Impact of External Environment on HRM at La Trobe University

This report provides a comprehensive analysis of Human Resource Management (HRM) at La Trobe University in Australia. It begins with an introduction to Strategic HRM and its importance, followed by an overview of La Trobe University, its mission, and vision. The core of the report examines the impact of external environmental factors on HRM functions, drawing upon the Jackson and Schuler model. The report explores various factors including the political environment, laws and regulations, social culture, unionization, labor market conditions, and national culture, demonstrating their influence on HRM practices at La Trobe University. Specific HRM functions such as planning, recruitment, training, and employee relations are discussed in detail, highlighting the effects of the external environment on these processes. The report references relevant academic research and legislation, such as the Fair Work Act, to support its analysis, providing insights into how the university adapts to and manages these external influences. The report concludes by summarizing the direct impact of these external factors on the university's HRM, including its recruitment, compensation, and employee relations strategies, offering a thorough understanding of the challenges and opportunities in managing human resources within a higher education context.

Running head: HUMAN RESOURCE MANAGEMENT
Human Resource Management
Name of the Student:
Name of the University:
Author’s Note:

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Introduction
Strategic Human resource management (SHRM) is a systematic approach of managing
the employees of an organization and directing them towards leading organizational success
(Kramar 2014). It covers a broader area of recruitment, selection, induction, compensation,
training, and motivating and employee relation within an organization. However, Jackson and
Schuler (1995) stated that external environment factors have huge on the human resource
management functions of an organization. This study will discuss the impact of external
environment factors on the human resource function of higher education (HE) provider. The HE
provider chosen for this study is La Trobe University of Australia, which is the most reputed
university in Australia. The study will discuss the external environment factors of HRM as per
the Jackson and Schuler HRM model. Furthermore, the study will demonstrate the impact of
these factors on the HRM functions of La Trobe University.
La Trobe University is an Australian public research university having multi-campus
located at various places Melbourne, Sydney and Victoria. The university was established in the
year 1964. It has become the third university in Victoria and Twelfth University in Australia.
The university is considered as the largest metropolitan campus in Australia. La Trobe offers
undergraduate and post graduate courses across its two colleges of arts, science, Social Science
and Commerce (ASSC) and Health and Engineering (SHE). The university is particularly strong
in the area of humanities and arts (Latrobe.edu.au 2018). Such strength of the university reflected
in QS World University Rankings of 2014, where La Trobe was ranked in top 200 international
universities for humanities and arts. The university was also ranked in top 100 universities under
50 in Times Higher Education World University Rankings (Latrobe.edu.au 2018).

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La Trobe is an extremely multicultural university having more than 8000 students from
110 countries studying in it annually. The largest campus of this university hosts around 25000
students. The University also offers accommodation facilities to the students for their studies.
The mission of La Trobe is to encourage innovation, build alliance with industry and community
partners and embrace research excellence. Furthermore, the vision of the university is address
the major issues of contemporary time and promote positive changes through being inclusive,
connected and excellent. Moreover, the university is targeted at provide outstanding student
experience through research excellence.
Jackson External Environment and Impacts on HRM Functions
External environment of human resource management is comprised of all the external
factors, which have huge influence on the human resource activities. External environmental
scanning facilitates the human resource managers to become proactive to the environment, which
is characterized by intense competition and change (Helfat and Martin 2015). Jackson and
Schuler (1995) pointed out some significant external environment factors, which have huge
influence on the human resource management activities of an organization. The most important
external environment factors influencing the environment are like political environment, laws
and regulations, social culture, unionization, labor market condition, industry characteristics
and national culture.
According to Jackson and Schuler (1995), political environment covers the influence of
political institutions on the human resource management activities of an organization. Stable and
supportive political environment is always helpful for the well-being of the employees in an
organization. The laws and regulations of Government set workplace compliance standards,

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which keep the human resource manager under constant pressure for adhering with the law. Such
regulations can have impact on every process of human resource management like hiring,
compensation, training, termination and many more. Moreover, without adhering with such laws
and regulations, the organizations can be claimed with extensive fines. On the other hand,
Sheehan (2014) opined that the development and modernization of society have huge influence
on the human resource management of an organization. Moreover, education rate and quality of
life style decide the knowledge and skills level of people in the society, which in turn facilitate
HR managers to hire knowledgeable employees.
The pressure from the trade union of a country highly influences the HRM practice of an
organization. Moreover, the hiring, training, compensation and industrial relation of an
organization are set in consultation with the trade union. Furthermore, Deery and Jago (2015)
opined that several dimensions of labor market condition have high level of influence on the
human resource management practice of organization. Moreover, the unemployment rate and
labor market structure influence the cost and wage level of the employees. The industry
competition and nature of work of industry characteristics decide the effectiveness of human
resource management in an organization. On the other hand, the unique values, norms and
customs of national culture impacts on the behavior of human resource, which can affect them
in dealing with global customers (Jain and Kaur 2014).
Jackson and Schuler model can perfectly be used to analyze the factors of external
operating environment of La Trobe University. Political environment includes the political
institutions and their influences on the human resource management activities of an organization.
According to Stone and Deadrick (2015), the political condition of Australia is highly stable and
having less corruption rate among the political parties. Moreover, the political institutions of

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Australia are also supportive enough to the University for increasing the educational growth of
the country. Hence, such environment supports the well-being of the employees in the university.
On the other hand, Jackson and Schuler (1995) stated that Government laws and regulations
decide the workplace compliance standard of an organization, which must be followed by the
human resource managers for avoiding legal constraints. In case of La Trobe University, the
minimum wage laws, Fair Work Act and workplace relation act of Australia highly influence its
compensation package and termination policy (Nyberg et al. 2014). The Fair Work act ensures
the safety and security of the employees through effective human resource management
practices.
Furthermore, the social condition of a country can also have huge influence on the human
resource management activities of an organization. Tseng and Lee (2014) opined that the people
in Australian society are highly inclined towards leading a modern and sophisticated life style.
Everyone in Australia is targeted at choosing an effective profession for their career. On the
other hand, Australia is having a highly diversified society, where multicultural people build the
diverse nature of Australia society. In such situation, the HR managers of La Trobe University
can hire diverse set of employees for adding new opportunities to the educational system. As per
Jackson and Schuler (1995), the power of trade union in a country shapes the human resource
management strategies to be adopted by an organization. Likewise, Australian Government
allows high level of power trade union in shaping the human resource management practice and
procedures of the organization. Hence, in case of La Trobe university, Trade Union is high
responsible to safeguard the interests of the employees. Moreover, the human resource managers
of this university are under huge pressure of trade union to fix the unlawful industrial action and

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wage crisis. Furthermore, the trade union also deals with the employers’ response of La Trobe
University to gender equality in employment.
Several dimensions of labor market condition like unemployment rate, labor diversity and
labor market structure has high level of influence on the human resource management practice of
an organization. Chuang, Jackson and Jiang (2016) pointed out that the wage of the employees’
increases with the drop of unemployment in a country. It automatically decreases the demand for
employees and declines the investment of human resource departments. Conversely, Albrecht et
al. (2015) stated that the wage rate, absenteeism rate and turnover rate of an organization decline
with increasing unemployment rate. Likewise, the rising rate of unemployment highly influences
the HR practice and procedures of the La Trobe University. Hence, the university can satisfy its
employees with low wage rate. Furthermore, Australian labor market is having high level of
diversity with increasing diversity in its overall population. Hence, the La Trobe University is
likely to include diversity in its employment practice. On the other hand, Hollenbeck and
Jamieson (2015) opined that the unique national culture of Australia also influence the HR
practices of La Trobe University. Collaborative and innovative working culture of Australia has
set teamwork working environment with the university.
Human resource functions are the set of systematic activities for providing good
working condition to the employees so that they like working environment. Typical human
resource functions of La Trobe University are always concerned with hiring, motivating and
maintaining the talented workforce in an organization. Such typical human resource functions
are included planning, resourcing and retention, recruitment and selection, training and
development, remuneration and rewards and employee relation. According to Sikora and Ferris
(2014), human resource planning and resourcing is concerned with assessing proper human

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resource demand and sourcing most talented job candidates from the labor market. Employee
retention is the tactics and ability of an organization to retain most talented employees for longer
period of time towards getting long term organizational success. On the other hand, Cania (2014)
opined that recruitment is concerned with sourcing pool of talented employees with desired
skills, knowledge and experience for filling the job vacancies of an organization. Selection is
concerned with choosing the right job candidate for the right position in an organization. The
basic aim of recruitment selection in La Trobe University is to maintain a transparent and fair
hiring process for assisting the HR managers in selecting best candidate for the vacant job
position.
Wright, Coff and Moliterno (2014) opined that training and development is a formal and
ongoing effort made by an organization towards improving the performance and self-fulfillment
opportunities of the employees through proper learning programs. In case of La Trobe
University, it uses organized training and learning process for improving the skills and
knowledge of the professors to provide more effective learning to the students. The trainings are
always provided to the professors as per the changing academic courses offered by the university
to the students. Furthermore, Gupta (2016) opined that remuneration and rewards determines
the level of salary and benefits provided to the employees for attracting, engaging, motivating
and retaining the employees for longer period. In case of La Trobe University, remuneration and
reward are decided under the wage act and fair work act of the Australia. Moreover, the laws and
regulations are concerned with protecting the interest of the employees in relation to their
remuneration and rewards. Employee relation is concerned with the organizational efforts for
managing the relationship between the employers and employees. In case of La Trobe

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University, employee relation programs ensure fair and consistent treatment to all the employees
for making them loyal towards organizational success.
As per Jackson and Schuler (1995), the external environment factors have direct impact
on the typical human resource functions of La Trobe University. The political environment of
a country has direct bearing on the human resource functions of an organization. The nature of
work contracts and labor legislations are actually decided by the political institutions. Popaitoon
and Siengthai (2014) pointed out that the stable and democratic political condition of Australia is
always concerned about the well being of the employees in La Trobe University. The negotiated
consensus and ideologies of Australian Government have set equal employment opportunity
programs, which are to the adopted in all the organizations and institutions. Hence, the human
resource managers of La Trobe University have perfectly incorporated employee diversity in
their recruitment and selection program.
On the other hand, Tran (2015) opined that the legal and regulatory laws enforce
workplace compliance standard, which set the workplace rule and regulations to be implemented
by human resource manager of an organization. The hiring, compensation, training, termination
and many more HR activities of La Trobe University are strictly governed by the laws and
regulations set by the Government. The compensation policy of the university is governed by the
minimum wage act of Australia. Moreover, the minimum wage act of Australia has been
increased to $672.70 a week (Aryee et al. 2016). Hence, the university has set the compensation
structure of the employees as per this act. On other hand, the Fair Work Act of Australia has set
diversity resourcing and fair working hours for the employees. Hence, the HR managers of La
Trobe University has set 7.6 hours per day working hours for the employees to comply with Fair
Work Ombudsmen. In this way, the laws and regulations of the external environment has

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instigated the HR managers of the university to implement fair working environment for long
term retention of the employees.
Jackson and Schuler (1995) pointed out that the social environment in which an
organization operates, has huge influence on its human resource management. Australia society
is an extremely multicultural society, where people from different cultural backgrounds and
values live in collaboration with others. Such diversified social culture is highly reflected the
human resource management practice of La Trobe University. Moreover, the HR managers can
hire diverse people from the diversified society having different set of skills and knowledge. The
diverse employee force also leads the HR management of the university to initiate diversity
training programs for the employees towards understanding the values and norms of each other.
On the other hand, people in Australia society give more priority to work-life-balance over the
reward programs. Hence, the HR managers of La Trobe University have set fair working hours
for the employees towards motivating them for more efficient work. Furthermore, Barrick et al.
(2015) opined that trade union constitutes a major power block for the employees, which
protects their interest through influencing human resource management function of an
organization. Trade unions give voice to the organizational members for establishing human
resource policies towards handing compensations and employee relation. In case of La Trobe
University, the trade union has huge impact in setting the working hours for the employees.
Apart from that, the trade union also conveys the voice of the employees to the employers of the
university to raise employee compensation and benefits. Moreover, the trade union has high
level of impact on retirement benefit planning of La Trobe University employees. Moreover,
the union has convinced the employers for providing 17% contributed superannuation (Vomberg,

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Homburg and Bornemann 2015). Apart from that, the trade union also leads the HR managers of
university towards implementing flexible working arrangement.
Ployhart et al. (2014) pointed out that macroeconomic variables of the labor market have
high level of impact in formulating the human resource functions of an organization. The
unemployment level of a particular country has huge impact on the wage and benefit structure
of an organization. The rising unemployment condition of Australia has increased the demand
for job among the job candidates. In such situation, the absenteeism and turnover rates of
employees in La Trobe University have been decreased. Moreover, Sezerel and Tonus (2014)
stated that the HR managers of the university can retain the talented employees even with low
benefit plan. Hence, the demand of employees is reduced at the university. Furthermore, the
labor market of Australia is highly diversified. Such diversified labor market has high level of
influence on the recruitment and selection function of La Trobe University. Moreover, the
diversified labor market encourages the HR manager of the university to source diversified
employees having different culture, skills and talents. The selection of diverse employee set
helps the university to deal properly with the international students.
Industry characteristics often shape the human resource functions of an organization.
Moreover, Tran (2015) stated that tough industry competition leads the organizations to be more
competitive for gaining competitive advantage in the market. Moreover, La Trobe University can
face issues in retaining the employees in such highly competitive industry. In case of La Trobe
University, the HR managers are trying to gain such competitiveness through providing
competitive compensation package, benefits and flexible working arrangement. Moreover, La
Trobe University is facing tough competition from the Universities like Griffith, Deakin and
many more. In such situation, HR managers of La Trobe University provide competitive

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compensation and benefits to the employees for retaining them for longer period and achieving
the academic excellence. On the other hand, Hollenbeck and Jamieson (2015) opined that unique
national culture of a country has high level of impact in shaping the human resource function of
an organization. Likewise, the unique national culture of Australia has shaped the working
environment and employee relation of La Trobe University. Moreover, the national culture of
Australia is tightly integrated, which encourages the HR managers of this University to initiate
teamwork working environment. Such working environment is highly responsible for
collaborative employee relation among the employees of the university.
Conclusion
While concluding the study, it can be said that external environment factors have high
level of impacts on human resource functions of La Trobe University. The stable political
environment encourages the human resource managers of the university to initiate flexible
working environment. The laws and regulations of Australia guide the HRM functions of the
university in terms of setting compensation, working hours, retirement plan and employee
relation. Moreover, the minimum wage act of Australia highly reflects on the compensation
structure of the university. The HR managers can face legal complexities without adhering with
the laws and regulations of the Government. On the other hand, social environment has also huge
influence on the human resource functions of a university. Moreover, the diversified social
culture of Australia reflects on the diversified workforce hiring process of La Trobe University.
The diversified Australian society encourages the HR managers of the University to hire
diversified employees.

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The power of trade union has high level of influence on human resource function of a
university. Likewise, the increasing power of trade union in Australia has forced the HR manager
of the university to increase the flexibility of the workplace arrangement and other benefit plans.
Furthermore, the diversified labor market of Australia has encouraged the HR manager of the
university to hire increasing numbers of diversified employees. Increasing unemployment rate of
Australia has allowed the HR managers of La Trobe University to retain the employees even at
low salary package. However, the increasing industry competition forces the HR managers of the
university to provide competitive compensation package to the employees.