Digitalization of HR Processes in SMEs Based on the Employee Lifecycle Model

Abstract

The study explores the digitalization of human resource (HR) processes in small and medium-sized enterprises (SMEs) through the lens of the Employee Lifecycle model. The aim of the research is to assess the potential for integrating digital tools across different stages of employee management and to identify practical mechanisms that enhance organizational efficiency under resource constraints. The methodological framework combines a theoretical review of the Employee Lifecycle concept and digital HR transformation with a qualitative case study of a small enterprise operating in the Republic of Moldova. The analysis demonstrates that digital tools, such as online recruitment platforms, cloud-based documentation, task management systems, and ERP solutions, can significantly improve the efficiency, transparency, and coordination of HR processes in SMEs. At the same time, the findings reveal an uneven level of digitalization across lifecycle stages: while performance management and operational coordination are relatively well digitalized, earlier stages such as recruitment, onboarding, and employee development remain less formalized. The study highlights the dual nature of digitalization, emphasizing both its benefits such as reduced transaction costs, improved data-driven decision-making, and increased flexibility, and associated risks, including data security concerns, over-reliance on digital tools, and potential decline in interpersonal interaction. The results suggest that the effectiveness of digital HR in SMEs depends not on the number of technologies adopted, but on their integration into a coherent management system aligned with the Employee Lifecycle model. UDC: [005.96:004.78]:334.72.012.63/.64(478); JEL: M12, O33, L26