STRATEGIC PLANNING AND HRIS
After studying this chapter, students should be able to understand the following
• Strategic Planning
• Human Resource Information Systems (HRIS)
• Relationship of HRIS with overall MIS
A. Strategic planning:
It is the process by which top management determines overall organizational purposes
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
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,
and weaknesses analysis, and the implementation of the strategies. HR process
activities or steps.
I. HR Planning Process:
a. Determine the organizational mission:
It states Organization’s overall purpose and basic business scope and operations
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
opportunities available in the market and the threats that can be faced by the
and the weaknesses and strengths possessed by organizations are also measured
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
d. Formulate a strategic plan:
Courses of action is designed to meet strategic goals, also specifies functional
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
maintain a competitive advantage. Managers engage in three levels of strategic
corporate-level strategy, business-level competitive strategy, and functional
b. The Strategic Planning Process entails conducting a SWOT analysis to identify
strengths, weaknesses, opportunities, and threats.
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
balance opportunities and threats (like those previously discussed) with their
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
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.
B. Human Resource Information System
HRISs are systems used to collect, record, and store, analyze, and retrieve data
resources. The collection of
information on aspects of
work life as diverse as salary
and payroll, compensation,
superannuating and employee
benefits has always been part
of the human resource
manager's function. In the
early history of personnel
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
both management priorities and their own clerical backgrounds.
Such early information systems were manual, and were mainly used to notify employees
entitlements, to ensure accurate salary and wage payments and to process workers'
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
accurate and comprehensive, were mainly used for administrative and operational
were used to collect leave requests, workers compensation and accident data,
and salary variation
and superannuation entitlements. During the 1970s and 1980s, several factors
attitudes towards human resource information systems. The increasing complexity
systems in this period demanded more flexibility in, and access to information
system. These needs
happily coincided' with the development of increasingly sophisticated computer
software systems. In large organizations, centralized payroll processing sections
began to be
separated from other human resource functions. Some organizations contracted
responsibilities to external payroll bureaus with greater technological expertise,
and for reduced
II. Nature and benefits of HRIS
Modern human resource information systems are comprehensive, accurate and accessible
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
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
Specific benefits of such systems include:
i. Improved planning and program development using decision support software.
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:
• Jobs and work conditions
• HR events (e.g. recruitment. training and development, performance appraisals,
III. Uses of HRIS
Comprehensive and integrated information systems can be used widely -in administrative,
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.
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
• 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
• Structured interviews.
• Matching qualifications with open positions (finding a good fit).
• Also, consider budgetary concerns.
• Help with registration, tracking training, monitor training costs, and
• 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
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
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.
It is the process by which top management determines overall organizational
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.