Can the digitisation of HR services alter employee perceptions of
those services and the HR function at the same time as delivering HR
operational cost savings to an organisation?
1
Can the digitisation of HR services alter employee perceptions of
those services and the HR function at the same time as delivering HR
operational cost savings to an organisation?
Dissertation submitted in part fulfilment of the requirements for the degree of
Master of Business Administration
At Dublin Business School
Alan Murphy (10336867)
Master of Business Administration
August 2018
2
Declaration
I, Alan Murphy, declare that this research is my original work and that it has never been
presented to any institution or university for the award of a Degree or Diploma. In addition, I
have referenced correctly all literature and sources used in this work and this work is fully
compliant with the Dublin Business School’s academic honesty policy.
Signed:
Date:
15th August 2018
3
Acknowledgements
Firstly, I w
ould like to thank Mr David Wallace, my supervisor, for his patience, advice and support
throughout the tw
elve w
eeks it took me to get to this point and finally submit my dissertation. Next,
I w
ould like to thank all the lecturers w
ho I w
as lucky to meet over the past two years. Each one
brought their ow
n unique style of teaching w
hich made the learning experience fun. I cannot end this
paragraph w
ithout thanking all the staff of Dublin Business School w
hom I have interacted w
ith over
the past tw
o years.
Thanks also to my classmates for their support and banter in person, and on the class WhatsApp group.
Seeing a message from someone else w
ith the same problem or panic-filled dilemma as I had w
as
indeed a great leveller and helped me realise that I w
asn’t the only one in that situation.
My enrolment onto the MBA programme w
as part of a career development plan back in 2016; for
that, I should thank Orla Coughlan, former manager & CHRO of eir and now
good friend. Thanks for
the inspiration and your belief in me and for your leadership in the many battles we fought together.
My sincere gratitude to the one hundred and five respondents w
ho have made my research possible.
Without them I w
ould not have any data from w
hich I w
rote the next tw
enty-two thousand w
ords!
To the tw
o people that I thanked in my undergrad acknow
ledgements tw
enty-tw
o years ago I must
express my gratitude once again; thanks mam and dad for your continued support, even at this stage
of my life and for your parental guidance earlier in life w
hich has helped drive my ambition and
personal drive to be successful.
Finally, onto my family. While my children may have been blissfully unaw
are of the hard w
ork and
dedication that has gone into the past tw
o years of my MBA, my w
ife, Samantha has been an absolute
pillar of strength and support. Samantha has understood that all the classes, meetings and late nights
hunched over the kitchen table w
ere all for something bigger and better. For her love and patience, I
am eternally grateful.
4
Abstract
The objectives of this research included gaining an insight into the levels of satisfaction amongst
employees and managers with the digitisation of HR services and the availability of those services on
mobile apps. In relation to employees, the research sought to ascertain if demographic differences
such as age, industry or workplace had any significant impact on employee satisfaction w
ith the HR
function; the demographic aspect had not been considered in previous literature heretofore.
Other aims of the research were to determine if alw
ays on connectivity w
ith the workplace increased
stress among employees, managers and HR professionals. From the perspective of HR professionals
the research investigated if the digitisation of HR w
ould lead to cost savings or a reduction in HR
headcount. Other sub-themes under these main headings w
ere assessed.
The author, having reviewed various research philosophies chose a positivist, deductive approach
using a cross-sectional survey to collect the data w
hich w
as required to analyse the findings of the
research. There w
ere 105 responses to the online questionnaire.
The main findings in relation to satisfaction w
ith the HR function post digitisation w
ere aligned w
ith
the literature and consultant reports in that there was an increase in this regard. The findings in
relation to HR operational costs and headcount w
ere not as the author expected, in many cases there
was neither a cost or headcount reduction.
The recommendations arising from this research in order to ensure successful digital HR
transformation are; HR should create a clear digital strategy and roadmap; HR technology should not
be seen as a replacement for traditional HR processes but as a more efficient facilitator of such
processes; HR should create an expectation of redeployment of resources into higher value-adding HR
activities rather than an expectation of cost reduction; buy-in from senior management along w
ith
robust communication and training plans are essential and clear policies should be put in place
regarding accessing HR services outside of w
ork time.
5
Contents
Declaration
……………………………………………………………………………………………………………………………. 2
Acknow
ledgements
………………………………………………………………………………………………………………… 3
Abstract ………………………………………………………………………………………………………………………………… 4
Table of figures ……………………………………………………………………………………………………………………… 7
List of tables ………………………………………………………………………………………………………………………….. 8
1 Introduction ……………………………………………………………………………………………………………………….. 9
1.1 Research Objectives ………………………………………………………………………………………………………. 9
1.2 Rationale for the Research
……………………………………………………………………………………………. 11
1.3 Recipients of the Research
……………………………………………………………………………………………. 12
1.4 Suitability of the Researcher for the Research ………………………………………………………………… 12
1.5 Scope and limitations of the research ……………………………………………………………………………. 13
1.6 Structure of the Dissertation ………………………………………………………………………………………… 13
2 Literature Review ………………………………………………………………………………………………………………. 14
2.1 Introduction to the Literature Review ……………………………………………………………………………. 14
2.2 The Digital Workplace and the (Future) Nature of Work ………………………………………………….. 14
2.3 Challenges Facing Organisations in the Transition to Digital HR ………………………………………… 19
2.4 The Use of Technology and Stress …………………………………………………………………………………. 20
2.5 Benefits of Digital HR and the future ……………………………………………………………………………… 21
2.6 Investment in HR Technology and High Performance ………………………………………………………. 24
2.7 Literature Review
Summary
………………………………………………………………………………………….. 27
3 Research Methodology ………………………………………………………………………………………………………. 30
3.1 Introduction ……………………………………………………………………………………………………………….. 30
3.2 Research Objectives …………………………………………………………………………………………………….. 30
3.3 Research Philosophy ……………………………………………………………………………………………………. 31
3.4 Research Approach ……………………………………………………………………………………………………… 33
3.5 Research Strategy ……………………………………………………………………………………………………….. 34
3.6 Population and Sample ………………………………………………………………………………………………… 35
3.7 Data Collection, Editing, Coding and Analysis
………………………………………………………………….. 35
3.8 Ethical Issues and Procedures ……………………………………………………………………………………….. 36
3.9 Limitations to the Research ………………………………………………………………………………………….. 36
3.10 Conclusion
………………………………………………………………………………………………………………… 36
4 Findings ……………………………………………………………………………………………………………………………. 38
4.1 Demographics …………………………………………………………………………………………………………….. 38
4.2 Employee Data ……………………………………………………………………………………………………………. 41
4.3 Manager Data …………………………………………………………………………………………………………….. 47
6
4.4 HR Data ……………………………………………………………………………………………………………………… 53
5. Discussion
………………………………………………………………………………………………………………………… 62
5.1 Introduction ……………………………………………………………………………………………………………….. 62
5.2 Has employee and manager satisfaction w
ith HR increased or decreased as a result of the
digitisation of HR services and processes? …………………………………………………………………………… 62
5.3 Has the digitisation of HR services and processes created an alw
ays-on w
orkforce and led to
higher levels of stress?
………………………………………………………………………………………………………. 64
5.4 Is employee satisfaction w
ith HR services and processes influenced by factors such as w
orker
location, age, size of the organisation or industry?
……………………………………………………………….. 65
5.5 Has the digitisation of HR services and processes made any difference to the HR function? … 71
6 Summary and recommendations
…………………………………………………………………………………………. 74
7 Personal Reflection ……………………………………………………………………………………………………………. 78
7.1 The MBA programme
…………………………………………………………………………………………………… 78
7.2 The Dissertation Process
………………………………………………………………………………………………. 79
8 Bibliography ……………………………………………………………………………………………………………………… 81
Appendix 1 – Dissertation Meeting/Progress Monitoring Report
………………………………………………… 87
Appendix 2 – The Research Questionnaire
………………………………………………………………………………. 90
7
Table of figures
Figure 1 Cost of HR per Employee ………………………………………………………………………………………….. 26
Figure 2 Number of HR FTEs per 1,000 employees …………………………………………………………………… 26
Figure 3 SWOT analysis of Digital HR ………………………………………………………………………………………. 29
Figure 4 The Research Onion …………………………………………………………………………………………………. 32
Figure 5 Location of respondents. ………………………………………………………………………………………….. 38
Figure 6 Job level of respondents. ………………………………………………………………………………………….. 38
Figure 7 Age of respondents. …………………………………………………………………………………………………. 39
Figure 8 Company size of respondents. …………………………………………………………………………………… 39
Figure 9 Respondents’ Industry ……………………………………………………………………………………………… 40
Figure 10 Respondents’ role ………………………………………………………………………………………………….. 40
Figure 11 Employee responses on HR effectiveness …………………………………………………………………. 41
Figure 12 Employee responses on HR policies and procedures ………………………………………………….. 42
Figure 13 Employee responses on recruitment ………………………………………………………………………… 43
Figure 14 Employee responses performance management ……………………………………………………….. 44
Figure 15 Employee responses on training and ease of use
……………………………………………………….. 45
Figure 16 Employee responses on alw
ays-on connectivity and stress …………………………………………. 45
Figure 17 Employee responses on the use of digital HR services ………………………………………………… 46
Figure 18 Manager responses on HR effectiveness …………………………………………………………………… 47
Figure 19 Manager responses on HR policies and procedures
……………………………………………………. 48
Figure 20 Manager responses on performance management ……………………………………………………. 49
Figure 21 Manager responses on training and ease of use ………………………………………………………… 50
Figure 22 Manager responses on alw
ays-on connectivity and stress ………………………………………….. 51
Figure 23 Manager responses on the use of digital HR services …………………………………………………. 52
Figure 24 HR responses on a formal HR technology roadmap ……………………………………………………. 53
Figure 25 HR responses on who is responsible for HR technology
………………………………………………. 53
Figure 26 HR responses on the availability of mobile apps ………………………………………………………… 54
Figure 27 HR responses on the impact of digital HR on key areas ………………………………………………. 55
Figure 28 HR responses on alw
ays-on connectivity and stress …………………………………………………… 57
Figure 29 HR responses on obstacles faced w
hen implementing digital HR services …………………….. 58
Figure 30 HR responses on return on investment on implementation costs ………………………………… 58
Figure 31 HR responses on future HR technology spend …………………………………………………………… 59
Figure 32 HR headcount and costs …………………………………………………………………………………………. 60
Figure 33 HR assessment of engagement w
ith digital HR ………………………………………………………….. 60
8
Figure 34 Access to the HR team (by demographic category)
…………………………………………………….. 66
Figure 35 The range of services offered by HR by demographic category ……………………………………. 67
Figure 36 The effectiveness of the HR team by demographic category ……………………………………….. 68
Figure 37 Responsiveness of the HR function by demographic category……………………………………… 69
Figure 38 Quality of service from the HR function by demographic category ………………………………. 70
Figure 39 Recommendations to ensure successful digital HR transformation
………………………………. 76
List of tables
Table 1 Comparison of manager and employee responses on HR policies and procedures
……………. 62
9
1 Introduction
1.1 Research Objectives
Walker (2001) discussed a range of technologies available for re-engineered HR processes such as
workflow
s, manager self-service, employee self-service, HR service centres, HR information systems
(“HRIS”) and others how
ever he also says that if HR technology is to be considered successful it must
achieve the follow
ing three objectives; Firstly, there must be strategic alignment in that it should help
the users in carrying out their role and achieving their objectives. Secondly, from a business
intelligence perspective the user must be provided with relevant information and data w
hich w
ill
inspire new
insights and learning and thirdly, it must change the w
ork performed by HR professionals
by substantially increasing their effectiveness, reducing costs and allow
ing more time for HR functions
to conduct activities of higher strategic value.
The purpose of this research is to answ
er the follow
ing question;
“Can the digitisation of HR services alter employee perceptions of those services and the HR function
at the same time as delivering HR operational cost savings to an organisation?”
The research w
ill review several organisations both in Ireland and internationally w
hich have
undergone a digital transformation of HR services in the tw
elve months preceding a quantitative
survey being conducted w
hich w
ill form the basis of this research. The research will examine if, in the
view
of employees that the digitisation of HR processes and services has led to greater satisfaction
with the services offered and the HR function.
People managers and leaders rated their level of satisfaction from their perspective as a manager as
well as their perspective as an employee of the organisation.
In each participant organisation HR professionals were asked specific questions about the cost of
digitisation and if it has achieved operational cost savings for the HR function.
The overall objectives of the research are to;
1. Gain insight if in the opinion of employees and managers, their level of satisfaction w
ith HR
and HR services has increased or decreased w
hen surveyed compared to before the
digitisation of those services took place, in relation to;
a. HR services and processes
b. Policies and procedures
c. Performance management
d. Training received and the ease of use of digital HR services
10
e. If managers and employees believe they received appropriate training and
communication before and during the implementation of digital HR services and
processes.
2. Gain an insight into the availability of mobile apps for digital HR processes and services
amongst respondents.
3. Determine if the digitisation of HR services and processes has, among employees, managers
and HR professionals led to:
a. An increased feeling of connectivity to an “alw
ays-on” w
orkplace;
b. An increase in the levels of stress experienced because of the availability of “always-
on” digital HR processes.
4. Compare if there is a difference in employee satisfaction w
ith digital HR as a result of the
follow
ing;
a. Whether the respondent is a field based w
orker, office based w
orker or remote
worker;
b. The age of the respondent (specifically analysing the difference in levels of satisfaction
betw
een Baby Boomers, born 1946 to 1964; Generation X born 1965 to 1976;
Millennials, born 1977 to 1995; and iGen (also know
n as Generation Z), born 1996 and
after).
c. The size of the organisation in w
hich the respondent is employed;
d. The industry of the organisation in w
hich the respondent is employed;
5. Determine if the digitisation of HR services and processes has, in the opinion of respondents
who categorised themselves as HR professionals, led to;
a. A positive impact on HR services such as recruitment, performance management,
learning & development and other services;
b. A change in the HR function in terms of headcount and operational HR costs;
c. Engagement w
ith digital HR services;
d. A change in the amount of time HR professionals spend on administrative HR tasks
and higher value-adding HR tasks.
6. Gain an insight into the key obstacles faced by HR professionals w
hen implementing digital
HR services and future plans for digital HR w
ithin respondent organisations.
11
1.2 Rationale for the Research
According to the Global Human Capital Trends Report (Deloitte, 2016) the digital transformation of
HR w
ill not only enhance user experience of HR services it w
ill also enable business leaders to shift
their approach to managing, organising and leading change.
The 2017 Global Human Capital Trends Report (Deloitte) w
hich is subtitled Rewriting the rule for the
digital age discussed the digital w
orkforce, the digital w
orkplace and digital HR. The follow
ing w
ere
amongst the key findings;
•
Over half of companies surveyed are designing their HR programmes to leverage digital and
mobile tools;
•
Fifty-one per cent of respondent companies are currently in the process of redesigning their
organisations for digital business models;
•
HR is focusing on building the organisation of the future by hiring young digitally competent
workers w
ho are comfortable w
ith digital self-service and sharing information transparently.
This w
orkforce w
ants an integrated digital experience and HR is expected to deliver.
There are over 7 billion mobile devices on earth, that is one for almost every person on the planet
(Dorrier, 2014) and 40% of all internet traffic is driven by these devices (Meeker, 2015) so there is
huge scope for organisations to utilise this technology to transform HR.
In any one day over 100 billion emails are exchanged but only one in seven of them is deemed to be
critically important (Deloitte, 2017) and 18.7 billion text messages are sent everyday w
ith people in
the age category from 25 to 34 years old receiving on average 75 text messages per day (Burke, 2016).
Khanna (2016) says that the HR function should start to treat employees as consumers of their services
who w
ant an enhanced user experience of “alw
ays on” technologies w
hich are engaging and effective.
For example, according to the 2016 Thomsons Global Benefits Report, 67.7% of employees prefer to
access their benefits via digital tools.
According to Goldstein (2014), digital HR is changing how
HR interacts w
ith employees from self-
service to performance management and other traditional HR processes in that employees are
bringing their expectations as consumers to the services that they received from HR.
There is some literature which states that user experience of digital HR processes, services and apps
will be enhanced how
ever there is very little research which backs up such claims. Furthermore, there
is literature w
hich states that cost savings and efficiencies can be gained from the digitisation of such
services and processes. In the literature review
, the author w
ill cite examples of such research.
12
In an era w
hen so many organisations are moving to a new
digital w
orld and a digital w
orkforce an
examination of w
hether this move w
ill not only enhance user experience and satisfy the needs of a
multi-generational w
orkforce but also save the organisation money is w
ell justified.
The author has a personal interested in the field of research as HR professional (see section 1.4).
Adding the body of know
ledge on this subject may open opportunities in the author’s professional life
or in the field of Digital HR.
1.3 Recipients of the Research
Dublin Business School w
ill be the primary recipients of the research as part of the Master of Business
Administration (“MBA”) course requirements.
The research w
ill be conducted in conjunction w
ith one HR softw
are vendor and a number of
companies in the pharmaceutical and telecommunications industries.
Any company w
hich participates in the research through the softw
are vendor will also be eligible to
receive a copy of the research should they w
ish. The author has already committed to present findings
of the research at a sales seminar in early October 2018.
Other professional bodies such as the Irish Business and Employers Confederation (“IBEC”) and the
Chartered Institute of Personnel & Development (“CIPD”) may also be interested in receiving copies
of the research should the research be at a level that it could be published.
1.4 Suitability of the Researcher for the Research
The researcher holds a primary Bachelor of Business Studies (1996) from Dublin City University
(“DCU”) during w
hich Human Resource Management (“HRM”) w
as the chosen specialism. The
researcher also holds a Diploma in Employment Law
from The Dublin I nstitute of Technology (“DI T”)
as w
ell as being a Chartered Fellow
of the CI PD and a member of the Irish Institute of Training &
Development (“IITD”).
The researcher has tw
enty years’ experience w
orking in HRM. Most of those tw
enty years have been
spent as a HR Manager or a HR Business Partner however the past three years have been spent
working in HR Operations roles during w
hich time the researcher has led digital HR transformation
projects in the organisations he has w
orked w
ith. The researcher is w
ell qualified in the field of HRM.
13
1.5 Scope and limitations of the research
While the author feels that a longitudinal study w
ould yield more meaningful results such as study is
not possible in the context of this MBA programme and the tw
elve-w
eek timeframe in w
hich the
author has had to conduct the research.
There w
as a total of 105 respondents to the research questionnaire (appendix 1) w
hich the author
sent to personal HR contacts in the HR softw
are vendor and other companies mentioned in section
1.3. I deally there w
ould have been a larger number of respondents to the questionnaire but again,
given the short time frame in w
hich the research had to be conducted there may be some limitations
on the statistical significance of some of the findings of this research.
1.6 Structure of the Dissertation
Chapter one of the dissertation has introduced the research in terms of the objectives and the
rationale for this research. The author has also discussed his qualifications and suitability for
conducting such research. In chapter tw
o the author will review
academic journals and reports on the
matter of digital HR during w
hich he w
ill identify key themes to be researched w
ith the research
questionnaire. The author will show
alignment betw
een the themes identified in the literature review
,
the research objectives and the research questionnaire.
Chapter three w
ill discuss the methodology adopted by the author regarding this research, not only
outlining w
hy he chose the research approach that he did, but also discussing the reasons for not
choosing other methodologies.
In chapter four the author will present the findings of the research questionnaire in their raw
format.
It in chapter five that the author w
ill discuss the findings in more detail and discuss the findings of the
research vis-à-vis the research objectives detailed above.
The dissertation w
ill come to an end in chapter six in which the author w
ill discuss his conclusions and
recommendations.
14
2 Literature Review
2.1 Introduction to the Literature Review
DeSanctis (1986) proposed an early definition of HRIS as a “specialised information system w
ithin the
traditional functional areas of the organisation designed to support the planning, administration,
decision-making and control activities of human resource management”. Over ten years later Haines
and Petit (1997) said HRIS is a system used to acquire, store, manipulate and retrieve data about an
organisation’s human resources.
Bhatia, 2016 says that “digitisation is the process of converting analogue signals or information in any
form into a digital format that can be understood by computer systems or electronic devices”.
Bandarouk and Ruel (2009) in their research to define electronic Human Resource Management
(“eHRM”) said that new
HR technologies are aimed at employees and managers w
hereas until the
mid-1980’s HR technology w
as primarily directed at HR departments. The author conducted the
research w
ith employees, managers and the HR function in mind.
Throughout the entire literature review
the author w
ill present findings of many surveys and pieces
of research w
hich have been conducted into this area. The author w
ill demonstrate that there is much
recent research into how
the digitisation of HR services and processes has differing benefits for
employees, managers, HR professionals and organisations. The author w
ill conclude the review
of the
literature by identifying that there is no single piece of research w
hich has considered the differing
outcomes for the different stakeholder groups mentioned above w
hich in essence w
ill address
research objectives identified in Chapter 1.
2.2 The Digital Workplace and the (Future) Nature of Work
As of 31 December 2017, there w
ere 4.156 billion internet users in the w
orld, or 54.4% of the entire
population of earth (I nternet World Statistics) w
ith the penetration level as high as 95% in North
America, 85% in Europe including 92.7% of the population being internet users in Ireland. Not only is
internet usage increasing across the globe, so too is average life expectancy, w
hich according to the
World Health Organisation was 72 at birth in 2016, meaning people are w
orking for longer.
Social media, mobility, analytics, cloud and internet of everything (“SMACI”) according to Goshal
(2015) are the key enablers of digital transformation. Camille (2015) states that companies must have
a strong employer value proposition (“EVP”) or employer brands w
hich attract digital natives.
15
As people w
ork later in their lives, today’s w
orkforce is made up of both digital natives and digital
immigrants (Prensky, 2001). Digital natives are younger people w
ho have grow
n up w
ith the internet
and do not remember the first time they used it. They feel very at ease in today’s always-on, connected
world of technology. This is a generation of people who are rarely not connected in some shape or
form to technology and usually check their mobile device w
ithin five minutes of w
aking up (Ipsos
MediaCT & Wikia, 2013). Digital immigrants are adults w
ho have easily adopted technology and like
their younger counterparts, they are alw
ays connected w
ith a plethora of technologies and apps
available on their mobile devices.
“It is abundantly clear that technology is advancing at an unprecedented rate. Technologies such as
Artificial Intelligence (“AI”), mobile platforms, sensors and social collaboration systems have
revolutionised the way we live, work, and communicate – and the pace is only accelerating. This causes
stress for individuals as well as societies”. (2017 Deloitte Human Capital Trends).
That statement made by Deloitte is one of the introductory statements of their fifth global human
capital trends report w
hich w
as subtitled “Rew
riting the rules for the digital age”. In this literature
review
the author w
ill examine some of the aspects of this statement. The follow
ing chapter w
ill
review
w
hat is meant by the digital w
orkplace and the changing nature of w
ork. The accelerating
nature technological change presents many challenges to organisations – the theme of section 2.3 of
this review
. Section 2.4 w
ill examine one of the potential consequences of alw
ays-on connectivity and
the changing w
orkplace, stress. The literature review
will conclude w
ith an examination of the benefits
of digital HR and how
investments in digital HR are likely to continue.
According to Deloitte (2011) the digital w
orkplace encompasses all technologies that people use to
get their w
ork done. This can range from email to instant messaging applications and social media
platforms. These can be either desk based applications or mobile applications (usually accessed on a
smart phone or other mobile device).
The author w
ill review
articles, reports and academic papers w
hich state that the digitisation of HR
services and processes w
ill lead to enhanced user experience. The author w
ill also review
reports
which show
that the cost of the HR function has been reduced in some organisations due to the
digitisation of its services.
Digital is changing how
employees interact w
ith their organisations (Spitzer, 2014) and there is a need
for alw
ays-on HR technology as businesses no longer operate in the old traditional nine to five opening
hours (Goldstein, 2014). Cianni and Steckler (2017) say that digital is going to have the most dramatic
impact on the nature of work, including the w
ork of HR professionals. They go on to say that senior
16
HR professionals are already seeing the value w
hich can be obtained from self-service portals, HR
analytics and the inter-connectivity of various internal and external social media platforms. As far back
as 1998, Walker said that with the introduction of HR technology and HR service centres that HR w
ould
become consultants and professional partners w
ith line managers as they are no longer going to be
handling the day to day drudge w
ork. I n this context, HR technology platforms offer more and more
system integration and access to data w
hile at the same time reducing the administrative burden on
the HR function. HR should strive to standardise and automate repeatable operational processes to
ensure that the ‘basics’ of HR are done w
ell so that HR Business Partners can become more credible.
As w
ell as driving employee engagement, the author, with tw
enty years HR experience suggests that
it is also the role of HR to facilitate higher productivity among employees. For example, the average
employee can spend over one quarter of their w
orking day reading and answ
ering emails (Wasserman,
2012). HR, in conjunction with business managers should seek w
ays to reduce non-value adding
activities.
The reality is that digital is changing the w
orkplace and the nature of w
ork itself with almost fifty per
cent of jobs in the w
orld having the potential to be automated (McKinsey Global I nstitute, 2017).
Organisations w
hich use digital can focus on improving organisational efficiency rather than being
consumed w
ith administrative w
ork (Gueutal and Stone, 2005) yet according to Spitzer (2014) many
HR functions are remaining entrenched in traditional modes of engagement, although the Deloitte
Global Human Capital Trends Reports of 2016 and 2017 seem to suggest that this organisation
mentality from HR functions is shifting (see section 1.2 above).
Bennett, Maton & Kervin (2008) find that it is not generational membership that is an indicator of
digital fluency, but it is the ubiquitous nature of technology in our lives and the experience of using it
that creates such fluency. Colbert et al (2016) agree with Bennett et al that both digital natives and
digital immigrants may possess similar levels of digital fluency due to experiential learning w
hen using
technology, but they go on to say that further research is required on how
digital fluency impacts w
ork
performance and career progression.
The use of technology in the w
orkplace and its availability on mobile devices has removed the
boundaries betw
een the workplace and the home. Cisco (2008) found that 83% of people use
technology at w
ork for personal matters but it is only when such personal usage impacts productivity
or security do employers become concerned (Stanko and Beckman, 2015).
Conversely, Sonnentag, Binnew
ies and Mojza (2008), found that using technology such as email
outside of w
ork hours may not allow
employees to fully disengage from w
ork w
hich may lead to higher
levels of anger and family conflict; this conclusion w
as backed up in 2015 w
ith similar findings by Butts,
17
Becker and Bosw
ell. Later, the author w
ill review
how the use of technology may cause stress for
employees.
The digitisation of the w
orkplace is creating new
opportunities for how
employees interact w
ith each
other and their organisations. (Jesuthasan, 2017)
Instant messaging apps such as Skype for business, email and collaboration platforms such as Yammer
and Slack are changing how w
orkers interact w
ith each other not only w
hen based in the same office
but w
hen w
orking remotely or internationally.
Technology is also changing how
w
ork is being done. Artificial Intelligence (“AI”) is already employed
in many organisations to complete routine and repeatable tasks such as answ
ering customer queries
as chatbots or reducing HR administration tasks such as setting up new
employees on HR systems.
According to Jesuthasan, HR acts as an enabler of digital engagement as it helps the business to
leverage digital technologies.
As referred to above, AI can eliminate repetitive administration tasks, thus freeing up time for
employees to undertake higher value-adding w
ork. Digital technology, particularly on mobile devices
has the ability to create a better w
ork-life balance for employees though this is not w
ithout its dangers
or pitfalls w
hich w
ill be discussed later.
As previously mentioned, digital collaboration tools are changing how
employees interact w
ith each
other and their organisations. Traditional face to face engagement is being replaced or augmented
with such collaboration tools as w
ell as online benefits portals and social learning platforms.
Engagement is moving more and more to a digital landscape.
Jesuthasan contends that HR has a key role to play in the digital landscape by redesigning business
processes for digitisation and by engaging the entire workforce on the digital transformation journey.
His contention supports Bersin (2015) w
ho says that traditional HR practices need to be reinvented to
ensure digitisation, organisational layers need to be reduced or flattened and functions such as
performance management and recruitment need to be redesigned to fit the digital era and demands
of tech-savvy employees.
Why have a digital w
orkplace? There are many reports and supporting literature that answ
ers this
question. Organisations w
ith strong online social networks and collaboration tools are seven per cent
more productive than those that don’t (Pentland, 2009).
According to Cisco’s Connected World Report (2010); 64% of employees w
ould accept low
er w
ages if
they could w
ork aw
ay from an office.
18
McKinsey (2009) have found that organisations w
hich have internal social media tools have higher
average employee satisfaction. Then, w
hen engagement increases, employee retention increases by
87% (Human Capital Institute, 2009).
Research has show
n that HR professionals w
ho integrate different technology platforms and maximise
the use of technology can demonstrate clear Return on Investment (“ROI”). (Thomsons UK Benefits
Watch Report, 2018).
Leading organisations are creating consumer grade online benefits experience for employees w
hich is
accessible all in one place, mostly on mobile devices.
According to the Cisco Connected World Technology Report November 2014
•
76% of respondents prefer their smartphone over TV.
•
58% w
ould sacrifice one of their senses for Wi-Fi
•
48% w
ould give up sex for a month instead of their smartphone.
•
54% look at their phone first thing in the morning.
The majority of people use tw
o to three devices per day.
•
53% prefer mobile phones to fixed line phones.
•
Almost 40% believe that the mobile phone w
ill be their most important device by 2020.
70% of HR professionals say that they can perform tasks faster on phones, mobile devices and apps
than on laptops or PCs. Over half of the HR professionals surveyed consider themselves to be
accessible 24 hours per day and most believe that the future of w
ork is not in an office. Most HR
professionals think that the traditional w
orkday w
ill remain but 44% believe that greater flexibility is
required.
Another finding from the HR professionals surveyed was that 48% believe that managers w
ill not need
to be present in the same office as their boss w
hile 38% believe that 24/7 accessibility w
ill be expected
(but constant w
ork w
ill not be).
Forbes I nsights (2017) in the research article “The impact of the digital w
orkforce: The new
equilibrium
of the digitally transformed enterprise” surveyed 2158 executives, a mixture of Chief Information
Officers (CIOs) and app end users. They found that digital transformation is creating a new
equilibrium
betw
een I T and users which empow
ers employees and that empow
ered employees are more
productive.
19
By making apps more easily accessible to employees from any device drives higher employee
performance w
hich in turns raises enterprise performance, leads to increased revenue and low
ers
costs.
This research categorised three w
ork environments. The first being the traditional w
orkplace in w
hich
employees w
ere provided w
ith enough technology to do their jobs. The second category is the
transitioning w
orkplace in w
hich the apps and technology w
hich employees need and w
ant are
available at a corporate level but are not easily accessible to employees. The third category is the
digital w
orkplace; this is the w
orkplace in w
hich the apps and technology that employees w
ant, and
need are readily available and accessible on any device.
The research contends that a shift to a digital w
orkplace is a competitive factor in today’s market. To
create the digital w
orkplace, employees should be given a consumer-like experience w
hen it comes
to business technology and apps. The outcome being, empow
ered, productive employees and better
enterprise performance.
2.3 Challenges Facing Organisations in the Transition to Digital HR
The emergence of digital HR poses issues for organisations, it is not all plain sailing as some authors
suggest. Peter Cheese, Chief Executive of the CI PD in an article in People Management says that
despite the promise that HR technology offers, productivity is decreasing, and employee stress is
increasing due to the issues associated w
ith the alw
ays-on nature of technology. These comments are
supported by the research of Bozeman (2011) and Ebelhar (2009) w
hich found that technology
(smartphones) can have a negative impact in w
orkplaces in that people can become addicted to them.
It is estimated that people check their phones more than 150 per times day. Pervasive connectivity on
mobile devices w
hich have the ability to deliver w
ork to employees w
hen they are at home impinge
upon family time w
hich can give rise to addiction to the technology and a vicious cycle feeling like one
is alw
ays at w
ork, according to Rose in his “Rew
ired: The Psychology of Technology” Blog. Further
research has found that people w
ho use their phones at night to check email are less productive during
the day (Klodiana et al, 2014) w
hich obviously has consequences for an organisation. Therefore,
organisations face the challenge of getting the balance right betw
een keeping employees connected
without negatively impacting productivity and organisational effectiveness.
Bersin (2015) outlines some challenges facing organisations in the transition to digital HR;
•
Disruptive leadership is required to lead the change to a digital w
orkplace.
20
•
HR needs to be re-skilled to w
ork in new
w
ays and to adopt technological change. HR business
processes and practices w
ill have to be redesigned to deliver value adding digital solutions as
introducing technology w
ithout changing the processes w
ill fail. This is particularly true w
hen
organisations need to attract millennials and Generation Z employees (w
hich the author w
ill
discuss later).
•
Organisations must gain buy-in from employees for the change to digital to be successful, it
cannot be done in isolation by the management of the organisation.
Another challenge facing organisations in the transition to digital according to Accenture (2015) is that
HR processes and HR information w
ill be fully integrated and accessible to all employees and because
of the age profile of organisations w
ith more and more employees (millennials and soon Generation
Z) being younger, digital natives that HR departments w
ill almost have to act like digital marketing
departments not only to engage employees but also to attract, develop and retain employees.
The general data protection regulations (GDPR) are the regulations of the EU w
hich govern data
protection issues such as the right to be forgotten, the correct and proper use of data, the deletion of
said data once it has served the purpose it w
as intended for and the export of data outside of the EU.
With the grow
th of new
HR softw
are, cloud based technologies and the integration of personal data
with employment and performance data (such as sales performance) organisations face many
challenges in this regard (Regulation (EU) 2016/679). GDPR must be taken very seriously by
organisations as they could face fines of up to €20 million (O’Neill, 2017) not to mention reputational
damage and loss of customers and/or employees.
2.4 The Use of Technology and Stress
While there is a large amount of commentary on the benefits of digital HR to employees and
organisations it is important to review
some of the literature on how
technology usage may have a
detrimental effect on employees such as causing stress.
As mentioned previously the use of technology from work can impinge upon personal time. Murray
and Rostis (2007) and Middleton and Cukier (2006) agree that because of the ubiquitous nature of
technology on mobile devices that a person’s time and space at home or w
ith family may not alw
ays
be safe from technological invasion.
Authors have, broadly speaking, taken tw
o different view
s on this matter, both of w
hich reach the
same conclusion. The first school of thought is based on the overflow
of w
ork related emails and tasks
into personal time and the use of technology at w
ork for personal matters. Proponents of this view
21
argue that w
ork related technologies make it more difficult to disengage from work, w
hich can lead
to interpersonal or family conflicts, thus creating stress for employees (Major et al, 2002) and (Bosw
ell
and Olson Buchanan, 2007).
The second school of thought focuses on email overload w
ith the premise being that email and other
technologies create additional w
ork w
hich in turns increases stress levels for people. For example,
some authors say that intrusions from technology can distract attention aw
ay from the task at hand
(Manger et al, 2003). While Dabbish et al (2005) found that a third of emails contained tasks for further
action w
hich added to a person’s w
orkload.
Regardless of the explanation, both schools of thought concluded that technology can extend a
person’s w
orking time w
hich can induce stress.
To counter argue the above conclusion, Thomèe et al (2007) could not find a relationship betw
een
time spent on email and stress, though they found a link betw
een time spent on email and depression
amongst w
omen. This is the only study w
hich sought to establish a link betw
een technology and stress,
whereas the aforementioned authors, inferred stress due to an increased w
orkload or extended time
spent on w
ork-related tasks, even w
hen not in w
ork.
Furthermore, the studies which have concluded stress as being a side-effect of increased w
orkload
due to the alw
ays-on nature of technology did not offer an alternative view
. That alternative view
being that by using technology people may actually reduce their w
orkload and manage their w
ork
time more effectively to give themselves more w
ork-life balance.
Renaud et al (2006) suggest that using technology can assist people to avoid time w
asting activities
and reduce w
orkload w
hile Chesley et al (2003) had previously found positive links betw
een the use
of technology and w
ork-life balance for w
omen such as enabling home-w
orking.
2.5 Benefits of Digital HR and the future
At this point in the literature review
it is w
orth taking stock of w
hat the research and articles have said
heretofore. There seems to be a consenting voice from most commentators and authors that the
digitisation of HR w
ill lead to greater efficiency and effectiveness of the HR department allow
ing HR
professionals to engage in more higher value-adding activities w
hich w
ill also lead to greater employee
satisfaction w
ith HR processes and services, especially as younger generations of digital natives
become more prevalent in the w
orkforce.
22
Some of the benefits of digital HR are, according to Gueutal and Stone (2005) are that the introduction
of HRIS and streamlining of processes allow
s HR to focus on more strategic activities. By simplifying
the w
ork-life of employee’s processes are easier to use and tasks can be done with the flexibility to
work from home (Walker, 2016).
Despite the challenges facing organisations there is a real need to transform their business (not just
HR) to a new
digital landscape, in fact, a 2016 Forbes study found that 90% of global organisations
surveyed have already commenced a formal digital transformation w
hile previously almost sixty-seven
per cent of the CEOs surveyed by Fortune (2016) said that they w
ere leaders of a technology company.
Khanna (2016) says that digital HR is the underpinning requirement for organisational transformation
to ensure that organisations are future proofed. He says that the use of technology w
ill make HR
transactions and decisions informed and inspiring leading to greater organisational effectiveness.
A 2014 survey conducted by Cisco found that 76% of respondents prefer their smartphone to TV.
Deloitte’s Global Mobile Consumer Survey found that 97% of adults aged between 18 and 24 years
old check their mobile device w
ithin three hours of waking up w
ith over half checking their devices
within fifteen minutes of going to sleep.
As the author has already discussed, there can be detrimental side effects of always-on connectivity
and the use of smartphones how
ever the opportunities presented by their use in digital HR cannot be
ignored. In fact, one might suggest that HR is compelled to go mobile, given the changing w
orkplace
and the pervasiveness of mobile devices.
Rush (2011) states that “working excess hours including being constantly accessible via smartphone
or the expectation of needing to be so may result in negative consequences, for example, w
orkplace
related stress.
Smartphones offer employee autonomy w
hich according to Zielinski (2012) makes employees feel
better. They also change how
people interact w
ith each other and their relationships w
hether this is
a negative or positive change is a matter of debate. It is beyond doubt that smartphones are a great
tool for know
ledge sharing due to the high levels of usage across all age groups.
There is plenty of research w
hich links the three factors above; autonomy; relationships and
know
ledge sharing to job satisfaction and productivity. Gagne and Deci (2005) have found that w
hen
employees have more autonomy they are better motivated to do a good job. Miller-Merrell (2012)
found that employees w
ho had better w
ork relationships as w
ell as better communication and
know
ledge sharing tend to be more efficient.
23
Bakker (2011) w
ent a step further than linking job satisfaction to productivity by focussing on
engagement as engagement is a more active state of job satisfaction, therefore leads to even greater
productivity. This research could lead the author to believe that smartphones present HR
professionals w
ith huge opportunities, notw
ithstanding the possible negative consequences already
discussed.
According to the PWC Human Resources Technology Survey (August 2017) 68% of companies surveyed
had at least one HR process in the cloud in 2015 w
hich had increased to 73% in 2017 and 40% of
companies have their core HR applications in the cloud. Of those w
ith hosted (on-premise)
applications, one-third said they have plans to migrate to the cloud in the next tw
elve to eighteen
months.
PWC found that w
hen cloud applications w
ere introduced; 52% found an increase in employee usage
while 47% managers said that they used self-service applications more regularly. One third of
respondents found that the introduction of cloud-based HR apps broadened HR’s bandw
idth to be
more strategic and 20% said they had decreased HR personnel costs.
PWC concluded w
ith some tips for successful cloud migration. The first tip was that HR cannot
champion the change alone, business stakeholders must be the champions of change. Companies
which engaged change management and communications experts had the most success w
hen
launching and implementing cloud-based apps.
Respondents to the PWC survey cited many challenges w
hen moving to cloud technology. 45% said
that the product that they had purchased didn’t live up to the expectations created during the sales
process. 44% said that they didn’t have enough internal resources for the implementation and 39%
said that they w
ere not fully prepared for the process re-engineering that w
as required.
The HR function can create competitive advantage by retaining and attracting the best talent available
by leveraging technology (Larkin, 2017). Developments in cloud technologies make information flow
s
and data more accessible to enhance decision-making capabilities as w
ell as more sophisticated HR
apps related to recruitment and talent.
Despite all the talk about digitisation and the rise of the machines in a w
orld where many fear that
jobs w
ill be automated and humans replaced by machines there is an argument that digitisation,
automation and technology itself still requires humans.
Bajer (2017) states that rather than compete w
ith or fear digital transformation, that there needs to
be a partnership created betw
een people and technology w
here w
orking in tandem can create
substantial value. He contends that there are some areas in w
hich humans are simply better than the
24
digital alternatives. Humans are far better at problem-solving w
here rules do not exist w
hereas
machines do so based on a set of programmed rules contained w
ithin code or algorithms. Humans are
value driven and can make value-based judgements or decisions w
hich may create a better outcome
rather than a rule based on a series of equations. Humans can express humour or empathy just w
hen
that human touch is needed, something w
hich clearly cannot be done by machines (yet).
Bajer concludes that machines w
ill replace humans w
hen it comes to boring, mundane and
monotonous jobs w
hich can free people to be more creative and expressive.
Digital transformation is not just about technology, it is a means not a strategy (Altimeter, 2016). There
is no one w
ay to pursue digital transformation but whatever approach is taken it must have human
centred input. Change agents across functional boundaries are important to ensure the change is
successful.
To conclude the literature review
, the author w
ill cite some very recent reports which review
ed the
traits of high performing organisations and the relationship betw
een high performing organisations
and their investment in HR technology. There w
ill also be a brief review
of w
hat further investment is
required alongside investment in technology, to ensure that the technology is leveraged effectively.
2.6 Investment in HR Technology and High Performance
Investment in technology is not a new
phenomenon. McKinsey (2007) found that three quarters of
executives w
ho responded to their survey said they would maintain or increase their investment in
technology. More than half said they w
ere pleased w
ith their past investments and that they should
have acted more quickly in terms of investment and building digital capability.
The executives surveyed said that they invested for the reasons of either creating a competitive
advantage or reducing costs. The author considers it interesting in the context of this research that in
their reasoning for investment that the executives did not mention employee satisfaction to any great
extent.
Oxford economics, in their 2012 research identified four megatrends in digital transformation. Those
four trends being mobility; data analytics; cloud technology and social media. Technology is shaping
the role HR plays in that it allow
s leaders to leverage tools that enable them to measure metrics that
they previously couldn’t which is helping to transform HR into a strategic business function.
Mobile technologies are most w
idely used, w
ith 51% of companies surveyed stating significant HR use.
Interestingly, technology adoption for HR processes is higher in fast developing countries than it is in
already developed countries.
