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Lecture Outline
Chapter 8: Human Resource Administration and Human Resource
Information Systems
CHAPTER OBJECTIVES
After completing this chapter, you should be able to do the following:
❖ Understand the basic role of job analysis in human resources, and explain the role of
HRIS in supporting job analysis
❖ Discuss the complexity of HR administration and the advantages of an HRIS over a
INTRODUCTION
● Human resource management (HRM) administration deals with the efficient performance
of the transactional activities introduced in Chapter 1. Recordkeeping, updating policy
and informational materials for a self-service portal, generating and disseminating
internal reports, complying with governmentally mandated external reporting, and
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JOB ANALYSIS
● The aim of an effective HR department is to ensure that the organization has the best
available people working in the proper jobs at the appropriate time to maximize the
organization’s productive capacity. To do this, however, the organization must know not
only what each job entails but also what knowledge, skills, and abilities (KSA) are
necessary to perform the job successfully. Job analysis provides the organization with
both sorts of information.
Approaches and Techniques
There are variety of approaches to job analysis, but only a general approach to conducting job
analyses is discussed in this chapter. Job analysis involves the following general steps:
1. The sources of information about the job must be identified, and this is a starting point.
2. The type of job information or data must be identified. This information can include
HRIS Applications and Job Analysis
● The utilization of technology, especially web-based job analysis tools, has dramatically
increased the availability of information supporting job analysis and the convenience of
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THE HRIS ENVIRONMENT AND OTHER ASPECTS OF HR ADMINISTRATION
● HRIS can assist managers charged with improving the efficiency of HR administration by
reducing costs, enhancing the reliability of reporting, and improving service to internal
customers.
● Information technology facilitates administration in multiple ways. First, an HRIS can
● HR managers face a variety of other administrative requirements in the rapidly evolving
HRIS era. The HRM administrative issues highlighted in this chapter include (1)
organizational approaches for providing HR in a global economy (i.e., self-service
HRM ADMINISTRATION AND ORGANIZING APPROACHES
Today, computer hardware and the accompanying software packages offer considerable support
for daily HR transactions and make it possible to move beyond the limited administrative
approaches available to the HR managers of the 1950s.
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Service-Oriented Architecture (SOA) and Extensible Markup Language
● “SOA is a paradigm for organizing and utilizing distributed [computing] capabilities that
may be under the control of different ownership domains . . . providing a uniform means
to offer, discover, interact with and use capabilities to produce desired [business]
Advantages of XML-Enhanced SOA
● Security is improved—This is especially important because of the privacy
protection issues associated with HR data and applications
● Performance is enhanced—This aids in reducing transaction costs and increased
customer satisfaction
Typical HRM Administration Service Delivery Alternatives
There can be four structural approaches to HR administration facilitated by technology. Each has
opened paths to increased efficiency and effectiveness, improved service, and cost controls,
possibilities unimagined by HR professionals a decade ago. The four HR administrative
approaches—self-service portals, shared-service centers, outsourcing, and offshoring.
● The self-service portal is an electronic access point to an organization’s HRM
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Theory and HR Administration
● Resource-Based View of the Firm: Barney argued that organizations are bundles of
resources, identified as physical capital, organizational capital, and human capital. To
achieve sustainable competitive advantage, a firm’s resources, when compared with its
Both theories can explain the different choices organizations make in their preferences for
human resource administration approaches.
Self-Service Portals and HRIS
● Employee self-service (ESS) HR portals provide an electronic means for a company’s
employees to access its HR services and information. Such portals provide a single sign–
on capability for employees, who can complete transactions based on data previously
established in records and/or knowledge bases, without HR. In addition to providing an
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Advantages of Self-Service Portals for HR Administration
● Self-service portals improve the speed and quality of service to employees and managers
for routine inquiries and changes.
● Self-service portals reduce inquiry transactions requiring direct HR staff involvement and
facilitate keeping information current.
● Self-service portals enhance employee satisfaction by permitting employees to control
when and where such access activities occur. This empowers employees; increases their
Disadvantages of Self-Service Portals for HR Administration
● Permitting employees to access company data through Internet self-service portals may
increase the possibility of security breaches and associated negative outcomes for
affected employees, including identity theft.
Shared Service Centers and HRIS
SSCs generally appeared in response to the increasing globalization of competitive markets
occasioned by proliferation of multinational enterprises (MNEs). To compete successfully,
organizations were pressured to reduce costs through the consolidation of administrative
transactions while still providing excellent service.
Functions in Shared Services:
● Centralizing/decentralizing of business processes
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SSCs must view themselves as an independent business unit offering products. Internal
customers are managers in different business units, such as operations and marketing. If
the HR function is unsuccessful in reducing costs, providing desirable services, and
Advantages of Shared Service Centers for Human Resource Administration
● SSCs permit HR administration managers to focus on delivering timely, high-
quality transactions necessary to fulfill corporate requirements like mandated
governmental reporting, particularly in MNEs, which have to respond to labor
laws of multiple countries.
Disadvantages of Shared Service Centers for Human Resource Managers
● Frequently, organizations combine multiple, unrelated shared services into a
combined business unit. Depending on the nature of such functions, synergies to
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Outsourcing and HRIS
The third approach to HR administration, outsourcing, is the practice of contracting with vendors
to perform HR services and activities. Outsourcing is not new in HR administration.
HR outsourcing (HRO) firms are hardly uniform. There are many different types of providers,
reflecting the diverse needs of organizations. HRO firms provided HR services for 3.3 million
employees in North America (Everest Research Institute, 2007). Moreover, for firms that had
more than 1,000 employees and revenues of greater than $100 million and that participated in
comprehensive outsourcing (defined as more than five human resource functions outsourced),
satisfaction with HRO levels increased over time. Of the 310 firms surveyed, HRO satisfaction
(on a scale of 1 [not at all satisfied] to 5 [very satisfied]) improved from an average of 2.9 in the
first two years to 3.4 after two or more years (EquaTerra, 2007).
Outsourcing contracts should include specific pricing agreements (e.g., flat or fixed fee per
process or per employee served, unit prices per transaction levels, hourly and overtime rates,
Reasons to Pursue HR Outsourcing (HRO)
● Some organizations outsource only discrete or selected functions, pursuing
tactical HRO through niche third-party providers. This involves having
● Multiprocess HR outsourcing involves outsourcing all of one or more related
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● Total HR outsourcing involves having all or nearly all HR functions handled by
one or more external vendors. All of the traditional HR administrative and
Advantages of HR Outsourcing
The advantages of HR administration outsourcing can be both financial and strategic.
Strategic advantages to HR outsourcing might include the ability to better focus on a firm’s core
business through HR transformation, moving from a historical focus on administrative activities
to a strategic business partner perspective.
HRO could free HR professionals to focus on strategic issues, such as talent management, while
providing the firm with skilled transactional and professional services in HR functional areas
such as compensation and in administrative areas such as governmental compliance and
regulations. Moreover, these services would be powered by the up-to-date technology provided
by the external vendor.
Disadvantages of HR Outsourcing
● One big disadvantage of HRO is the likelihood that the organization will not
achieve its strategic goals. Such a failure could have significant, negative impact
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Offshoring and HRIS
Offshoring is an expansion of HR outsourcing that includes sending work outside the U.S. to
vendors located in other countries. Technological capabilities and global competition have
combined to make HR outsourcing a global business, and offshoring in MNEs is quite complex.
Types of HR Offshoring
● When their organizations pursued offshoring, HR managers reported that
manufacturing (43%) functions were most common, followed by IT (29%) and
computer programming (22%), customer call centers (29%), and HR functions
(16%).
Summary of HR Administration Approaches
● HR administration managers have a number of approaches that can contribute to
the goals of reducing costs, improving efficiency, and increasing service levels for
internal customers. It is also important that such alternatives be pursued consistent
LEGAL COMPLIANCE AND HR ADMINISTRATION
● The country and its general environmental have the major effect on HRM and the
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development and implementation of an HRIS (Beaman, 2002). The labor laws
provide the foundation of employee protections in the workplace.
● What complicates U.S. employment laws for HR professionals is that the 50 states
frequently expand on, adopt rules and regulations that differ from, or add
additional protections not covered by federal law. For example, a partial
comparison of elements of the Family Medical Leave Act (FMLA) with the
federal and state legislation of California and Oregon demonstrates these
variations.
HR ADMINISTRATION AND EQUAL EMPLOYMENT OPPORTUNITY
U. S. Civil Rights Act of 1964, Title VII, and the EEO-1 Report
Title VII of the Civil Rights Act of 1964 provides the requirements for such equal employment
opportunity. Under the statute, it is illegal for employers with 15 or more employees working 20
or more weeks per year to
“(1) fail or refuse to hire or discharge any individual with respect to his compensation,
Employers who engage in business with the federal government and have contracts valued at
$50,000 or more must comply with additional requirements that include providing a written
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EEO-1 Report (Standard Form 100)
The Equal Employment Opportunity Commission (EEOC) was charged with gathering
EEO-1 and HRIS
Smith (2006) suggests that the recent changes to the EEOC guidelines will be the most
sweeping change in the history of the EEOC, as workers are asked to reclassify
themselves based on the new EEO designations and organizations pour through job
descriptions to classify individuals into the new work categories.
Potential system changes required by the updated EEO-1 report include the following:
● Track race separately from ethnicity (e.g., Hispanic or not Hispanic)
Occupational Safety and Health Act (OSHA) Recordkeeping
● OSHA primarily established, in the general duty clause of the law, that employers
must provide a workplace free of known hazards likely to cause death or serious injury.
● The National Institute for Occupational Safety and Health (NIOSH) researches and
publishes safety and health standards under the law. For all businesses with 11 or more
OSHA Form 300 (Log of Work-Related Injuries and Illnesses) and HRIS
● All covered employers are required to notify OSHA within 8 hours of any accident
involving either a fatality or an in-patient hospitalization of three or more employees. In
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Technology, HR Administration, and Mandated Governmental Reporting
● The increasing use of HRIS is essential to accurate, timely recordkeeping and reporting
for both EEO and OSHA mandates.
● For organizations with centralized HRM, either operations employees or managers would
be required to do the report at each remote location. However, this waste of productive
time is substantially reduced by the presence of an HRIS in the following ways:
o HRIS records can be established coincident with the employee application,
including optional self-reporting of EEO race/ethnicity and sex data. No separate
o Changes in mandated reporting requirements (e.g., increase in numbers of job
classifications) can be handled mechanically by HR, without involvement of field
employees.
o Electronic reporting (i.e., computer to computer) can ensure timely receipt or
reports.
● The laws safeguarding personal privacy have added more requirements to the HRIS
software and often updates are needed due to court decisions or modifications to legal
guidelines.
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● The Fair Credit Reporting Act of 1970 permits applicants and employees to know of the
existence and context of any credit files maintained on them.
● All of this need for security and privacy directly affects HR administration within the
context of an HRIS. It is most important that the employee database be secure, and this
means limiting access to individuals by use of passwords. The underlying principle for
database security and individual employee privacy is the “need to know” rule—only
persons with a “need to know” can access specific personnel records and reports.
HR STRATEGIC GOAL ACHIEVEMENT AND THE BALANCED SCORECARD
● Kaplan and Norton (1992, 1996, 2006) recognized that an organization could no longer
rely solely on simple financial measures to assess its ability to achieve sustainable
competitive advantage. They devised the balanced scorecard to facilitate the
organization’s efforts to measure its success in achieving strategic goals required to meet
the needs of its stakeholder groups.
HRM and the Balanced Scorecard
● HR professionals understand the impact effective human capital management has on an
organization. However, unless measures to reflect the value-added nature of HRM in
leveraging human capital are developed and linked to the strategic goals reflected in a
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HR Scorecard, Its Measures, and Its Alignment With the Organization’s Balanced Scorecard
Consider the following hypothetical example:
HR professionals want to identify the processes and measures that support the strategic
goal of customer retention. The steps they might take are as follows:
1. Specify the business strategy to be supported (e.g., customer retention).
2. Identify leading (e.g., on-time order delivery) and lagging (e.g., customer
satisfaction level) indicators.
A leading indicator is a predictor of future outcomes (e.g., on-time order delivery), whereas a
lagging indicator shows what has already occurred (e.g., customer satisfaction level). Thus, to
HR Scorecard and Balanced Scorecard Alignment
● In recognition of the importance of alignment between the organization’s balanced
scorecard and HRM strategic initiatives, researchers (Becker et al., 2001) have suggested
SUMMARY
This chapter discussed the relative value of the HR administration module versus a traditional,
“paper-and-pencil” approach to HR administration. In addition, the chapter discussed the various
