The Forces Shaping the HR Agenda
- February 28, 2021
- Posted by: Harry King
- Category: CIPD Level 5
The HR Function in most firms is seen as a strategic tool. It can be used to make an organisation retain its competitiveness in their market. The HR Function plays may roles including recruiting and selection, offering coaching and mentoring programs facilitating regular training and frequent performance reviews through appraisals. The HR Function is also concerned with keeping the employees motivated and satisfied at work and thus ensures that the organisational culture is one that promotes flexibility, diversity and creativeness. The HR Function also guarantees that the employees with outstanding performances are greatly rewarded (either financially or with other benefits) and applauded to encourage them to perform better and also motivate others to achieve their goals. When the HR Function is viewed strategically, it is key as it will allow the recruitment of experienced, qualified and talented employees who will in turn stay in the organisation for longer thus not only improving the company’s reputation but also improving their performance and overall productivity. This makes the firm have a good reputation of treating its employees well and the effects are seen in the increased number of customers who make the profitability of the firm to increase. However, the HR Agenda is shaped by various factors and among them:
Labour market- the prevailing labour market dictates how the HR Function will conduct its operations. This is due to the fact that, when there is plenty or shortage of labour organisations normally reorganise themselves to accommodate the changes in the labour market. When the employees are too many and the work they are doing is minimal, they tend to be under-utilised and they do not optimise on their skills; this makes them work just for the sake of working which results to laxity and reduced productivity. In a firm, when the employees are not many (understaffed), they are overwhelmed by the responsibilities and the duties they should be doing. This makes them less productive also since they have to do too much work which ideally should be handled by more employees. Overworking the employees makes them tired, less committed to work and also significantly reduces their morale to work. This makes the firm to incur losses and reduce their competitiveness in the market. The HR Function plays a very vital role in trying to strike a balance to ensure that the firm is properly balanced and that the different roles are played by the best and most qualified employees. According to UKDiss (2019), this harmonisation of roles not only improves efficiency and effectiveness but also enhances the company’s brand and reputation.
Employment Law- the Employment Law that is currently in use greatly impacts on how the HR function conducts its business. For instance, the HR Function needs to always be compliant with the rules, regulations and policies set out for each and every function they participate in. the Employment Law also states the minimum wages that the firms should pay its employees and thus HR Function are expected to observe this or else risk being sued or penalised and in very dire circumstances, the business may be closed down. Moreover, failure to observe the Employment Laws adversely affects the firm as its reputation and brand image is tarnished. This is causes very severe impacts for the company as they risk losing a lot. Further, Employment Laws dictates the basic terms of employment such as the working hours, wages, health and safety regulations and recruitment and dismissal processes. All these have to be fully adhered to minimise instances of organisations incurring penalties. The HR Function should also not resist its employees form joining labour parties which advocate for the improved working conditions of employees and other better terms of employment. These labour parties assist the employees to address their issues to the employer collectively instead of each employee rising their concerns independently and advocates for reforms for the well-being of the employees.
Skills shortage- when an Organisation faces shortage of skills internally, they tend to hire new skills from the labour market. However, sometimes the labour market too has a shortage of a particular skill. This can be as a result of inadequate supply from the institutions or many of the holders of a given skill leaving formal employment. Whatever the reason, shortage of skills has dire effects to any organisation. When a given set of skills are in short supply in the market, most organisations tend to train their best employees to cope with the situation in the hope that they can gain as much knowledge in this area as possible. The few available employees with these set of skills also become very marketable and they become very competitive; their demands and terms of employment means that only the very best firms can hire them due to their attractive benefits and package. The other firms have to readjust themselves to meet this shortage by assigning other employees to handle these roles and conducting intensive training and coaching. Shortage of skills also makes the firm to outsource these services from other firms who are experts in the field so as to remain competitive.
Competition- stiff competition in the firm affects most of the decisions made by an organisation. For instance, due to the high competition experienced in a given field, companies strive to reduce their costs as much as possible and increase their profitability. High competition forces the firms to devise creative low cost solutions for their operations. Therefore, most organisations are viewing the HR Function as a strategic function. This is due to the fact that, when any given firm has qualified, experienced and talented employees who stay longer in the firm, their output is definitely higher than those firms who lack skilled labour. The qualified trained employees are seen as a core competence and a strength for these firms since they guarantee that the firm can easily adapt to the ever changing business environment with ease. These experienced employees too, make quality products or offer quality services which guarantees customer retention and increased customer satisfaction levels. This results are reflected in the numbers when the performance of the firm improves as compared to that of competitors. Firms reduce their operational costs so as to sell their good/services at a much lower rate than their competitors so as to create a market niche for themselves.
Technology- with the advancements of technology every time, firms are also readjusting their operations to support technological advancements. As a result, most HR Functions have been automated in a bid for the firms to benefit from the many technological enhancements some of them being; increased efficiency and effectiveness, increased storage and ease of retrieval, enhanced accuracy and reduced information distortion as well as authorised access. With advancements in technology and automation of most HR Functions, the quality of candidates elected has greatly improved since there are no instances of discrimination or biasness. Further, with online recruitment, there is a greater chance to select the most qualified candidates for the job and who are more culture fit for each firm. Technology has also significantly reduced the amount of time spend in these HR Functions and therefore enabling the HR Practitioners more tie to focus on other issues (Zielinski 2019). Further, the HR Function has become an outsourced function which companies may use for consultation and for their daily operations. This means that firms are not limited to given individuals but they can easily access these services from experts and thus make informed and quality decision regarding their Human Resources operations.
Demographics- the needs of the employees are also changing just like the organisation’s. Therefore, they influence how HR functions as HR will adjust its operations to suit the evolving needs and desires of the employees. For instance, the employees will need to be rewarded differently every time they perform well, they need to be constantly trained and hence HR should be ready to assist them as they would require (People Works 2019).
People Works 2019, “Forces Shaping the HR Agenda “People Works Available on: www.peopleorks.in (Accessed on 27/02/2021)
UKDiss 2019, “Business Issues and the Context of Human Resources” UKDiss Available on : www.ukdiss.com (Accessed on 27/02/2021)
Zielinski 2019,”Technology Is Shaping the New HR Agenda” SHRM Avai;able on: www.shrm.org (Accessed on 27/02/2021)