Over the last few years, technology has touched almostevery aspect of human resources. Computers and software now play an integralrole in managing processes — from benefits enrollment to recruiting and fromrecording time and attendance to administering retirement accounts. As enterpriserequirements have grown, HR systems have become more complex and more tightlyintegrated within organizations.
“The boundaries that previously separated departments are breaking down,” says Ian Turnbull, a systems consultant for ComputerSciences Corporation, Aurora, Ontario, Canada, and president of the InternationalAssociation for Human Resource Information Management. “Today, HR mustthink about how its systems can interact with the entire enterprise. The Web has completely changed the equation. It has allowed organizations to use data,and exchange it, in far more powerful ways.”
As enterprise resource planning (ERP) systems and human resources managementsystem software have grown more complex, they’ve also become easier touse. Browsers and a Web interface have made software a click-and-point proposition.“It has reduced training requirements and fueled the trend toward employeeand managerial self-service,” Turnbull says.
The good news is that HR has a greater choice of powerfulsystems than ever before. The bad news is that “companies still sufferfrom a great deal of enlightened self-interest,” he notes. “Peopledon’t necessarily want to give up best-of-breed applications for an ERPpackage.” Helene Slowik, a consultant at Cedar in Chicago, says that finding“the right balance between what’s best for a department or a workgroup and what’s best for the enterprise can prove extremely challenging.”
What makes many of today’s add-on applications so attractive is the relative ease with which they can be integrated into a core ERP or HRMS. Over the last few years, the entire industry — including organizations such as SAP, PeopleSoft, Oracle, Lawson, Infinium, and Ultimate Software — has migrated toward systems that are more open and interchangeable.That, combined with the growing acceptance of application service providers(ASPs) — outside companies that manage systems and software remotely — hascreated new opportunities and challenges.
Slowik says that ASPs are ideal for small to medium-sizecompanies that cannot afford an extensive IT staff or the up-front capital tobuy high-end ERP and HRMS. “The predictable cost of such systems can beappealing,” she notes. However, many large companies are also finding theASP route desirable for niche applications. Not only can they get a system,such as recruiting, e-learning, or time and attendance, up to speed quickly,they also can later make changes more seamlessly. Meanwhile, most ERP vendors,including SAP, PeopleSoft, J.D. Edwards, and Lawson, have optimized their softwareto run under an ASP model.
The technology has also made it possible for organizationsto rethink structure and the way work gets done, says Al Doran, president ofPhenix Management International Inc., a Richmond Hill, Ontario, HR consultingfirm. While some companies, such as United Technologies, have embraced sharedservice centers that consolidate various functions into a single location ableto process transactions en masse, others, such as the Canadian Imperial Bankof Commerce, have completely outsourced HR.
On a practical level, HRMS and other enterprise systemsare changing the way human resource professionals work. They’re usheringin an array of new capabilities, including business intelligence, knowledge,and competency management. By gaining greater insight into organizational trends and patterns, it’s possible for human resources professionalsto become a key part of the corporate engine. Factoring in advanced work-flow and e-businesstools — including Web portals — adds value in ways that simply weren’tpossible only a few years ago.
One of the biggest challenges, for now, is connectingvarious systems and eliminating islands of automation. Although many HR departmentshave developed efficient practices in specific areas, the links between functionscontinue to break down. Paper and inefficient processes limit the overall gains,making it difficult to build a highly automated e-enterprise with cross-applicationcapabilities.
Another challenge is the fast pace at which systemschange. “Expertise in software and what constitutes best of breed is constantlychanging,” Turnbull says. Unless an organization — and HR department –is prepared to move quickly, an HRMS might never realize its full potential.What’s more, building a solid technology foundation and choosing a clear-cuttechnology path is essential. “You’re not just buying today’sversion of software, you’re buying a relationship with a company that shouldlast 5 to 10 years,” he adds.
Observers say that many companies have only begun toreap the harvest of enterprise systems. In the months and years ahead, the Webwill gain even greater stature. Mobile and wireless technologies will furtherextend the reach of HRMS. Work-flow and self-service capabilities will growfar more sophisticated. If HR is to flourish in this new corporate order, Slowiksays, it must partner with IT and other departments within the enterprise toforge new thinking. “Today, technology and business processes are tightlyintertwined, and HRMS is the glue that holds much of it together.”
Workforce,July 2001, p. 35 — SubscribeNow!