Changes In Environmental Factors Commerce Essay

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This assignment below is divided in two parts the first part describes the importance of HR in the changing environment of an organization; it starts with its introduction followed by strategic issues and HR implication ending with two case studies. The second part highlights role of HR to gain the competitive advantage for an organization using relevant examples at each HR practice.


The HR of an organization consists of all people who complete its activities. Human resource is link with the system managerial practices and personnel policies that overcome on the workforce.  In broader conditions, decisions that influence the workforce of the organization concern the HRM function.

The behaviour involved in HR function is persistent through the organization. Line managers; usually spend more than 50 percent of their time for HR activities such, evaluating disciplining, hiring and scheduling employees. Human resource management specialists in the HR department help organizations with all activities related to staffing and maintaining a victorious workforce. Main HR responsibilities include work design and job analysis, development and training, team-building, performance management and appraisal as well as identifying or developing valid method for selecting staff. HR department provides the outfit, data and processes that are used by line managers in HRM section of their job.

Literature Review :-

 In recent years there has been an increased interest in identifying those organisational and environmental factors that relate to the development of Human Resource (HR) practices in an organisation. (Cohen & Pfeffer, 1986; Edwards, 1979) explored that the control perspective like size and heterogeneity of organisations increase. HR practices are needed to control the forces of organisational conflict and disintegration. Balkin (1988) and Dimick & Murray (1978) suggest that economic forces determine HR practices. Only reasonably wealthy firms can afford many of the sophisticated HR practices that are available.

According to (Maryan Albrecht, 2001, Pg. 9) stated the mental programming perform a vital role in the change of environment factor in HR. It is an informatician's metaphor for the pattern of thinking feeling and acting for organisation. So it lead to different factors like political forces such as unions, professional associations and government have been suggested as important determinants of HR practices (Cohen & Pfeffer, 1986; DiMaggio & Powell, 1983). Grievance procedures and seniority based pay systems are often highly favoured by union organisations, while advanced employee hiring techniques and complex performance-based incentive wage systems may be advocated by HR professional associations seeking to incorporate "the latest HR technology" into their organisations. What might be referred to as an institutional or imitation approach may also be in operation.

According to (Mike Millmore et al, 2007, 214) Tolbert & Zucker (1983) and Zucker (1987) suggest that organisations adopt HR practices which they see being used by other organisations, not necessarily because the practices are effective or appropriate for their organisation, but because they want to appear legitimate and up-to-date. But on the other hand, in multinational firms cultural factors may play an important role in determining HR practices. However multinational organisations may carry home country HR practices to those locations abroad where they have operations (Laurent, 1986).

Concept of Environmental Factors Affecting:-

According to (Nelarine Cornelius, 2001, Pg, 108-109) HR performs in the business environment because it has been become increasingly competitive during the several years. Organisations are facing competition from a wider range of countries. Markets may be thought of as global, rather than local. Technology used in business promotes speed in decision making and economises in production. And also (John Leopold, 2002 Pg. 10-11) Kaleidoscope therefore suggests that the external environment can have an impact on internal choices and thus change the overall shape and cause movement in the pattern, but also that a change in any one internal component may simultaneously affect other. So, several factors influence in the four forms which are mentioned below:

Economic Factor Social Factor

Legal Factor Political Factor

Source: John Leopold (2002, Pg, 11) The Kaleidoscope model of the organisation, its environment and the relationship of international HRM policies and practices

According to John Leopold(2002 Pg 25-26) considered strategic planning for HR has been recognised in the HR literature when environment will have to change (for example Guest, 1987) over the last couple of decades and recently by chief executives and senior HR specialists. Various external factors such as a move towards globalisation, changing economic trends, changes in the demographic make-up of the labour force and a shortage of key skills, knowledge and experience have contributed to the urgency. Also there is a realisation within organisation of the changing and more flexible nature of the workforce and their need to combine diverse careers with their personal lives. In order to be effective a human resource plan must recognise the constraints of the external and internal environment and provide a useful, managed link between strategic corporate plans and strategic GR when changes are in environment factors.

Resourcing Plan

Development Plan

Retention Plan

Flexibility Plan

Productivity Plan

Reward Plan

Downsizing Plan

Source: John Leopold (2002, Pg, 25) HR providing the link between business planning and human resource management

The outcome of this process is a number and procedures -referred to as HR style practices in this model- that offer a vertically and horizontally integrated HRP.

Changes in environment factors:-

According to According to (Ravi and Vern, 2000, Pg. 124) (Francis Cherunilam, 2008, Pg. 4-5) and (Janet Morrison (2002 Pg 2-3) HR perform an important role when changing in environment. Global marketing is likewise link to its global HR strategy. In global marketing HR, to introduce a new product there are three basic influences that are global environment, the industry and the firm itself. The international legal political environment involves political relations between two or more countries. Below mentioned model show about the environment factors on domestic to international level.

Source: Francis Cherunilam, 2008, Pg.4-5

The Internal Environment Component

All the recent evidence shows that HR specialists are marginalised in technical change situations, which are dominated instead by systems engineers and line mangers (Clark 1993, Legge 1993). However, this may be in the narrower, engineering; job change aspects of new function there had a real involvement in technical change in cultural environment, natural environment, political environment and legal environment by creating a climate over a long period through managing the role relationship and industrial relations style on the domestic and international level (Hendry 1993). Following points meet with the internal environment criteria.

Mission, Policy, Corporate, Culture, Management Style of Upper Management, Employees, Organisation Structure, Labour-Management, Agreement

The External Environment Components:-

According to John Leopold (2002, Pg, 129) Shaun Tyson (1995) explored that external forces such as competition, regulation and other environmental factors all impact on organisational performance. HR perspective, the organisational culture argument was attractive. The belief in organisational culture was based on the assumption that the culture was the most significant determinant of worker behaviour. Market size and product type, market share, the state of technology, investment policies etc are the main external components to the HR. These components are mentioned below:

Labour Force, Legal Considerations, Society, Unions, Shareholders Competition, Customers, Technology, Economy, Sons of soil, Government

Key factors affecting changes in the UKAEA:-

According to (C. Margerison & Ashton 1979, Pg. 59) a convenient way of assessing an organisations capacity to assimilate change is to regard it as a system and to emphasise the principle of mutual influence in a fluid flied of forces which bear on labour- management relations. Forces are classified as largely internal or largely external to the organisation then it is possible to make an assessment of the ease with which the forces can be changed by

managements at the local level.




Payment Labour/ management relation


Technology Job Design



Source: (C. Margerison & Ashton 1979, Pg. 59) Factors affecting the rate of change in the UKAEA

It is important to say that arrows indicate the independent nature of the variable. Where arrows cross the circular boundaries they indicate constraints placed on the authority, s management by the external environment.

The Activities of Human Resources Management

According to the (Michael Armstronge, 1992, Pg. 236) the task of the strategically minded HR or personnel directors is to propose and implement personal and organization policies which will continuously improve the performance of their organisation. The activities performed by HR professionals fall under five major domains when changing in environment factors

Organizational design,


Appraisal and Performance Management

Employee and Organizational Development

Reward Systems, Benefits and Compliance

(Shaun Tyson 1995, Pg. 2-5) stated that human resource ability should begin with organizational analysis and design. Organizational design involves the understanding of work tasks based on communication of people and the tasks to be performed in the context of the goals and the strategic plan of the organization. HRM activities such as human resources planning, work analysis and job, job design computerization, and worker-machine interfaces meet in the HR performance

 According to (Gordon L. Lippitt et al, 1971, Pg. 343 - 350) recruitment, employee direction, selection and termination are among the activities that fit into the staffing domain. The performance management domain includes assessments of individuals and teams to measure, and to improve work performance. 

According to (John Leopold, 2002, Pg. 147) stated that compliance have to do with any type of reward or advantage that may be obtainable to employees. Such as labour law, unemployment policies fall under conformity component.

Major Trend Affecting HRM

According to (Nelarine Cornelius 2001) the given trends have an effect on human resource management department and its function.

According to (Francis Cherunilam, 2008, Pg. 92)

Increased Globalization of the Economy.

According to (Charles W.L. Hill, 2007, Pg. 165) and (John Leopold, 2002, 2009)

Technological changes and environmental changes.

According to (Monir Tayeb, 2000 Pg. 143)

The need to be flexible in response to business changes.

According to (Gregory G. Dees et al, 2003, Pg. 55)

Changing characteristics of the workforce.

According to (Philip Kotler, 2001, Pg. 283-288)

International management development

Cultural diversity and the management of multinational teams

The Importance of Human Resource Measurement

According to (Brian E Becker et al, 2001, Pg, 1-2) HR influence on the firm performance is difficult to measure. Considered the elements and outcomes of the organisation's human resources architecture that is tracked on the standard basis. A recurring theme of the book is that measurement and accountability are key components to organizational effectiveness and competitive advantage. Excellent measurement, related with business strategies, will help organizations select, develop, improve all of their HRM activities, provide a much stronger connection between HRM activities and organizational effectiveness.

Strategy Issues and HRM Implications

According to (Hugh Scullion & Margaret Linehan, 2005, Pg.281-298) Stated about HR implication which work with strategy issues

Shuler and Jackson (1987, 6-27) argue that different types of HR strategy are required for organisation that follow what Porter (1980,1985) identifies as the three key strategic options for a business; innovation, quality enhancement or cost reduction. And also Kochan and Baroci (1985) suggest that different types of HR strategy are relevant to different stages in an organisation' life cycle. In the employee development area, again a different set of practices would be needed when an organisation had achieved maturity from when it was in a start up or growth stage.


Example 1: Bovis Construction

According to Nelarine Cornelius (2001, Pg.99-100) Bovis Construction has in operation a distance learning programme aimed at ensuring the transfer of best practice, knowledge and management skills across the Group. This process provides the opportunity for those who wish to gain a postgraduate qualification. As stated by the Bovis Chief Executive, Luther Cochrane, in the professional Manger 1999, ours is very much people' business given both new trainees and seasoned mangers the opportunity to broaden their understanding of Bovis and enhance their own career prospects to be beneficial to everyone concerned.

Example2: Bradford and Bingley Building Society

Nelarine Cornelius (2001, Pg.99-100) described this society engaged in radical change, according to its training and development manager, Margaret Johnson, who states we needed to do something quite radical. We needed to develop and modernise our management thinking and the way we operate. This approach is reported as being integrated through a focused communication process, with wide employee involvement.

Example3: IBM Corporation

According to Nelarine Cornelius (2001, Pg.99-100) showed IBM has approached the need for flexible response to skills development by combining the best features of companywide and local approach in the development of a skills database. This has the aim of overcoming the highly centralized and complex worldwide skills inventories maintained by Corporate HR.

Example 4: Timex Dundee

During the 1980s the electronics markets expanded rapidly Timex invested substantially in new plant, and by 1993 were on the the biz six contract electronic assemblers in the UK Nelarine Cornelius (2001, Pg.99-100). Redundancies, mainly voluntary occurred throughout the period, as the company strove to remove its cost disadvantages of 20% to 30% compared with competitors. IBM was one of the major customers, and had installed electronic control systems which gave it instant access to production information.

Example 5: UK Post Office

Nelarine Cornelius (2001, Pg.99-100) the UK Post Office introduced a significant change in their procedures using computerized processes. This included integrated skill planning and training. The focus on training and development is emphasized in a quote by one senior

Example 6: Sainsbury Super Market

Nelarine Cornelius (2001, Pg.99-100) the UK food retailer Sainsbury's too have been concerned with culture change aimed at helping staff to work together more effectively, encouraging release of their talents. The process emphasizes continuous improvement and is supported by the involvement of no fewer than five board members. Continuous improvement play vital role in human recourses management.

Example 7: Establishing Culture of trust at Richer Sound

According to Mike Millmore (2007, Pg.229) the UK hi-fi retailer Richer Sound has, for a number of years, been using a variety of HR interventions to enhance the working environment and create a culture if trust. Employee are offered a range of benefits on top of their basic pay package, including a subsidised health - care plan, a hard ship fund and performance related bonuses. Staffs who have been employed by Richer Sounds for over a year receive short paid holidays in holiday homes owned by the company on top of the normal leave entitlement. Richler Sounds introduce a scheme to the under 35, it's argued that this is a risky thing to do, as the majority of employees are male, its argued that this help reinforce a culture of trust. For the same reason who wins performance related bonuses are allowed to take the cash directly from till. The company's scheme for employee feedback channels complaints via a named reprehensive. This means that no individual is held back by fear of repercussions.

Example 8: Change in British Communications

Barry Welch (1992, Pg.127) stated that the transformation in British Communication represented by Project Sovereign in 1990-1991, is extensive change programme in logistical term as most organizational are likely to encounter, since it involved a complete redrawing of organisational lines from top to bottom, a reduction in management layers and reassignment to new jobs for all managers left over after first shrinking their number. What follows is a representation of events and interactions in that short period of intense corporate change in BT together with an explanation of the setting.

Case Study:-

Example 9: Growing Pains (Waterway Industries)

Waterway Industries began its service in 1993 from small and high quality canoe maker. Recently, CEO may be facing a human resources problem. Lee Carter is a relatively new employee whose high-powered sales ability has completely changed sleepy canoe company into extraordinary growth. But Maher has overheard Carter discussing a new job that would offer equity position and money, and he fears her defection is imminent.

Maher has begun to reconsider his employees' compensation arrangements, particularly Carter's. As he consults with his banker and advisers in the industry, he begins to realize that organization culture he created at Waterway may have changed for good. The ideas of how to help company get out of dilemma occupied the proscenium of his mind.

Analysis of the case:

Until 2007, the expanded business hadn't changed Waterway's informal work style and Maher hadn't been motivated to push any harder even though sales and revenues had increased with the market. But the sales network had grown informally, and Maher had never really tracked it or thought much about building a sales force or developing a formal distribution plan. He wants to keep her and continually improving, but he is in dilemma that how can special employees deserve special motivation and how come company manages paying some much more than others after Maher mentally reviewed his payroll. If I am Maher, I will take short-term and long-term actions.

Actions to be taken:

Short-term actions: Communication:

The best way to find out what Carter wants and establishes trusty between Maher and Carter is communication. Through communication, Maher can get Carter to understand her own personal role in the process and built friend relationship between them. Money is not the only way to motivate employees, because different things can motivate different employees. So, this is the best way to save business cost and reduce turnover and keep the best employee.

Offer variable compensation and benefits:

Variable compensation and benefits is base on the company's success. Company can accord to employee's special high performance offering special motivation. This means special employees deserve special motivation. Maher need to manage paying some much more than others. On the other hand, employees do not think that employer has not a reputation for a tight wallet.

Long-term actions:

According to Newman (1987, Pg.216) suggest it is a term that can be broadly applied to any form of variable pay scheme which rewards employees on the basis of performance. There are four ways to motivate employees:

Creating a positive work environment

Provide opportunities for growth

Manage employee performance

Recognize and reward performance

Recommendation and conclusion:

In case of waterway, individual are concerned with the equity of their pay relative to others both within and outside their organization. Maher is also concerned with pay, not only because of its importance as a cost, but because it motivates the decisions of key employees about continuing on a job, or leaving the organization. In waterway, Maher need to develop strategic compensation plans for competitive business environment that requires high quality and continuous innovation.

Following points meet in managing change,

Governments are increasingly less able to control the flow of capital, information and technology across borders.

There has been de-regulation of financial and other markets, and the integration of markets for goods, services and capital such as the European Community.

It has led to the de-nationalization of enterprises and the creation of global companies and global webs.

Production of goods and services acceptable to the global market, and the convergence, to a great extent, of customer tastes across borders determined by quality.

The need to achieve competitiveness and to remain competitive in respect of attracting investment, goods and services.


From a purely HRM perspective, the identified the following factors as accounting for the increasing interest in and resort to HRM practices. Improving the management of people or utilizing human resources better as a means of achieving competitive advantage. And numerous examples of excellence of work in Human Resource have created an interest in such models. However, the traditional role of personnel managers has failed to exploit the potential benefits of effective management of people; neither did personnel management form a central part of management activity. Like, some countries the decline of trade union influence has opened the way for managements to focus on more individual issues rather than on collectivist ones. The emergence of better educated workforces with higher individual expectations, changes in technology and the need for more flexible jobs have, in turn, created the need to incorporate human resource into central management policy. Hence the Commitment and motivation play emanate from the area of organizational behaviour, and place emphasis on management strategy.

Question Part 2:

Competitive Advantage and HR



According to (MacMillan, I. C. Seizing, 1983, 43-57) in global world, HR is improving relative to other potential sources of competitive advantage for an organization. Professor Pfeffer notes that traditional sources of success (e.g., speed to financial, marketing, technological) can still provide competitive leverage, but to a lesser degree now than in the past, leaving organizational culture and capabilities, derived from how people are managed, as moderately more essential.

According to (Chris Brewster, & Hilary Harris, 1999, Pg.31-34) competitive advantage refers to the capability of an organization to prepare strategies that place it at positive place relative to other companies in the industry.

According to Noe Hollenbeck & Gerhart Wrighr (2003, Pg.5) Competitiveness is associate to company effectiveness, which is determined by whether the company satisfied the needs of stakeholders. Companies that do not meet stakeholder needs are not likely to have competitive advantages over other firms in their industry.

Example: Kodak & the Container Store

Both Kodak and The Container Store illustrate the key role that human resource plays in determining the effectiveness and competitiveness of US business.

Competitive Challenges Influencing Human Resource Management

According Noe Hollenbeck & Gerhart Wrighr (2003, Pg. 12-13) to Four competitive challenges that companies now face will increase the importance of human resource management practices.

Figure: Competitive challenges influence n companies

Source: Noe Hollenbeck & Gerhart Wrighr (2003, Pg.15)

Competing in New Company

According to Noe Hollenbeck & Gerhart Wrighr (2003, Pg.15) stated that a company expand globally, they are spending more time and energy assessing employees cultural fit for overseas assignment.

Competing in the New Economy

Several changes in the economy have important implications for human resource management. Some key statistic about the economy and the workforce. These indicate the changing structure of the economy.

Example 10: Electronic Business

The way business is conducted has change rapidly during the past few years and will continue to do so. Many companies are connecting to the Internet to gain an advantage over competitors.

Competing through High Performance Work System

According to Noe Hollenbeck & Gerhart Wrighr (2003, Pg. 22-23) (Arthur, J. B, 1994, Pg.670-684) & (Abowd, J. M, 1990, Pg. 52-73) companies trying to win the war for talent: all involves HR practices. They include finding creative ways to avoid layoffs and retirement, creating a positive work environment, and expanding the search for talent to the global labour force.

Finding and keeping the best Employees

Companies are coming up with creative ways to avoid layoffs or remain connected to laid-off talented employees whom they worked hard to recruit.

Example 11: Sun Microsystems

Sun Microsystems is trying to avoid layoffs by closing plants over the summer. Cisco systems is paying some laid off employees on-third of their previous salaries and will continue to provides full benefits, including health insurance, use of a laptop, and access to company gym. After a year the employees will get an additional two months' salary to help pay for a job search inside Cisco. Charles Schwab is promising a $75,000 rehiring bonus to any of the 2100 employees laid of whom return within 18 months. Many companies are considering rehiring retired employees on a part time basis.

Competing By Meeting Stakeholders' Needs

Noe Hollenbeck & Gerhart Wrighr (2003, Pg.25-30) stated meeting stakeholders needs box shows how people systems can contribute to competitive advantage. For Hr activities to contribute to a company's competitive advantage, mangers need to consider the question shown in table and be answer them.

Composition of the Labour Force

Company performance on the balanced scorecard is influenced by the characteristic of its labour force. The labour force of current employees is often referred to as the internal labour force.

Example 12: Tellabs Communication

A company that provides communication service products such as optical networking around the world, key result tracked on the balanced scored include revenue growth, customer's satisfaction, time to market for new product and employee satisfaction. Every employee has a bonus plan; bounces are tied to performance as measured by the scorecard.

Competing Through Globalization

According to Noe Hollenbeck & Gerhart Wrighr (2003, Pg.24) as companies expand globally. They are spending more time and energy assessing employees cultural fit for overseas assignments. Research and practice indicate that the biggest mistake companies make is choosing people who have the technical skills needed to perform the job, but ignoring personality characteristics and family support.

Figure: Organisational strategy: for global competitive advantage

Source: Humes 1993 "Managing the multinational"

Example 13: Tricon Restaurant

Tricon Restaurant International, based in Dallas, Texas, has 100 expatriates; 20 are American working overseas. Tricon is the franchiser for over 10,000 overseas Kentucky Fried Chicken, Pizza Hut, and Taco Bell Restaurants.

Role of Customer Value in HR

According to (Prahalad & CK, 1995, Pg. 34-36), (Ulrich, D. 1997) and Hofstede, G. (1984) stated that competitive advantage occurs if customers perceive that they receive more value form their transaction or relationship with an organization than from its competitors. Chris Brewster, & Hilary Harris, (1999, Pg.145) explored that four key roles for HR professional. HR has to deliver results in each of domains, since the four of them are equally important. The following model shows about the added value to

advantage for organisation

Long term

Management of strategic Management of transforming

Human Resource and change

Process People

Management of Management of employee

Administration of


Short term

Source: Chris Brewster, & Hilary Harris, (1999, Pg. 33) HR roles

Further model debate on following points

Management of strategic Human resource

Management to transformation and change

Management of employees

Management of the administration of organisation

Role of Knowledge Management for competitive advantage in HR

Barney(1991,354-355) discussed in detail by Tony Watson, exploiting and developing the knowledge of employee is taken to be a core organisational competency (Hamel and Prahalad,1994, Boxall and Purcel, 2003) which, if appropriately managed can assist in that knowledge is a resource which can be managed.

Figure: Present Knowledge map for HR

Example 14: Moddens Foods

Moddens foods, which products high quality broad range and premium food products for European and North American markets. Jean Frear VP of Hr looking at item six on the agenda of the forthcoming company board meeting, group managing director stated: 'knowledge management for competitive advantage at Moddens. She did recognise the advantages in attempting to utilise the personal knowledge of those who worked for the company.

HR Effective Planning and Forecasting for R & S Process

According to Gary Dessler (2000 Pg. 178) & Balkin, D.B. (1988, Pg.207-213) described that R & S perform a vital role in organisation for competitive advantage practices. Recruitment and selection ideally starts with personnel planning for organisation. Job analysis identifies the duties and human requirements for each of the company's job. HR plays an important role to planning and forecasting for recruitment and selection to hold the competitive advantage for organisation in HR.


Source: Gary Dessler (2000 Pg. 178)

Efficiency of Strategic Targets and Thrusts in HR

A basic understanding of where companies can gain competitive advantages through their HR practices is facilitated by a discussion of

Strategic targets

Strategic thrusts

Researcher described these via examples of companies that have gained a competitive advantage through the various targets and thrusts. After description of thrust and nation of targets, researcher shows how specific HR practices can be used to expand a competitive advantage.


There are four targets signify upstream and downstream activities as well as the company itself. Accordingly, the four include: self (the focal company) customers, distributors or servicers, and suppliers. Companies can reach backward or reach forward to help shape the HR practices of other companies. For instance, companies like' PepsiCo training store managers (PepsiCo's distributors) in merchandizing techniques to help improve store sales as well as sales of PepsiCo. Unifi helps customers with their performance appraisal systems, making their customers more competitive and thus enhanced to buy Unifi products.


There are two strategic thrusts, or ways to beat the competition, through human resource management practices. One is a cost efficiency thrust.

Example 15: Lincoln Electric

The case of Lincoln Electric; is an example of the use of HRM practices to increase the efficiency of production and thereby lower the cost of the electric motors and arc welders.

Example 16: People Express Airline

People Express Airlines is a similar example of, a cost/efficient thrust. Unifi, McDonald's, and Honda assist in the HRM practices of their customers, distributors, and suppliers, :respectively, in order to help them keep costs down as well- as to ensure a competitive, and thus enduring, set of customers, distributors, and suppliers.

The second thrust option is a differentiation thrust. The differentiation thrust uses HRM practices in ways to differentiate the product or the company from its competitors. Although this may not make them more efficient, their farm system and promotion policies help differentiate the Baltimore Orioles from competitors in the eyes of its supply; sources-young talented baseball players.


Care in selecting to bring the right people on board leads logically to another important staffing practice like socialization. Socialization show the process used by companies to depiction new employees to their culture and ways of doing things. When done successfully, it results in strongly loyal employees who are dedicated to the company.

Example 17: Procter & Gamble

Companies that have perfected the socialization process contain IBM, Procter & Gamble, and Morgan Guaranty Trust. The socialization process start before the employee is hired. At Procter & Gamble for example, an elite cadre of line managers trained in interviewing skills probes applicants for entry level positions in brand management for such qualities as the capability to turn out high volumes of outstanding work.


According to (Chris Brewster, & Hilary Harris, 1999, Pg.145) and (Kerr, J.L, 1988, Pg.215-223) performance appraisal (PA) is currently used in the majority of large companies. Traditionally, appraisal schemes have concentrated on past and current performance.

GTE performance appraisals are viewed as one of the most important tools in the management arsenal. The appraisal reviews help executives in clarifying and articulating objectives and prospect for themselves and their employees. They give GTE a realistic assessment of its weaknesses, strength and future requirements.

Example 18: Emery air Freight

At Emery Air Freight, the company was losing $1 million annually because employees on the airport loading docks were shipping small packages separately rather than placing those with the same destination in one container that would be carried at lower rates by air carriers. Management found that the containers were being used 45 percent of the time when they should have been used 90 percent of the time.


For success in 21st century, HRM activities must be responsive to a highly competitive marketplace and global business structures, closely linked to business strategic plans, mutually conceived and implemented by line and HR managers, customer service, focused on quality, employee involvement, productively, teamwork, and workforce flexibility.


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