The Impact of e-HR on HR and Line Manager Capability

Written by Martin Reddington

Monday, 30 June 2008

Large numbers of organisations, including many in the public sector, are now falling over themselves to replicate the tripartite ‘Ulrich’ framework of shared service centres, centres of excellence and strategic HR.

However, an article in People Management (October 2006) draws attention to recent research that questions the validity and effectiveness of this model:

As HR has sought to become more strategic, value-adding and business-focused, the emphasis has increasingly fallen on the ideal structure for the function – a trend that has been particularly influenced by the writings of US academic Dave Ulrich.

His writings have built up the popularity of a three-legged model: an HR shared-service centre, centres of expertise, and business partners. In many large organisations, this model has replaced the integrated teams that previously carried out the full range of HR activities, from administration to strategic direction.

Though the three-legged model is often thought of as the norm, our research has highlighted the shortage of evidence – in the UK and Ireland at least – on the extent of its adoption and, more worryingly, on its effectiveness.

(People Management, 26 October, 2006)

This situation highlights a paradox for the HR function. ‘Institutionalised Devaluation’ of the HR function is connected with the perception of HR being stuck in a primarily administrative role and lacking the capabilities to occupy the higher value, business partnering role. And yet,

if the basic HR processes such as administrative activities are not in good order, especially on sensitive issues such as executive pay, no strategic contribution is likely to be considered of value until the administrative problem has been fixed.

(Holbeche, 2001)

It is here that the use of technology, and in particular e-HR, purports to offer a solution and effectively break the logjam that prevents HR from increasing its capabilities and changing its business model. As Lawler and Mohrman (2003) put it:

Investment in a high quality e-HR system should increase the HR function’s credibility and the perception of value it adds, while decreasing the time the function spends on administrative tasks.

However, the adoption of e-HR in this way involves more displacement or devolution of traditional HR activities into the line manager communities, often through web-based, self-service tools. This is illustrated in the ‘HR Value Pyramid’ featured in Figure 2 below.

Figure 2: HR Value Pyramid (Based on Reddington et al, 2005)

The management of this process is extremely challenging. The HR function has to undertake a major internal shift in the nature, structure and composition of different job roles, with the emphasis on more highly skilled positions. At the same time, it has to manage the impact on line managers resulting from the devolution of more HR tasks. A summary of these impacts is set out in Table 2 below:

Concern Type

Concern Description

Lack of clarity of roles

Managers not adequately consulted about devolution of responsibilities and unclear about their roles.

Inconsistencies in implementation

Devolution of tasks to line managers may lead to inconsistent standards in the application of those tasks.

Increased workload.

Extra pressure on ‘hard pressed’ line managers

Lack of institutional and personal objectives.

People management activities taken less seriously than production or service goals

Lack of adequate preparation in training and skills

Line managers insufficiently skilled to carry out people management practices

Lack of support from HR

Lack of skills in HR adopting their new role may limit the success of devolution

Low usage

e-HR tools cannot be accessed or fail to inspire usage through poor design

Alienation of HR service

Lack of contact with HR personnel causes perception of alienation

Changes to employment contract

The transition to e-HR gives rise to a variety of psychological transition issues causing diminution in trust

Table 2: Concerns associated with devolution of HR activities

(Based on Reddington, 2008)

Last Updated ( Tuesday, 07 October 2008 )

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