ASSIGNMENT

Human Resource Management Environment

2011 AJAY SHARMA

ROLL NO. NU/MN-01/10.

SCHOOL OF MANAGEMENT STUDIES,NU

INTRODUCTION
The term human resource management means employing people, developing this resource, utilising and compensating this services in tune with the job and organisational requirement with a view to contribute to the goals of the organisation, individual and the society. It is a part of management and it based on human behaviour.

Definition:
Leon C. Meggsion, the term human resource can be define as , the total knowledge, skills, creative ability, talents and aptitudes of an organisations workforce, as the value, attitudes and beliefs of the individuals involved. Human resource management(HRM) can be define as managing (planning, organising, directing and controlling) the functions of employing, developing and compensating human resources resulting in the creation and development of relation with a view to contribute proportionally(due to them) to the organizational, individual and social goals. It can be show as the following figure.

Thus, Human resource management includes, all the management functions and department, such as employee management, shift management, attendance management, leave management, payroll management etc.

Human Resource Management Environment:

The term environment, in general, refers to the entirely of the surrounding conditions. In human resource management, it means the combinations of factors that have influence on the working of HR department/manager. As illustrated in the following figure, the factors that shape the environment are classified in to two categories----1. External factors. 2. Internal factors. These factors are discussed below Technological Environment

Vision and Mission

Social Environment

Political Environment

Business Strategy

HR System

Human Resource Managemen t

Organizational Culture

Economic Environme nt

Organizational Structure

Legal Environment

External Environment Internal Environment

External factors:
The events occurring outside the organisation but influencing the HR activities are called external factors. Since external environmental factors operate outside business, organizations will have little or no control over these factors. External environment factors are usually made up of the macro environment and industry environment. We shall now see each of these factors in details.

1. Social Environment factors:

The social environment is created in general by the educational levels, attitudes, beliefs and values of the people who live in a specific region. The social environment of an organization consists of the beliefs and behaviour of the employees, customers, suppliers, shareholders and all others who interact with organization. Each society normally has a distinct cultural identity that separates it from others. Employees as a member of the society bring in their soritical value to the organization. These values, in turn, directly and indirectly influence the HRM activities of the organization. In India, many organizations have a diversified workforce since employees in these firms typically reflect the characteristics of the Indian population. These employees represent different regions, ethnic groups and ideologies. These diverse workforces influence the HR environment of organization. Let us discuss about some factors that influence the social environment of organization.

a. Demographics:
A scientific study of the size and structure of the population and its development is usually described as demographics. The demographics of the Indian workforce are broadly diverse in nature. The compositions of workforce in Indian organisation have undergone a tremendous change in the recent decade. The marginal sections like woman, the physically challenged, minorities and people belonging to schedule cast schedule tribes and other backward communities have joined the organizations in a sizable numbers. It is therefore; very important for HR managers to clearly understand the environmental influences of different demographics on the organization and HR activities.

b. Educational Status:
The success of training and development programme undertaken by organization largely depend on the educational level of the employees. Thus, the organizations with large proportions of knowledge workers-a term used for well educated workers- may require dynamic HR policies to meet the high expectations of these employees.

2. Technological Environment Factors:

A technological environment is created when the knowledge of science is applied effectively for practical use. Now a day, almost all organisations apply technology to perform their job. They use internet to control recruitment etc. Thus, if technology changes then organization needs new technical worker for doing their job. And that cause, HR manager has face problem to recruitment and training to new workers. In India, the technological environment is undergoing changes as such a rapid pace that the organizations are finding is very difficult to cope with such changes.

3. Political Environment Factors:

The primary issue concerning political environment of a nation are called political environment. I. Nature of political organization:

The govt. political organization takes and create policy about the workers of the business organization. These decision and policies are different in case of organizations. So, the HR manager has to follow these policies for their task. II. Political stability:

Business organizations and industry are sometimes relying on political stability. If there are no stability in govt. then it effect on the economy of a country. In India, before 1998, there was no political stability of the govt. but after 1998, the NDA govt rolling complete five years then UPA also rolling since2004to till that. In this situation there are no chance to change the policy of wages & compensation immediately. III. Prevailing political Ideologies:

The philosophies of political parties are called political ideologies. The ideologies determine the government policies and intervention strategies, the attitudes towards trade unions, labour legislations and attitudes towards the foreign organizations.

The prevailing political environment usually influences the HR management in many ways. Hence, the HR manager should wary of the political ideologies of the ruling parties on issue like collective bargaining, social security benefits, and recruitment.

4. Legal Environment factors:

The legal environment greatly influences the operation of HRM. This environment is normally shaped up by the prevailing laws. These laws are classified into three categories:

I. II. III.

Administrative laws: which includes the regulations issued by the government, Case laws: which comprise court decisions and, Constitutional laws: which include the fundamental rights of the citizens enshrined in the constitution.

As far as India is concerned, there is a plethora of laws covering different spheres of employment and thus having implications for HRM. The country has several acts to protect the rights and conditions of employees and to govern the employee-employer relations. similarly it has specific legal provisions for payment of wages, working conditions, terms and conditions of employment, welfare facilities, and dispute settlement. We shall see now list of some laws: I. II. III. IV. The Trade Union Act, 1926 The Payment of WagesAct,1936 The Mines Act,1952 The Information Technology Act,2000 etc.

In additions to these laws, some of the articles of Indian constitution also guarantee a few right as fundamental to all the citizen. These laws and provision create a definite legal environment. Organization has to plan and execute the HR actions without violating and existing legal provision.

5. Economic Environment Factor:

The economic environment is created by the combination of economic factors like national income, population, cyclic fluctuation in economy, labour market conditions, trade cycle, interest rate and globalization of economy. These factors can influence the behaviour of consumers, competitors, suppliers and employees. Naturally, the factors that create the economic environment greatly influence the functioning of HRM. For instance, when the economy is performing well, say, due to boom conditions, the demand of labour might be increase in the labour market. Consequently, organization might face a difficulty in getting the requisite number of labour to accomplish its corporate goals and plans. In such a situation, organization may force to increase compensation to the prospective candidates in labour market. This may pose problem for the HR managers in recruitment, retention and compensation.

INTERNAL FACTORS:
The factors that are influence internally to an organization are called the internal environmental factors. These factors can be influence by the organization as it remains within the control of the management. We shall now discuss those internal factors that influence the HR activities of a firm.

1. The vision and mission of the organization:

The vision and mission statement of an organization strongly influence its HR environment. HR policies are usually derived from the vision and mission statement of an organization. Further, specific and unambiguous vision and mission statement have the potential to motivate the employees on a sustain basis. They can also ensure that all the HR activities are properly coordinated and directed towards the achievement of common goals. 2. Business strategy: An organizations business strategy determines its direction, plan its activities and allocate its precious resources to exploit the opportunities emerging in the external environment. The business strategy greatly influences the HR environment of an organization.

3. Organization culture:
The tradition, past practices, language, values, beliefs, meanings and norms of an organization together form its culture. The organization culture creates a common understanding among its members. Certainly, organization culture creates an internal environment within which HR activities are develop and performed. The strength of corporate culture has a definite impact on corporate HR policies. Therefore, human resource strategies need to be closely aligned to the culture of the organization.

4. Organizational Structure:
Organization structure deals with the firm deligate controls and coordinate the authority, responsibilities and accountability among the members of the organization. The organization structure has a critical influence on the HR practices of the organization. For instance, the structure helps in grading and grouping the jobs in the organization. This grading, in turn, helps in developing the recruitment process for each job. Similarly, the structure also helps in determining the ideal number of subordinates for each manager.

Conclusion
Thus, from the above discussion we can conclude that, HRM environment consist of both external and internal factors. External factors a little or no chance to control by the organizations. But internal factors can control by the organization by using several types of policy. --------------------Reference: Human Resource Management by P Subba Rao : Human Resource Management by Prabin Duari : internet