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LITERATURE

Human Resource Management


The history of HRM is said to have started in England in early 1800s during the craftsmen and apprenticeship era, and then further developed with the arrival of the Industrial Revolution in the late 1800s. In the 19th century, Frederick W. Taylor suggested that a combination of scientific management and industrial psychology of workers should be introduced. In this case, it was proposed that workers should be managed not only for the job and its efficiencies but also for the psychology and maximum well-being of the workers. Moreover, with the drastic changes in technology, the growth of organizations, the rise of unions and governments concern and interventions resulted in the development of personnel departments in the 1920s. At this point, personnel administrators were called welfare secretaries (Ivancevich, 2007). HRM is said to have started from the term Personnel Management (PM). Traditionally, the function of PM is claimed to hire and fire employees in organizations other than salary payments and training. But there were many criticisms and concerns of ambiguity expressed about the purpose and role of PM to HRM (Tyson, 1985) The developing and mature phases of personnel management from the 1940s to the 1970s saw an increase in the status and professionalization of the personnel function, particularly in relation to industrial relations (IR) matters (see Armstrong, 1997 and Gunnigle et al, 1997). Therefore, the term HRM gradually tended to replace the term PM (Lloyd and Rawlinson, 1992). Dessler et al., (1999) defined HRM as the management of people in organizations. It consists of the activities, policies, and practices involved in obtaining, developing, utilizing, evaluating, maintaining, and retaining the appropriate number and skill mix of employees to accomplish the organizations objectives. The goal of HRM is to maximize employees contributions in order to achieve optimal productivity and effectiveness, while simultaneously attaining individual objectives and societal objectives Dessler et al., (1999: 2). To the authors, the function of HRM include assisting the organization in attracting the quality and quantity of candidates required with respect to the organizations strategy and operational goals, staffing needs, and desired culture. Helping to maintain performance standards and increase productivity through orientation, training, development, job design, effective communication, and performance appraisal. According to Torrington et al., (2005: 5) HRM is fundamental to all management activity and has evolved from a number of different strands of thought. The field of Human Resource Management (HRM) has in recent times been seen as moving away from a supportive - selecting, training, and retaining- (Porter, 1996) to a strategic role (Bartlett & Ghoshal, 2002).

SHRM has evolved and been transformed from personnel management into traditional human resource management (THRM), and then to SHRM. Bratton and Gold (2003: 37) defines strategic human resource management as the process of linking the human resource function with the strategic objectives of the organization in order to improve performance. To the authors, global companies function successfully, if strategies at different levels inter-relate. Torrington et al., (2005: 5) defines SHRM as means of accepting the HR function as a strategic partner in the formulation of the companys strategies as well as in the implementation of those strategies through HR activities such as recruiting, selecting, training and rewarding personnel. Other strategic HRM activities include team-based job designs, flexible workforce, quality improvement practices, employee empowerment, studies designed to diagnose a firms strategic needs, and planned development of the talent required to implement competitive strategy and achieve operational goals.

Recruitment
There is wide agreement among scholars about the growing importance of organizational recruitment in the development of human capital and strategic human resource management (Cober et al., 2004; Liviens et al., 2009; Millmore et al., 2007). Recruitment represents one of the core staffing activities that need to be efficiently and effectively planned and conducted for organizations to attain success (Darrag et al., 2010). Given that the primary objective of recruitment is to identify and attract potential employees [Barber, 1998], recruitment can be defined as practices and activities carried out by an organization for the primary purpose of identifying, attracting and influencing the job choices of competent candidates (Barber, 1998; McKenna & Beech, 2008; Ployhart, 2006). Recruitment activities are either directed towards external candidates from outside organizations or towards current employees, in which case it is called internal recruitment. Darrag et al. (2010) identified recruitment as the process of discovering potential candidates for actual or anticipated organizational vacancies or, from another perspective, it is a link activity-bringing together those with jobs to fill and those seeking jobs. According to Selden et al. (2000) a fair number of studies focus on the performance effects of specific human resource management practices, such as training, and selection. Effective recruitment and selection of employees for the core workforce that provides the organization with stability and continuity has become essential for organizational survival and presents another set of challenges (Kraut & Korman, 1999). There is already intense competition for workers who are talented enough to be a part of the core, and this is predicted to become even fiercer. A review of technologically advanced recruitment processes will now be presented.

Training & Development


Training is a planned program designed to improve performance and to bring about measurable changes in knowledge, skills, attitude and social behavior of employees for doing a particular job (Pattanayak, 2009). Training refers to a systematic approach to learning and development to improve individual, team, and organizational effectiveness (Goldstein & Ford 2002). Alternatively, development refers to activities leading to the acquisition of new knowledge or skills for purposes of personal growth. However, it is often difficult to ascertain whether a specific research study addresses training, development, or both. As organizations strive to compete in the global economy, differentiation on the basis of the skills, knowledge, and motivation of their workforce takes on increasing importance. Training not only may affect declarative knowledge or procedural knowledge, but also may enhance strategic knowledge, defined as knowing when to apply a specific knowledge or skill (Kozlowski et al. 2001, Kraiger et al. 1993). Training is the tool for enhancing the knowledge of employees on the new employee role and expectations and the services and products offered through induction courses. Training also improves the skills in need (sales skills, communication skills, service skills, etc.), the productivity and effectiveness of employees (Glaveli and Kufidu, 2005). According to a recent industry report by the American Society for Training and Development (ASTD), U.S. organizations alone spend more than $126 billion annually on employee training and development (Paradise 2007). Training and development could no longer be based on the good will of the senior employee to train his/her subordinates (Glaveli and Kufidu, 2005). The training and development intervention needed to be carefully designed and implemented and linked to organizational goals and strategy, for the training investment to pay-off (Glaveli and Kufidu, 2005).

HRIS
Tannenbaum (1990) defines HRIS as a technology-based system used to acquire, store, manipulate, analyze, retrieve, and distribute pertinent information regarding an organizations human resources. HRIS shape an integration between human resource management (HRM) and Information Technology. Kovach et al., (1999) defined HRIS as a systematic procedure for collecting, storing, maintaining, retrieving, and validating data needed by organization about its human resources, personnel activities, and organization unit characteristics. Even though these systems may rely on centralized hardware resources operationally, a small group of IS specialists residing within the personnel department increasingly manage, support, and maintain them. HRIS support planning, administration, decision-making, and control. The system supports applications such as employee selection and placement, payroll, pension and benefits management, intake and training projections, career-pathing, equity monitoring, and productivity

evaluation. These information systems increase administrative efficiency and produce reports capable of improving decision-making (Gerardine DeSanctis, 1986: 15). As is the case with any complex organizational information system, an HRIS is not limited to the computer hardware and software applications that comprise the technical part of the system it also includes the people, policies, procedures, and data required to manage the HR function (Hendrickson, 2003). Additionally, it also includes skill testing, assessment and development, rsum processing, recruitment and retention, team and project management, and management development (Fein, 2001). According to Sadri and Chatterjee (2003) computerized HRIS function enable, faster decision making, development, planning, and administration of HR because data is much easier to store, update, classify, and analyze. Kovach et al., (1999) presented the three major functional components in any HRIS by giving the model below: Input Data Maintenance Output

The Input function enters personnel information into the HRIS. Data entry in the past had been one way, but today, scanning technology permits scanning and storage of actual image off an original document, including signatures and handwritten notes. The maintenance function updates and adds new data to the database after data have been entered into the information system. Moreover, the most visible function of an HRIS is the output generated. According to Kovach et al., (1999), to generate valuable output for computer users, the HRIS have to process that output, make the necessary calculations, and then format the presentation in a way that could be understood. The outcomes that are generally stated in terms of management processes are: enhancement in executive decision making, employee training, technology usage, interdepartmental integration, and better reporting structures (Mayfield, Mayfield and Lunce, 2003). Consequently, given the authority and relevant accessible information for decision making, both managers and employees respond more quickly to changes (Lengnick-Hall and Lengnick-Hall, 2002). In an ideal situation HRIS should aid in strategic integration, personnel development, communication and integration, records and compliance, human resources analysis, knowledge management, forecasting and planning, and moving forward towards the organizational vision (Mayfield et al., 2003). However in most of the cases, the strategic relevance is not understood or achieved (Tansley and Watson, 2000). The use of Human Resource Information Systems (HRIS) has been advocated as an opportunity for human resource (HR) professionals to become strategic partners with top management. Such calculations include health-care costs per employee, pay benefits as a percentage of operating expense, cost per hire, return on training, turnover rates and costs, time required to fill certain jobs, return on human capital invested, and human value added.

Similarly, the forecasting and planning function transforms input from HRIS analysis and other sources into its predictive feedback estimates about future organizational personnel and skill requirements. This factor is also very closely linked to the personnel development unit of an HRIS. In response to HR forecast communications, personnel development can address any organizational talent deficiencies with such methods as employee training or through recruitment. Strategic HRIS consists of tools that assist in decision making. For example strategic decisions may include those associated with recruitment and retaining employees. Much, if not all, of the administrative information held by HRIS can be used to analyze an organization and formulate strategies to increase the value of an HRIS.

HRIS & Recruitment


Martinsons (1994) as cited by Ngai and Wat (2006) classified HRIS into two types according to their usage: unsophisticated and sophisticated. Payroll and benefits administration, and employee absence records keeping electronically is listed as unsophisticated since it is an electronic replication of the contents of the HR departments manual files. He called this simple minded automation. Use of IS in recruitment and selection, training and development, HR planning and performance appraisal, is classified as sophisticated since those support decisions which involve expert judgments. Organizational recruiting sources such as direct applications, advertisements, public or private employment agencies, colleges, universities, etc. are going to be replaced by HRIS electronic recruiting facilities reducing the cost of the organization. Employee selection must be according to the job type and relevant skill requirements such as technical skills, intelligence, interpersonal skills, computer skills, etc. HRIS skill inventory facilities can be used to store data in a skill database facilitating the selection of the most suitable candidates after analyzing their skills and qualifications according to the job requirement. The first decision to be made by the firm is whether the recruitment will be internal or external. Internal recruitment has, initially, more advantages than the external. This is why several academics (e.g. Deguy, 1989; Pea Baztn, 1990 and Dez de Castro et al., 2002) recommend this option whenever it is feasible and suitable. Only in those cases that this is not valid or sufficient, the firm must resort to external recruitment. Nevertheless, it is necessary to keep in mind that this statement is to be taken cautiously. There is no perfect recruitment method; the choice will have to be made considering the particular circumstances of the firm and its objectives. Internet technologies allow companies to process most common HRM applications over their corporate intranets. Intranets allow the HRM department to provide around-the-clock services to their customers: the employees.

The optimal use of internal recruitment processes requires possessing an updated and accurate knowledge of the personnel of the firm (Leal Milln et al., 1999), for which a HRIS can be used. The simplest and cheapest of them all, most likely, is a human resource inventory (also known as Internal IS): a database or registrar in which the largest amount of information possible is kept. Basic data to be included in this database are the personal details, the recruitment dates, the positions held, promotions, and other observations regarding their performance and potential (Pea Baztn, 1990). Following this, it must be reminded that the internal recruitment sources are to be employed wisely, because, on occasion, they may lead to deception instead of motivation. Likewise, in order to ensure that all internal and external (if any) applications are considered equally, the former should be complemented with the most complete information available (Besseyre des Horts, 1988). E-recruitment can be understood as recruitment carried out by the use of various electronic means. Online, Internet, or web-based recruiting can be defined as the use of the Internet to identify and attract potential employees (Parry & Wilson, 2009), e.g. advertising a vacant position and attracting a pool of applicants through corporate websites and Internet job boards (Borstorff et al., 2007). An e-recruitment system is a back-office system for administrating the recruitment process, and is normally designed to allow applicants to submit their data electronically. E-recruitment can thus be perceived as an umbrella term covering recruitment activities performed using various electronic means and the Internet, including online recruitment and e-recruitment systems.

Reddic (2009) addressed the effectiveness of HRIS and the use of web-based self-service in HR. He concluded that most of the web based HR is currently providing information rather than more advanced self-service based applications. The most pronounced method is using the Web for recruitment. The Internet has dramatically changed the ways of both job seekers and organizations in employment practices (Ngai et al., 2006). CVs sent through the Internet can be scanned for keywords identifying the required knowledge, skills, competencies and experience (Ngai et al., 2006). This information can then be stored in the information system for immediate or future use (Ngai et al., 2006). Ngai et al. (2006) pointed out that the Cisco Corporation has achieved a 45% reduction in recruitment costs since using the web as its core channel for recruitment. Web-based recruiting is the search for employees via the company website, job exchange or career portals, and resume databases (Wolter, 2007). Thematically, web-based recruiting belongs to the external recruitment since the main goal of career portals or an own website is to attract people from the external job market. It is, however, also conceivable to implement an in-house career portal, for example via the Web. Company websites may present different kinds of useful information about the company and its available jobs (Harris et al., 2005). The person interested in the job has the possibility to either

apply via an online application form, via email or, quite conventionally, via mail. Just like in newspapers, different job offers from various companies are published in online job exchanges like www.monster.com or www.stepstone.de. Job exchanges also give applicants the opportunity to create and upload resumes, which can later on be found by various companies. Those companies often have to pay a fee for this service (Grund, 2006, Harris et al., 2005). Companies can search for new employees in different ways (Grund, 2006). Web-based recruiting, however, can offer advantages over the conventional forms of recruitment such as newspaper ads or employee recommendations.

Moreover, Web-based recruiting has a better coverage and effectiveness than traditional recruitment forms (Crispin & Mehler, 1997; Eckhardt, 2007). Potential applicants are able to visit job-offering websites at any time and from all over the world (Lievens & Harris, 2003; Wolter, 2007). The internet has a wealth of information and contacts for both employers and job hunters. Top websites for job hunters and employers on the World Wide Web include Monster.com, FreeAgent.com, and Jobweb.org. these websites are full of reports, statistics, and other useful HRM information, such as job reports by industry, or listing on the top recruiting markets by industry and profession (O Brian, 2004). Of course, you may also want to access the job listings and resource databases of commercial recruiting companies on the web. For corporate staffing managers in all sectors of the economy, this advantage has been seized through the growing use of online recruiting (i.e., e-recruitment) as a primary method for marketing jobs in an increasingly world-wide labor market. Indeed, reviews of job postings featured via online placement services and corporate websites illustrate a growing reliance on these sources. For instance, studies show that online sources now hold 110 million jobs and 20 million unique resumes (including 10 million resumes on Monster.com alone), and that US online recruitment revenueswill top $2.6 billion in 2007 (Li, Charron, Roshan, & Flemming, 2002). Similarly, data show that virtually all Fortune 100 companies now use some form of erecruiting methods (Lee, 2005) and that 94% of Global 500 companies use their websites for recruitment, as compared to just 29% in 1998 (Greenspan, 2003). These trends are emerging because e-recruiting has changed recruiting from a batch mode to a more efficient continuous mode (Lee, 2005) and has reduced hiring costs by about 87% as compared to tradition al recruiting through newspapers and magazines ($183 versus $1383, respectively). Also contributing to this growth are reports of success from prominent employers such as Dow Chemical, which was able to reduce its hiring cycle from 90 to 34 days while cutting its cost per hire by 26% (Gill, 2001).

HRIS and Training & Development


In an organizational context, the Internet makes it possible for an organization to automate HR processes. Various existing HR functions, applications or services can virtually be transformed to Web-based ones (Ngai et al., 2006). More and more HRM systems today are being changed to eHRM systems, mainly due to the advent of Internet technology and the emerging concept of business intelligence (Zhang and Wang, 2006). Web-based training and performance evaluation are two other functions supported by e-HR, which was studied by Ngai et al. (2006). The proliferation of the Web has enabled HR to train employees in city government virtually from home or at work. Web was mostly being used to provide information on benefits information (Reddic, 2009). Web-based training (WBT) is a popular approach to distance learning using the technology of the Web, the Internet, intranets and Extranets. Individuals use the commonly available Web browsers of Internet Explorer (IE) and Netscape to access different types of information text, pictures, audio and videos over the Internet (Ngai et al., 2006). The Internet plays an important role in reducing the effort and agony of managing performance evaluation as well. Typically, individuals have their performance evaluated at regular intervals. Performance evaluations can easily be tracked online by one or more sources such as supervisors, peers, customers or subordinates (Ngai et al., 2006).

Tao et al. (2006) advocated that though companies may adopt various training models or processes, they all need to establish a training information system as a reference for determining an effective training plan. HRIS consists of one of the automated training needs assessment tools. Tao et al. (2006) have presented an integrated framework of a web-based training needs assessment system to effectively and efficiently assist organizations in their pursuit of competitive core competencies. It shows that HRD professionals do recognize the power of web technology in helping them become more efficient. Though Tao et al. (2006) presented a framework of a web-based training needs assessment system, they have not studied whether the existing HRIS TNA support for HR planning which is going to address by this research study. According to Glaveli and Kufidu (2005), an electronic model based on skills development and the evaluation of employees sustains the training and development effort. The advantages expected are to: 1. put the right employee to the right job, 2. profile the best people in each area and create personality and skill traits, 3. make a valid and fair evaluation, 4. allow people see and understand who they are and their future training and development needs, 5. help to know at which rate each employee is capable of learning, and 6. help to build effective teams.

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