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Critically Discuss Two Key Environmental Forces Essay Sample

Critically Discuss Two Key Environmental Forces Pages
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(1.0). Introduction

Organizations are managed and staffed by human. With out people organizations cannot exist. Among all other resources inside the organization the ‘Human Resource’ falls in to the most dynamic category as well to the most vital category.

So, Human Resource Management has become one of the most discussed approaches to the practice and analysis of the employment relationship in world market economies. Whether the perspective is supportive or critical, the idea that a reformulated relationship between management and employees is occurring has taken hold to a considerable degree. There’s no doubt that the world as we know it is rapidly changing. As part of an organization then, HRM must be prepared to deal with the effects of the changing world of work. The manner in which organizations conduct their HR activities will help create and sustain a competitive advantage. The contemporary trends and challenges in the business environment necessitate that even greater attention be given to the human resources of an organization.

This essay will mainly adopt main two key variables in the environment such as, advancements in Technology and the Competition and will examine what impact those changes will have on the HR function in organizations & provide implications to HR managers to respond in an effective manner.

(2.0). Key Environmental Forces

Today’s business environment is changing day by day. So, the environment where we have to do business is very uncertain. Nothing is permanent, and the cause of yesterday’s success may be the cause of tomorrow’s failure.

Because of this, the HR management’s strategic emphasis requires a focus on the key environmental variables. The latest technology, the trends and cultural changes which arising out of the globalization, the competition etc…

The changes the business environment has major consequences for people managers. It means the factor changing outside of the organization’s control have a greater affect the requirements for human resources and the way they are managed.

(3.0) Technology

We refer to any equipment, tools or operating methods that are designed to make work more efficient as technology.

As the pace of technological change has quickened, so firms have had to rethink their technology investment strategies and their human resource management practices to face these changers in an affective manner.

(3.1) How Technology affect on HR?

“The rate of technological change is now greater than it has ever been. No employee or organization can escape its whirlwind impact.” (Stone, 2002, p.330)

“More organizations are now evaluating their human resources and labour costs in the context of available technologies, based on the theory that products and services can be delivered more effectively & efficiently through an optimal combination of people, software and equipment. Today, with the assistance of HR, more companies are evaluating the role of organizational structure, technology, and human resources with the goal of providing more and higher quality products and services to the customer at a lower price.” (Bernardin, 2003, P.9)

Modern world organizations require more brain power or mental work rather than the physical power. This begins with the advancements of the technology. After the computer invented to the organizations all the internal procedures was changed. Not only had the computers, multi purpose machineries also contributed to this vast revolution with in the organizations.

With this vast revolution in the technology crates a demand for a different labour market. The skills and the knowledge need by the employees for the sustainability of the organization among the other competitors will be different. Mostly employees need the latest skills, knowledge and the ability to move with this rapidly changing technological environment.

The major problem that the companies facing with these technological advancements are with the employees who find it’s difficult to adopt. The technology needs expert users. Sometimes the reason may be the age of the employees, because some matures aged people find it hard to capture new things and compete with the youngsters in the same level. That may create a problem when maintaining the competitive edge with the technological changes.

“Research shows that integrated IT systems enable HR professionals to show true contribution to business and allow them more time to focus on strategic business issues.” (Clake, 2007).

(3.2) How HR Managers Respond to Technological
Changers?

“Cost reduction without loss of effectiveness or decline in customer service is seemed to be the main benefit of the use of HR technology.”
(Schramm, 2006)

When moving with the advancements in the technology the HR managers always have to keep their eye opened to the environment, to capture these slight changes in the technology, otherwise it may leads to a huge problem when it comes to the productivity and the effectiveness of the organization.

Job analysis is an integral part of any human resource function. Recent advancements in technology and changing worker environments have drastically altered the means by which job analysis data are collected and stored.

In this type of a situation the training and development plays a vital role inside the organization. But all these must be aligned with strategic business objectives if the organization is to gain the ultimate and the benefits out of the training and development expenditures.

“Training and development will take place for their own sake. Popularity and fashion will be paramount. A strategic approach to HRD, in contrast, aims to meet an organization’s specific business objectives. The ultimate purpose of HRD is to help the organization and the individuals to compete more effectively, now and in future.” (Stone, 2002, p.331)

HR managers train employees in different ways. Designing training methods are more important to stick employees to technological changers it can include activities such as: ❖ Learning via involvement in research and visiting other works or organizations. ❖ Undertaking planned reading, or follow from the use of self teaching texts and video tapes; ❖ Receiving coaching from seniors;

❖ Learning via involvement in research and visiting other works or organizations. ❖ Learning from observation of trained workers;
But when carrying the training process that other factor that the HR manager should think is the trainability of the employees, they must be carefully selected careers by their previous performances, knowledge and skills.

Also the HR management can think of recruiting new qualified people to fill up the vacancies which needs more technological knowledge. Sometimes that could be more profitable when comparing the training expenditures and the recruiting process expenses. Sometime the right person who fits to the position can be within the organization and some times he or she can be from outside. So that he mangers have to seek for the right person in both ways. E.g. In some advertisements we can see that those organizations ask to recruit people who have expertise technological knowledge with more than 2 year experience.

In the other way some companies put on fully automated and partially automated machines to their production process to increase the production. In this kind of situation HR managers would be able to terminate excess employees from the organization by giving them recompenses. E.g. Unilever Company terminated excess employees when they are introducing new automated and partially automated machines to the factory site.

HR managers respond to technological changers variously. But it is important to remember that while management can solve a technical problem, Technology will never solve a management problem.

(4.0). Competition

Organizational competitors are other firms offering or potentially offering rival products or services. Organizations must focus on known competitors and monitor for achieve HR objectives.
(Kuntz 1995)
(4.1). How Competition affect on HR?

People are a key factor to face competition successfully. Employee contribution to competitiveness is conditioned by their literacy, type and quality of education, experience, motivation, their skills, work attitudes, value systems and quality of life. Similar organizations in the industry also try to achieve competitive advantage with more skilled talented work force in order to increase their production. So competition affect on HR widely.

There are some challenges and changers which have a great impact on the competition. Those are globalization, increasing customer expectations, compensation (costs for an employee), transportation and, the continue development of information technology.

So, all organizations in the industry seek to attract the best work force in order to achieve competitiveness and to remain competitive in respect of attracting investments, goods and services and especially for survive in the market. Not only but also for achieve the highest market share. In order to do this organization need skilled, more trained, efficient and more customer oriented workers with a high quality of productivity.

“Globalization, enhanced customer expectations, increasing information technology, and the transparency of global markets are main shifts in a developing world. These main changes are seen in labour markets and are affecting each company.” (Schnelte, 2005)

“Competitive advantage refers to the ability of an organization to formulate strategies that place it at a favorable position relative to other companies in the industry.”

(Bernardin, 2003, P.13)

According to Bernardin (2003, P.14), there are two major principles described the extent to which a business has a competitive advantage. Those are; ← Customer value
← Uniqueness

Competitive advantage occurs when customers feel that they perceive more benefits from dealing with the organization compared to similar organizations in the industry. And also competitive advantage occurs through uniqueness when the organizations offer products which can not be copied or imitated by competitors.

(4.2). How HR Managers Respond to Competition?

When there is a big pressure from competition HR managers should find ways for to improve their quality and productivity of goods and services, continuous innovation, greater flexibility, and also to respond rapidly for market needs and wants. In order to achieve these things organization should have active productive work force with correct quality and quantity.

When responding to the competition by HR managers the main problem they face is maintain the competitive edge. Competitive edge is the lack of activeness of the existing employees than other similar organizations in the industry. The largely used method by HR managers to face this problem is motivating the employees by providing incentives, bonus, higher rate of sales commission based on their performance. So then employees will put greater effort on their task to gain rewards. Then employee performance will increase and the organization will can face to competition affectively.

And also another problem face by HR managers is improved quality and productivity of work force that they have to remain competitive in the industry. The two aspects of improve quality and productivity can be achieved through training and development, extrinsic and intrinsic rewards and employee involvement. Mainly attractive compensation system will increase the productivity of employees. It means if the HR managers can design attractive wages and salary structure than competitors, then gradually employees will be enthusiastic and will put greater effort on their task. E.g.:- High over time payments on performance increase the productivity. Another way increasing employee performance is reward employees based on their performance (e.g.:- Pay $50 on extra unit sold by sales persons). From this method sales will be increased and also employees will be motivated. This will help organizations to face competition affectively.

But for improve the quality of employees, training and development is essential. These training and development activities should be match with the task that employee performance and especially for the new generation of business world. It means training should be done in a proper way. As an example, when new technology emerged for business, employees should be trained to do their task and duties according to the new technology. And also sales force of the organization can be trained in the best way to communicate with the customers and make better relationships with them to have present as well as the future sales. It means training should be related to the new competitive environment.

Not only but also HR managers should be able to identify employees especial attributes such as literacy, type and quality of education, experience, motivation, their skills, work attitudes, value systems and quality of life etc.. And make greater value to the society than other organizations in the industry.

Also HR managers can assume competitors actions before they implement those actions. HR managers can get know their barriers and opportunities that they have to face in the future competition. Then HR managers consider what might be done to face the competition in the future.

Mainly organization should be able to give value to customers and be unique than others in the industry to win the competition. Simply it means achieve the advantages of competition by productive use of human resources which ultimately leads to meet the organizational goals easily. (5.0). Conclusion

The key environmental variables which were described before, underline the importance of HR to meet the future challenges. There are critical competencies for general management and HRM professionals. And organization needs both competent personnel trained in HRM and motivated managers who recognize the importance of HRM activities and apply the best procedures.

The organizations face a variety of difficulties when they move with the latest technology. Those may be the lack of competency, the lack of skills which require moving with the technology and the lack of trainability to the latest technology. When responding to these variations the HR managers should identify the trainable employees existing and going through successful training programs which make them fit in to the new environment. Or else they can recruit new people who perfectly fit to the new environment.

The competition makes the organizations to run fast and gain the higher market share. In this sort of a situation the impact upon the employees in the high working pressure, By motivating the employees by giving higher remuneration, incentives, bonus, higher sales commissions etc… This will allows the organization to gain more from the employees than they expected.

(6.0). List of References

← Bartol, K., Tein, M., Matthews, G., & Martin, D. (2005). Management: Pacific Rim Focus. (4th ed.). McGraw- Hill Press.

← Bernardin H. J. (2003) Human Resource Management – An Experiential Approach, 3rd Edition, Tata Mc Graw-Hill Publishing Company Limited, New Delhi.

← Clake R. (2007) HR and Technology, 151 The Broadway, London SW191J, UK.

← Haag S.; Cummings M.; Mccubbery D. (2005) Management Information Systems for the Information Age, 5th Edition, McGraw Hill, New York.

← Minehan N. (2003) HR Magazine – Technologies increasing impact on the work place.

← Price, A. (2004). Human resource management. Thompson Learning

← Peters,L.(2001).five keys to effective e-recruiting: Ivey business journal,65(1),8-11.

← Schnelte A. (2005) HRM Challenges. Grin Scholarly Publishing House.

← Schramm J. (April 2006) HR Technology Competencies: New Roles for HR Professionals.

← Stone, R. J. (2002). Human Resource Management. (5th ed.). Milton: John Wiley and Sons Australia

← Randall, I. (1999). Black Enterprise. Employees and changing world. Retrieved March 30, 2008 from the web site: www.findarticles.com

← Kackmar, K. M. (1993). HR magazine. HR technology can add value Retrieved March 30, 2008 from the website: www.findarticales.com

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