The effect of human resource information systems on the merger of a selected financial institution in the Western Cape

Abstract

Information systems and processes, particularly the Human Resource Information System, are difficult to implement and maintain during mergers and acquisitions. The changing nature of business establishes a postulation that the Human Resource Information System is not a traditional cost-driven partner, but a strategic partner. Human Resource technologies such as the Human Resource Information System are used to collect, store and report workforce data and are often described as a solution to Human Resource related problems. This study aimed to answer the following questions: i) RQ1: What are the reasons for ineffective Human Resource Information System implementation in organisations during mergers and acquisitions? ii) RQ2: How can the Human Resource Information System be utilised to achieve organisational success during merger and acquisition? The aim of the study was to explore the reasons for Human Resource Information System integration failure before and after merger and acquisitions. The study was inductive. Data were collected through interviews. An interview guide with semi-structured interview questions was used. Non-random, conveniently selected participants in the Human Resource (10) and Information Technology (5) department at senior, middle and lower-level positions who utilised the Human Resource Information System on a regular basis were interviewed. The data were analysed using summarising, categorising and thematic analysis. The contribution of the study is proposed guidelines for insurance organisations to assist with the integration and maintenance of the Human Resource Information System during and after mergers and acquisitions for the newly-formed organisation to gain the benefits of using the system. The research found that where integration fails, a large proportion of this failure is due to the lack of integration. In addition to the integration challenges, the study identified many factors that need to be considered when successfully integrating an Human Resource Information System during a merger and acquisition, with business process management, change management, communication, culture, human resources, information management, product development and business-IT alignment being the main factors. The study adhered to strong ethics to ensure that the integrity and moral principles were followed throughout as required by Cape Peninsula University of Technology. Consent was obtained in writing from the companies as well as the research participants.