7/11/2017 FACTORS AFFECTING HUMAN RESOURCE PRACTICES | Isaac Onsarigo | Pulse | LinkedIn

FACTORS AFFECTING HUMAN RESOURCE

PRACTICES
Published on March 18, 2016

Isaac Onsarigo Follow

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HUMAN RESOURCE AND ADMINISTRATION OFFICER at Anti Counte

Different studies show that several HRM practices at small and medium enterprises are
influenced by organizational contextual variables including ownership, age and size of
firms (Zheng and Morrison, 2009), even though the level of formality of HR practices at
these firms is low (Kotey and Slade, 2007). Using data from micro, small, and medium
firms in Australia leads to the fact that human resource practices increase with
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increasing firm size (Kotey and Slade, 2007).

Factors affecting human resource practice can be summarized at two levels; internal and
external.

A) Internal factors

(i) Size of the firm

There are two key reasons why one can find a positive relation between firm size
and formalization of HRM practices: First, if organizations become larger, the need to
decentralize and communicate between employees and departments increases. This, in
turn, requires a certain level of standardization, specialization and formalization of
HRM (Nooteboom, 1993). Second, most formalized HRM practices
require considerable development costs (Klaas et al., 2000). This results in a cost
advantage for larger firms, which is strengthened by the limited supply of financial
resources of many small firms.

(ii) Organizational culture

Todays organization is predominantly dynamic as it poses large opportunities and
challenges to the corporate practitioners and policy makers. Understanding such
dynamism is very crucial to pursue the organizational strategic objective. Organizational
culture adapts overtime to cope with the dynamic changes and meet the varying
demands of the organization in its quest for gaining competitive advantage in all its
activities. Therefore, a supportive culture as noted by Ritchie, (2000) is considered as a
motivational instrument which promotes the organization to perform smoothly and
ensure success in all its endeavours. A negative organizational culture kills human
resource practice.

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b) External factors

Government Regulations With the introduction of new workplace compliance

standards your human resources department is constantly under pressure to stay within
the law. These types of regulations influence every process of the HR department,
including hiring, training, compensation, termination, and much more. Without adhering
to such regulations a company can be fined extensively which if it was bad enough
could cause the company to shut down.

Economic Conditions One of the biggest external influences is the shape of the
current economy. Not only does it affect the talent pool, but it might affect your ability
to hire anyone at all. One of the biggest ways to prepare against economic conditions is
to not only know whats happening in the world around you, but also create a plan for
when there is an economic downturn. All companies can make due in a bad economy if
they have a rainy day fund or plan to combat the harsh environment.

Technological Advancements This is considered an external influence because when

new technologies are introduced the HR department can start looking at how to
downsize and look for ways to save money. A job that used to take 2-4 people could be
cut to one done by a single person. Technology is revolutionizing the way we do
business and not just from a consumer standpoint, but from an internal cost-savings
way.

Workforce Demographics As an older generation (generation X) retires and a new

generation enters the workforce the human resources department must look for ways to
attract this new set of candidates. They must hire in a different way and offer different
types of compensation packages that work for this younger generation (generation Y).
At the same time, they must offer a work environment condusive to how this generation
works.

Those involved in human resource management does more than hiring and firing, they
make sure that every type of external influence is listened to and proper procedures are
followed to avoid lawsuits and sanctions. If youre in HR make sure that youre paying
close attention to external influences because there is a good chance theyre affecting
your job and the company you work for.

Isaac Onsarigo
HUMAN RESOURCE AND ADMINISTRATION OFFICER at Anti Counterfeit Agency Follow
6 articles

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2 comments Newest

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LYDIAH JOHN 1y
Financial Advisor at ICEA LION LIFE ASSURANCE
good stu there onsarigo
Like Reply

Michael Ngowi 1y
Administrative/Human Reources Oicer at Muhimbili National Hospital
nice, have got something on this.
Like Reply

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