Strategic Planning and HRIS-Human Resource Managment-Lecture Handout, Exercises for Human Resource Management. Gandhi Institute of Technology and Management
saami8 August 2012

Strategic Planning and HRIS-Human Resource Managment-Lecture Handout, Exercises for Human Resource Management. Gandhi Institute of Technology and Management

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This course includes introductions and history of HRM, job analysis, selection, socialization, taxation, maximizing learning, career management, benefits, trade union, discipline, HR auditing, leadership. This lecture in...
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Human Resource Management (MGT501) VU

Copyright © Virtual University of Pakistan 61

Lesson 13

STRATEGIC PLANNING AND HRIS After studying this chapter, students should be able to understand the following concepts:

Strategic Planning Human Resource Information Systems (HRIS) Relationship of HRIS with overall MIS

A. Strategic planning: Itis the process by which top management determines overall organizational purposes and objectives and how they are to be achieved. The linking of HRM with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility. The role of HR in the strategic planning process depends on the organization's view of HR. There are three views detailed in the text which involve HR as an operational function, HR as a "fitting" function, and HR as an equal partner in the strategic planning process. Obviously, it is our contention that the latter is the appropriate view. In this view, HR's role would include environmental scanning, competitive intelligence, internal strengths and weaknesses analysis, and the implementation of the strategies. HR process involves following activities or steps.

I. HR Planning Process: a. Determine the organizational mission:

It states Organization’s overall purpose and basic business scope and operations it provides information like, why does our organization exist? What unique contributions can it make?

b. Scan the organizational environment.

This is also known as SWOT analysis through this process organizations identify different opportunities available in the market and the threats that can be faced by the organization, and the weaknesses and strengths possessed by organizations are also measured and identified through this process.

c. Set strategic goals: To achieve the overall mission or purpose of the organization it is required to set specific long- term and short term objectives and goals. The goal can be defined as desired outcomes to accomplish mission. Following are the characteristics of effective goals.

• Specific • Challenging • Measurable d. Formulate a strategic plan:

Courses of action is designed to meet strategic goals, also specifies functional or departmental goals are selected at this step.

II. Strategic Planning and Strategic Trends a. The Basics of Strategic Planning – A strategy is the company’s plan for how it will balance its

internal strengths and weaknesses with its external opportunities and threats and maintain a competitive advantage. Managers engage in three levels of strategic planning: corporate-level strategy, business-level competitive strategy, and functional strategies.

b. The Strategic Planning Process entails conducting a SWOT analysis to identify its strengths, weaknesses, opportunities, and threats.

Human Resource Management (MGT501) VU

Copyright © Virtual University of Pakistan 62

c. Basic Strategic Trends

Globalization refers to the tendency of firms to extend their sales, ownership, and/or manufacturing to new markets abroad. For businesses everywhere, the rate of globalization in the past decade has been enormous, and has several strategic implications for firms.

Technological Advances have been forcing, and enabling, firms to become more competitive.

The Nature of Work is changing due to new technological demands. The Workforce demographics are changing as well. It’s becoming more

diverse as women, minority-group members, and older workers enter the workforce.

d. Managerial Consequences of the Basic Trends – Managers have to craft strategies that balance

opportunities and threats (like those previously discussed) with their firm’s strengths and weaknesses, such as global expansion and improved competitiveness strategies. These types of strategies are driving other organizational changes.

III. HR’s Strategic Role

a. HR’s Evolving Role – It’s the firm’s workforce that provides the competitive advantage for the firm. HR’s role is shifting from protector and screener to strategic partner and change agent.

b. Strategic Human Resource Management refers to improving business

performance and developing an organizational culture that fosters innovation and flexibility by linking HRM with the strategic goals and objectives of the firm.

c. HR’s Role As a Strategic Partner can be seen as either adapting individual

HR practices to fit specific corporate and competitive strategies or as an equal partner in the strategic planning process.

1. HR’s Role in Executing Strategy – Execution has been HR’s traditional strategic

role. 2. HR and Value Chain Analysis – Strategy execution usually involves identifying and

reducing costs, and therefore value chain analysis. 3. HR’s Role in Formulating Strategy – HR management can play a role in

environmental scanning by assisting in identifying and analyzing external opportunities and threats that may be crucial to the company’s success.

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B. Human Resource Information System HRISs are systems used to collect, record, and store, analyze, and retrieve data concerning an organization's human resources. The collection of information on aspects of work life as diverse as salary and payroll, compensation, leave, accidents, superannuating and employee benefits has always been part of the human resource manager's function. In the early history of personnel management, administrative aspects, including data collection, took up a great deal of time. Reviews of employee salary and leave entitlements often dominated the activities of earlier personnel officers, reflecting both management priorities and their own clerical backgrounds. Such early information systems were manual, and were mainly used to notify employees of leave entitlements, to ensure accurate salary and wage payments and to process workers' compensation and superannuating claims. The data was seldom used to predict trends, identify problem areas and, or aid in the longer-term staffing process.

I. The development of human resource information systems (HRIS) In the early development of human resource management, information systems, although often accurate and comprehensive, were mainly used for administrative and operational purposes. Forms were used to collect leave requests, workers compensation and accident data, and salary variation and superannuation entitlements. During the 1970s and 1980s, several factors radically changed attitudes towards human resource information systems. The increasing complexity of payroll systems in this period demanded more flexibility in, and access to information system. These needs happily coincided' with the development of increasingly sophisticated computer hardware and software systems. In large organizations, centralized payroll processing sections began to be separated from other human resource functions. Some organizations contracted their payroll responsibilities to external payroll bureaus with greater technological expertise, and for reduced costs.

II. Nature and benefits of HRIS

Modern human resource information systems are comprehensive, accurate and accessible systems for recording employee and work data relevant to HRM, HR and organizational planning. An HRIS is: The system used to acquire, store. Manipulate, analyze, retrieve and distribute pertinent information regarding an organization’s human resources. Its purpose is to facilitate, or support, straight, tactical and operational decision making, to avoid litigation, to evaluate programs, policies, or practice and daily operations Specific benefits of such systems include:

i. Improved planning and program development using decision support software. Faster information processing and improved response times

ii. Decreased administrative and HR costs iii. Accuracy of information iv. Enhanced Communication at all levels.

Not all systems fulfill all these requirements, nor is such a complete system suitable for all organizations. Essentially however all HRIS contain information on: • Employees • Jobs and work conditions • Positions • HR events (e.g. recruitment. training and development, performance appraisals, and







Assessing information


Distributing information

Internal records

Management decisions and communication


Micro- Environment


Macro- environment


Management Information System Developing information

Management intelligence

Research Management

decision support analysis

Human Resource Management (MGT501) VU

Copyright © Virtual University of Pakistan 64

III. Uses of HRIS Comprehensive and integrated information systems can be used widely -in administrative, operational and strategic fields by HR and other managers. On the operational level HRIS data can be used to identify potential internal applicants for job vacancies, saying external recruitment costs and assuring employees of career opportunities. Strategically, such information may be used to gauge the effectiveness of current recruitment or promotional systems, their costs and/ or benefits, and enable subsequent changes of direction in line with proposed organizational strategies.

IV. Strategic HR planning and HR information systems Proactive HR managers ensure that their HRIS contributes to organizational performance. A recent development in the uses of HRIS in many has been the linking of 'benchmarking' practices to the design, choice and implementation of such systems as a directly strategic initiative. Integration with organizational strategic objectives is achieved by the subsequent establishment of performance targets and quantitative measures. As a strategic 'tool', HRIS can be used to contribute to the development and modification of HR plans, on both quantitative and qualitative bases, and to feed into specific HRM functions. HR data, if collected effectively and contained within computerized, accessible systems, can both compare organizational HR 'bottom line' outcomes by HRM function, between functions and with national or international performance benchmark

V. HRIS Applications A computerized HRIS contains hardware and software applications that work together to help managers make HR decisions. HRIS software applications currently available to business include those for employee information, applicant tracking, skills inventory, payroll, and benefits administration.

VI. HRIS Security and Privacy The HR department must develop policies and guidelines to protect the integrity and security of the HRIS so that private employee information does not fall into the wrong hands. To maintain the security and privacy of HRIS records, companies should control access, develop policies and guidelines that govern the utilization of information, and allow employees to check their records.

VII. Purposes of HRIS All organizations and their HR mangers need to consider whether their HRIS will be primarily used for collecting, analyzing, interpreting or reporting employee information. The nature of the system chosen should reflect this primary purpose, based upon a realistic analysis of needs prior to its introduction. Small organizations with stable workforces and secure markets do not require complicated data analysis, but can benefit from comprehensive and accurate databases for reporting purposes. On the other hand, large organizations in competitive and dynamic industries demand strategic HRIS. Every organization needs to assess its particular needs and identify the most appropriate information system for its chosen purposes. VIII. Common HRIS Functions Mainly following functions are performed by the HRIS in different organizations.

• Job analysis information can be placed in the HRIS. • The program can write job descriptions and job specifications. • Constant monitoring of compliance with EEO legislation. • Maintain records of rejected applicants. • Saves money and time in compiling reports. • Ensure that women and minorities or not be adversely affected. • Track minority hiring, recruitment, and advancement. • Forecast supply and demand of labor from both the internal and external labor markets. • Useful for internal recruiting. • Can post job opening for employees to access. • Can search for match between job specifications and applicant qualification. • Applicant tracking system. • Administering and scoring ability tests. • Scanning resumes submitted online (web based or e-mail) or in person (or mail). • Structured interviews. • Matching qualifications with open positions (finding a good fit).

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Copyright © Virtual University of Pakistan 65

• Also, consider budgetary concerns. • Help with registration, tracking training, monitor training costs, and schedule training. • Used to deliver training. • Career and managerial succession planning. • Used to provide assessment tests to help employee’s plan their own career. • Predict career paths. • Provide PA instruments and results. • Comparisons between employees, groups, or supervisors ratings. • Monitor attendance. • Monitor compliance with Labor Standards. • Individual sale data can be accessed (tracking commissions). • Benefits can be managed and administered by computers. • Planned raises and wage histories. • Provides reports for Occupational Safety and Health Administration (OSHA). • Track hazardous materials. • Track accidents and costs of accidents. • Record employee safety training. • Record employee exposure to various conditions and chemicals. • Track disciplinary actions and grievances. • Labor contract data. • Worker seniority list. Etc..

C. Relationship of HRIS with overall MIS Information is the backbone of healthy and efficient business management. An information system allows the collection and processing of data to produce useful information for designated users at each level of management. Information management must conform to well-defined principles, run on appropriate software, and be completely adapted to your organization within an integrated system usually known as Management Information System (MIS). Management Information System is the entire set of systems and activities required to manage, process, and use information as a resource in the organization. Stated slightly differently, MIS is the management and use of computer-based systems, computer-resident data, and telecommunications for the support of business decision processes. HRIS is the part of MIS that provides the information regarding workforce in the organization and facilitates the decision makers in decision making process in this regard.

Key Terms

Strategic planning: Itis the process by which top management determines overall organizational purposes and objectives and how they are to be achieved.

Human Resource Information System: HRISs are systems used to collect, record, and store, analyze,

and retrieve data concerning an organization's human resources.

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