2023

Noponen, Niilo; Auvinen, Tommi; Viklund, Pia; Leppäniemi, Matti; Tiainen, Jarno

Digitalisation has reached a significant role among the literature on human resource management (HRM) ever since the turn of last millennium. During the last decade advanced digital technology systems have been enthusiastically fitted into HRM functions, even as a possible replacement. Especially consultant literature paints an overtly positive picture of advanced artificial intelligence HRM systems that deliver cost savings, efficiency, and real-time information. Scientific sources often raise more problematic issues and even threats related to human factors as well as to the core of business operations. Also, the actual strategic integration to increase competitiveness may not be more than a sales pitch, for example in workplace training and competence development. In addition, the majority of studies and their research data, business environment, and action recommendations focus on large international corporations. This qualitative study approaches the topic from a less researched point of view and examines digitalisation of human resource management and its state of affairs, challenges and near future goals among small and medium sized enterprises (SME) in Central Finland. The empirical data consist of 25 interviews of managers responsible for HRM tasks among different industries. In our study we found that in each target organisation digital systems are used to some degree in HRM tasks, such as payroll and time tracking. In practice, however, the reality of daily work is far from the image of fully automated HRM processes painted by consultant literature. The challenges of digital HRM are related to lack of time, information, and know-how. The near future goals include more effective and comprehensive use of digital systems but also improving in overall HRM and workplace wellbeing. Indeed, one can claim that even with the associated challenges, the development stage of HRM’s digitalisation is ahead of the development of overall HRM. Human resource management is at the core of SME business and the strategic role of HRM must be understood, in order to reach digital systems’ greater advantages.