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Human Resources or Information Technology: What is More Important for Companies in the Digital Era?

Author

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  • Turulja Lejla

    (School of Economics and Business, University of Sarajevo, Bosnia and Herzegovina)

  • Bajgorić Nijaz

    (School of Economics and Business, University of Sarajevo, Bosnia and Herzegovina)

Abstract

Background: Companies can improve their business performance, increase revenues and reduce costs by enhancing their information technology (IT) capability. On the other side, there is an increasing importance of human resource management (HRM) practices related to IT utilization, which are important for the business performance of a company in the rapidly changing knowledge-based economy.Objectives: The objective of this paper is to analyze the relations among IT capability, HRM capability and the firm’s performance outcomes.Methods/Approach: The paper uses survey data and Structural Equation Modeling to analyze the relationships among IT capability, HRM capability and firms’ performance.Results: This paper reveals that IT capability to some extent determines firms’ business performance but it plays more important role in enhancing HRM capability. In addition, HRM capability significantly impacts business performance.Conclusions: The findings indicate that managers should not focus on allocating resources only for IT investments. In order to achieve better business performances, these technologies need to be used to support all business processes including HRM activities.

Suggested Citation

  • Turulja Lejla & Bajgorić Nijaz, 2016. "Human Resources or Information Technology: What is More Important for Companies in the Digital Era?," Business Systems Research, Sciendo, vol. 7(1), pages 35-45, March.
    • Handle: RePEc:bit:bsrysr:v:7:y:2016:i:1:p:35-45
    DOI: 10.1515/bsrj-2016-0003
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    References listed on IDEAS

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    Cited by:

    1. MIHU Cantemir & BOGOSLOV Ioana Andreea & LUNGU Anca Elena, 2021. "The Impact Of Digital Transformation On Business Management," Revista Economica, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 73(4), pages 41-64, December.

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    More about this item

    Keywords

    information technology capability; human resource management capability; business performance; dynamic capability view;
    All these keywords.

    JEL classification:

    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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