social media, and describes social media user patterns. It also identifies legal and ethical
considerations of using social media in HR.

- Chapter 9 (Gamification & e-HRM) introduces the concept of gamification, explores the
operational and strategic perspectives on gamification and highlights the implications of
gamification for HRM in general.

PART 3: E-HRM APPLICATIONS

- Chapter 10 (e-Talent Management) focuses on specific talent management practices – talent

acquisition, talent identification, talent development and talent retention – to highlight the

15
benefits and limitations associated with appropriating technology in strategic talent
management.

- Chapter 11 (e-Recruitment & Selection) presents an overview of e-recruitment and selection

practices and discuss the use of technology throughout the hiring process.

- Chapter 12 (e-Performance & Reward Management) explores the nature and role of
technology in automating performance and reward functions. It considers the critical adoption
factors, in terms of people, technology and organization and highlights the critical success
factors.

- Chapter 13 (e-Learning & Development) addresses technology issues relating to and the
advantages and disadvantages of important e-learning methods. Factors that impact the
successful implementation of e-L&D systems in organisations are also discussed.

PART 4: PROBLEMS & PROSPECTS

- Chapter 14 (Strategic Evaluation of e-HRM) shows that not only do many firms fail in
capitalising on the advantages of e-HRM, in some cases, e-HRM may also lead to negative
and unintended outcomes. It outlines ways in which the strategic value of e-HRM can be
assessed.

- Chapter 15 (Information Security & Privacy) provides an overview of the basics of

information security and privacy concepts and frameworks. It highlights the major roles HR
can play in designing, applying and monitoring appropriate controls throughout the
employment cycle.

- Chapter 16 (Future Directions of Electronic/Digital HRM) draws the book to a logical

conclusion by looking back and looking forward in terms of the evolution of HR function. It
examines the latest empirical trends in HR technology and presents a strategic framework of
Digital HR Strategy.

Summary
Despite the claims made by HR technology vendors, the evidence so far suggests that the
adoption of technology in HRM has not really led to strategic outcomes (Marler and Fisher,
2013). While technology has certainly been able to increase the efficiencies of most
transactional and some relational HR activities in terms of cost reduction and speed,
organisations today are more concerned about effectiveness of these activities in terms of
strategic outcomes. Further, as further explained in the next chapter, strategic HRM is
primarily most focused on transformational HR activities, such as culture change and
leadership development and here, technology has somewhat fallen short of expectations
(Thite, 2013; Bondarouk, Parry and Furtmueller, 2017).

But as we will see in Chapter 3, technology is not the primary determinant of technical
project management success. Instead, success is dependent upon organisational and social

16
factors and actors, such as systems thinking, agility, user involvement and acceptance,
managerial competency, communication, governance, and stakeholder collaboration.
Technology is only a tool and cannot fix broken processes and substitute managerial
competence.

Today, disruptive digital technologies dominate the landscape and have already radically
altered the way we work. It is too early to evaluate their effectiveness. The shape of the
twenty-first century technology-intensive knowledge economy is still unclear. With lack of
clarity on what is digital, what to do and how to do digital, “most companies are still in a
‘digital fog’ (and) most approaches are still in an exploratory phase” (Andersson et al., 2016,
p.56). With the digital world taking over the business and millennials who are born digital
natives set to take over the workplace, time will tell whether going digital is a boon or a bane.

17
Case Study: The Workforce of the Future - Employers' Evolving Relationship with
Workers

A Chief Human Resources Officer (CHRO) arrives at the office in a shiny town car, dropped
off by a very polite Uber driver. The CHRO has returned from visiting corporate offices in
three other countries where some work had been sent and where new business was
developing. During the drive from the airport the driver shared with the CHRO that he's an
Uber driver when he's not working as an independent contractor in technology for multiple
companies.

The driver explained that he'd learned that there was a lot of project work available - he just
uses his phone to log into the available virtual talent marketplaces to bid on jobs that interest
him and that meet his pay, location, and schedule needs. He'd even done some work for the
CHRO's company, and recently won a competition created by a software company to get the
public to help it solve a tricky coding problem. While he didn't have health or other benefits,
he proudly told the CHRO that he was making more money now than he had before being
laid off in 2008 during the recession.

As the CHRO passes through the office lobby she notes that the security officer is not
actually an employee of the company, although he's wearing the company logo, and that the
custodian going by with a cleaning cart has another company logo on her shirt. The CHRO is
met upstairs by one of two administrative assistants; her assistants job share, with each
working part time, with a few hours of overlap for coordination of tasks. She sees that the
hoteling office space is full; it's a seasonal business, and this is the season where extra
employees are brought on board to help manage the workload. Now that many people are
working from home there is space available in the building.

As she sits in her office, the CHRO reflected on what she had just seen over the past 30
minutes. Traditional long-term, full-time, paid employment is being supplanted by other,
newer, more flexible options. Everyone was now talking about the "gig" economy.
Companies didn't just have employees - they had people performing work in a variety of
arrangements. These include part-time employment, temporary employment, independent
contracting, franchisor-franchisee co -employment, and customers performing work that was
formerly performed by employees.

The CHRO knows some of the factors that are driving this development: global economic
competition, de-regulation, rapid technological change, entrepreneurship and demographic
changes. But she realized that she wanted to know more.

She has come to you, her newest addition to the HR team, and asked you to prepare a white
paper answering one of the following questions.

Case Study Questions

• What are the implications of this "gig" economy for current and future regulation of
the "employment" relationships, including such aspects as what constitutes an
"employee", discrimination, wages and hours, labor relations, and health/safety?
• Considering all of the changes to the traditional long-term, full-time, paid
employment relationship, what should be the role of the CHRO in leading and

18
 advising other senior executives and the Board of Directors? What should she be
doing?

Source: National Academy of Human Resources. Ram Charan HR Essay Contest, 2016.
Reproduced with permission.

Note: The winning essays of this competition can be accessed at

http://www.nationalacademyhr.org/node/57

19
Debate: Should We Outsource Digital Talent?

Introduction
With increasing globalisation and global competitiveness, organisations around the world are
under constant pressure to produce “more with less”. They need to offer products and
services that are faster, cheaper and better than competitors. With disruptive technologies
almost destroying old industries and skills and in the process creating new industries, the
human resource management practitioners are similarly under pressure to constantly upgrade
the skill profile of their workforce to make it most up-to-date, competent, and cost-effective.

Arguments in Favour
• Outsourcing is a management trend that became main stream in the 1980s as a result
of competitive and cost pressures in a globalised business environment. The key
rationale behind outsourcing is that one should stick to the knitting, meaning, one
should focus on core competencies and outsource the rest to specialist providers who
focus on offering various products and services.

• The main drivers for outsourcing are access to specialist expertise, greater process
control, operating efficiencies or cost reduction, and risk reduction. Most importantly,
for workforce management, it can be a key competitive enabler if planned and
implemented strategically.

• Today, talent sourcing has become global with organisations scouting around the
world for the best talent and at the most competitive price. One can see doctors,
nurses, IT managers, software developers, engineers etc. being recruited from a global
pool of talent. In fact, most of the Western hospitals, especially in rural and regional
areas simply cannot function without the help of overseas professionals.

• An innovative economy demands state of the art skills that are rapidly changing. This
is true particularly in STEM areas. With booming demand for but declining supply of
STEM talent due to ageing population etc., emerging economies, such as India and
China have emerged as key source countries for STEM talent.

• If done strategically and smartly, talent outsourcing can be a sustainable competitive

advantage.

Arguments Against
• There can be serious negative repercussions of outsourcing talent, such as long-term
negative effects on costs, employee morale, and loss of organisational knowledge. If
not managed strategically, costs can spiral out of control, employee morale can sink
and precious organisational knowledge lost.

• Talent management is indeed a core competency for most high-technology

organisations and therefore, they need to adopt a long term perspective on talent
sourcing and make all out efforts, in collaboration with government and industry
bodies, to develop local talent without unduly relying on outside talent. Otherwise, it
may lead to a ‘contracting-out culture’.

20
 • Outsourcing may not be an ideal solution for every industry, company and occupation
and every time. For effective management of outsourcing one has to take small steps,
learn from mistakes, ensure that outsourcing agreements are well thought out and not
merely focus on short term cost reductions. Strategic partnering with key and reliable
outsourcing partners is another important prerequisite which is easier said than done.

Video Learning Resources

• What is ‘Digital’? https://www.youtube.com/watch?v=xsWbECkVqgI

• 2017 Global Human Capital Trends: Rewriting the rules | Deloitte Insights:
https://www.youtube.com/watch?v=dvTGfw4wWoE

• Digital HR: Using Digital Tools to Unlock HR's True Potential:

https://www.youtube.com/watch?v=RyZRtolpmmw

• Digital Transformation Of HR: https://www.youtube.com/watch?v=2qkTjWJ2C-Y

• Burning questions – Should we outsource our workforce?

https://www.youtube.com/watch?v=Q3o4vp2OMKU&t=5s

Acknowledgements: The author gratefully acknowledges Profs. Mark Lengnick-Hall and

Cynthia Lengnick-Hall for their feedback on and suggestions for improvement of this
chapter.

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Table 1.1: Competency Portfolio of Digital Workforce

• Future-focused
• Out of the box critical and innovative thinking
• Digital fluency (Colbert, Yee and George, 2016, p.732)
• Strategic thinkers (see chapter 2)
• Systems-thinkers (see chapter 3)
• Agile (see chapter 4)
• Self-leadership
• Big data literate (see chapter 5)
• Analytical (see chapter 6)
• Social media-savvy (see chapter 8)
• Organizationally Ambidextrous (exploiting existing competencies while
simultaneously exploring new opportunities; balance between alignment and
adaptability, flexibility and efficiency, radical and incremental) (Nieto-Rodriguez,
2014)
• Inter-personal skills
• Communication skills, both in the virtual and real world
• Cross-cultural competency
• Emotional intelligence
• Multi-tasking
• Ability to work with multi-generational workforce
• Life-long learning
• Personal mastery (Senge, 1990)
• Team learning (Senge, 1990)

Source: Author

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Table 1.2: Examples of Digital Tools in HR Applications

Wade and This chatbot service, brings AI and chatbots to recruitment and career
Wendy planning and helps candidates better understand career strategies and
company culture
Mya This Firstjob’s chatbot answers candidate questions during recruitment
Switch This recruitment app gives Tinder-like experience for job search
Know Your This tool from Glassdoor provides compensation data for similar jobs by
Worth city, tenure, industry and company
Checkpoint IBM’s new performance management tool with new feedback process
CHIP Powered by IBM Watson, CHIP (Cognitive Human Interface Personality)
handles a wide range of HR-related queries
Embark ‘Pre-boarding’ application developed by Royal Bank of Canada
Brilliant U An online learning platform by GE offering employee-driven learning
opportunities where content is created and shared by employees
Recruiter Dedicated app by LinkedIn for mobile recruitment
Mobile
Gamified - ‘America’s Army’: a recruitment-oriented game developed by US Army
Recruitment (see Chapter 9)
Apps. - ‘The Candidate’: a recruitment campaign by Heineken (see Chapter 10)
Crowdsourcing This is a cloud-based process of obtaining online information from a large
set of people for completion of a particular project (see Chapter 7)
Virtual HRs Enabled by ‘Expert Cloud’, V-HRs facilitate HR experts from around the
world to collaborate to share knowledge, skills & expertise to quickly
solve any business problem (see Chapter 7)
DataRobot Automated machine-learning software program for HR data analysis (see
Chapter 6)
Social Index The company provides a digital footprint or online profiles for both
candidates and recruiters (see Chapter 10)
MOOCs Web-based Massive Open Online Courses through online learning
platforms, such as Coursera and edX (see Chapter 13)
Experience Learning technology that allows the tracking of e-learning activity (see
API or Tin Chapter 13)
Can API
SuccessFactors Developed by SAP, it offers a complete, recruit-to-retire solution across all
talent processes ((see Chapter 10)

Source: The top 8 entries are adapted from Deloitte (2017, p. 31, 90-91). Rest are drawn from
different chapters in this book

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