HRIS – Human resources information system

Human Resource Information Systems

The purpose of this paper is to identify other companies who have faced similar human
resources issues in regards to information technology. Through benchmarking different
companies we can learn how other companies have handled certain human resources
issues related to information technology, information systems, new technology, and data
security. An overall analysis has been completed using research on IBM Europe,
Ameriprise Financial, Terasen Pipelines, Shaw’s Supermarkets, CS Stars LLC, IBM,
WORKSource Inc., and Toshiba America Medical Systems, Inc. This paper also includes
eight synopses of companies facing similar issue to those in the reading.

New Technology

With the changing world and constant new technology that is available, managers need to
be aware of the technology that will increase effectiveness in their company. Human
resource information systems (HRIS) have increasingly transformed since it was first
introduced at General Electric in the 1950s. HRIS has gone from a basic process to
convert manual information keeping systems into computerized systems, to the HRIS
systems that are used today. Human resource professionals began to see the possibility of
new applications for the computer. The idea was to integrate many of the different human
resource functions. The result was the third generation of the computerized HRIS, a
feature-rich, broad-based, self-contained HRIS. The third generation took systems far
beyond being mere data repositories and created tools with which human resource
professionals could do much more (Byars, 2004).

Many companies have seen a need to transform the way Human Resource operations are
performed in order to keep up with new technology and increasing numbers of
employees. Terasen Pipelines moved its headquarters from Vancouver to Calgary to be
closer to the oil and realized a major growth in employees. In the past recording keeping
was done on paper and with spreadsheets. Mangers at Terasen realized that there was a
need to change to a more computerized system and looked into different HRIS vendors.
By making the move to a HRIS system, Terasen is able to keep more accurate records as
well as better prepare for future growth. Another company that saw the benefits of
keeping up with new technology is WORKSource Inc. To meet the challenge of handling
100 new employees, WORKSource Inc. acquired Web-based technology programs from
GHG Corp. like electronic pay stub, electronic timesheet software, time-off system, and
human resource information system (“Tips,” 2006). By adapting these new programs,
WORKSource was able to reduce waste and cost.

The Internet is an increasingly popular way to recruit applicants, research technologies

and perform other essential functions in business. Delivering human resource services
online (eHR) supports more efficient collection, storage, distribution, and exchange of
data (Friesen, 2003). An intranet is a type of network used by companies to share
information to people within the organization. An intranet connects people to people and
people to information and knowledge within the organization; it serves as an
“information hub” for the entire organization. Most organizations set up intranets
primarily for employees, but they can extend to business partners and even customers
with appropriate security clearance (Byars & Rue, 2004).

Applications of HRIS

The efficiency of HRIS, the systems are able to produce more effective and faster
outcomes than can be done on paper. Some of the many applications of HRIS are:
Clerical applications, applicant search expenditures, risk management, training
management, training experiences, financial planning, turnover analysis, succession
planning, flexible-benefits administration, compliance with government regulations,
attendance reporting and analysis, human resource planning, accident reporting and
prevention and strategic planning. With the many different applications of HRIS, it is
difficult to understand how the programs benefit companies without looking at
companies that have already benefited from such programs.

One such company is IBM. IBM has a paperless online enrollment plan for all of its
employees. Not only has the online enrollment saved the company 1.2 million per year on
printing and mailing costs, the employees enjoy working with the online plan. "Since we
began offering online enrollment, we've learned that employees want web access,"
Donnelly [Senior Communications Specialist] says, so they can log on at home rather
than through the company intranet. So the company has been working to put in place a
web-based enrollment system that employees and retirees can access from anywhere
(Huering, 2003). By utilizing the flexible-benefits application HRIS has to offer, IBM
was able to cut costs and give employees the freedom to discover their benefits on their
own time and pace.

Another company that has taken advantage of HRIS applications is Shaw’s

Supermarkets. In order for Shaw’s to better manage its workforce, the company decided
it was time to centralize the HR operations. After looking at different options, Shaw’s
decided to implement an Employee Self Service (ESS) system. The use of self-service
applications creates a positive situation for HR. ESS gives HR more time to focus on
strategic issues, such as workforce management, succession planning, and compensation
management, while at the same time improving service to employees and managers, and
ensuring that their data is accurate. With this solution, employees have online access to
forms, training material, benefits information and other payroll related information
(Koven, 2002). By giving employees access to their personal information and the ability
to update or change their information as needed, HR was given more time to focus on
other issues. Understanding the different applications HRIS has to offer will give
companies the chance to increase employee efficiency and reduce costs.

Measuring the Effectiveness of HRIS

The evaluation should determine whether or not the HRIS has performed up to its
expectations and if the HRIS is being used to its full advantage (Byars & Rue, 2004). One
of the most significant challenges faced by public personnel executives today is
measuring the performance of their human resources information system (HRIS) In order
to justify the value-added contribution of the HRIS to accomplishing the organization's
mission (Hagood & Friedman, 2002). Implementing an HRIS program may seem a
necessary stem for a company, but unless it will be an effective tool for HR operations, it
will not help increase efficiency and may hinder it instead.

One company that implemented a HRIS system is Toshiba America Medical Systems,
Inc. (TAMS). TAMS put all employee benefits information online and created an open
enrollment option when TAMS changed healthcare providers. Almost immediately upon
rolling out the UltiPro portal [new HRIS technology] to employees, TAMS began seeing
improvements, with an estimated 70% increase in open enrollment efficiency (Wojcik,
2004). By determining the efficiency of the new program, TAMS was able to realize the
benefits of the new HRIS system.

Security of HRIS

The privacy of employee information has become a major issue in recent years. With
identity theft becoming a common problem, employees are becoming more sensitive
about who sees their personal information, and the security it is kept in. By making sure
employee information that is kept in the HRIS is relevant to the company and making
sure there is limited access (password protection) to such information, companies can
make its employees more secure with the safety of their information. Whether electronic
or paper, employee files deserve to be treated with great care. Establishing security and
end-user privileges calls for a balance of incorporating, HR policy, system knowledge
and day-to-day operations (O’Connell, 1994).

One company that faced a major security issue was CS Stars, LLC. CS Stars lost track of
one of its computers that contained personal information that included names, addresses
and social security numbers of workers compensation benefits. The bigger problem was
that CS Stars failed to notify the affected consumers and employees about the missing
computer. Though the computer was retrieved and no information seemed to have been
harmed, many employees lost their sense of security with the company. New York's
Information Security Breach and Notification Law, effective in December 2005, requires
businesses that maintain computerized data which includes private information to notify
the owner of the information of any breach of the security of the system immediately
following discovery, if the private information was, or is reasonably believed to have
been, acquired by a person without valid authorization (Cadrain, 2007).

Another company that experienced a breach in security is Ameriprise Financial. In late

2005, a computer that contained personal information on clients and employees was
stolen. Because many of the employees at Ameriprise take their computers between work
and home, the company determined there was a need to put more security into those
computers. Ameriprise made sure all employees had the new security suite installed on
their computers. By responding quickly to the need for more security, Ameriprise made
sure all information is being kept secure. Making sure employees information is kept as
secure as possible there will be more trust in the company and the HR employees
working with that information.

Conclusion

IBM, Terasen Pipeline, CS Stars LCC, and Toshiba America Medical Systems, Inc. are
good examples of companies facing issues similar to human resources information
technology and human resources information systems. All of these companies know the
importance of new technology, human resources information systems, and data security.
The remainder of this paper provides synopses of more companies facing human
resources issues, how the company responded to the issues, and the outcomes of the
company’s responses.

Companies Benchmarked

IBM Europe

The Situation:

IBM is a global organization offering research, software, hardware, IT consulting,

business and management consulting, ring and financing. It employs around 340,000
people, speaking 165 languages across 75 countries, and serving clients in 174 countries.
In January 2007, IBM established a separate “new media” function within its corporate
communication department. IBM main goal is to educate, support, and promote programs
that utilize social media. IBM Europe decided to expand internal communication by
blogging guidelines. The recognition was that blogging was already happening among
IBMers, just in an unregulated way. In a similar way, institutionalizing a function to deal
specifically with new media is not a corporate move, or establishing from scratch. It’s a
response to the issues already emerging in the company. Now that those technologies are
here, people are using them, they’re growing and there here to stay-we’re just going to
put some structure around them so that we can try to optimize their use.” The users
decide what technologies they want to use and how they want to use them. That main
idea is that IBM understands that they must remember to respect the fact that social
media are social. IBM had the need to connect its 340,000 global employees more
effectively.

The Response:

IBM’s intent around social media has now been officially formalized. From January 22
2007, the company established a separate “new media” function within its corporate
communication department. “Its remit: To act as expert consultants inside and outside
IBM on issues relating to blogs, wikis, RSS and other social media applications. The
main idea is to educate, support and promote programs that utilize these tools. IBM has a
history of being a t the forefront of technology based corporate communication. From the
multimedia brainstorming “WorldJam” that made news headlines back in 2001 in which
50,000 employees worldwide joined a real time, online idea-sharing session about the
company’s direction. IMB has always prepared itself to use breakthrough technologies to
establish a two-way dialogue with its employees. The need for social media was
necessary and could no longer wait.

The Outcome:

In the last few years IBM has been recognized as being the vanguard of social-media use:
IBM was on of the first Fortune 500 companies to get behind collaborative wikis,
published internal blogging guidelines as far back as 2003, and is now moving fast
beyond RSS and podcasts into videocasting and “virtual world” technologies like Second
Life. The intranet search facility extends to all areas of the site, including new media
aspects. When an employee logs onto their portal an executes a key word search, the
results they get back not only come from the main intranet pages, but include results from
IBM forums, wikis, blogs and podcast/videocasts tags. IMB has an understanding that
employees are no longer staying in a company their entire lives. It’s just not like that any
more. In Belgium for example over 50 percent of 2,300 employees have been there fewer
than five years. The company has come to the conclusion that with an increasingly young
and mobile workforce, the likelihood is that an employee population full of a younger
generation, for whom these tools are part and parcel of life, is not that far away. In years
to come IBM will have to deal with employee base for which blogging is just the natural
way to interact over a web platform. IBM has created centralized platforms for most tools
that fall under its remit, which includes wikis. For Philippe Borremans, new media lead
Europe for IBM, has the potential business applications of a wiki cover two broad
benefits: Collaborating and knowledge sharing. IBM has scored some notable successes
on both fronts in the near 5000 wiki pages now up and running in the organization. The
company has been a huge pick-up in interest in podcasting over the last 18 months
writing can seem such a technical skill, whereas people feel they can talk more freely
than they can write. One of the most consistently popular IBM podcasts, with over
20,000 downloads a week.

Ameriprise Financial

The Situation:

The Department of Justice survey estimates that 3.6 million U.S. households were
victims of identity theft in 2004. Trafficking in personal date goes beyond U.S. borders:
the New York Times reports that stolen financial information is often distributed among
participants of online trading boards, and the buyers are frequently located in Russia,
Ukraine, and the Middle East. One reason clients are concerned about data security is the
widespread publicity generated by breaches at financial services firm. In late December
2205, an Ameriprise Financial employee’s laptop that contained unencrypted data on
approximately 230,000 customers and advisors was stolen from a car. Other financial
services firm, including Citigroup and Bank of America, also acknowledge large-scale
customer data losses in 2005. President of NCS, Rita Dew, a compliance consulting firm
in Delray Beach, Florida, says that the Securities and Exchange Commission requires
investment advisors to have policies and procedures that address the administrative,
technical, and physical safeguards related to client records and information.

The Response:

Ameriprise Financial had to fight back and had to implement “layers of protection.” It is
important for employees who their primary business computer, and employees regularly
transport the computer between home, office, and meeting sites. The vulnerability of this
arrangement and the need for a safety software program is much needed.

The Outcome:

Employees who are transporting lab tops should install the Steganos Security Suite on
their computer. This software allows employees to create an encrypted virtual drive on
the laptop that serves as data storage safe. Employees stores all client related data and tax
preparation software database on the encrypted drive, which employees has set up with
one gigabyte of storage space. The best thing is that when an employee turns off the
computer the information is stored “safe”, the software automatically encrypts the virtual
drive’s data. The software also generates encrypted backup files, which employees store
on CDs in a fireproof safe. This should keep the data secure if any employee’s laptop is
stolen or if the drive is removed from the laptop. Other financial advisors are relying on
encryption both in and out of the office. Other programs that are being used to protect
client’s information are RAID Level 1 system to store data on the drives that are
encrypted with WinMagic’s SecureDocs software. Encryption ensures that anyone who
steals the computer will be absolutely unable to read the data, even by connecting it to
another computer as a “slave drive. This has given many financial advisors the greatest
peace of mind.

Terasen Pipelines

The Situation:

Terasen Pipelines is a subsidiary of Terasen Inc. located in Vancouver, Canada and is

located in several provinces and U.S. states. In 2001 the company changed its
headquarters to Calgary to be closer to the oil. With the big move, the company went
through a growth spurt. With the company in many different locations and the growing
numbers of employees, the HR department saw a need to find a new system to keep more
accurate records.

The Response:

In the past Terasen had kept records on paper and with spreadsheets and with the growth
of the company, this system does not work as well as in the past. In order to compensate
for future growth, Terasen began to look into HRIS companies to help with the HR
operations. After researching different companies, Hewitt’s application service provider
model with eCyborg was found to be the right fit.

The Outcome:

Although there was difficulty adapting to a new way of recordkeeping, Terasen was able
to find a system that will help support the current and future growth of the company.
Fortunately, some of the HR staff had experience working with an HRIS and were able to
help their colleagues imagine new processes, as aided by a system. One theme often
voiced throughout this process was: "You guys don't know how hard we're working when
we can make it so much easier with a system that could do a lot of this for us. You don't
always have to run to the cabinet for the employee file just to get basic information. It can
all be at your fingertips." (Vu, 2005). In order to help Terasen ease the HR burden of
implementing a new HR system, the management of Terasen was convinced to look for a
vendor to help implement and maintain a HRIS system. This system has helped Terasen
better prepare for current and future growth.

Shaw’s Supermarkets

The Situation:

Shaw’s Supermarkets is the second largest supermarket chain in New England. With a
workforce of 30,000 located at 180 stores throughout six states, Shaw's HR staff is
responsible for managing employees' personal data. Their employee mix includes
approximately 70 percent part-time employees, consisting of students, senior citizens,
second-job part-timers, and career part-timers. One third of the workforce is made up of
union associates, and Shaw's staff oversees the company's involvement with three unions
and six separate contracts (Koven, 2002). In order to help manage the workforce, the HR
staff became interested in centralizing its HR operations.

The Response:

In order to centralize HR operations Shaw’s decided to implement an ESS (employee

self-service) solution. The use of self-service applications creates a positive situation for
HR. ESS gives HR more time to focus on strategic issues, such as workforce
management, succession planning, and compensation management, while at the same
time improving service to employees and managers, and ensuring that their data is
accurate. With this solution, employees have online access to forms, training material,
benefits information and other payroll related information.

The Outcome:

Shaw’s has had positive feedback since implementing the ESS solution. "The reaction
from our employees has been extremely positive," Penney, VP of Compensation and
Benefits, says. "We even had a significant increase in our medical coverage costs, and it
was almost a non-issue because the online enrollment featured the plan choices, the
employee cost, and the company subsidy. An employee self-service application makes it
very easy for them to understand their contributions and coverage options. I received
several e-mails from employees saying this was a great change and how easy ESS was,
which the case is not often when employees are selecting their benefit options." (Koven,
2002). By giving the employees more access to their information they are able to see the
benefit choices available to them. Employees are also able to update their information
online, which helps reduce the paperwork of the past. Shaw’s has also seen improvement
in productivity because employees are updating information at home, not during work
hours.

CS Stars, LLC

The Situation:
New York Attorney General Andrew Cuomo has announced that New York State has
reached its first settlement with a company charged with failing to notify consumers and
others that their personal data had gone missing. Cuomo’s office, which enforces the
state’s 2005 Information Security Breach and Notification Law, charged CS STARS
LLC, a Chicago-based claims management company, with failing to give notice that it
had lost track of a computer containing data on 540,000 New Yorkers’ workers’ comp
claims.

The Response:

The owner of the lost data, which had been in the custody of CS STARS, was the New
York Special Funds Conservation Committee, an organization that assists in providing
workers’ comp benefits under the state’s workers' comp law. On May 9, 2006, a CS
STARS employee noticed that a computer was missing that held personal information,
including the names, addresses, and Social Security numbers of recipients of workers’
compensation benefits. But CS Stars waited until June 29, 2006, to notify Special Funds
and the FBI of the security breach. Because the FBI declared that notice to consumers
might impede its investigation, CS STARS waited until July 8, 2006, to send notices to
the 540,000 New Yorkers affected by the breach. On July 25, 2006, the FBI determined
an employee, of a cleaning contractor, had stolen the computer, and the missing computer
was located and recovered. In addition, the FBI found that the data on the missing
computer had not been improperly accessed.

The Outcome:

New York's Information Security Breach and Notification Law, effective in December
2005, requires businesses that maintain computerized data which includes private
information to notify the owner of the information of any breach of the security of the
system immediately following discovery, if the private information was, or is reasonably
believed to have been, acquired by a person without valid authorization. The law affects
not only businesses in their dealings with their customers, but employers in their role as
custodians of employees’ personal data. (Cadrain)
Without admitting to any violation of law, CS STARS agreed to comply with the law and
ensure that proper notifications will be made in the event of any future breach. The
company also agreed to implement more extensive practices relating to the security of
private information. CS STARS will pay the Attorney General’s office $60,000 for costs
related to this investigation. (Cadrain)

IBM

The Situation:

IBM's paperless online enrollment system, introduced in 1999, has proved to be a winner
for both the company's 135,000 active U.S. employees and the company, according to
Cathleen Donnelly, senior communications specialist at company headquarters in
Armonk, N.Y. The company saves $1.2 million per year on printing and mailing costs
alone, Donnelly says, and the employees’ can take advantage of a variety of technologies
to learn about issues, research program information and access decision support tools
from their desktop computers. (Heuring, 2002)

The Response:

One of those tools, a personal medical cost estimator, enables employees to calculate
potential out-of-pocket health care expenses under each of the plan options available to
them, Donnelly says. Employees log in personally and are greeted by name and with
important information regarding their benefits enrollment, such as the deadlines and
when changes take effect. They automatically get access to health plans that are available
to them, and the calculator lets them compare estimated benefit amounts for each plan.

"Employees can select the health care services they expect to use in a particular year,
estimate expected frequency of use, and calculate potential costs under each plan option,"
Donnelly says. "The feedback that we've received from employees tells us that this tool
has really helped them to make a comparison between plans based on how they consume
medical services." The calculator shows both IBM's costs and the employee's. (Heuring,
2002)

The Outcome:

"Since we began offering online enrollment, we've learned that employees want web
access," Donnelly says, so they can log on at home rather than through the company
intranet. So the company has been working to put in place a web-based enrollment
system that employees and retirees can access from anywhere.

Employees can get summary information on the plans, drill down into very specific
details and follow links to the health care providers for research. Donnelly says the
system has received high marks for convenience because employees can "get in and out
quickly."
WORKSource Inc.

The Situation:

To meet the challenge of handling 100 new employees, WORKSource Inc. acquired
Web-based technology programs from GHG Corp. like electronic paystub, electronic
timesheet software, time-off system, and human resource information system (“Tips,”
2006). These tools enabled CEO Judith Hahn to handling payroll procedures efficiently
and effectively.

The Response:

WORKSource has eight workforce centers, with approximately 108 employees, located
throughout a six-county region. Previously, payroll, benefits, and human resources for
those employees were processed and managed by a Professional Employer Organization.
The company also has 52 administrative staff in its headquarters office. When the
contract with the PEO terminated on June 30, 2006, those 108 employees were
immediately moved to the payroll of WORKSource, which meant Hahn’s workload more
than doubled effective July 2006 (“Tips,” 2006).

Hahn, in an interview with PMR, said she relied on LEAN to help get a handle on what
needed to change for her to manage the increased workload. Two years earlier, Hahn’s
CEO had introduced her to LEAN, a Japanese management concept of eliminating
wasteful steps and motion when completing processes. “I began to read as much as
possible about LEAN and joined an HR LEAN focus group” (“Tips,” 2006).

The Outcome:

Mastering the concepts of LEAN led Hahn to develop and apply her own acronym of
“REASON” to her department’s payroll and HR processes. Review the process: map
payroll tasks from start to finish. Eliminate waste: determine how to complete a payroll
task most efficiently without unnecessary steps. Analyze alternatives: research and
evaluate the applicability of new technology. Sell innovations to management: document
the return on investment of each innovation. Open the lines of communication:
communicate openly—and often—with all stakeholders, including employees and top
management. Never allow negativity: make change simple and fun. Give employees
plenty of encouragement and time to learn (“Tips,” 2006). Judith Hahn was able to
implement the right human resource functions using information systems.

Toshiba America Medical Systems Inc.

The Situation:

Lynda Morvik, director of benefits and human resources information systems at Tustin,
California-based Toshiba America Medical Systems Inc. (TAMS), thought it would make
sense to add a benefits communication component to it. By having all the benefit
information online, the TAMS employee handbook would also be a living document,
enabling Morvik to make changes when necessary. Such was the case halfway through
the project, when TAMS changed health care plans from Aetna Inc. to United Health
Group Inc (Wojcik, 2004).

The Response:

TAMS, an independent group company of Toshiba Corporation and a global leading

provider of diagnostic medical imaging systems and comprehensive medical solutions,
such as CT, X-ray, ultrasound, nuclear medicine, MRI, and information systems, had
been using a payroll service bureau and an in-house solution for HR that didn't include
easy-to-use consolidated reporting or an employee portal. After evaluating UltiPro
alongside several enterprise resource vendors, TAMS selected Ultimate Software's
offering and went live in September 2002 after an on-time and on-budget
implementation. Almost immediately upon rolling out the UltiPro portal to employees,
TAMS began seeing improvements, with an estimated 70% increase in open enrollment
efficiency (Wojcik, 2004).

The Outcome:

In an effort to expand the usage of the Web beyond the benefits enrollment process,
TAMS has posted a library of documents and forms on its HR portal, including the
benefits handbook, which garnered a 2004 Apex Award for publication excellence. That
same year, Business Insurance magazine also gave TAMS the Electronic Benefit
Communication (EBC) award for outstanding achievement in communicating employee
benefits programs over the Web. To continue elevating its use of Ultimate Software's
HRMS/payroll solution, TAMS modified the UltiPro portal to meet the imaging
company's unique needs (Wojcik, 2004). It was completely integrated with several
proprietary applications created to address compensation and performance management
issues so that TAMS employees have a central location for comprehensive workforce and
payroll information from a Web browser that they can access with a single sign-on
(Wojcik, 2004).