DYNAMIC HUMAN RESOURCE MANAGEMENT

ENVIRONMENT

LESSON OBJECTIVES• Identify the external environmental factors that affect human

resource management .• Explain who performs human resource management tasks.

Human resource management environment • External environment – factors outside an organization’s boundaries

that affect a company’s human resources make up.• The organization has little control over how the external environment

affects the management of its human resources .

External environment factors1. Labor market• Comprise potential employees located within the geographic area

from which employees are recruited.• The labor market is always changing and this can have an affect on

the company .

External environment factors2. Society • society may exert pressure on human resource management .• The company needs to remain acceptable to the general public with

regards to human resource issues .

External environment factors3. Unions • Group of employees who have joined together for purpose of dealing

collectively with their employer .• The union , rather than the individual employee negotiates an

agreement with management.

External environment factors4.Shareholders • Are owners of a corporation.• Because they have invested money in firm ,they may at times be able

to influence a company’s human resource policies .

External environment factors5. Competition • Firms may face intense competition in both their product or service

and labor markets.• Must maintain a supply of competent employees in order to

succeed ,grow, and prosper .• Can lead to bidding wars among companies .

External environment factors6. Customers• People who actually use firm’s goods and services .• Company needs to ensure that it employs staff who are able to

provide top – quality goods and services .

External environment factors7. Technology • The rapid development of technology can either help or add

additional pressure for companies to keep up with it.

External environment factors8. Economy • The economy can have a major impact on human resources issues . • When the economy is booming ,it is often more difficult to recruit

qualified workers.• When there is a downturn, chances that more applicants will be

available.

External environment factors 9.Unanticipated events• Occurrences in the external environment that could not be foreseen.• Every disaster ,whether manmade or natural, requires a tremendous

amount of adjustment with regard to human resource management.

External environment factors10. Legal considerations • Each country has their own laws which can affect a company's human

resource issues.

Who performs HRM tasks?5 parties:1.Human resource managers2.HR outsourcing3.HR shared service centers4. Professional employer organization (employee leasing )5. Line managers

Who performs HRM tasks?1. Human resource managers :• Acts in advisory or staff capacity.• Works with other managers to help them deal with human resource

matters.

Who performs HRM tasks?2.HR outsourcing :• Is the process of hiring an external provider to do the work that was

previously done internally.

Ways HR outsourcing is done3.Ways :a. Discrete servicesb. Business process outsourcing c. Recruitment process outsourcing

Ways HR outsourcing is donea. Discrete services • One element of business process or single set of high volume

repetitive functions is outsourced to a third party . For example administration .

Ways HR outsourcing is doneb. Business process outsourcing • Transfers the majority of the HR services to a third party.• Example : kraft foods Inc .signed a multi – year agreement to

outsource HR business processes for 98,000 employees to IBM .

Ways HR outsourcing is donec. Recruitment process outsourcing • Organization uses an external service provider to perform all or part

of its recruitment activities.

Who performs HRM tasks?3. HR shared service centers :. Takes routine ,transaction based activities that are dispersed throughout the organization and consolidates them in one location.

Who performs HRM tasks?4. Professional employer organization (PEO). A company that leases employees to other businesses.

Who performs HRM tasks?5. Line managers• Individuals who are directly involved in accomplishing the primary

purpose of the organization.• Can be involved with performing some human resource duties like the

selection process.

Thank you