Human Resources in External Environmental Changes

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

Apart from the internal environment, there is another environment of the organisation where another interaction takes place. No organisation does exist without being influenced by its external environment. If the organisation will definitely interact with its external environment, then, it assigns the Human Resource Managers not only internal task, but a greater responsibility outside the internal environment. The subsequent discussion looks at these external environmental factors and what needs to be done by the Human Resource Manager.


First and foremost every organisation lies within a country. And of course countries have their set of laws that govern and protect the people. Apart from that there are regulations that are also laid done by governments for organisations to follow. From time to time these regulations are amended to meet the needs of the country. In the event of any change of regulation, organisations are automatically bound by that and impose a huge responsibility on the human resource manager to quickly get his employees informed so that they will conform to the amendments. In a situation whereby the human resource manager refuses to update the knowledge of the employees of new regulations will have serious repercussions on the organisation in the course of time. To forestall everything, the human resource manager has to pay meticulous attention to the political issues.


Economic environment consists of factors that affect the purchasing power and the buying pattern of people within a common market. Economic factors such as inflation, demand and supply issues and a host of others should be considered and possibly reviewed when the need arises for it is in the light of this that Becker (1996) articulates that the economic environment is changing supersonically, and therefore human resource managers should be abreast with the economic trend. Human resource managers live with their employees in the same country and usually the same city or town, go to the same market with their employees and therefore should be aware when the prices of items change. It is incumbent upon the human resource manager to make sure that compensation packages are raised to meet the economic climate of the environment. If this is not done, employees may decide to look for better organisations where they will be economically covered in the event of inflation. When it happens like that the human resource manager will eventually lose, because key employees may leave for better prospects.


The human society in which we dwell shapes our lives, perceptions, believes norms and values. Human beings consciously or unconsciously absorb the views of society about themselves, others, organisations and the world at large. In the course of recruitment and selection the human resource manager should make sure that those who are brought in meet the social needs of the time. For instance, the world has become very sophisticated and full of elites. In view of that if the HR manager is recruiting, conscious effort has to be made to get those who can squarely meet the standard of the elites. Again, the employees should not be made ignorant of the social issues within which they operate. It is only when they understand that they will be able to respond appropriately and give off their best. It is in line with this that Delaney (1996 p.949-969) citing from Peters and Waterman's (1982) states that, 'the way an organisation manages people can influence its performance

As part of the social issues, serious consideration must be given to competition within the environment. 'This is because Organisations are embedded in an environment comprised of other organisations' Handel (2003 p.243). According to Lancaster (2002 p.49) 'in virtually every market in the world, the degree of competitive rivalry is increasing. To expatiate further, Becker (1996) also states that 'competition has become the norm for most organisations.' To this end, human resource managers should employ, train and develop their staff to meet the competition within the industry.


Human resource managers ought to understand that many of the things we have and work with today were either not with us or were with us but have been upgraded. Mention can be made of computers and the internet which have globalised the world in which we are. Years ago, computers were not in existence and employees had to do things manually and more difficult way. In this present age, it is termed as the 'information age' and enjoins all human resource managers to keep their employees knowledge well updated by training them so as to meet the requirements of the time. We are in the world where customers now have their own specifications that have to be met at all cost. But if one does not have an advanced knowledge about Information Technology (IT) then who is to be blamed? This is the reason why human resource managers should make it a point to do critical evaluation of their external environment so as to lead their staff along.

Finally, on this first part, the attention of human resource managers is being drawn to PEST factors which are Political, Economic, Social and Technological. These are important external variables that ought to be adhered to so that as the internal environment is granted some attention the external ones are not neglected because they can spell the doom of the organisation.


The present world is gradually doing away with monopoly hence creating competition in all spheres of human endeavour. Organisations all over the world are being faced with competition one way or the other. It is for this reason that Collins and Clark (2003 p. 740-751) expresses that human Resource Practices may lead to higher firm' performance and be sources of sustained competitive advantage because these systems of practices are often unique. In order to have the upper hand over the other, there are some human resource practices that can be put in place to enhance effectiveness and efficiency thereby going ahead of competitors. It is in line with this that Batt (2002) citing from (Appelbaum, Bailey, Berg and Kalleberg, 2000; Delery, 1998) expatiate that employees skills, involvement in decisions and motivation can be enhanced by human resource practices. To discuss the practices into detail Sharma (2010) outlines some of these human resource practices when properly practised could enhance performance and gain competitive edge.


A very safe and healthy environment provides a very sound and serine atmosphere for employees to work and remain loyal to the dictates of the organisation. If the condition in which employees work are not conducive, they feel unhappy and not motivated to work and give off their best. On the other hand, if they are safe and feel comfortable with the work each is assigned to then obviously they will render their maximum to enhance the growth and development of the organisation.


Management should do its possible best to give out bonuses and pay compensation packages to boost the morale of its staff. Apparently the criteria for dishing out of bonuses to employees should be well spelt out with the employees clearly informed that the organisation will not pay compensation if it failed to hit its target. It should be clearly articulate that bonuses should be necessitated by performance measurement.


The 360-degree appraisal system illicit feedback from management peers and subordinates. The system gathers comprehensive information from all available ways of collecting performance feedback. Some years ago, work was done to please only management, but in this contemporary world the opinions and perception of all stakeholders of the organisation matter. This system affords the company the opportunity to identify potential candidates for future higher positions in the organisation.


A well designed evaluation and assessment criteria of employees' performance should be conspicuously cohered to the goals and aspirations of the organisation. Equal opportunities and access to management should be made available to all without any discrimination. What X did and was reprimanded, when Y does the same thing he should also be reprimanded accordingly.


A systematic method to ensure that knowledge management supports strategy. Luckily for this generation knowledge could be stored in databases which will be made available to the employees. More so, when an employee is appointed to attend any in-service training and conferences, vital information acquired from such programmes should be made to all staff for the betterment of the organisation.


Employees who execute their functions expeditiously with distinction should be identified and the necessary recognition given to them. The names and pictures of such employees could appear in the organisation's newsletters or magazines which are periodically issued. This practice will go a long way to resonate those who have relaxed thereby creating a healthy competition within the organisation.


Organisations exist to make impact inside and outside its internal and external environments respectively. But since the organisation has no control over the external factors like Political climate, economic, social and technological issues, it lays a greater responsibility on human resource managers to constantly monitor events of the external environment so as to re-adjust to the situation. This paper also examined human resource practices that will act as catalysts for the organisation to gain competitive edge. Among the practices touched on were: safe, healthy and happy workplace, performance-linked bonuses 360-degree feedback system and many others. If all these are strategically put in place, they will definitely work for the growth and development of the organisation.