Business Issues and Human Resource Management: An Analysis

This report examines the critical role of Human Resource Management (HRM) in addressing various business issues within a dynamic global environment. It emphasizes the shift of HRM from an administrative role to a strategic one, crucial for organizational growth and competitive advantage. The report delves into key forces affecting HR agendas, including talent development, employee engagement, and business process improvements. It explores the core functions of HR, such as recruitment, employee relations, and compliance with labor laws, highlighting the importance of the Ulrich model. Furthermore, the report analyzes HR strategies, business ethics, and provides insights into the changing landscape of HRM. It also details tools for analyzing the business environment, including SWOT, PESTEL, and Porter’s Five Forces. The discussion covers factors influencing HR functions, strategy formulation and implementation, evaluation of business performance, and the role of HR in business planning and change. The report concludes by underscoring the significance of HR in aligning organizational objectives with employee needs to achieve enhanced productivity and profitability.

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BUSINESS ISSUES AND HUMAN RESOURCE MANAGEMENT
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Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Key Forces affecting HR agendas..........................................................................................3
Functions of the HR...........................................................................................................4
HR strategies......................................................................................................................5
Business ethics...................................................................................................................6
HR Insights.........................................................................................................................7
Tools for analyzing Business Environment...........................................................................7
SWOT Analysis.................................................................................................................8
PESTEL Analysis...............................................................................................................8
Porter’s Five Forces...........................................................................................................8
Comparison of the Tools....................................................................................................9
Factors influencing HR Functions.........................................................................................9
Corporate Objectives........................................................................................................10
Technological Resources.................................................................................................10
Economic factors..............................................................................................................11
Legal factors.....................................................................................................................11
Strategy Formulation and Implementation...........................................................................11
Evaluation of Business Performance...................................................................................13
Role of HR in Business Planning and Change.....................................................................13

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Sources of Business and Contextual Data............................................................................14
Conclusion................................................................................................................................15
References................................................................................................................................17

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Introduction
The rapidly evolving scope of global business environments has made the role of
Human Resource Management critical in the planning processes in order to drive strategic
growth. The largely administrative role of the Human Resources, pertaining to providing
support and assistance to the employees and workers of a business organization has
undergone a significant transformation. In the present age of rapid globalization and
technological advancements, Human Resource Management plays an important role in the
strategic position assumed by an organization in its competitive business environment
(Johnson, Lukaszewski and Stone 2016). In this regard, it can be mentioned that the
functions, operations and strategies adopted by the Human Resource Management System is
hugely dependent on the objectives, internal strengths, weaknesses, opportunities and threats
faced by the organization. The primary functions of the Human Resource Management
System of organization pertaining to selection, recruitment, retention and management of
employees are performed keeping into consideration the organizational goals and objectives.
The formulation of appropriate strategies for Human Resources further aids the organization
to research into such practices and methods of operations that will enable them to obtain and
maintain a competitive advantage in the market (Monks et al. 2013). The essay will further
focus on the analysis and discussion of the role of Human Resources in various business
environments, with respect to the various strategies and changes implemented by business
organizations.
Discussion
Key Forces affecting HR agendas
The main agendas of the Human Resource Management System of a business
organization pertains to the functions of talent development, employee engagement,

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developing the culture of the organization, acquisition of talent and improvement of the
business processes. The function of the HR involves the provision of productive workers and
employees to the organization in order to obtain favorable outcomes for the business
activities and achieve the organizational targets and goals (Lopez-Cabrales, Bornay-
Barrachina and Diaz-Fernandez 2017). In this regard, it may be noted that there are certain
key internal and external forces that significantly affect the agendas of the Human Resources.
These factors have been discussed as follows:
Functions of the HR
The key function of Human Resource Management is to improve and enhance the
overall organizational effectiveness. For this purpose, the HR of a business organization
performs a variety of functions such as selection of individuals on the basis of their
competencies, knowledge and skills, for the purpose of recruiting them with the
organizational structure (Khan, 2014). Another important function of the human resources is
to comply with the labor laws that are prevalent in the country or state in which the
organization conducts its operations. These labor laws may include employment regulations
in terms of payment, working hours and the like (McConnell Brue and Macpherson 2016). It
is also the function of the HR to ensure the enhancement of working relations among the
different employees and departments to an optimum level. This is ensured for the purpose of
bringing about an overall personal and professional development of the employees, thereby
optimizing employee satisfaction and employee retention in the organization.
The Ulrich model, formulated by David Ulrich, helps in the identification of the four
primary roles that are played by HR professionals within the scope of a business
organization. these roles include those of being a strategic partner, change agent,
administrative expert and employee champion (Armstrong and Taylor 2020). As a strategic
partner to the organization, the Human Resources professionals help in ensuring successful

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business outcomes for the organization through the alignment of the business strategies with
the strategies adopted by the HR. The role of the HR as an agent of change pertains to their
function of managing the planning and implementation of changes within the scope of the
organization. Furthermore, the HR also plays the role of ensuring the capacity for
incorporating the proposed changes among the employees and workers and their functions
and operations. As an administrative expert, the role of the Human Resources, is to build an
efficient and effective infrastructure for the organization so that the quality of services
provided by the employees and workers may be optimized. As a champion of the employees,
the HR professionals play the role of advocating the needs and requirements of the employees
and workers to the management and integrating them with the organizational objectives.
HR strategies
Human Resource strategies refer to the designation of long-term plans for a business
organization in order to achieve the goals and targets of human capital management as well
as bringing about the development of the organization (Cascio 2015). The formulation and
implementation of Human Resource strategies are dependent on certain factors like legal
requirements pertaining to the working conditions and compensation for the employees or
workers. Furthermore, the development of HR strategies also requires the professionals to
obtain employee engagement. This can be ensured through a system of providing rewards on
the basis of employee performance, like incentives, promotions and appraisals. The HR
strategies may also incorporate the consideration of career advancement programs for the
employees and workers in order to obtain an optimum level of employee satisfaction as well
as enhancement of performance (Noe et al. 2015). In house training sessions or training
programs may aid the employees to develop their skills and knowledge, thereby making them
capable of achieving the organizational targets and goals.

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The Human Resource strategies developed in business organizations further aid in the
development of a positive and strong corporate image, thereby attracting increased number of
skilled and experienced individuals to work for the company. The development of a
performance management system further aids in the development of effective and efficient
HR strategies, based on the evaluation of the skills and performances of the employees and
workers (Shields et al. 2015). In this regard, it can be mentioned that the formulation and
implementation of effective Human Resource strategies are generally based on an evaluation
of the operations and activities practiced within the scope of the organization, along with an
evaluation and assessment of the skills of the workforce. The successful implementation of
HR strategies, therefore, requires the involvement and participation of the entire workforce,
and their adherence to the policies established by the HR.
Business ethics
Business ethics comprise the policies and practices of a business organization that act
as guidelines for ensuring the approval of the public. The different aspects of business that
are included under the purview of business ethics are conduct of business, accounting
practices, sales techniques and the like. Business ethics play an important role in determining
the Human Resource agendas adopted in an organization as they aid the maintenance of
proper conduct of business among the employees and prevent unethical practices (Hartman,
DesJardins and MacDonald 2014). During the selection and recruitment procedure, the
Human Resource Management System undergoes and elaborate verification process of the
background and competencies of the employees so that they may be able to align their
business activities and functions with the code of ethics established in the organization.
Furthermore, the HR system of business organization also aids in the management of
conflicts and negotiations in case of discrepancies in the business operations and functions
(Crane et al. 2019). Strict rules and regulations pertaining to the prevention of unethical

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practices by the employees of the organization is further an important function performed by
the Human Resource Management system, pertaining to the business ethics of the
organization.
HR Insights
The scope of Human Resource Management has significantly developed in the recent
ages due to rapid transformations and changing trends of the global business environments in
which the organizations operate and function. The role of the HR is no longer limited to
meetings and proposals. Instead of this, the HR plays an important function in the strategy
formulation and implementation for bringing about enhanced productivity and profitability of
the business organizations (Ployhart et al. 2014). For this purpose, the Human Resource
Management system integrates the interests of the organization with the interests of the
employees, thereby fostering optimum levels of employee engagement. Furthermore, this
employee engagement helps in the creation of positive corporate identity for the organization
thereby attracting talented, skilled and experienced individuals to work for the company.
Such quality work force is then retained by the HR through several strategies and formulation
of agendas. In order to bring about the individual and professional development of the
employees and workers, the human resource management system of business organizations
additionally undertake the process of employee training or development, so that they may
acquire the skills and knowledge required to provide favorable business outcomes and
achieve the organizational targets and goals (Budhwar and Debrah 2013).
Tools for analyzing Business Environment
There are several tools that can utilized for the purpose of evaluating and assessing
the external and internal environment of a business organization. The results of such
assessment further aids the Human Resource Management system of these organizations to

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formulate and implement effective and efficient strategies that may aid the organization to
obtain an enhanced productivity and profitability (Lüttgens and Montemari 2016).
SWOT Analysis
The SWOT analysis provides a strategic tool for the evaluation of the internal
strengths and weakness and the external opportunities and threats that may be faced by a
business organization during the course of its operations (Gürel and Tat 2017). The tool of
SWOT analysis is regarded as one of the most effective ways to evaluate the internal and
external business environment of an organization. Such an evaluation further aids in the
development of effective strategies that help the organization to improve on the weaknesses,
fortify the strengths, utilize the opportunities and prevent the threats.
PESTEL Analysis
The PESTEL analysis provides a framework for the analysis of the different external
factors that contribute in affecting the business operations and functions of an organization.
These factors pertain to the political, economic, social, technological, environmental and
legal aspects of the business organization and the environment in which it operates (Perera
2017). This framework focuses on the macro-environmental factors of business operations,
thereby providing certain essential guidelines for strategy formulation and implementation.
These factors further help in the evaluation and assessment of the various threats and
opportunities that are available to the organization for conducting successful business
operations and obtaining a competitive advantage in the market.
Porter’s Five Forces
The model of the five competitive forces was formulated by Michael E. Porter in
order to determine the threats that may be faced by a business organization in the course of
conducting its business operations and activities. These threats have been identified to be the

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threat of new entrants in the market in which the organization operates, threat of substitute
products, threat from the bargaining power of the suppliers, threat from the bargaining power
of the customers and the threat of competitive rivalry (Dobbs 2014). The evaluation of these
factors is essential for the effective functioning of the organization and the formulation of
efficient strategies that may help it to achieve a competitive advantage in the market.
Comparison of the Tools
As discussed earlier the framework of SWOT analysis provides the organization with
an analysis of internal as well as external factors that may affect their operations and
functions. In this regard, the scope of the SWOT analysis is wider than that of the PESTEL
model or Porter’s Five Forces, as they evaluate the macro-environmental factors affecting the
business activities of organizations. However, it may also be noted that the PESTEL model
forms a framework of a detailed analysis of the possible external factors that may influence
the decision making and strategy formulation processes of the organization. The framework
of Porter’s Five Forces on the other hand helps in the evaluation of particularly the external
competitive environment of the business organization. An evaluation of the internal and
external environment of business organizations using the above mentioned tools will further
be useful to the Human Resource Management System of the business organization as it will
provide them with an idea of how the corporate objectives may be obtained through
utilization of the opportunities and prevention of weaknesses (Öneren Arar and Yurdakul
2017). The resources available to the organization may be effectively utilized with the help of
recruitment of skilled and experienced workers suited to perform specific business activities
that may be favorable to the interests of the organization. Prevention of threats may include
efficient retention of talented individuals who may aid in innovation and creation, thereby
reducing the threat of competition from the rivals.

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Factors influencing HR Functions
The different internal and external factors affecting the operations of the human
resource management system of business organization have been discusses as follows:
Corporate Objectives
The corporate objectives and targets adopted by the organization plays an important
role in determining the direction in which the organizational activities and functions will be
targeted. An establishment of the corporate objectives further aids in evaluating the skills and
competencies of the employees that are required to obtain and achieve these objectives. The
HR functions of selection and recruitment are then directed in such a manner so as to assess
the skills and knowledge of the applicants and recruit members to the organization
accordingly (Stewart and Brown 2019). Furthermore, the establishment of distinct corporate
objectives aids the HR system to align the interest of the individuals and groups of
individuals working within the scope of the organization with the goals and targets of the
organization.
Technological Resources
The technological resources available to the business organization enables the
assessment of the skills and knowledge required of the employees and workers in order to be
able to operate and utilize such resources. The function of selection and recruitment
undertaken by the Human Resource Management System is practiced accordingly.
Furthermore, the scope of technological advancement available to the organization also
determines the recruitment of individuals who are skilled and talented enough to engage in
further innovation and creation of new opportunities for the organization. Efficiency and
enhancement of the performance of the employees and workers with the help of advanced
technology is therefore dependent on the HR system and its assessment of the potential of
these individuals (Snell, Bohlander and Morris 2015). Furthermore, in the case of introducing

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technological changes within the scope of business operations the HR system of the
organization plays an important role of conducting and managing training programs for the
employees and managing conflicts or dissatisfaction that may arise due to the change
implementation process.
Economic factors
Economic factors such as the availability of a workforce, level of unemployment and
number of skilled and unskilled employees available act as important external factors that
determine the effectivity and efficiency of the Human Resource Management system of
business organization to perform their functions and operations (Tsogas 2015). These
economic factors of the country or state in which the organization operates in turn determines
that strategies and policies that are to be undertaken by the HR system, so as to aid the
organization to obtain its goals and objectives. The important function of the HR pertaining
to selection and recruitment are significantly dependent on these external factors.
Legal factors
Workplace regulations and laws contribute to be one of the most important external factors
influencing the functions of the Human Resources of a business organization. These
workplace regulations are established by the government of the states or countries in which
the organization functions and operates. These regulations pertain to the scopes of employee
compensation, nature of work, duration of work, workplace conditions and the like.
Workplace regulations can therefore be considered to be important determinants of the hiring
processes, training and compensation schemes adopted by organization (Frege and Kelly
2013). In case the Human Resource Management system of an organization is not able to
maintain or adhere to these regulations, the company may be liable to lawsuits.