Introduction
A specialized software program
called the Electronic Human Resource Management System (EHRM) is used for
automating and streamlining human resource management processes. It aids
businesses in effectively managing employee data, monitoring worker
performance, and managing other HR-related tasks. Due to its capacity to
streamline HR procedures, and eliminate mistakes, EHRM is becoming more
and more popular among enterprises. (Smart Capital Mind (n.d.))
Functions of EHRM
Depending on the business and the particular EHRM system
being utilized, the fundamental roles of Electronic Human Resource Management
(EHRM) can change. However, some of the primary duties frequently connected to
EHRM include (Nivlouei, 2014).:
- HR data management: EHRM systems can offer a centralized database for employee information, reducing the likelihood of data mistakes, inconsistencies, and security issues.
- Recruitment and selection: Through the automation of processes like screening resumes and candidate communication, EHRM systems can contribute to the streamlining of the hiring and selection process.
- Performance management: EHRM systems can offer resources for conducting performance reviews, giving feedback, and defining and monitoring employee goals.
- Training and development: Employees may have access to online learning materials, career development opportunities, and performance reviews because of EHRM systems.
- Compensation and benefits: Employer time and attendance reporting and benefits enrollment management are two examples of duties that EHRM systems can automate.
- Compliance management: EHRM systems can assist firms in adhering to employment-related legal and regulatory requirements.
In this article, we will discuss
some of the challenges faced by small businesses in implementing EHRM and
provide examples of how organizations have addressed these challenges and also
the benefits.
Challenges of implementing EHRM
When using this technology, it's
crucial for businesses of all sizes to properly take into account their unique
requirements and available resources. Small businesses deal with particular
difficulties, have fewer resources, and have fewer people to manage the
implementation process. Large firms might have the funds to invest in intricate
EHRM systems, but they also deal with higher operational complexity and scale.
According to the study, as given in
the table 62% of challenges (the first three items in the below table) related
to implementing E-HRM in organizations are due to resistance and various
reasons. This underlines the importance of taking into account resistance
management concepts and experiences during EHRM implementation (Soltani &
Mirzanejad, 2007, cited in Nivlouei, 2014)
|
Challenge Title |
As a % |
|
Users’
resistance due to unconventional user interface |
25% |
|
Managers’
resistance to fulfilling a few tasks |
17% |
|
Managers’ and
Employees’ resistance due to the lack of education and documentation |
20% |
|
Cost of Investment
in EHRM |
11% |
|
The lack of
planning & thinking about the accordance of the new EHRM |
27% |
While it can be beneficial for
organizations of any size, small businesses often face unique challenges during
the implementation process. Some of the common challenges faced by small
businesses in the implementation process of EHRM are:
1.
Limited
resources -
Small
businesses might not have the funds to purchase expensive EHRM software or the
IT manpower to oversee the adoption process. Small businesses should
investigate cost-effective EHRM options like cloud-based systems to address
this issue because they can be more economical and require less IT support.
2.
Lack
of IT expertise -
Small
businesses might not have a dedicated IT team to manage HRMS deployment and
upkeep. Small businesses can work with HRMS providers who provide assistance
and instruction services to help them through the deployment process and offer
ongoing support as a solution to this problem.
3.
Resistance
to change -
Employees
who are used to conventional HR procedures might not feel at ease using the
fresh EHRM system. Small businesses can address this issue by including staff
members in the implementation process and offering enough assistance and
training to guarantee a seamless transition.
4.
Data
security and privacy concerns -
It's
possible that small businesses lack specialized IT security personnel to handle
data security issues. Small businesses can overcome this obstacle by
implementing secure data transfer and access controls as well as frequent
security audits to find and fix flaws.
The
Benefits of Implementing EHRM
Although
implementing HRMS might provide unique challenges for small businesses, the
rewards are substantial.
1. Improved Data Management -
Resources
for HR data management are frequently scarce in small businesses. EHRM can
offer a centralized database for information about employees, reducing the
likelihood of data inaccuracies, inconsistencies, and security threats.
2. Streamlined HR Processes -
Improved
efficiency is one of the main advantages of HRMS implementation for small
businesses. Routine HR duties, such as managing employee data, benefits, and
performance, can be automated using HRMS, which may reduce time and ease administrative
hassles.
3. Better Decision-Making -
Additionally,
HRMS can offer insightful analyses of HR data that can aid in better
decision-making. In order to recognize areas for improvement and provide
information for strategic planning, HRMS, for instance, may give information regarding
employee performance, learning, and career development.
4. Improved Employee Engagement -
By
giving employees simple access to their HR information and empowering them to
have more say over their professional growth, HRMS may also contribute to
better employee engagement. For instance, HRMS can give staff members access to
virtual training courses, resources for career advancement, and performance
reviews, all of which can support a culture of ongoing learning and growth.
Conclusion
Deploying HRMS presents special obstacles for small businesses, however, these obstacles can be overcome with
careful planning and implementation. Small businesses can successfully deploy HRMS and enjoy the advantages of
streamlined and effective HR operations by tackling issues including scarce
resources, a lack of IT experience, employee resistance toward change, and data
confidentiality and security.
References
L Ecuyer, F., Raymond, L., Fabi, B., &
Uwizeyemungu, S. (2019). Strategic alignment of IT and human resources: Testing
a mediation model of e-HRM in manufacturing SMEs. Journal of Small Business
Management, 57(1), 126-142.
NetSuite. (2020).
What Is a Human Resources Management System (HRMS)? [Video]. YouTube. https://www.youtube.com/watch?v=uu-j7zXGEPA [Accessed:
19 April 2023)
Nivlouei, F. B. (2014). Electronic human
resource management system: The main element in capacitating globalization
paradigm. International Journal of Business and Social Science, 5(2).
Shah, N., Michael, F., & Chalu, H. (2020).
Conceptualizing challenges to electronic human resource management (e-HRM)
adoption: A case of Small and Medium Enterprises (SMEs) in Tanzania. Asian
Journal of Business and Management, 8(4).
Smart Capital Mind, n.d. What is Electronic
Human Resource Management? [Online] Available at: https://www.smartcapitalmind.com/what-is-electronic-human-resource-management.htm [Accessed: 19 April 2023]



