HR –

a new
dimension

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Features of competitive business environment
Globalization: The globalization of business refers to the free
movement of goods, services, ideas, information, people, etc. across
national boundaries. Markets in every country have become
battleground where both domestic and foreign competitors fight for
market share.

Implications: As every advanced economy becomes global:

• they can design, produce and distribute goods and services equally
good and equally fast,
• every factor of production, other than workforce skills, can be
duplicated anywhere in the world,
• a workforce that is knowledgeable and skilled at doing complex
things keeps a company competitive and attracts foreign
investment.
• For that matter the lesson for the managers is clear: Be ready or
be lost.
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Technology: The modern technology is changing the way
we live and work. The information revolution will transform
everything it touches, and it will touch everything. In the
creative economy, the most important property is the
intellectual capital that resides in people; and for that
matter there can not be true ownership of people. The
best that the firms can do is to create an environment that
makes the best people to stay – the real challenge of
managing human resources.

Impact: HR professionals are recognizing:

 improvements in response time, presentation system, etc.
 use of computer (programs) for management control and
decision making (e.g. HRIS, cost estimation, training, etc.)
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E-commerce: It is said that the Internet will change
the relationship between the consumer and producer in
ways more profound than one can imagine. E-commerce is
taking off whether it is business-to-business or business-
to-consumer, etc. The knowledge workers are the people
who make e-commerce possible, and organizations will
have to address HR challenges of attracting, retaining,
and motivating them to perform well.

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Profitability through growth: In place of costs cut
using downsizing, re-engineering, etc. the executives
paying attention to the other part of the profitability
equation – revenue growth.

Impacts:
 Companies are to be creative and innovative in
developing new products for acquiring new customers,
 They are to be more market focused.
 Companies seeking growth through mergers,
acquisitions, or joint ventures require other
capabilities to integrate different organizations’
work processes and cultures.
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Change and further change: The greatest
competitive challenge companies’ face is adjusting to non-
stop or continuous change that is taking place. Companies
must be able to take on new strategies to adjust with the
changes faster and comfortably. Here, changes means
organizations must have the ability to detect the
emerging trends quicker than others, ability to make
rapid decisions and the ability to identify new ways of
doing business.

Impact:
Companies are to be in a never-ending state of
transformation and perpetually creating an environment
for enduring change.

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Implication for HR management

The consultant-adviser role: guiding top

management -
• about organization strategy and HR
implications
• on motivational, moral, legal implications of
policies and practices
• on needs to protect, develop, reward
employees

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The catalyst-facilitator role: bridging on -
• management philosophy, organizational culture –
culture of collaboration, leadership style and
development, communication skills, etc.

The diagnostic role: identifying -

• Problems - mitigate those
• Assessing impact of various programs like;
MBO, QC, job enrichment, etc.

The assessment role: auditing –

• of HRM policies and practices
• cost analysis of different functions
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