HRA and HRIS: Complementary Roles in Strategic HRM

Introduction

Human resource management (HRM) refers to the tasks and activities that maximize employee performance within an organization. Over the past few years, HRM has become increasingly dynamic as organizational leaders constantly seek to improve quality, productivity, and effectiveness. New models for promoting the value and effectiveness of HRM have been developed and adopted across organizations. The evolution of HRM is fueled by rapid technological advancements and increased globalization (Aljamaan, 2017). Human Resource Information Systems (HRIS) represent one such model that has emerged in HRM. HRM also entails the management of accounting information, which is used extensively in organizational strategic decision-making.

Rapid technological advancements have contributed to the emergence of new models and approaches to human resource management. Human resource professionals are increasingly seeking measures to enhance the effectiveness of their processes and activities. These efforts have contributed to the development of new models including Human Resource Accounting (HRA) and Human Resource Information Systems (HRIS). The development of these models has been influenced by organizational leaders' growing awareness of the kinds of technology that can enhance organizational effectiveness. HRA and HRIS have become critical components of modern HRM initiatives, as both play a vital role in strategic decision-making processes.

HRIS is a term used to refer to integrated systems that collect, store, and analyze information about an organization's human resources (Gupta, 2013). The concept of HRIS was first introduced over five decades ago and has evolved well beyond its initial purpose of converting paper records into computerized databases. Contemporary HRIS tools enable HR professionals to carry out a variety of daily activities. Through these tools, organizations implement sophisticated computerized systems to ensure their records remain accurate and current. HRIS tools are considered critical in today's HRM as they enhance efficiency in HR decision-making.

According to Al-Hattami and Kabra, human resource accounting is one of the sub-systems within the accounting information system used in HRM (Al-Hattami & Kabra, 2018). Human resource accounting provides both financial and non-financial information regarding human resources. It achieves this by gathering data about an organization's human resources from a variety of sources and examining that data according to established accounting rules. The results of this process are then provided to all interested parties in order to promote the realization of desired goals and objectives. Therefore, HRA plays a critical role in understanding the accounting dimension of strategies and activities adopted in HRM.

While HRIS and human resource accounting have both become critical components of HRM, there is limited research on the link between these two concepts. There is also an erroneous assumption that human resource accounting primarily focuses on financial information alone, which negates the important role non-financial information plays in HRA processes and systems. This limited understanding has contributed to a lack of appreciation for the role accounting information plays in human resource information systems and human resource management more broadly.

The purpose of this study is to explore the complementary link between human resource accounting and human resource information systems. The study seeks to demonstrate how these two concepts are inter-related and how they jointly support HRM processes. This study is important to the field of HRM as it provides insights on the relationship between financial and non-financial information in HR practices. By exploring the relationship between HRA and HRIS, the study demonstrates how both types of information are critical in HRM and should be incorporated in a complementary manner. The study also addresses the existing gap in the literature regarding this complementary link, and highlights the need for HR professionals to design accounting information systems as an integrated part of HRIS tools for better decision-making.

This study seeks to achieve the following objectives:

1. To provide insights regarding human resource information systems.

2. To provide insights regarding human resource accounting.

3. To analyze the comparative relationship between human resource accounting and human resource information systems.

4. To clarify the significance of financial and accounting information in human resource information systems.