Denouements and Prospects of Digitization of Human Capital Management Practices in Small and Medium Enterprises : An Evidence Based Analysis

There are nearly 4.68 Crore working Micro, Small and Medium Enterprises (MSMEs) in India which are producing around 6000 varieties of products and have generated employment to 10.62 Crore people They contribute nearly 8% to GDP and 45% to manufacturing output and 40% to Indian exports (MSME Annual Report, 2012). Automotive component Industry which constitutes significant part of MSME sector in India has registered a Compound Annual Growth Rate of 18% (2009-13) with an annual turnover of USD 39.7 billion in 2013. It has a potential of USD 115 billion by 2020-21 (ACMA Annual Report, 2013). The Auto component industry, which is an integral part of the automotive sector, comprises about 500 firms in the organized sector and more than 10,000 firms in the unorganized sector and it has been one of the fastest growing segments of Indian manufacturing. It has provided direct and indirect employment to about 1.31 crore people in the country and contributes nearly 4% to GDP and 5% to industrial production. As the size of employees is growing in automotive component firms due to robust growth rate in the industry, it has become imperative for automotive firms to digitize their HCM operations so as to streamline all their operations and processes pertaining to Human Capital Management (HCM). This study attempts to evaluate the effectiveness of digitization of HCM practices in Micro, Small and Medium Enterprises (MSME) sector with particular emphasis on Automotive Component firms through assessment of the impact of digitization on core factors like-, simplification of HCM processes, decision making, Cost, standardization, process consistency, ease of accessibility, quality, time and others. Through an exploratory analysis an endeavor was made to identify the denouements and benefits derived due to automation of HCM operations and processes