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Chapter 8: The Effects of eHR System Characteristics and Culture on System Acceptance and Effectiveness

Overview

Eugene F. Stone-Romero

Electronic human resource (eHR) systems are being used by a large percentage of organizations in North America and Europe (Cedar, 2002; Gueutal, 2003). Illustrative of this, a study of 299 organizations showed that approximately 73 percent of North American firms and 90 percent of European companies used eHR systems for one or more human resource (HR) purposes (Cedar, 2002). Among the many goals associated with the adoption of such systems are enhancing the efficiency and effectiveness of HR- related activities through such strategies as (a) decreasing the need for HR staff; (b) reducing the costs of HR transactions; (c) increasing access to HR information; (d) improving service to employees; and (e) freeing HR staff from many routine tasks and, thus, allowing them to devote more time and attention to strategic HR planning activities (Cedar, 2001; Towers Perrin, 2001; Ulrich, 2001). Regrettably, there is very little research on the degree to which eHR systems actually facilitate the accomplishment of these and other goals (Cardy & Miller, 2003; Gueutal, 2003; Stone, Stone-Romero, & Lukaszewski, 2003). As a result, many of the recommendations for practice that appear in the HR literature rest on a fairly weak foundation. Moreover, there is very little research evidence on the relative effectiveness of eHR systems across cultures.

In view of the above, this chapter has two major purposes. First, it considers the functional and dysfunctional consequences that may arise from using eHR systems for such purposes as employee recruitment, personnel selection, and performance management. Second, it deals with cross-cultural differences in the acceptance and effectiveness of eHR systems. The latter purpose is especially important because most such systems are predicated on values (for example, individualism, meritocracy) that are rooted in the cultures of the United States and several western European nations. As a result, the same systems may not be so effective in nations that subscribe to different values (for example, collectivism, egalitarianism). Consequently, various aspects of “canned” systems may have to be modified to make them compatible with the values of individuals in specific cultural contexts. In addition, because the employees of many organizations are multicultural, the eHR system of any specific organization may have to be flexible enough to accommodate individuals from different cultures. This flexibility should serve to increase employee acceptance of the systems and, thus, enhance their overall effectiveness. In view of this chapter’s focus on the impact of values on the acceptance and effectiveness of eHR systems, the next section considers cross-cultural differences in values (cultural orientations).

Values and the Acceptance and Effectiveness of eHR

Research by Bond (1988), Hofstede (1980, 1997), Erez and Earley (1993), and Trompenaars and Hampden-Turner (1998) has identified national differences in values. In this regard, a major premise of this chapter is that such differences will influence the degree to which eHR-related policies and practices have desired effects. Consistent with this premise, Figure 8.1 shows a model dealing with the moderating effect of cultural values on the relation between (a) eHR system characteristics and (b) the outcomes of eHR system use (for example, employee reactions or effectiveness of practices). Numerous examples of this moderating effect are detailed here.

Although there is a sound basis for hypothesizing the just-described moderating effect, many eHR systems have been designed in a standardized way, with virtually no concern for differences in the values of employees. More specifically, many such systems are based on values that are common to the United States and several Western European nations. This is unfortunate, because even though they may be well- intended, organizational practices often will have diminished effectiveness if they fail to consider differences in employees’ values (Stone & Stone-Romero, 2004; Stone- Romero & Stone, 1998; Stone-Romero, Stone, & Salas, 2003; Trompenaars & Hampden-Turner, 1998). For example, HR practices that are based on Western European (that is, Anglo-Saxon) values have proven to be difficult to implement in organizational contexts where different values are prevalent (Stone-Romero & Stone, 1998; Trompenaars & Hampden-Turner, 1998).

Consistent with the just-noted arguments, available theory and research suggest that eHR systems will be more accepted and effective in cultures that share Western European values than those that do not. There are at least three reasons for this. First, a great deal of currently popular eHR software was developed in either the United States (for example, by PeopleSoft) or Germany (for example, by SAP). Organizational policies and practices in these countries are often predicated on models of organization that have their roots in bureaucracy theory (see, for example, Katz & Kahn, 1978; Stone-Romero & Stone, 1998; Weber, 1947). Such models emphasize (a) the standardization of policies and practices; (b) the use of objective data in decision making; (c) the uniform and impersonal treatment of job applicants and job incumbents; and (d) the separation of the job and the job holder. As a result, most eHR systems will be more acceptable to individuals who share the values associated with the bureaucratic model than to individuals who do not (Trompenaars & Hampden-Turner, 1998). For example, such systems may be less compatible with the cultures of countries in Asia, South America, and Africa than with the cultures of nations in North America and Northern Europe. Second, organizations that use eHR software often implement it as it originally was programmed, as opposed to customizing it to reflect local cultural values (Cedar, 2002). Thus, it is likely that the benefits that might stem from local adaptations of eHR software are unrealized. Third, and finally, eHR systems will be more accepted by employees in organizations that have well-developed (mature) HR practices (for example, organizations in the United States) than those that do not (for example, organizations in Brazil). In view of the above, it is critical that researchers and

practitioners consider the influence that values may have on the acceptance and effectiveness of eHR in international or multicultural contexts.

In light of the hypothesis that values will moderate the relationship between (a) eHR system characteristics and (b) the outcomes of eHR system use, the following section considers several values that appear relevant. Immediately thereafter, the chapter turns to (a) the functional and dysfunctional consequences of using eHR to facilitate such processes as employee recruitment (referred to below as recruitment), personnel selection (referred to hereinafter as selection), and performance management, and (b) the way in which culture influences reactions to eHR system characteristics.

Dimensions of Culture

The literature on culture suggests a number of values (cultural orientations) that differ across national cultures (for example, Bond, 1988; Hofstede, 1980, 1997; Triandis, 1994; Trompenaars & Hampden-Turner, 1998). In the interest of brevity, the consideration of values is restricted to the following values or orientations: (a) achievement, (b) individualism, (c) long-term perspective, (d) masculinity, (e) power inequality, (f) predictability, (g) specificity, and (h) universalism.

[1] In subsequent

sections we consider the implications of these values for the acceptance and effectiveness of eHR systems.

Achievement Orientation

In achievement-oriented cultures, individuals are evaluated on the basis of their personal accomplishments, whereas in ascription-oriented cultures, they are often evaluated on the basis of such factors as their kinships, gender, age, or personal relationships with others (Trompenaars & Hampden-Turner, 1998). Research by Trompenaars and Hampden-Turner (1998) showed that respondents from English speaking and/or Northern European countries (including Australia, Canada, Denmark, Finland, Germany, Ireland, New Zealand, Nigeria, Norway, Sweden, and the United States) were likely to endorse the achievement value. However, respondents from other countries (including Argentina, Austria, Bahrain, Brazil, Cuba, Hong Kong, India, Kenya, Kuwait, Oman, the Philippines, Saudi Arabia, Serbia, and Thailand) were likely to endorse the ascription value.

Individualism Orientation

In individualistic cultures ties between individuals tend to be relatively “loose” or weak and each person is viewed as being responsible for his or her own welfare. In contrast, in collective cultures people believe that in-groups or other collectives should look out for their welfare. In exchange for this support, individuals manifest a high level of loyalty to the collective. Research by Hofstede (1980) showed that support for individualism is relatively (a) high in such nations as the United States, Australia, Great Britain, and Canada, and (b) low in such countries as Taiwan, Peru, Pakistan, Colombia, and Venezuela.

Long-Term Perspective

On the basis of work by Bond (1988), Hofstede (1997) described a value that he labeled “Confucian dynamism.” Individuals who subscribe to this value tend to (a) have a long-term perspective, (b) view relationships between people in terms of status differentials, (c) regard the family as the prototype of social organization, (d) subscribe to the Confucian version of the Golden Rule, (e) manifest sensitivity in dealings with others, and (f) value education, tradition, patience, frugality, and perseverance. The aspect of Confucian dynamism that differs most from the other values described by Hofstede (1980) is a long-term perspective. Research by Hofstede (1997) showed that support for this orientation was relatively (a) strong in such countries as China, Hong Kong, Taiwan, Japan, and South Korea and (b) weak in such nations as Pakistan, Canada, Great Britain, and the United States.

Masculinity Orientation

The masculinity value detailed by Hofstede (1980, 1997) is somewhat similar to the just-described achievement value. More specifically, in masculine (as opposed to feminine) cultures, emphasis is placed on such factors as achieving worldly success, accumulating money, and possessing material goods. Men are socialized to be assertive and tough, whereas women are socialized to be modest and tender. In addition, in masculine cultures there tends to be high worker involvement in their work roles, an acceptance of work organizations “interfering” in the non-work lives of employees, and a domination of desirable organizational jobs by males. Research by Hofstede (1980) showed that the masculinity orientation tends to be relatively (a) strong in such nations as Japan, Austria, Italy, Switzerland, and Mexico and (b) weak in such nations as Finland, Denmark, Norway, and Sweden.

Power Inequality Orientation

This is the same value that Hofstede (1980) labeled power distance. However, the label of power inequality is used here because it seems far more descriptive of the nature of this value. In cultures with a high power inequality orientation, people accept unequal distributions of power across individuals in social systems and expect such distributions. In addition, in high power inequality cultures, subordinates tend to have dependent relationships with superiors and to maintain considerable emotional distance from them. Research by Hofstede (1980) showed that power inequality tends to be (a) strongly valued in such nations as Mexico, Venezuela, India, and Singapore and (b) not strongly valued in such countries as Austria, Israel, Denmark, New Zealand, and Ireland.

Predictability Orientation

Hofstede (1980) called this value “uncertainty avoidance.” However, the term predictability is used here because it is simpler. Predictability reflects an orientation on the part of individuals to prefer situations in which events are stable or predictable and to avoid situations in which there is ambiguity or uncertainty. In work organizations,

predictability can be enhanced by (a) clear rules, regulations, and policies and (b) practices that ensure stability (for example, of work schedules and employment). Hofstede’s (1980) research showed that predictability is (a) strongly valued in such nations as Greece, Portugal, Belgium, and Japan and (b) weakly valued in such nations as Singapore, Denmark, Sweden, and Hong Kong.

Specificity Orientation

In cultures with a specific orientation such as the United States, individuals’ interactions with others tend to focus on specific areas of life (Trompenaars & Hampden-Turner, 1998). For example, a manager’s work relationship with a subordinate would be separate from a personal relationship that he or she might have with the subordinate. Note that in many Western organizations there is often a clear separation between the job and the job-holder (Katz & Kahn, 1978; Stone & Stone- Romero, 2004; Stone-Romero & Stone, 1998; Weber, 1947). In contrast, in cultures that have a diffuse orientation (China or Japan, for example), individuals tend to involve others in multiple areas of their lives (Imai, 1986; Morishima, 1982; Trompenaars & Hampden-Turner, 1998). In addition, relative to cultures with a specific orientation (the United States, for example), in cultures with a diffuse orientation, organizations tend to be more involved with the families and personal lives of their employees. Interestingly, research by Trompenaars and Hampden-Turner (1998) showed that respondents from many European and North American countries (for example, Bulgaria, Canada, Czech Republic, Denmark, Finland, France, Hungary, the Netherlands, Sweden, Switzerland, and the United Kingdom) were likely to endorse specific values. In contrast, respondents from several other nations (for example, Bahrain, China, Egypt, Indonesia, Kenya, Kuwait, Nepal, Nigeria, Singapore, South Korea, and Venezuela) were prone to endorse diffuse values.

Universalism Orientation

Individuals who subscribe to universalism believe that each person in a culture should be treated in a uniform manner, whereas those who endorse the value of particularism believe that each individual should be treated in a differentiated manner (Trompenaars & Hampden-Turner, 1998). The greater the belief in universalism, the lesser the degree to which emphasis is placed on (a) the obligations associated with personal relationships and (b) the way in which unique circumstances influence dealings with others. Thus, for example, consistent with the precepts of bureaucracy theory, a manager who subscribes to universalism would be likely to have impersonal (as opposed to personal) relationships with each of his or her subordinates and to treat each one in a uniform manner (Imai, 1986; Morishima, 1982; Stone-Romero & Stone, 1998). Interestingly, the results of research by Trompenaars and Hampden-Turner (1998) revealed that, whereas respondents from North American and European nations (for example, Canada, Germany, Ireland, the Netherlands, Romania, Sweden, Switzerland, the United Kingdom, and the United States) were likely to endorse universalism, respondents from many other countries (for example, Bulgaria, China,

Cuba, Greece, India, Indonesia, Mexico, Nepal, Russia, South Korea, and Venezuela) were likely to stress particularism.

Having described several values that appear relevant to eHR systems, we now turn to a number of HR processes that are thought to be facilitated by them. For each such process, attention is devoted to two sets of issues. First, the functional and dysfunctional consequences of eHR systems for organizations and individuals (for example, job seekers, job applicants, job incumbents) are considered. Second, examples are presented that illustrate the moderating effect of values on relations between (a) eHR system characteristics and (b) the outcomes of eHR system use (see Figure 8.1).

Figure 8.1: The Moderating Effect of Culture on the Relationship Between eHR

System Policies and Practices and the Outcomes of eHR System Use.

[1] In the interest of avoiding cumbersome labels, values are referenced by simple

labels. For instance, masculinity is used in place of masculinity/femininity and individualism is used in place of individualism/collectivism.

Recruitment and eHR

In order to maximize organizational efficiency and effectiveness, organizations use recruitment to attract highly talented job seekers and encourage them to apply for jobs. Interestingly, a recent study showed that 100 percent of large firms in the United States use eHR systems for recruitment (Cedar, 2002; Gueutal, 2003).

Recruitment also serves the interests of job seekers. More specifically, they can use information gained through recruitment efforts as a basis for assessing the likelihood of

organizations providing them with jobs that will lead to such outcomes as satisfying work, equitable pay, fringe benefits, job status, supportive social relationships, and developmental opportunities (Lofquist & Dawis, 1969; Porter, Lawler, & Hackman, 1975).

Appropriately designed eHR systems may prove beneficial to (functional for) both organizations and job seekers. However, as noted below, they also may lead to a number of dysfunctional, typically unintended, consequences.

Functional Consequences of Using eHR for Recruitment

The use of eHR for recruitment may lead to several functional consequences for job seekers and organizations. We consider these in turn.

Functional Consequences for Job Seekers

Well-designed eHR-based recruitment efforts may provide several benefits to job seekers. First, they can use organizational websites (referred to hereinafter as websites) to gather information about organizations around the world. This information can then be perused in as much detail as needed to assess the relative attractiveness of the same organizations. Second, websites may allow job seekers to assess the likelihood of being hired by any given organization. For instance, a job seeker may be able to determine the correspondence between his or her abilities and the ability requirements of any specific job. Third, information on websites may enable job seekers to assess the odds of being satisfied with a given job. This can be accomplished by comparing their needs with the reinforcers (for example, pay, fringe benefits) provided to job incumbents (Lofquist & Dawis, 1969). Fourth, to the degree that websites convey information about the values and goals of an organization, job seekers may be able to determine whether or not their own values coincide with those of the organization. Fifth, to the extent that websites provide information on the goals of organizations and the strategies used to pursue them, job seekers can use this information to manage positive impressions during the selection process. Sixth, websites can provide job seekers with a virtual preview of an organization (Johnson & Isenhour, 2003; Stone, Stone-Romero, & Lukaszewski, 2003). Seventh, and finally, websites can reduce the time needed for individuals to apply for jobs (Giesen & Frank, in press; Hesse, 2004; Johnson & Isenhour, 2003; Stone, Stone-Romero, & Lukaszewski, 2003).

Functional Consequences for Organizations

eHR-based recruiting may result in several functional consequences for organizations. First, it may allow for the cost-effective and timely communication of large amounts of information about an organization to a broad pool of job seekers. Second, it may enable organizations to reduce or eliminate the expenses associated with recruiting fairs. In fact, some large multinational firms (Ford Motor Company, for example) are replacing recruitment at college fairs with eHR-based recruiting. Third, to the extent that websites are attractive and engaging, they can attract and hold the attention of job seekers, enhancing the odds of them applying for jobs (Barber & Roehling, 1993). In support of

this contention, recent research (for example, Anderson, 2003; Chapman & Webster, 2003; Scheu, Ryan, & Nona, 1999) has shown positive relations between the attractiveness of websites and applicants’ reactions to organizations. For example, research by Higgs, Strong, and Light (2002) showed that eHR-based video clips about an organization enhanced applicants’ liking for it. Fourth, to the extent that they are programmed to do so, eHR-based systems can reduce the time needed to scan the résumés of applicants and provide them with feedback on their suitability for jobs. Fifth, and finally, eHR systems can be used to evaluate the effectiveness of recruitment processes, including the degree to which such processes result in the attraction of well- qualified job applicants.

Dysfunctional Consequences of Using eHR for Recruitment

eHR-based recruitment may result in a number of unanticipated dysfunctional consequences. The following two subsections consider these with respect to job seekers and organizations.

Dysfunctional Consequences for Job Seekers

eHR-based recruiting may lead to several dysfunctional consequences for job seekers. For example, to the degree that they lack experience with computer use and/or lack access to computers, they may not be able to access and/or use websites. This is a very important issue because of the “digital divide problem.” More specifically, relative to individuals in nations in which people have high levels of access to computers (for example, Canada, England, Germany, and the United States), large percentages of people in other countries (El Salvador, Somalia, and Vietnam, for example) lack such access. For example, recent research (Cedar, 2002) showed that among individuals employed by relatively large organizations, fewer people in Asian companies had access to the Internet than did people in either U.S. or European firms. In view of this, it seems likely that computer access was even lower for people who were either unemployed or were employed by relatively small firms. It is clear, therefore, that to the degree that individuals are unable to use computers or lack access to them, they will have diminished odds of benefiting from eHR-based recruiting.

It deserves adding that, even in countries where there are generally high levels of Internet access, such as the United States, members of several ethnic groups (for example, African Americans, Hispanic Americans, Native Americans) may have little or no access to computers. Thus, they will be unlikely to benefit from eHR-based recruiting. Similarly, because they lack computer experience, many older individuals will not benefit from such recruiting.

Interestingly recent research revealed that computer experience and computer self- efficacy are important determinants of computer use (Venkatesh & Davis, 2000). Thus, even if they are well-qualified for jobs, to the degree that job seekers lack experience and the self-efficacy that it brings, their chances of benefiting from eHR-based recruiting efforts will be diminished.

Dysfunctional Consequences for Organizations

Organizations that only use eHR-based recruiting may experience a number of dysfunctional consequences. First, to the degree that otherwise well-qualified job seekers lack access to websites, eHR-based recruiting will be less effective than traditional recruiting (such as job fairs or campus visits). Second, eHR-based recruit- _ing may not provide organizations with as much information about job seekers as traditional types of recruitment do. For example, eHR-based recruiting may yield little or no information about the interpersonal skills of job seekers. Third, to the degree that eHR-based recruitment has an adverse impact on certain classes of job applicants (ethnic minorities in the United States, for example), it may lead to costly litigation in some countries (for example, the United States).

Cultural Influences on Reactions to eHR-Based Recruitment

As noted above, values may influence both the acceptance and effectiveness of eHR- based recruitment systems. In particular, many such systems were developed with the assumption that all job seekers have similar values and, for example, seek the same types of job-related outcomes. However, in view of the fact that there are important differences in values across various nations (Bond, 1988; Hofstede, 1980, 1997; Triandis, 1994), this assumption seems incorrect. Thus, eHR-based recruiting may be more effective in some cultures than in others. Illustrations of this are presented below.

Achievement Orientation

Recruiting systems based on eHR may be less acceptable to individuals from cultures that stress ascription than to individuals who value achievement. One reason for this is that people from ascription-oriented cultures (for example, those of many South American nations) are prone to use personal relationships or connections to gain access to jobs. Thus, they may react negatively to eHR sys-_tems that do not consider such relationships. Also, in nations with achievement-oriented cultures (for example, the United States) it is common for organizations to conduct job analyses and select job applicants who meet job requirements. In marked contrast, in organizations in several South American nations, individuals are hired and then allowed to write their own job descriptions (Trompenaars & Hampden-Turner, 1998).

Individualism Orientation

Although research on the issue is lacking, it seems safe to infer that individualists will respond more positively to eHR-based recruiting than will collectivists. One reason for this is that such methods are impersonal in nature and afford little or no opportunity for a person with collective values to pursue group interests. Thus, eHR-based recruiting should be viewed more positively in such nations as the United States and Great Britain than they are in such countries as Guatemala, Venezuela, and South Korea.

Long-Term Orientation

In view of the nature of the long-term orientation construct (Bond, 1988; Hofstede, 1997), it would appear that individuals who subscribe to this value will be more accepting of eHR-based recruiting than those who do not. There are at least two reasons for this. First, individuals with a long-term orientation will be accepting of such recruiting if they view it as adapting traditional ways to a modern context. Second, such individuals will value eHR-based recruiting to the degree that it is viewed as cost- effective. Regrettably, there is no research to support this speculation.

Masculinity Orientation

It seems safe to infer that eHR-based recruiting will be more acceptable to individuals in masculine cultures than to individuals in feminine cultures. Such recruiting should allow job seekers to find jobs that will allow them to achieve worldly success, and thereby accumulate resources. Research is needed to test this prediction.

Power Inequality Orientation

On the basis of what is known about the power inequality construct (Hofstede, 1980, 1997), it seems that individuals who are tolerant of high levels of power inequality will be more accepting of eHR-based recruiting than individuals who favor low levels of power inequality. The reason for this is that those who tolerate high levels will view such recruiting methods as the legitimate right of powerful organizations. Unfortunately, there is no research on this issue.

Predictability Orientation

On the one hand, to the degree that individuals value predictability and are accustomed to traditional recruiting practices, they may react negatively to eHR-based recruiting. This would be especially true if they had low levels of computer experience. On the other hand, eHR-based recruiting may lead to lower levels of stress among job seekers if it provides them with a sense of control over their activities. The same sense of control may be absent in face-to-face encounters with live recruiters. Research is needed on this issue.

Universalism Orientation

The acceptance and success of eHR-based recruiting is likely to vary across cultures that differ with respect of their standing on a universalism (for example, Germany, Sweden, the United Kingdom, and the United States) versus particularism (for example, China, Mexico, South Korea, and Venezuela) continuum. One reason for this is that eHR-based recruiting systems typically are designed by individuals from cultures with a universalist orientation. Thus, they are often highly standardized and impersonal in nature. For example, with such systems employment applications are processed by computer programs, as opposed to being reviewed by an HR professional. In addition,

managers from universalist-oriented cultures are likely to value standardized processes, impersonal decision making, and the consistent treatment of job seekers or applicants. Because of this, eHR-based recruiting systems will be more likely to be accepted by individuals from universalist-oriented cultures than by people from particularist-oriented cultures (Trompenaars & Hampden-Turner, 1998).

Specificity Orientation

As noted above, research by Trompenaars and Hampden-Turner (1998) showed that people in some countries (for example, the United Kingdom and the United States) are likely to endorse specific values, whereas individuals in other countries (China, Singapore, and Venezuela, for example) are prone to subscribe to diffuse values. In addition, research by Lewin (cited in Trompenaars & Hampden-Turner, 1998) found that there are national differences in preferences for personal space. For instance, people in the United States stress public space more than private space, whereas individuals from Germany emphasize private space more than public space. Compared to people from the United States, people from Germany are more likely to have a smaller public space and guard access to their private space. However, once an individual from Germany allows friends to access his or her private space, they are granted access to a considerable amount of private information. The results of this research suggest that, compared to individuals from cultures with specific orientation, people from cultures with a diffuse orientation will be more concerned with protecting their privacy in organizational contexts. As a result, relative to individuals from cultures with a specific orientation, those from cultures with a diffuse orientation will (a) want more safeguards for information in eHR-based systems and (b) be more reluctant to divulge information during the recruitment process.

Selection and eHR

Research shows that selection practices differ across nations (Ryan, McFarland, Baron, & Page, 1999). However, in most organizations in the United States and other Western nations, selection involves the matching of the knowledge, skills, and abilities of job applicants with the requirements of jobs (Campbell, McCloy, Oppler, & Sager, 1993; Guion, 1976; Lofquist & Dawis, 1969). In order to achieve the matching, organizations often use a wide array of methods (for example, ability tests, personality inventories, interviews) to gather data about applicants.

eHR systems can be used to perform such tasks as (a) scanning applicants’ résumés for key words found in statements of job requirements, (b) matching individuals’ profiles with those of jobs (Pearlman & Barney, 2000), and (c) comparing the knowledge, skills, and abilities of internal candidates with the requirements of jobs (Stone, Stone-Romero, & Lukaszewski, 2003). In view of this, eHR-based selection may lead to functional and dysfunctional consequences for both job applicants and organizations, and these may vary across cultural contexts (Konradt & Hertel, in press).

Functional Consequences of Using eHR for Selection

eHR-based selection systems may lead to a number of functional consequences for job applicants and organizations. These are considered next with respect to each of these groups.

Functional Consequences for Job Applicants

Relative to traditional HR systems, eHR-based selection systems may result in a number of functional consequences. One is increasing the advancement opportunities of internal job candidates (that is, current employees) because of improvements in the availability of information about openings. A second advantage is convenience. With eHR systems, job seekers may be able to complete application forms and pre- employment tests online.

Functional Consequences for Organizations

eHR-based selection systems may result in several functional consequences for organizations. First, they may increase both the speed and the accuracy of the selection process, especially when there are large numbers of job applicants. Second, they may enable organizations to collect information about job applicants in a rapid and cost- effective manner. Third, they may allow for applicants to complete one or more predictor measures (for example, ability tests, personality inventories, self-assessments) online. Fourth, such systems may allow organizations to conduct background checks or reference checks on job applicants in a cost-effective manner. Fifth, the same systems may increase the amount of information available to decision makers. Sixth, eHR-based systems may help organizations assess the validity and utility of their selection practices. Seventh and finally, through appropriate placement activities, they may increase the organization’s ability to utilize the skills and abilities of applicants who are hired.

Dysfunctional Consequences of Using eHR for Selection

eHR-based selection may lead to dysfunctional consequences for both job seekers and organizations. These are considered next.

Disadvantages for Job Seekers

Selection systems based on eHR may have one or more dysfunctional consequences for job seekers. First, once data are in an eHR-based system, applicants may not be able to ensure their accuracy (Barak & English, 2002; Bartram, 2000; Pearlman & Barney, 2000). This is not a trivial issue because of the inaccuracies found in databases. For example, research in the United States showed that 42 percent of the data in credit databases are inaccurate and may result in misclassification errors or a loss of job opportunities for individuals (Stone & Stone-Romero, 1998). Second, the standing of individuals on various dimensions (for example, skills, abilities, educational attainment, licenses) may change over time. However, data in eHR-based archives may fail to

reflect such changes, and employees may not have the ability to update their records. Third, to the extent that eHR-based selection systems focus on limited types of data, they may not allow applicants to fully describe their job-related knowledge, skills (for example, interpersonal and team-related), and abilities. Fourth, such systems may be reductionist; that is, relatively complex information about job applicants (for example, their knowledge, skills, and abilities) may end up being represented by a simplistic, one- dimensional profile in a database (Cardy & Miller, 2003). Fifth, eHR-based selection systems may allow organizations to store data about job applicants and incumbents in large databases and disseminate it worldwide, even though the data subjects (for example, job applicants) may not be aware of such sharing or disapprove of it (Stone & Stone-Romero, 1998). This can be especially problematic when the information is inaccurate, leading to the stigmatization of data subjects (Stone & Stone, 1990; Stone, Stone-Romero, & Lukaszewski, 2003). Sixth, eHR-based selection systems may be perceived as invasive of privacy (Stone & Stone, 1990; Stone, Stone-Romero, & Lukaszewski, 2003). Not surprisingly, concerns about the widespread dissemination of information about data subjects prompted the European Union (EU) to enact privacy laws in 1998 that restrict the transmission of such information across national boundaries. Regrettably, there are no comparable laws in many other parts of the world (for example, the United States).

Disadvantages for Organizations

eHR-based selection systems may lead to a number of dysfunctional consequences for organizations. First, as noted earlier, they may provide an incomplete picture of the knowledge, skill, and ability levels of job applicants, resulting in increases in selection errors (that is, false positives and false negatives). For example, eHR-based selection systems may not provide information about the communication, interpersonal, or team- related skills of applicants. Second, if such systems allow applicants to complete various measures (for example, personality profiles, aptitude tests) online, there is no way of knowing whether they completed the measures on their own or were assisted by others.

Cultural Influences on Reactions to eHR-Based Selection

The available literature suggests that culture will influence individuals’ reactions to eHR-based selection systems. Representative differences in reactions are considered in the following subsections.

Achievement Orientation

The extant literature suggests that eHR-based selection systems will be more effective in achievement-oriented cultures than in ascription-oriented cultures. An important reason for this is that in achievement-oriented cultures, individuals are judged on the basis of such factors as their measured abilities and accomplishments, rather than their personal relationships with personnel decision makers. Research is needed to test this prediction.

Specificity Orientation

The acceptance and effectiveness of eHR-based selection systems may differ between cultures with a specific orientation and those with a diffuse orientation. The basis for this prediction is that, relative to individuals from cultures with a specific orientation, people from cultures with a diffuse orientation will (a) be more concerned with protecting their privacy in the selection process and (b) react more negatively to eHR-based selection systems that collect large amounts of personal data about job applicants (for example, through personality inventories and background checks). Although some research has been conducted in the United States on reactions to data collected for HR information systems (for example, Eddy, Stone, & Stone-Romero, 1999; Stone, Lukaszewski, & Stone-Romero, 2001) and applicant reactions to selection procedures (Stone-Romero, Stone, & Hyatt, 2003), we know of no research that has examined cross-cultural reactions to eHR-based selection systems. Thus, cross-cultural research is needed on reactions to eHR-based selection systems, including the extent to which they are viewed as invasive privacy.

Universalism Orientation

eHR-based selection systems are often highly standardized, basing selection decisions on specific types of data (for example, scores on tests, personality inventories). They assume that the same data are the most effective means of selecting individuals. However, this assumption may be incongruent with cultures that have a particularist (as opposed to a universalist) orientation (Trompenaars & Hampden-Turner, 1998). As noted above, individuals from particularist-oriented cultures are prone to attend to the obligations of personal relationships and the merits of unique circumstances (Trompenaars & Hampden-Turner, 1998). As a result, they may not believe that selection decisions should be based on standardized or objective data and may resent the use of such data. As a result, they may not be very accepting of eHR- based selection systems, reducing the overall effectiveness of such systems (Cober, Brown, Levy, Cober, & Keeping, 2003; Wiechmann & Ryan, 2003). In marked contrast, individuals from universalist-oriented cultures may believe that the effectiveness and fairness of selection systems is improved by the standardization of data and objectivity in decision making. Research is needed to validate these propositions.

Performance Management and eHR

In the interest of improving organizational efficiency and effectiveness, many Western organizations engage in such performance management activities as (a) setting performance standards; (b) appraising individual and work group performance; (c) giving employees and work groups performance feedback; (d) taking steps to improve individual and work group performance; and (e) ensuring that employees are prepared to fill job openings that may arise (Porter, Lawler, & Hackman, 1975). Performance feedback is especially important in organizations that base rewards on performance.

Functional Consequences of Using eHR for Performance Management

The use of eHR systems for performance management may result in several functional consequences. These are considered next in terms of employees and organizations.

Functional Consequences for Employees

eHR-based performance management activities may lead to several functional consequences for employees. First, they can provide employees with information about the types and levels of behaviors that are desired by an organization (that is, role expectations), enabling the employees to better meet these expectations of their roles. Second, such activities may enable employees to obtain feedback about their performance on a timely basis, enhancing their chances of performing in such a way as to obtain rewards controlled by the organization. For instance, eHR systems may facilitate the use of 360-degree feedback, providing employees with performance feedback from their supervisors, co-workers, subordinates, and customers (Geister, Scherm, & Hertl, in press).

Functional Consequences for Organizations

eHR-based performance management systems may contribute to the attainment of several objectives, including (a) obtaining information about employee performance on a timely basis; (b) assisting managers with the provision of performance feedback to individuals and work groups; and (c) assessing the accuracy and effectiveness of performance appraisal (Stone, Salas, & Isenhour, in press). One of the ways in which they can contribute to the achievement of these objectives is by the use of management self-service systems to track, analyze, and organize data about individual and work group performance (Gueutal, 2003; Schaeffer-Kuels, in press). To the degree that such systems provide managers with timely data about employee performance, they can be instrumental in allowing managers to provide frequent performance feedback to individuals and work groups. This feedback can be on various aspects of behavior, including production quantity and quality, turnover, attendance, tardiness, and disciplinary problems.

A number of unanticipated dysfunctional consequences may result from the use of eHR for selection purposes. These are considered next with respect to employees and organizations.

Dysfunctional Consequences for Employees

The use of eHR systems for performance management may result in several dysfunctional consequences. First, it may depersonalize the feedback process, increasing the psychological distance between managers and their subordinates (Stone, Stone-Romero, & Lukaszewski, 2003). Second, it may decrease the level of social support experienced by employees. In accordance with this argument, research on the

social impact of the Internet (for example, Kraut & Kiesler, 2003; Kraut, Kiesler, Boneva, Cummings, Helgeson, & Crawford, 2002) has shown that (a) online communication is viewed as less beneficial than face-to-face communication because it is less interactive and conveyed less contextual information and (b) relationships developed or maintained online are slower to develop and weaker than those developed by more traditional means. In addition, research by Ambrose, Adler, and Noel (1998) suggests that individuals may react negatively to electronic performance monitoring when there is no explicit justification for it. Overall, the use of eHR systems for monitoring individual performance may undermine relationships between managers and their subordinates, resulting in lesser trust and social support than traditional HR performance management systems (Hertel & Konradt, in press). Third, employees will view eHR systems negatively to the degree that they fail to consider all aspects of performance. Fourth, and finally, such systems may be viewed as invasive of privacy and employees may attempt to subvert them (Stone & Stone, 1990; Stone & Stone-Romero, 1998; Stone, Stone-Romero, & Lukaszewski, 2003).

Disadvantages for Organizations

eHR-based performance management systems may result in several dysfunctional consequences for organizations. First, managers may experience information overload problems as a result of the large amounts of data produced by them. Second, such systems may fail to provide information on such aspects of performance as interpersonal behavior and organizational citizenship behavior (Cardy & Miller, 2003). As a result, performance management activities may focus on only a subset of important criteria. Third, and finally, eHR systems may shift work that was previously performed by the HR department to line managers. Gutek (1995) calls this the “coproduction” problem and recommends that organizations avoid it.

Cultural Influences on Reactions to eHR-Based Performance Management

In view of the fact that many eHR-based performance management systems standardize the performance management process, base evaluations primarily on objective data, and depersonalize the feedback process, it seems likely that cultural orientations will influence reactions to them. Several moderating effects of culture are considered below.

Achievement Orientation

eHR-based performance management systems may be more effective in cultures that are achievement-oriented as opposed to ascription-oriented. One reason for this is that such systems often encourage decision making based on an individual’s actual accomplishments. Such accomplishments are valued over ascription-based inferences about individuals.

Individualism Orientation

It would appear that eHR-based performance management systems will be more accepted and effective in cultures that value individualism than in those that stress collectivism. This is predicated on the assumption that individualists will view such systems positively because they offer the potential of establishing clear connections between performance data and valued outcomes.

Long-Term Orientation

It seems safe to predict that eHR-based performance management systems will be accepted more readily by individuals from cultures with a long-term orientation than in cultures with a short-term orientation. One reason for this is that people with a long-term orientation will value the efficiency associated with such systems and their potential to produce good outcomes in the long run.

Masculinity Orientation

eHR-based performance management systems will be better accepted in cultures that value masculinity than in cultures that stress femininity. This prediction rests on the assumption that individuals in masculine cultures will view organizational “intrusions” more favorably than will individuals in feminine cultures.

Power Inequality Orientation

Individuals from cultures that accept high levels of power inequality will be more accepting of eHR-based performance management systems than will individuals from cultures that have the opposite orientation. One reason for this is that individuals who are tolerant of power inequality will regard organizations as having the right to use such systems for controlling employee behavior.

Predictability Orientation

It seems that eHR-based performance management systems will be better tolerated in cultures that value high levels of predictability than in those that have considerable tolerance for uncertainty. The basis for this prediction is that the objectivity of such systems tends to eliminate rater-specific, idiosyncratic variability in performance evaluations (and the personnel actions that are based on them) that is common when performance evaluations stem from human judgments.

Specificity Orientation

Research shows that individuals from cultures with a diffuse orientation are more prone to guard their privacy than are people from cultures with a specific orientation. Thus, compared to individuals from cultures with a specific orientation, people from cultures with a diffuse orientation will be more likely to believe that eHR-based

performance management systems are invasive of privacy, especially when performance data come from multiple sources. Research is needed on this issue.

Universalism Orientation

In view of the way in which most eHR-based performance management systems are designed, it seems that they will be more accepted in cultures that have a universalist orientation than in cultures with a particularistic orientation. One reason for this is that most such systems treat all data subjects (for example, employees) in a standardized manner, as opposed to being concerned with relationships and allowing for exceptions to rules. Thus, eHR-_based performance management systems will be more effective in universalist-oriented cultures (that emphasize standardized policies and practices) than in particularist-oriented cultures.

Implications for Practice and Research

This section examines the implications of the material considered above for HR practice. In addition, it deals with some research-related issues.

Practice Issues

As a result of the proliferation of eHR-based systems, the role of HR professionals in many organizations is changing dramatically. More specifically, with eHR systems, HR professionals are increasingly faced with the need to develop and implement HR strategies, as opposed to performing relatively narrow HR tasks (such as administering employee benefit programs).

The overall effectiveness of HR professionals hinges on their ability to recruit, select, hire, and retain employees who have high levels of (a) motivation to perform and (b) job-related knowledge, skills, and abilities. To the degree that they are accepted by job seekers and job incumbents, eHR systems can lead to a number of functional consequences, including assisting HR professionals with the just-noted functions. Nevertheless, HR professionals must be aware of the potential dysfunctions stemming from the use of eHR systems. For example, the use of such systems will prove especially problematic in countries where the “digital divide” precludes large numbers of individuals from accessing and using them. In view of the fact that all individuals may not have access to eHR systems, for the next decade at least, it would appear prudent for most organizations to maintain a traditional HR system in parallel with an eHR system.

The effects of culture on the acceptance and effectiveness of eHR systems is an extremely important issue. In view of this, HR professionals must anticipate how the values of job seekers and/or job incumbents are likely to affect their reactions to such systems and take steps to mitigate unwanted outcomes. Thus, for example, in cultures

with a particularist orientation, it may be prudent to limit eHR-based recruitment to the online submission of employment applications and the verification of information, with applicant screening handled by means that are culturally appropriate. In contrast, in cultures that have a universalistic orientation, HR professionals may use eHR systems for most recruitment and selection activities (for example, online applications, application screening).

A final practice-related issue concerns privacy. HR professionals must be sensitive to the way that eHR systems are likely to affect individuals’ views about invasion of privacy and the effect that culture is likely to have on such views. Sensitivity to privacy issues is especially important in organizations that have international operations or operate in areas where employees come from a variety of cultures.

Research Issues

As noted above, there is very little research on factors that determine the acceptance and effectiveness of eHR systems. Thus, at present, there is not a firm foundation for many practice-related recommendations. In order to provide such a foundation, research must consider the degree to which eHR systems (a) are acceptable to job seekers and job incumbents; (b) lead to increased levels of individual, group, and organizational effectiveness; and (c) can be implemented successfully in cross-cultural contexts.

Conclusion

Clearly, eHR systems may produce both functional and dysfunctional consequences for individuals and organizations. In view of the rate at which such systems are being implemented in organizations, increased attention must be devoted to determining the outcomes stemming from their use. It is especially important to assess how culture affects various outcomes. eHR systems must meet the needs of both individuals and organizations. As such, HR practitioners and researchers can play a crucial role in determining whether eHR systems prove to be a blessing or a curse.

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