Managing Human Capital: Assignment
Some are Big and others have few employees, some are very sophisticated technologically, while other have specific ways of doing things. These are factors that affect the way of managing the organization. (ABE, 2008) All organisations operate in a specific environment and are affected by what happens around them. The outside factors that effect the way how organization manage people are called External Environment Factors, which are: Political Environment Economic environment Social Environment and Technological Environment
With increasing competitive pressures from global economy, talented human resources have become critical for achieving competitive advantage in the past decades. Therefore the role of HR managers changed and added value to organizations to achieve business goals. (ABE, 2008) In this study is necessary to take in consideration the roles of HR managers when changes occur in the external environment and how can management be more efficient. And how can HR managers help the organization to achieve competitive advantage. (Dr. Kumar, 2010) 2. External Environment Changes and Role of HR Management 2. 1HR Managers Roles “Companies now are finding that the HR issues are, in fact, centre stage to business competitiveness. The intellectual capital, core competencies and organizational capabilities are all the pieces that are central to success. ” (HARVARD PRESS, 1997) To meet pressures the HR profession has begun to work in new ways of creating value through the function. In the recent years a new model has appeared to provide HR managers with the platform on which to deliver its promise.
Managing Human Capital: Assignment Essay Example
The new model requires HR to position itself to engage with the business at the right levels, in the right ways. (Hunter, 2004) Hr Managers need to have direct relationship with subordinates. In doing so it has fulfilled a gap in the business – the voice or advocate of the employee. It has achieved the role of facilitator and executor of all people related processes, regardless of whether these were necessary or HR was the most appropriate method of delivery. (Hunter, 2004) 2. 2Human Resources Management are responsible for: -Sizing the workforce -Evaluating the available skills Cost of Labour and the return they produce -Labour turnover rates -Industrial relations -Structuring the organisation – hierarchical -Managing the Time’s sizes -Managing the style of structure to follow -Training and development. 3. 0External Environment Analyse 3. 1PEST 3. 2Political Governments, legislative powers, the legal and regulatory framework applying to business and the public sector. Also give direction to a country through the way in which they exert control over the economy. Political environment operates in national level but it is influenced by international relations.
Organisations must operate within the regulatory environment applicable to the country of origin. (ABE, 2008) 3. 3Economic It is the evaluation of Land, Labour and Capital. It is reflected in form of wages, interest rates, taxations, prices, competitors and level of demand. When an economy is growing, funds tend to be widely available, interest rates will be low and demand Organisations need to understand both the trends in the economic indicators and what these mean for the enterprise in which they are involved. The changes will normally occurs in interest and exchange rates through inflations. ABE, 2008) 3. 4Social Social change involves changes in the nature and norms of society. In particular, Organisations need to understand the trends in demographics and the cultural environment. (ABE, 2008) Demographic Change Demography is the evaluation of population dynamics, which has wide implications for both the nature of the workforce and the markets for goods and services. Overall, the size of populations does not change rapidly, but there can be big fluctuations in its Composition over relatively short periods of time, particularly at a local level. ABE, 2008) Cultural Environment The concept of culture can be difficult to define, but generally it incorporates aspects of peoples’ beliefs and values, behaviour and thought patterns. Sometimes there are Visible signs of culture, such as a style of dress, the adoption of rituals, ceremonies, Etc, the predominance of a particular religion, for example. Cultural influences are not just at a national level but can also be reflected within regions, ethnic background, class, age or sex. (ABE, 2008) 3. 5Technological Environment and Technological Change
The technological environment Changes in production or working methods: for example, machines, computers and production. Changes in technology will effect the staff by minimizing the work force by implementing innovative equipment that can provide the same job with more efficiency and less time, but at the same time more staff in IT departments are required. Improvements in communications: for example, networking of PCs, videoconferencing, and mobile phones all allow more people to work at home and reduce the need for large central offices.
It can improve communication by videoconferencing, mobile phones, intranet, etc. (ABE, 2008) Example 1- Swiss watch manufacturer ETA, which by the later 1970s was facing big losses in its market share at the lower and middle levels to manufacturers of electronic watches abroad. At this time, Swiss watch production was still characterised by individual craftsmen producing the many different parts of a watch for central assembly. Although quality standards were the main aim of the organisation, the structure was not able o adopt the new electronics technology. Through careful analysis of the external environment, ETA spotted a gap in the market for well-designed, but inexpensive, watches, which young people would buy as fashion accessories. To keep costs down, it was essential that the new watches should with few components. As a result, the Swatch was developed; in no time the company started making fortunes. (ABE, 2008)