digital transformation and its impact on human resource management

digital transformation and its impact on human resource management

Murphy, A. ", HR's role here is critical, he said. As a result, people need to reconsider the possibility or the urgency of HRM digital transformation in the context of the internal and external organizational environment. Much of the work done by HR will be automated. How to achieve HRM digital transformation. Digital transformation: Drivers, success factors, and implications. (Yu & JInajun, 2020). Clearly defining where the organization stands in relation to its goals can help leaders understand how to reach them. Therefore, in the pursuit of digital transformation, organizations need to balance their existing business models with new business models. National digital innovation governance is defined as the effective organization, coordination, and guidance of coherent actions of all related entities in the national digital innovation system (or regional innovation system) with the help of relevant institutions, rules, and mechanisms to achieve the goals of promoting scientific and technological progress and improving innovation capabilities (Yuezhou, 2020). In Digital Business Strategies in Blockchain Ecosystems (pp. Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. The purpose of this study is to explore how human resource management can be digitally transformed in the context of the digital economy. They can point out their observations to their managers, who in turn can discuss the advantages and disadvantages of these solutions and adopt the best one for the team. Artificial intelligence is also being used to some extent in the recruitment field. Berghaus and Back (2017) suggested that some companies are facing changes in government-led digital innovation governance, which is forcing companies to rethink the method they do business and change their organizations and even the way HRM does business. Regarding talent inventory, assessment, and motivation, they are collectively referred to as evaluative functions. The focus of this section is on digital HRM, so based on the previous definitions around digital, it is needed to clarify the definition of digital HRM. Data analysis provides organizations the opportunity to improve their decision-making and identify roadblocks well before they can cause any disruptions. else if(currentUrl.indexOf("/about-shrm/pages/shrm-mena.aspx") > -1) { Lin Grensing-Pophal is a freelance writer in Chippewa Falls, Wis. You have successfully saved this page as a bookmark. Any change will come with the high losses of mistakes. Capturing and tabulating information by comparing the daily growing volume of data with past information is particularly useful for achieving outcomes that will be valuable in the policymaking process of the HRM function. Advances in Developing Human Resources, 4(4), 392404. To cope with the change in market behavior, many enterprises realize the need to transform business models to gain a sustainable competitive advantage and maintain pace with the digital evolution of their industries. This gap between adopting new technologies by organizations and employees can be plugged by focusing on organizational culture and making concerted efforts to maintain it during transformation. Dmeijer, D. (2017). DiRomualdo et al. But the outbreak made it clear that this digitalization or online and offline integration has become a necessary point for survival. Springer. Reluctance to let go of existing procedures stops them from setting and achieving new goals that contribute to the growth of their employees and organization. National governance mechanisms in the digital economy - A data-driven science and technology innovation perspective. It is obvious that Industry 4.0 imposes deeper digital innovation requirements on HRM. The development of digital systems has highlighted the idea of e-learning. It's important, he said, for HR to "recognize that building a sustainable capability in-house is a huge undertaking, requiring leadership, people development, career paths, roles and skills clarification, and a culture of lifelong learning and feedback. Focusing on customers is an important sign of digitally transformed organizations. Real big data and smart technologies are the most widely used in selection recruitment, using intelligent algorithms to identify, as well as accurate profiling. In this way, they meet the needs of employees by offering speed, quality, and cost advantages (Ladkin & Buhalis, 2016) Digital service centers provide efficient, high-quality, and diverse employee services to realize the goals of cost reduction and high-efficiency, better employee experience, and increase their commitment. It can nurture digital HRM strategies that result in process refinement and modularity and can bring in novel practices and creative initiatives. HRM A service perspective. Transforming talent management: The impact of social and digital tech. Sebastian, I. M., Ross, J. W., Beath, C., Mocker, M., Moloney, K. G., & Fonstad, N. O. There are at least two relevant results for the digital management of the organization (Fabbri et al., 2019). This process should not only be embraced by management but should also be popularized at all levels of the corporate culture. He refers to digital HRM transformation as a process of change in which HRM transforms to digital in order to be data-driven and automated. The use of digital technology allows HRM operations to change. How chief digital officers promote the digital transformation of their companies. Media, D. (2021). The digital workplace facilitates an online work environment that enhances transparency, improves synergy, boosts employee engagement, and increases team productivity. In the future, researchers may consider how AI technology can gather knowledge and organize personalized training. It's important for HR and IT teams to work together to reduce this friction, he added. Zhang, J., Chen, Z. As the Internet has become widely used, the HRM recruitment process in companies has also changed (Vardarlier, 2020). Fichman, R. G., Dos Santos, B. L., & Zheng, Z. "Any successes we've achieved in digital transformation have been hinged on gaining input and active collaboration across functions and departments." Also, defining the requirements of transformation can allow the employees of the organization to see the bigger picture. Need assistance with a specific HR issue? However, the expectations encouraged by digital technology have also created significant pressure for change in the workplace (Betchoo, 2016). Pagani, M., & Pardo, C. (2017). "Digital transformation is the transformation of business processes, operations and structures in order to exploit the benefits of new technology." [].Thus, digital transformation does not only have far-reaching effects on almost all aspects of our society, but also has a major influence on the role, processes, and practices of human resource management (HRM) [2,3,4]. Inconsistent resource allocation: Employees need to know how the new resources added to workflows can simplify their lives. "Not every new tool or system is going to be a smashing success," she said. It reduces the routinized and tedious operational processes of HRM, enhances its productivity, and gives it permission to shift toward strategic domains that are of value to the organization. Tumbas, S., Berente, N., Brocke, J., & v. (2018). Bridging includes creating links between current functional units to enable novel digital initiatives. High uncertainty involves changes in digital talent standards, business needs, and the environment. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law. Whether in the HRM field or business management in general, it seems that every aspect is being digitally innovated (Yu & JInajun, 2020). Digital Transformation and HR: Playing a Role, Making an Impact, New OSHA Guidance Clarifies Return-to-Work Expectations, Trump Suspends New H-1B Visas Through 2020, Faking COVID-19 Illness Can Have Serious Consequences, Innovation in Remote Digital Collaboration, How Creator Platforms, ChatGPT Are Transforming Corporate Learning. Modern organizations need to reposition the value of HRM operations and create end-to-end, closed-loop HRM processes with the help of digital technology and digital operations thinking. The study reminds managers of the need to consider the possible implications of the new digital system. It is emphasized that although digital transformation brings benefits for business development, its potential impacts cannot be ignored, including how the old and new human resource management systems are converted and the negative effects of the new system. Correspondence to Cultivate leadership qualities in employees. Managers need to consider and assess these consequences in advance. However, it lacks interface with the existing HRM processes and can easily fall into a siloed state. Emphasizing infrastructural costs above everything else: From having an omnichannel presence to ensuring employees' goals are aligned to those of the organization, there are plenty of tools that can simplify the lives of employees. When done right, it gently nudges employees to get out of their comfort zone and identify the cracks in current processes. Tou et al. The factors that drive the uptake of digital technologies are essential prerequisites for a successful digital transformation of HRM. Expertise from Forbes Councils members, operated under license. The authors declare no competing interests. Due to the implementation of digital technologies, digital transformation is intrinsically linked to strategic changes in business models (Sebastian et al., 2020). By 2020, the majority of the workforce will be millennials, who have a different mindset. 5G, cloud computing, big data, artificial intelligence, IoT, blockchain, and other technologies have become the driving and enabling forces of work (Yu & JInajun, 2020). Program Management Within Digital Transformation: The Emerging Importance Of Technology Architecture, Product Management, and Human Capital Transformation . Strategic Management Journal, 22(6-7), 493520. Conceptualising the future of HRM and technology research. Part of Springer Nature. The process starts with digital transformation in HR, as HR leaders explore new technologies, platforms, and ways of working. Furthermore, we argue that digitization and digital innovation may lead to significant reforms in how business is undertaken (Osmundsen et al., 2018). Inverse transparency as a digital leadership concept, Towards the Knowledge-Smart Professional Service Firms: How High-Performance Work Systems Support the Transformation. Digital transformation changes the way the whole organization operates, especially the business processes and tasks (Amit & Zott, 2001). The formation of the digital economy talent means, first of all, the improvement of the training system, which should supply the required competencies for the digital economy in the Industry 4.0 environment; it also includes the rapid reorganization of the traditional talent needs to ensure the availability of modern digital competencies and a system of employee incentives to acquire the necessary competencies and personnel to participate in the digital economy development. Provided by the Springer Nature SharedIt content-sharing initiative, Over 10 million scientific documents at your fingertips, Not logged in How big old companies navigate digital transformation. var currentLocation = getCookie("SHRM_Core_CurrentUser_LocationID"); Human Interaction, Emerging Technologies and Future Systems V: Proceedings of the 5th International Virtual Conference on Human Interaction and Emerging Technologies, IHIET 2021, August 27-29, 2021 and the 6th IHIET: Future Systems (IHIET-FS 2021), October 28-30, 2021, France 543-549). } Digital transformation of the workplace, which helps to improve employee performance and increase organizational effectiveness, is also an important task of digital transformation of HRM. HRM is faced with different challenges all over the world. Operational guidelines on common CDR norms and values can be developed. That engagement, just like digital transformation efforts themselves, must be ongoing. Before and after the COVID-19 outbreak, there were changes in business claims or leader claims regarding digital transformation. Digitalization of the banking industry: A multiple stakeholder analysis on strategic alignment. The impact of digital technology on relationships in a business network. Huang, Y.-T. (2020). Exploring Human Resource Management Digital Transformation in the Digital Age, https://doi.org/10.1007/s13132-023-01214-y, Digitalization, innovative work behavior and extended availability, Impact of employee digital competence on the relationship between digital autonomy and innovative work behavior: a systematic review, Adopting an Ecosystem Approach to Digitalization-driven Organizational Change ? to identify surface issues employees face. As digital transformation progresses, the existing business model will encounter obsolescence (Teece, 2010). Therefore, this article aims at a conceptual clarification of digital human resource management and of related concepts of the digitization of human resource management, the digitalization of human resource management, the digital transformation of human resource management, and the digital disruption of human resource management. It is clear that HRM needs to adopt digital changes in line with the governmental digital innovation governance plan. Disentangling the fuzzy front end of digital transformation: Activities and approaches. Abstract Growing importance of technology and digitalization, leaded by globalization, has changed the nature of competition. Mosca, M. (2020). It may be interpreted as the convergence of HRM and technological sources and also implies the development and implementation of HRM strategies that are directly grounded on digital potential and generate corporate advantages to create value for the organization (Strohmeier, 2020). Singh, A., & Hess, T. (2020). It is also about bridging digital change based on the existing HRM operational processes. Taylor & Francis. The Denovati group. It is unrealistic to parallel the old and new HRM systems and expect the digital transformation to be a one-time success. In . The changing role of human resource management in an era of digital . Talent management in todays environment is influenced by politics, economics, technology, culture, and values. Research Gate. When integrating digitally, there is a need to clarify what kind of information will be available for big data objectives and to determine the appropriate information gathering and analysis instruments. (2017). After assessing these impacts, organizations need to decide whether to adopt minor digital HRM changes to transition or a large-scale approach. Emanuela Shaba, Marco Guerci, Emilio Bartezzaghi, Beatriz Ferreira, Carla Curado & Mrian Oliveira, Maren Gierlich-Joas, Thomas Hess & Rahild Neuburger, Junaid Rehman, Igor Hawryszkiewycz, Abdul Samad Dahri, Journal of the Knowledge Economy This doesn't mean we should give up. Employees will be able to decide their own training, they will be able to allocate training time at any given time, and they will be able to access training materials and training identified from their location. A Mckinsey study found that the culture of an organization requires planning and an attitude of developing alternatives to handle contingencies. The operational guidelines may be followed and implemented jointly by stakeholders in the digital HRM transformation process. Slider with three articles shown per slide. We found after literature analysis that 22 studies about HRM digital transformation were really published, so there are many studies about HRM digital transformation that is worth exploring. This can prove difficult to sustain in the long term, especially when digital capabilities require infusion into legacy organizational units. This research paper analyses the importance of digital transformation within public organisations and its impact on related human resource factors like human resource development,. Therefore, organizations should recognize the importance of digital conversion across levels. I can think of several digital tools or processes that we've piloted in the past four years that didn't deliver as expected. The impact of digital transformation can be found to lead to changes in consumer behavior, evaluation of services and products, and expectations (Mosca, 2020). In 2016 IEEE International Conference on Emerging Technologies and Innovative Business Practices for the Transformation of Societies (EmergiTech) (pp. (2) In addition to the drivers for transformation, HRM needs to consider the direction of transformation, that is, what HRM business area to transform in. "Without the workforce properly prepared in advance to engage, transformation efforts are dead on arrival and a waste of money," he warned, pointing to research cited by International Journal Of Contemporary Hospitality Management,28(2), 327345. (2019) combine the successful experiences of Finland and Singapore and propose to integrate digital innovation resources into the national production system to form a new open innovation mechanism under the conditions of a digital economy. Vakulenko, R. Y., Tyumina, N. S., Potapova, E. A., & Proskulikova, L. N. (2016). Berghaus, S., & Back, A. By having remote access to company information and training programs, trainers would not need to work directly with new employees in all training programs. Unlike previous generations, millennials are looking for employers who will give them purpose, job satisfaction, and career growth (Media, 2021). We can even take online interviews, video interviews, and voice interviews, through the application of various algorithms. Adi Ignatius. Proceedings of the International Conference on Digital Technologies in Logistics and Infrastructure (ICDTLI 2019).280-285). In Proceedings of the National Conference Digital transformation of business in India: Opportunities and challenges (pp. HRM must begin to plan for the role changes to meet the needs of the digital transformation of the enterprise and utilize these chances to enhance HRM abilities, service delivery, and job performance. Dublin Business School. The application of big data and data mining in the domain of HRM and transforming human resource data into profitable operational solutions allows us to leverage facts-based information, forecast analysis, and obtain a greater return on HR investment (Evseeva et al., 2019). Leaders and managers across levels can act as mentors to their teams. It has also been critical to foster true support from top-level leadership, she said, including the CEO. It encourages employees across departments and functions to come together as a team and optimize processes, which leads to an increase in efficiency. The concept of big data in which we live has significant opportunities for HRM (Vardarlier, 2020). Employee attitudes and (digital) collaboration data: A preliminary analysis in the hrm field. As Boudreau and Strategy (2015) aptly point out, the HR industry is at a turning point, and in order to be able to add value, HR professionals need to reassess their digital capabilities and skills. It analyzes the essence of the human resource management digital transformation, such as digital workplace, digital human resource management processes, and digital employee services. var temp_style = document.createElement('style'); (Vardarlier, 2020). Transformation requires leaders to take control of the situation and explain the need to their subordinates so that the work necessary for the transformation is properly planned. University of Twente. Sotnikova, Y., Nazarova, G., Nazarov, N., & Bilokonenko, H. (2020). Human Resource Development International, 25, 87103. It is suggested that researchers could explore how metaverse technology could be applied to digital training in the future, how training in virtual worlds could ensure the privacy of personal information, and the harm of excessive indulgence in digital worlds (e.g., learning in metaverse with game modules). Being agile and flexible provides the freedom to pursue different solutions and pick the best possible one for the employees. Support of startup innovation towards development of new industries. The digital transformation in HR | Deloitte Insights HR is being pushed to take on a larger role in helping organizations to be digital, not just do digital. As organizations progressively move forward with their digital HRM transformation, there is a need to focus on the ethical issues raised by digital technology. The new round of technological revolution and industrial change is accelerating. If they're taking place without you, or if you have a role on the sidelines, these initiatives may be doomed from the start. Abstract: This research paper analyses the importance of digital transformation within public organisations and its impact on related human resource factors like human resource development, talent and performance management. AI technology can intelligently retrieve the knowledge required by an organization or individual and build the appropriate knowledge base. Technology in Society, 28, e101114. Information and Knowledge Management, 7(4), 6. 202220). Automation and artificial intelligence, Sharkey said, will play a major role in the evolution of the workplace. Members may download one copy of our sample forms and templates for your personal use within your organization. In the same way that marketing or operations departments have come to accept that it is the critical key to business efficiency, digital HRM may fall into what has been called the HRM trap (Schneider, 1994). It is suggested that the following areas could be explored in depth with regard to future research directions on digital HRM change. Therefore, it is important to conceptualize management functions, especially digital HRM, and to acquire new competencies and tools to change and adapt activities and strategies to these novel digital workforce characteristics (Manuti & De Palma, 2018). The ability to fully meet the needs of internal customers and reduce their loss, especially to avoid falling into HRM traps, is a factor in ensuring the success of the transformation (Huang, 2020). In the context of current digital technology developments, it is necessary to explain the concept, drivers, transformation directions, and the implications of digital HRM. Thite, M. (2020). Information Systems. Introduction. Abstract: Digital transformation has revolutionized employee engagement and organizational communication. Professionals (e.g., HR practitioners) are required to make significant strategic and operational changes in the face of them. Digital transformation and culture go hand in handboth have to have well-thought-out processes in order to deliver the most impact. Heilig, L., Schwarze, S., & Vo, S. (2017). Digital HRM approaches are playing a growing role and now hold the key to shaping HR strategy and the organization as a whole. Digital technologies are fundamentally redefining the future of training and development functions. (2014). Please confirm that you want to proceed with deleting bookmark. 16). Palgrave Macmillan. Journal of Decision Systems, 27(sup1), 3845. Possible implications include how to transition between the two HRM systems, the negative impact of the new digital HRM system, the impact of digital HRM on work outcomes, and digital ethics. "We've learned that a dedicated project team comprised of HR, operations, IT and relevant business experts is a winning model for us," she said. 1. While digital transformation is an organizational initiative and not limited to HR, people are the common denominator. In this part of the study, for the sake of the subsequent discussion, we believe that several concepts need to be distinguished: digitalization, digital transformation, digital innovation, and the digital workforce. Grafting involves a longer-term vision, which can cause completely different working models when the organization coordinates different action logics. People. In Strategic information management (pp. Bilgeri, D., Wortmann, F., & Fleisch, E. (2017). HRM is one of the main parameters of ensuring the competitiveness of companies in the digital age. Corporate digital training activities are a collection of systems (Vardarlier, 2020). Manuti, A., & De Palma, P. D. (2018). It reduces the amount of time, money spent, strategies used and the efficiency of HR services (Nachit and Okar, 2020 . In the digital domain, information technology may facilitate business process relationship management and is better suited to the organization (Levikangas, 2016), becoming key elements of HRM operations that drive innovation. Nawaz, N. (2017). From my perspective, there are nuanced reasons as to why these key attributes have been isolated by industry professionals. Decoupling explains how novel digital initiatives can be separated from current functional units to enable novel digital initiatives. . A digital-first mindset helps employees think in terms of optimal solutions to solve the issues theyre facing. Furthermore, this transformation can help organizations to better interact with external customers through innovative technologies (Singh & Hess, 2020). The new concept of CDR highlights its importance based on the different stakeholder perspectives. University of St. Gallen. (2015). (2020). Build specialized knowledge and expand your influence by earning a SHRM Specialty Credential. It needs to rethink the new digital HRM business logic, the digital transformation challenges, the impact on performance, and digital ethics (Osmundsen et al., 2018; Piccinini et al., 2015). German Journal of Human Resource Management, 34(3), 345365.

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