Design of Human Resources Management and Payroll Information

Systems with a Self-service Approach at Recreation Services

Company

Dwia Pungky Arumdani

and Tb. M. Yusuf Khudri

Faculty of Economics and Business, Universitas Indonesia, Jakarta-Indonesia

Keywords: Accounting Information System, HRD Management, Payroll, Self-Services, Cloud, On-Premis, FAST

Abstract: The database that is not yet integrated makes the payroll process at PT X often hampered because data

collection is late in entering HR payroll. Supporting data related to the payroll process at PT X are still in

the form of excel and hardcopy. The purpose of this study is to design human resource management and

payroll with a self-service approach at PT X. Human resources management and payroll information

systems with a self-service approach are expected to produce information supporting the payroll process

that facilitates the payroll system in collecting and processing payroll data. The self-service approach is

intended to make employees as entities that play an active role in information systems for managing human

resources and payroll so they can manage their data in real time. The study was conducted qualitative

research method with in-depth interviews, observations, and literatures studies. In this study, the type of

data used is primary data. The method used to design human resources management and payroll information

systems is the initial six phase of Framework for the Application of System Thinking method. This research

will also explain about comparison total cost of ownership between implementations using cloud based

compared to on-premise. The results of this study are expected to provide a design of information systems

for human resource management and payroll with a self-service approach that can be used by company to

minimize the risks that might occur in the payroll process and make the process effective and efficient.

1 INTRODUCTION

One of the business processes in the company is the

human resource cycle and payroll which consists of

several business processes, such as the process of

recruiting, training, paying, evaluating, promoting,

and laying off employees from the company

(Romney and Steinbart, 2018). Human resource

information systems make it easier to store and

analyze human resource information, with a self-

service system enabling employees to access

frequently accessed information, such as personal

data, salary, benefits, training, and deductions easily

(Decenzo et al, 2016). Rahimzai & Teruhiko (2018),

in their research applied a web-based Employee

Self-Service module that allows employees, together

with professionals in the human resources

department to manage employee databases.

Generally, digitizing HRIS has produced a well-

integrated HR database and built in a coordinated

way using software database management

techniques (Tomanna et al., 2018).

Currently supporting data is related to the payroll

process, such as employee data information,

employee attendance data, and other supporting data

(overtime, leave, other benefits, incentives,

employee deductions, etc.) PT X is still in excel and

hardcopy, so HR payroll must reprocess the

information and data in accordance with the format

provided by the Apisoft application (HR payroll

system). The HR Payroll and Compensation Benefit

Supervisor (2018) said that often the process was

hampered because of late data collection into the HR

payroll, the database that has not been integrated

causes the process to be longer because it has to

match the data.

1190

Arumdani, D. and Khudri, T.

Design of Human Resources Management and Payroll Information Systems with a Self-service Approach at Recreation Services Company.

DOI: 10.5220/0009509011901196

In Proceedings of the 1st Unimed International Conference on Economics Education and Social Science (UNICEES 2018), pages 1190-1196

ISBN: 978-989-758-432-9

According to Sirkemaa (2015), information

technology infrastructure may be seen as a basic

technology platform for other systems used in

various business activities and processes. This study

designed an information system for human resource

management and payroll with a self-service

approach at PT X. The analysis of total cost of

ownership was done to determine which

infrastructure is better in implementing information

systems for human resource management and

payroll with a self-service approach at PT. X.

2 THEORICAL FRAMEWORK

This study only focuses on the cycle of human

resources or payroll cycle, as explained in the

previous chapter. According to Romney and

Steinbart (2018), states that human resource

management activities are limited to information

about hiring, transfer, training, and gathering

information about the use of working time that

occurs every day.

Payroll cycle activities are based on Romney and

Steinbart (2018), there are five input sources to the

payroll system, namely HRM Department,

Employees, Various Deputies, Banks, Government

Agencies, and Other Companies.

System modeling includes process modeling and

data modeling of the data Flow Diagrams (DFD)

which are translated into Context Diagrams,

Functional Decomposition Diagrams (FDD), Entity

Relationship Diagrams (ERD), and user interface.

The total cost of ownership (TCO) was

developed by Bill Kirwin, director at the Gartner

group (Gartner Inc.) in 1987, an information

technology research company and United States

advisory firm based in Stamford. All costs

associated with the use of computer hardware and

software include administrative fees, licensing fees,

distribution and configuration, hardware and

software updates, training and development,

maintenance, technical support, and all other costs

associated with obtaining, implementing, operation,

maintenance and improvement of computer systems

in organizations. Using the TCO approach, total

costs can be calculated from sum of Up-front costs

with Operational costs (Mtebe and Raisamo, 2014).

According to the National Institute of Standards

and Technology (NIST) quoted from Erl et al.

(2013), "Cloud computing is a model for enabling

networks that are ubiquitous, convenient, and on

demand access to a collection of shared computing

resources that are easily managed (such as networks,

servers, storage, applications, and services) that can

be quickly available and released with the minimum

effort of management or service provider interaction.

Whereas the on-premise definition is a type of

software delivery model that is installed and

operated from in-house servers and customer

computing infrastructure. It uses the organization's

original computing resources and only requires a

copy of the software licensed or purchased from an

independent software vendor (Erl et al., 2013).

3 RESEARCH METHOD

This study used a qualitative research methodology

with case studies to analyze access and inclusion in

organizational services (Yin, 2014). Case studies are

used in order to answer the questions that

researchers ask related to the ineffectiveness of the

payroll process at PT X.

The data source used in this study is primary

data. Primary data is a direct source of data

(Sugiyono, 2015). According to Sunyoto (2013),

primary data is original data collected by researchers

to answer their research problems specifically. The

data used in this study was collecting by obtained

directly from field observation activities, interviews

with informants, and related parties who directly

manage payroll data, including the HR department

head, HR payroll and compensation benefit

supervisor, and HR administration staff.

All data obtained will be analyzed using system

development methods, namely the FAST

(Framework for the Application of Systems

Technique) method. FAST consists of 8 stages,

namely scope definition, problem analysis,

requirement analysis, logical design, decision

analysis, physical design and integration,

construction and testing, and installation and

delivery (Whitten and Bentley, 2007). The section

focused on this research is only the initial 6 phases.

In the decision analysis phase, a comparison analysis

of on-premise cloud is carried out using the Total

Cost of Ownership method.

4 ANALYSIS AND DESIGN OF

INFORMATION SYSTEM

4.1 Scope Definition

The payroll system is part of the human resource

management system. Activities carried out from the

payroll system are processes of data from the

Design of Human Resources Management and Payroll Information Systems with a Self-service Approach at Recreation Services Company

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management of human resources. The input source

of the payroll process is data that comes from many

actors. Based on the results of interviews,

documentation and observations of the author, the

following analysis of the scope of the problems that

occur in the human resource management system

and payroll PT X using the PIECES framework.

 Performance

Data collection is late in entering HR Payroll, so

it requires integration of payroll systems with

human resource management systems so as to

speed up the salary calculation process.

 Information

There are some data that are not filled, tucked,

and not inputted, so data input is needed

automatically through a website-based system

with verification notifications via e-mail.

 Economics

Storage of information supporting data on the

payroll process that still uses hardcopy meets the

storage filling cabinet, so that it is necessary to

store information on supporting data for the

payroll process in an online database.

 Control or Security

The HR payroll section is often overtime at the

payroll period because the database is not yet

integrated so it needs to be re-validated to avoid

human error, so that the employee self-service

approach allows employees to do all matters

relating to human resource management online.

 Efficiency

Management of the payroll process supporting

data cannot be managed by each employee at any

time, so a system is needed for employees to do

all matters relating to human resource

management online without the need for

departmental admin assistance.

 Services

Providing employee salaries often experiences

delays because the supporting data for the salary

calculation process are still done manually, so

that an information system for human resource

management and payroll is needed that is able to

provide the payroll process supporting data

quickly and accurately.

4.2 Problem Analysis

Based on the scope of the problems identified in the

previous phase, an analysis of the problems,

impacts, and problem solving related to the

information system of human resource management

and payroll is done manually as follows:

 The problem with the number of manual

support forms for payroll processes that have an

impact on the payroll process supporting data

becomes incomplete and takes time in

recording, required payroll process support

forms are made with electronic forms (e-Form),

and approval processes are also conducted

through the system information on management

of human resources and payroll whose

notifications will be directly connected to e-

mail.

 Long time process problems in managing

human resource data have an impact on the

payroll process supporting data to be inaccurate

or invalid, it is necessary to manage human

resource data by employees by storing data

online and can be accessed at any time.

 Problems with data collection that is late in

entering HR Payroll have an impact on the

payroll process for a long time and the HR

payroll section must overtime in the payroll

period, required integration of supporting data

for the payroll process with the payroll system.

4.3 Requirement Analysis

The proposed system of human resource

management and payroll is expected to be able to

meet several needs as follows:

 Record employee data in real time and easy to

access with the Internet network.

 Facilitate electronic forms (e-forms) of

supporting data on payroll processes such as

leave forms, late or sick permission, loans,

compliment, outside service, overtime, and

evaluation with notifications connected via e-

mail.

 Provide a smart reminder when an employee

will expire.

 Integrated with attendance machines, so

attendance data can be processed directly in the

human resource management system and

payroll.

 Make payroll reports for each period to be given

to finance and accounting.

 Send pay-slip to employee e-mails every period.

4.4 Logical Design

The design process displays functional

decomposition diagrams, context diagrams, data

flow diagrams, data dictionaries, process

specifications, and modeling databases on

UNICEES 2018 - Unimed International Conference on Economics Education and Social Science

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information systems for managing human resources

and payroll.

Functional decomposition diagrams in

information systems management of human

resources and payroll are divided into four

subsystems at the first level, twenty subsystems at

level two, and eight subsystems at level 3, as shown

in Figure 1.

Figure 1: Functional Decomposition Diagram

Data Flow Diagrams are used to find out the

relationships between entities in information systems

management of human resources and payroll. Data

flow diagram level 1, used to describe the flow of

data and documents that in and out the system. The

HR management system and payroll have 4

subsystems, consists of employee data management

subsystem, management of payroll supporting data,

calculation of net salary, and payroll reporting. Data

flow diagram level 1 as shown in Figure 2.

Figure 2: Context Data Flow Diagram

4.5 Decision Analysis

This phase helps management in making decisions

in implementing systems for managing human

resources and payroll, what technology is useful and

can be applied to the management system of human

resources and payroll. In this case, there are two

solutions offered in the implementation of system

infrastructure, namely Cloud based and On-premise.

Analysis of the total costs needed to determine the

system infrastructure using the Total Cost of

Ownership (TCO) approach. This TCO approach

divides costs into two categories, namely up-front

costs and operational costs.

So that,

Total cost = Up-front cost + Operational cost

Up-front costs are costs incurred by companies

in building information systems before the system

can be used, in the up-front cost infrastructure is the

cost of server devices, devices that support server

devices such as UPS (Uninterrupted Power Supply),

NIC (Network Interface Card), Switches and cables

are needed in connecting server and network device.

While operational costs are costs incurred by the

company after the system can be used, such as

maintenance and development costs, hosting, and

data center maintenance costs.

This research in comparing TCO Cloud based

and On-premise makes several assumptions to be

able to compare resources even though with

different infrastructure models. Here are some

assumptions:

 Analysis of TCO based on 36 months (3 years),

this is based on the life cycle standards of

computer infrastructure.

 Costs are estimated to be based on prices in

Indonesia.

 System for managing human resources and

payroll for in-house

 Cloud service prices are estimated monthly.

 Minimum specifications for the HR

management system server and payroll used in

this research are based on the following

specifications::

1. Processor: Intel Xeon Quad Core

2. Server Memory (RAM): 8GB, maksimum

64GB

3. Hard disk: minimum 500MB

PT X already has a server device and the following

data center which is sufficient for HR management

systems and payroll, namely Lenovo ThinkServer

Design of Human Resources Management and Payroll Information Systems with a Self-service Approach at Recreation Services Company

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TS150. The TCO estimation on the implementation

of infrastructure on an On-premise basis at PT X

does not have an up-front cost. While Operational

costs will be described as follows:

 Maintenance and development costs: these costs

are calculated based on the salary of the

technical staff at PT X. Minimum PT X requires

one technical staff to manage and maintain the

system. The scale of salary for computer science

graduates in Indonesia is estimated at Rp.

6,000,000 per month. So for one staff within a

period of 3 years, PT X will be charged a fee of

Rp. 216,000,000.

 Hosting costs: PT X already has a corporate

domain that can be used for HR management

systems and payroll.

 Data center maintenance costs: To be simple,

the electricity costs consumed by AC, computer

hardware is estimated by PT X to be Rp.

1,000,000 per month. Thus, PT X will be

charged a fee of Rp. 36,000,000 in 3 years.

Table 1: Summary of the estimated infrastructure

costs of On-Premise

Cost Item Monthly

Cost

Total

Up-front cos

ill

Operational cos

Maintenance

and

development

costs

Rp.

6.000.000

Rp.

216.000.000

Hostin

costs

ill

Data center

maintenance

costs

Rp.

1.000.000

Rp.

36.000.000

Total Rp.

252.000.000

TCO analysis for Cloud based is based on cloud

infrastructure services in Indonesia. Cloud based

infrastructure is not subject to up-front fees because

all services are already in a virtual machine, so what

is calculated in the following explanation is

operational cost. In this thesis, the infrastructure

cloud services used are:

1. Datacomm

The specifications used are in accordance with

the assumptions previously explained, by using 1

vCPU, 8GB memory, 500GB storage, and the

OS used is Windows a monthly fee of Rp.

3,599,999. So for a period of 3 years PT X is

charged a fee of Rp. 129,599,964.

2. Zettagrid

The specifications used are in accordance with

the assumptions described before, using 3.2 Ghz

CPU, 8GB memory, 500GB storage, and the OS

used is Windows Server 2008 R2 Web, and a

500GB network monthly fee of Rp. 3,330,000.

So for a period of 3 years PT X is charged a fee

of Rp. 119,880,000.

Based on the above analysis of two companies

offering cloud infrastructure services. Zettagrid

cloud service is cheaper than Datacomm. So, in this

research we will use the lowest price of the Zettagrid

infrastructure cloud service for comparison with On-

premise. Table 2 show the comparison of TCO

Cloud based with On-premise.

Table 2: Comparison of TCO Cloud based with On-

premise

Cost Item On-premis Cloud based

Up-front

cos

Nill Nill

Operational cos

Maintenance

and

development

costs

Rp.

216.000.000

Nill

Hosting

costs

Nill Rp.

119.880.000

Data center

maintenance

costs

Rp.

36.000.000

Nill

Total Rp.

252.000.000

Rp.

119.880.000

Based on the comparison above, if PT X uses

cloud infrastructure services then the profit

difference obtained is Rp. 132,120,000. However,

PT X must also consider the advantages and

disadvantages of each of these services. Like cloud

infrastructure services, the technology used does not

provide access to full control of the company. So, if

a problem occurs, it will refer to the agreed SLA.

On-premise infrastructure gives the company

complete access to control.

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4.6 Physical Design

Physical Data Flow Diagrams are used to determine

the relationship between the implementation of

entities in information systems management of

human resources and payroll. There are four parts to

the physical data flow diagram, namely the physical

process implementations, physical data flows,

physical external agents, and physical data stores.

Information systems for managing human resources

and payroll use JavaScript as a physical process, and

MySQL as physical data storage. Overall the

implementation relationship between entities can be

seen on the physical data flow diagram in Figure 3.

Figure 3: Physical Data Flow Diagram

Physical entity relationship diagrams are used to

determine the data types used in the system database

model. The system for managing human resources

and payroll uses a MySQL database, so the data

types used include Integer, Char, Varchar, Text, and

DateTime. The physical entity relationship diagram

of the HR management system and payroll can be

seen in Figure 4.

Figure 4: Physical Entity Relationship Diagram

The architecture of the HR management system

and payroll is used to see the flow of services being

passed until it is stored in the database. The

supervisor of self service employees makes the

service online, so that it can be accessed in real time.

Thus, the HR management system and payroll are

made based on websites that can be accessed via

browser devices on desktop or mobile.

5 CONCLUSION

After carried out all stages of this study, several

conclusions can be conveyed by the researcher are:

1) providing a system of supervision and

convenience for employees and company

management in managing employee data quickly; 2)

provide control of frauds that can occur in the

management of payroll supporting data; 3) reduce

the risk of input errors or non-current data; 4) The

payroll process can be done on time because all

payroll supporting data has been integrated; 5)

Cloud based infrastructure services have lower TCO

when compared to On-premise.

Several suggestions can be conveyed are: 1)

Research carried out is still at six initial phases of

system development, it is expected that further

research reaches the implementation and

maintenance phase; 2) Companies can integrate e-

learning systems that help employees get knowledge

easily; and 3) The management system of human

resources and payroll is expected to be developed

into a mobile application, so there is no need to open

it through a browser.

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