Business Issues and HRM Contexts: Analysis and Strategies

This report provides a comprehensive analysis of the relationship between Human Resource Management (HRM) and business operations. It begins by identifying and explaining four contemporary external factors—political, economic, social, and technological—that significantly impact both HR functions and overall company performance. The report then delves into the forces that shape the HR agenda, including Ulrich's 4-model, best fit practices, employee needs, and cultural balance. A detailed examination of the strengths and weaknesses of PESTLE analysis and Porter's Five Forces is provided, highlighting their usefulness for HR managers in navigating the business environment. Furthermore, the report outlines the stages of strategic management and the crucial role of HR managers within each stage. The contribution of HR managers to business ethics and accountability is discussed, alongside the importance of performance evaluation and HR support systems. Finally, the report explores various sources of business data and how HR planning can leverage this information to support organizational goals. The report provides a thorough understanding of how HRM contributes to organizational success.

Business Issues and
the Contexts of
Human Resources

Table of Contents
ASSESSMENT................................................................................................................................3
Task 1 Four contemporary external factors which can impact on the Function of HR and
company both.........................................................................................................................3
Task 2 Forces which give shape to the HR agenda of the Organization..............................4
Task 3 Strength and weakness of Pestle analysis and 5 forces which can be useful for HR
manager in making business environment.............................................................................6
Task 4 Stages of the strategic management and role of HR manager in the strategic
management............................................................................................................................7
Task 5 contribution of the Human resource manager in the business ethics and accountability
................................................................................................................................................9
Task 6 Performance evaluation and HR support to maintain performance ........................10
Task 7 Different sources of business data and HR planning to support ..............................12
REFERENCES..............................................................................................................................14

ASSESSMENT
HRM is strategic approach to the effective management of the employees and workers in
the company. HR manager of the company is responsible for recruiting employees in the
company and after the recruitment and selection HR managers provide training to those
candidates, so they can understand the task and develop necessary skills for task. HRM also help
organization to achieve competitive advantages through skilful workforce.
Task 1 Four contemporary external factors which can impact on the Function of HR and
company both
There are Four Contemporary external factors which can effect the probability of the
organization in both positive and negative way, this can effect the HR functions as well. Those 4
external factors are political, economic, social and technological. They are described below :
Political
This is the major factor that can impact on organization business. it is because any change
in government will result in changing laws and regulations. Also, it can also change employment
laws. Thus, it will directly impact HR function as the have to form and develop new polices and
work accordingly. HR department also ensure that organizational work culture is developed and
maintained as per political laws and environment. Similarly, organization will also have to
comply with these laws. With the introduction of the new workplace compliance standards HRM
department of the organization will be contentiously under the pressure to stay with the
governmental laws (Alvi, Prasad and Segarra., 2019).
Economic
Economic conditions are responsible to give shape to the economy. In this there are
factors such as GDP, inflation, currency rate, income level, etc. Thus, change in any of those
factors will impact on organizational expenses, resources, operational cost and other expenses
related to management and training of employees. Moreover, HR may have to give more salary
to workers due to high inflation. Also, HR may have to relive some staff due to downfall in GDP
(Baum., 2015). This can affect the profitability of the company so it is important for the HR
department to make strategies and plan to prepare against the economical conciliation.
Technological
Technology is also an external factor because when new technology come in workplace
of organization then HR manager of the company is responsible for implementing this

technology and associated resources within organization. HR department also conduct training
sessions for employees so that they technological advancement can be integrated with employee
performance and operational tasks. In organisation HR department also install high and advance
software to manage HR activities. Therefore, technological changes will highly impact on HR
functions.
Social
It is related to change in taste and preference of people, their needs, etc. The change in
this will directly impact on organisation. With social changes and preferences organisation is
required to bring significant changes to its product specifications, service features and other
marketing aspects. The failure to do so will make the organisational services less effective and
less competent. Moreover, it will also affect HR functions. The social trends and beliefs
influence the organisational culture and team work practices. Thus HR department ensure that it
respect the social beliefs and values effectively so that more productive team and work culture
can be maintained by HR department and employee productivity can enhanced. Besides this, HR
needs to fulfil employee needs to retain them for long term (Collings, Wood and Szamosi.,
2018).
Task 2 Forces which give shape to the HR agenda of organisation
Forces shaping the HR agenda
One of the important role of HR manager of the organization is to acquire resources for
the company to keep up with the accelerating needs of the business and to ensure the stability
and growth of the company. There are 4 forces of the HR agenda.
Urich 4 model- this model is related to organizing HR functions. It is used by large scale
organization. There are 4 key roles defined in it that are HR business partner, change agent,
administration expert and employee advocate. He focused on HR functions rather than its roles.
This has enabled in shaping organisation agenda. Now, they are communicating with internal
stakeholders. There is change in their strategy
Best fit and practice – this is another force that is shaping HR agenda. Here, two concepts are
included. The best fit means that HR strategy has to more efficient and linked to business
environment. Best practice means that HR practices are to be followed to gain competitive
advantage regardless of industry. It must focus on increasing employee performance and
generating positive outcomes. In this strategies are developed to follow right practice in HR.

Awareness
It is necessary for the HR manager to ensure that employees of the company are
competent towards company goals (D’Allura., 2019). If employees of the company easily
engage with the company then it become easier for them to achieve the goals and objectives of
the business. During the recruitment and selection of the candidates, HR manager should give
them role and task of the company, so they can understand objectives of the company, and they
will give their best to achieve company goals and company can achieve higher growth in the
market.
Needs of employees and recognition:
The first agenda of HR department is to recruit talent employees so that organisational
goals can be achieved. Along with the recruitment, the organisational goals varies as per the
situational demands and thus it encourages the need of specific training programs or skill set for
the employees. Thus agenda of HR practices is based upon these needs of employees and their
engagement within organisation.
Cultural balance
Bridging the gap between the business needs and personnel at the disposal of the
organization is paramount to the efficiency at which the organizational functions. This involves
communication, training, building a safe work environment, sense of ownership and
performance. Communication practices will help employees of the company to understand each
other, and they can make good relationship with the superiors and tell their problem facing in the
task (Marconatto and et.al., 2016). It will also help superiors because they can build trust with
employees and get some suggestions related to the work and employees can also help HR
manager to develop new strategies for the decision-making. HR manager can also provide them
group practices among the employees, so they can understand different culture and it will create
cultural understanding among the employees, and they will help each other for the task.
4 Legged stool model:
HR agenda and strategies depends upon several objectives such as organisational goals,
enhancing employee engagement. These forces can also be described with the help of 4 legged
stool model. As per this model the first component is emotional. Employee productivity can be
enhanced when their emotional needs are served effectively. For this purpose HR department use
several motivational techniques and effective management of organisational culture. Another

component affecting HR practices is physical component. It is the responsibility of HRM to
manage all necessary organisational resources so that employees can achieve optimum level of
productivity. HRM practices also depends upon third component called shared belief. HR
department must engage all employees in decision making.
Thus it is their responsibility to protect the beliefs and preferences of all team members.
It is one of the major force which help organisation to understand the requirements of individuals
and to provide them necessary training and support (Armstrong and Taylor, 2014). Along with
these components intellectual component is also an important aspect for the quality performance.
Thus HR department maintain good communication with employees so that knowledge can be
shared and effectively applied. This encourages the formulation of HR practices which builds
healthy intellectual relationships among employees. These forces shapes the human resource
agenda of organisation as well as necessary decisions.
Task 3 Strength and weakness of Pestle analysis and 5 forces which can be useful for HR
manager in making business environment
Pestle analysis
Political Factor
Change in the government can impact on the company, and they have to follow new rules
of the government (Nolan and Garavan., 2016). And this can impact on the HR functions as well
because they also have to make new strategies according to the new rules, but some times
company get benefits from the government can they can save money also use the employees
training programs.
Economic factors
Economic condition can impact on probability of the company if labour rate decrease in
the country. And it increases then it will be negative impact on the business and HR manager
have to recruit employees from the other country. Analysis of these factors is helpful in
formulation of suitable practices which causes financial benefits.
Social
Another strength of PESTEL analysis is that it also evaluate social factors. It is important
for company to work for people and provide job to skilful workers (Shorrock and Williams.,
2016). If they will provide job to the skill full person it will increase probability and without
talent and skilful person cannot help company to achieve objectives. Understanding of social

factors is helpful not only for managing work force and culture but also for improving work
productivity.
Technological
It is important for the company to adopt new technology to gain competitive market. If
organization will not have understanding or analysis of new technology in the workplace then
other company can overtake them. This also serve as great strength of PESTEL analysis.
Legal
It is important for the company to have all legal rights and employment right. They have
to follow rules and regulation. Analysis of legal factor is also a positive aspect of this tool as it as
apart from the competitive perspective it also regulate that organisation is meeting all necessary
legislations.
Environmental
With the business it is important for the company to work for the environment as well
and this will help them to attract customers and if they underestimate those factors Then it can
impact on their business and productivity.
Strengths –
 it helps in analysing external environment and factors that can impact on organization
operations.
 Through it, it is easy to identify new opportunities.
 The implications are accessed both at global and national level.
 PESTEL analysis is cost effective way to develop deep understanding of all external
factors influencing organisational performance and HR practices.
 This tool help HR managers to develop alertness and awareness of business environment
and to exploit opportunities on the basis of PESTEL analysis.
Weakness
 it is a time consuming process and HR needs to regularly analyze environment.
 It often ends up in making assumptions and taking wrong decisions.
 This tool also analyses social and technological factors which makes it hard for the
organisation to anticipate the development and thus in long run it can affect the
effectiveness of HR policies.

 This model analysis only external factors and thus it gives incomplete information
regarding competency of the organisation.
Porter's 5 Forces
Competition in the industry
One of the First force refer to the number of competitor of the organization and their
ability to undercut a company. It is important for the company to provide better services and
product to the customers, so they can give competition to the others, If they do not provide
services which can satisfy the customers then other competitors can over take them.
New entrance
There are many other new therapy companies are entering the market with better services
and this can have negative effect on the Organization (Soleiman Rutherford and Webb., 2018). If
they will have better labor force then they can make their better stability in the market.
Power of supplier
The next factor in the five forces model addresses how easily supplier can drive up the
cost of inputs. It is affected by the number of suppliers of key inputs of a good or service, how
unique these inputs are, and how much it would cost a company to switch to another supplier.
Power of the customers
Customers want quality services in affordable price, HR manager of the company should
recruit candidates who have experience then they can take advantages and service prices should
be not been that much low otherwise company can lose probability.
Threat of Substitutes
Substitute goods or services that can be used in place of a company's products or services
pose a threat.
Strengths
It gives info about competition within industry and various threats.
Weakness
 It does not include broader business issues such as multi national and market.
 It is a static model and thus it emphasis only on present day.
 It is mainly suitable for brainstorming and is not appropriate for deciding optimal
industries with surety.

Task 4 Stages of the strategic management and role of HR manager in the strategic management
Strategic management is not only a process in which manager set a rule to follow. It is
also a philosophical approach for the company and HR manager play important role to make
strategies for the employees, so they can help to achieve business goals. There are 5 stages of the
strategic management which are-
Clarifying vision
In the first stage of forming strategy. Here, purpose is to clarify vision of business and
then proceed further. Here, both long and short terms goals are set. Thus, the HR is involved in
this by clarifying their vision. They decide goals related to employees as well as availability of
necessary organisational resources which will be required for accomplishment of goals. After
setting the goals they recruit candidates who have ability of any particular task in organisation,
so they can be successful in their business (Stone and Deadrick., 2015). They have to clear the
vision, and they have to make long term goals for the company. In the final stage they have to
write the mission statement which can succinctly communicates company goals to both
employees and stakeholders.
Gathering and analyse information
Analyse information is key stage of the strategic formation because information gained in
these stage helps in understanding needs and requirement of business (Taylor and Woodhams,
2016). Here, HR is involved as they provide information of how many employees are needed,
how staffing is done, etc. they gather and analyse info from BOD. Aim of the analysis should be
on understanding the needs of the company and strategic direction from the HR manager. HR
department also interact with the outside business environment to analyse the market trends so
that good brand and awareness can be created and according to market needs suitable candidates
and business policies can be selected.
Formulation a strategy
In the 3rd stage management have to seek external resources. Here, it is identified that
what resources are required to attain goals. The HR manager form strategy and plan that from
where recruitment will be done, how much funds is required, etc.
Implementing Strategies
Implementation of the successful strategies is critical to the success of the business
venture. This is the action stage of this management process. Here, HR role is to implement

strategy in organisation. They recruit staff and develop polices. Also, they assign roles and
responsibilities to employees.
Evaluating and Control
This is final stage and after the executing the plan HR manager of the company should
take consistence review of the internal and external issue and make corrective action on them
when it is necessary (Wehrmeyer., 2017). HR manager of the organization record the
performance of the employees after implementing they strategies and compare with the
penurious performance of the employees. They are also responsible to monitor their performance
and help them to achieve objective and goals of the company. Employees who are having bad
performance then HR manager should provide them a training to develop their skill. If necessary
then they can replace another employees. HR department also use motivational strategy to
enhance the employee productivity. They also employ control measures and monitoring to
ensure that strategies are implemented in desirable way and they deliver desirable outcomes.
Task 5 contribution of the Human resource manager in the business ethics and accountability
Contribution of HR in business ethics
HR department of organisation tasked with the helping recruit new candidates by
understanding their backgrounds. By Cross checking the information on candidates resume, and
they also verify the potential claims of the employees on the basis of resume. HR manager have
skills to verify that employees they are recruiting are honest, and they have done what they have
claims in the resume. Thus it depends entirely on HR to follow all ethical aspects in recruitment,
selection and training process. During the interview of the candidates few ethical question can
help to judge that how candidate will behave and react with a real ethical behaviour. In this way
they are accountable to organisation. In addition to this HRM also emphasis on health and safety
of employees which is also the ethical duty of the organisation. For this purpose HR department
regularly conduct audit of related organisational risks so that employee safety is not
compromised in any way.
HR manager of organisation provide practices like team work and communication so
employees can work together and it also helps to reduce unethical behaviour from the
employees. Sexual harassment, religious discrimination, disability rights and issues pertaining to
minority groups are commonly the domain of HR departments. Regular training on legal

obligations as well as ethical behaviour can be highly effective. Apart form implementation of
these regulations HR department is accountable to all resources that their rights and interests are
protected and they are not influenced by unethical practices (Zhang and Pan, 2015). Don't just
plop employees in front of a video; instead, work to engage them in a meaningful discussion that
encourages empathy for historically oppressed groups and teaches people how to relate fairly and
legally to others. The HR department should ensure that new hires are aware of company
policies; this often helps prevent violations before they occur. Thus, they maintain ethics in
organisation.
Contribution of the HR in accountability
When any candidate applies for the Job in organisation then to go through the HR
manager (World Health Organization, 2016). Accountability is the keeping the commitment of
the company people. To provide a support to the company culture that values accountability the
HR professional needs to be intimately familiar with the what organization believes and HR have
to understand the company mission.
When employees come in the company HR is in the position to recruit to the value of the
company. If any individual employees value do not adjust with the value of the company. When
those value align with the companies valeus then workers slips right into the flow of the
company and adds to the culture rather than the culture distribution. HR manager of the company
is the only part of group who provides job description and direct them to focus on the candidates.
Task 6 Performance evaluation and HR support to maintain performance
For the long term sustainable success and to retain the competitive position in the market
it is vital for the organisation to deliver high quality performance. The regular performance
evaluation assist organisation to identify the gaps in its operations and to bring continuous
improvements in its practices. In order to accomplish this HR department uses variety of
performance evaluation tools.
OPA- organisational performance assessment is model through which performance is evaluated.
In this the balance between efficiency, relevance and financial viability of organisations is
measured. It also examines performance in relation with external environment. The HR helps in
finding out factors affecting employee productivity. On the basis of these results they motivate
them and enhance their productivity. For example – in organisation performance is measured
through OPA. Then on basis of it, changes are done in management. The HR make changes in

employee performance methods. Furthermore, training and development practices are aslo
changed so that business performance can be maintained.
KPI – they are key performance indicators that is used to measure organisation performance.
Here, company set certain benchmark and on basis of it performance is measured. This enables
HR department to focus on those areas where improvement is needed so that necessary resources
and training programs can be integrated for meeting the quality and performance benchmarks.
Balance scorecard- it is a method of evaluation where financial and other measures are done to
analyse organisation performance. The strategies formed are aligned with tactical activities.
APCQ input output measurement framework – it is a method where organisation process is
measured. They are linked with activities and outcomes. for example – in sales process (input)
that is labour is measured with revenue generated (outcome). Here, HR support it by calculating
employee recruitment cost with their present value. This allows them to maintain business
performance. HRM also provide necessary guidelines to plan business strategies with minimum
resource cost.
360 degree performance
HR manager of organisation needs to analyse performance of all over the organization.
Performance of each and every department in an organization needs to be analysed effectively
for development of organization at a large scale. Information from manager of all other
departments they are able to develop their business. Evaluation is done on the basis of
effectiveness of employees to complete their job on the basis of their skills and abilities.
Graphic scale of performance
Employees performance are evaluating on the basis of description of their job that helps
them to achieve goals and objectives of their business. organization needs to evaluate
performance of each and every employee on the basis of their effectiveness (Jenter and Kanaan,
2015). It is an important function of HR department as it helps organisation to fulfil its
performance gaps as well as to enhance the efficiency of each performer by providing them
appropriate support.
Performance measurement
Manager needs to measure performance of their employees on a regular basis that helps
them to take necessary steps to improve performance of their employees. Employees

performance help organizations to develop their business at a large scale and to improve overall
effectiveness of organisation. (Frost, 2019)
Task 7 Different sources of business data and HR planning to support
Business data helps organization to develop their business at a large scale. Data required
to develop new plans and policies for business that helps them to achieve goals and objectives of
business.
Primary data
It is source of business in which they gather fresh data from different methods. They are
done by doing survey, questionnaire, interview, etc. through this, it becomes easy to collect info
related to any topic. Moreover, the data can be gathered through observation as well. The HR can
collect data from employees, customers, etc.
Secondary data
This is the data collected from previous journals, articles, etc. in this data is analysed and
then only relevant data is kept. The business can collect it from previous annual reports,
magazines, etc. The HR can collect data from previous employees, company database, etc.
Customers interaction with services provided by their competitors and ability of their
competitors to satisfy wants of their employees. Requirement of customers from their products
and services and their ability to fulfil their wants.
Market research
Market research helps Organization to get information about the suppliers available in
market for their products and services. Market research helps them to increase availability of
their products and services. It also assist in gathering information about value of their products
and services and helps them to achieve goals and objectives of their business. Online information
about the products and services as large number of customers are using social media and online
platform and market research over their helps organization to develop their business by attracting
large number of customers.
HR planning activities
Different sources of data help HR manager of company to develop plan for their
business. Data helps them to develop planning activities.
Prepare business report

Different sources of data helps HR to prepare business report for their organization. After
analysis of financial effectiveness and market analysis helps them to prepare an effective
business report for development of their business (Panda, Routray and Mohanty, 2016). Business
report helps HR to prepare future plans for their business analysing loses and areas to develop
from business report helps them to achieve goals and objectives
Decision making
Market research and analysis of employees in their organization helps them to take
important decision in development of their business. Decision regarding effectiveness of their
employees and their ability to develop business at a large scale.
Right people in right place
Analysis of employees help HR manager to put right people at right job in an
organization. Analysis of employees skills and abilities helps manager to plan for their duties
according to requirement of their business. Effectiveness of employees help them to achieve
goals and objectives of their business.

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