HR executives need to get ready to manage these coming trends.
Over the past decade, we have seen how important technology has become in the space of HR, not only as a tool to capture, manipulate and analyse data but, more importantly, how HR technology has been instrumental in transforming the field of HR, and how changes on the near horizon have the potential for an even greater impact in the future.
In conducting my research, I came across some very interesting facts published by the Society for Human Resource Management Foundation (SHRM) regarding their predictions on what trends will transform HR technology. Although this research was not specifically mentioned with South Africa in mind, I found it comforting to see how closely we in South Africa are aligned to what is happening worldwide with regards to HR systems. According to the SHRM Foundation paper entitled Leveraging HR Technology for Competitive Advantage, the top five trends we can expect to impact our HR systems are:
Trend 1: Growth of social networking
One of the next challenges for HR executives is learning to integrate information from social networking sites. Potential benefits exist alongside problems of privacy and data accuracy. Challenges are evolving as new legislation and applications develop.
Trend 2: Expansion of compliance and reporting requirements
Organisations will increasingly need to adapt their HRIS in order to remain compliant with legislative requirements. Pending changes in tax codes, financial reports, EE compliance and Skills Development compliance all suggest that compliance and reporting demands will increase.
Trend 3: More renting, less buying of services
The use of hosted approaches, in which organisations rent services and software from vendors is booming in both America and Europe, with this trend sure to start picking up traction in South Africa in the near future. The growth of the Internet and web-based systems has enabled organisations to consider approaches such as cloud computing and software-as-a-service (SaaS). Such approaches can provide benefits, especially for smaller organisations that would like to access the capabilities of complex HR systems but are unable to afford a large system. Cloud computing and SaaS are likely to grow in market share and will provide added flexibility to organisations’ HRIS strategies.
Trend 4: Greater use of Business Intelligence (BI) and dashboards
One of the key challenges for HR professionals is how to turn HR data into a form that managers can use to measure HR’s contributions to organisational profitability. To address this problem, organisations will begin to use more sophisticated BI applications to analyse the large amount of data available through HRIS. HR dashboards are able to present high-level, real-time, graphically formatted data to executives and managers, and will become an integral part of the human capital management. In addition, firms will adopt more sophisticated web-based workforce analytic tools and will push data farther out to managers. This will enable managers to use the organisation’s personnel policies and practices to make better employee-related decisions.
Trend 5: Increasing HR data transparency, increasing privacy concerns
As noted above, HRIS can make increasing amounts of HR data more accessible to employees, along with more transparent policies and procedures. But with greater transparency comes greater concerns about privacy. News reports of data compromises and identity theft surface almost daily, and few entities manage more personal information than employers. As employers make data easier to access, risks of jeopardising employees’ privacy increase. Managing this risk is becoming even more complex as HR applications often link to systems outside the organisation (such as benefits vendors, online job search sites, distance learning providers).
Human Resource information systems have dramatically altered how HR services are delivered and managed by organisations. Used effectively, these systems make the HR function more efficient, better informed and better able to accurately communicate how it adds value to the organisation. However, to reap the full benefits of implementation, HR executives must combine the best of HR technology with effective HR management processes, and they must be ready to manage the challenges created.
Rob Bothma is an HR Systems Industry Specialist at NGA Africa, a non-executive director, Fellow and Vice President of the Institute of People Management and co-author of the 4th Edition of Contemporary Issues in HRM and member of the Executive Board for HR Pulse.
This article appeared in the July 2015 issue of HR Future magazine.