HRM323 Information Sheet 2 The Environment of Human Resource Management in The Philippines

HUMAN RESOURCE
MANAGEMENT
BACHELOR OF SCIENE IN INFORMATION

Program :
SYSTEM
Course Code : HRM323
Course Title : HUMAN RESOURCE MANAGEMENT
Course Credit : 3 units/54 hours
BULACAN POLYTECHNIC COLLEGE

Bulihan, City of Malolos
Human Resource Management
MODULE MATERIALS
List of Modules
MODULE
No. MODULE TITLE
CODE
1 Human Resource Management: An Overview HRM323-1
THE ENVIRONMENT OF HUMAN RESOURCE
2 HRM323-2
MANAGEMENT IN THE PHILIPPINES
3 Human Resource Planning HRM323-3
4 The Recruitment Process HRM323-4
5 The Selection Process HRM323-5
6 Performance Management HRM323-6
7 The Training Process HRM323-7
8 The Compensation Program and How to Manage It HRM323-8
9 Employee Benefits HRM323-9
10 Promoting Health and Safety HRM323-10
11 Employee Relations and Discipline HRM323-11
Bachelor of Science in Bulacan Date Developed:

Information System January 2024
Polytechnic Date Revised: Page 2 of 15
Human Resource College
Management Document No. Developed by:
Melannie Bautista Revision # 00
HRM323 c/o Admin
THE
ENVIRONMENT
OF HUMAN
RESOURCE
MANAGEMENT IN
THE PHILIPPINES

HRM323 c/o Admin
MODULE CONTENT
COURSE TITLE : HUMAN RESOURCE MANAGEMENT
MODULE TITLE : THE ENVIRONMENT OF HUMAN

RESOURCE MANAGEMENT IN THE
PHILIPPINES
NOMINAL DURATION : 4 Hours
SPECIFIC LEARNING OBJECTIVES:

At the end of this module, you MUST be able to:
1. Discuss the factors that influence Human Resource Management.
2. Discuss how the factors influence Human Resource Management.
3. Discuss the implications of the dimensions of national culture on
specific human resource functions.
TOPICS:
1. The Factors that Influence Human Resource Management
2. How the Factors Influence Human Resource Management
3. The Implications of the Dimensions of National Culture on Specific
Human Resource Management Functions.
ASSESSMENT METHODS:
• Written examination
• Recitation
REFERENCE:
Supangco, V., Los Banos, J., & Ocampo, K. T. (2021). Human Resource
Management in the Philippine Context (1st ed.). University of the
Philippines Press. (Original work published 2021)

HRM323 c/o Admin
INFORMATION SHEET 323-2
The Environment of Human Resource Management in the
Philippines
Learning Objective/s:
At the end of this module, you SHOULD be able to:
1. Discuss the factors that influence Human Resource Management.
2. Discuss how the factors influence Human Resource Management.
3. Discuss the implications of the dimensions of national culture on
specific human resource functions.
Introduction
Human Resource Management (HRM) practices are influenced by several
factors in the internal and external environments of an organization.
A core function of HRM is to support strategy. Thus, HRM is strongly

influenced by the strategy of the organization. HR practices are also affected by
the overall culture of the organization as well as policies. Moreover, HR
practices are affected by social conditions; they must work within a legal
framework, respond to economic realities and leverage technology to be more
effective.
External Lego Political
Internal Environment
Technological Economic
HRM
Strategy Organizational Culture
Social

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Internal Factors
Factors in the internal environment of the organization that affect human
resource management are strategy, organizational culture and policies.
Strategy
Strategy is a set of plans designed to achieve organizational objectives.
Simply put, it answers the question “how do we get from where to be where we
want to be?” Porter describes three generic strategies based on two dimensions:
scope of market and competitive advantage. The first two strategies are based
on a broader market. When an organization utilizes cost advantage in a broad
marker, it pursues a cost strategy. When it employs its unique offerings in
terms of product or service quality or characteristic in a broad market, it is
pursuing a differentiation strategy. The third strategy targets a limited market
and focuses either on cost or differentiation strategy within this limited market.
Implementing a strategy need alignment of the different functional areas

of the organization in terms of policies and practices, one of which is the
human resource management function. One way in which cost leadership is
achieved is by ensuring that cost of inputs remain low. On the other hand,
differentiation strategy may be achieved by providing constant unique product
innovation or technical expertise based on this generalized model, we are able
to infer the appropriate human resource practices that support the strategy
pursued by the organization.
Organizational Culture
Schein defines culture as “a pattern of shared basic assumptions that a
group learns as it solves its problems of external assumptions that a group
learns as it solves its problems of external adaptation and internal integration,
that has worked well enough to be considered valid and therefore to be taught
to new members as the correct way to perceive, think and fell in relation to
those problems.” Moreover, Schein identifies three levels of culture: basic
underlying assumptions, espoused beliefs and values and artifacts. At the very
core are the basic underlying assumptions that form the essence of an
organization’s culture. They are shared by members but are usually taken for
granted. This level is key to understanding the more visible levels of culture.

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At the most visible level are the artifacts, which are manifestations of a
culture. These are the things that one observes in an organization. These
include architecture, dress code, rituals and ceremonies, stories, etc. one
telling the artifact in a Catholic high school, for example, is the presence of a
school chapel, which is not present in a public high school. Most often, lady
teachers are called “Ma’am.” Public high schools are coeducational while most
Catholic High Schools are not. These are just few differentiating characteristics
of visible cultural differences between a Catholic high school and a public high
school. Still, one specific high school is distinct from the other and this is
determined by looking at different level of culture.
In between the subconscious and the visible levels is the level of

espoused beliefs and values. As opposed to those beliefs and values that are
learned and thus guide and predict behavior, these are beliefs and values that
remain in some but not shared by members. They are merely espoused and will
predict what will be said and not necessarily what is done. They may be found
in strategies, goals and philosophies. Espoused values may not necessarily be
shared by everyone and learned but may only be aspirations.
Human resource management is influenced by corporate culture as it

plays a vital role in nurturing such culture. For example, for an applicant to
stay long in an organization and for that individual to be productive, there
must be a fit between the person and the organization. Thus, selection criteria
consider cultural dimensions to be able to screen those who will fit and screen
out those who will not. In addition, orientation programs see to it that
individuals are properly introduced to into the culture of the organization and
taught what things are shaped by the strategies taken by the organization.
Policies
Policies are statements about how an organization intends to conduct its
business and guide employees in their actions and decisions. Human resource
management policies cover HRM functions such as recruitment, selection,
compensation, benefits, performance management, training, development,
employee relations, labor relations, retirement and others deemed important to
organization. Policies cover different functional areas of the organization, and
this chapter will focus on human resource management policies.

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HRM policies serve several ends. These policies communicate to
employees what are important to the organization and how the organization
intends to conduct its business including conditions of work. Policies provide
guidelines regarding how employees are protected or how employees may
proceed when they feel they are being unfairly treated. They provide
consistency in management actions and decisions.
There are several factors that influence policies. One is the legal
framework. Any human resource management policy must be compliant with
the Labor Code and other orders executed by the Department of Labor and
Employment (DOLE). The Labor Code sets the minimum standards of
conditions of work. Thus, provision of benefits could be above those stipulated
in the Labor Code. Policies also need to support the strategies of the
organization. For example, if the general strategy of an organization is to
provide innovative products, the organization is to provide innovative products,
the organization needs policies that attract creative and innovative individuals
to the organization, enhance employees’ abilities, empower employees and
provide an environment where experimentation is encouraged. Policies also
need to support an organization’s culture such that if the espoused value of the
organization is open communication, the policies must encourage it.
In developing a policy, objectives must be clear and the rationale behind

them must also be explained. The procedures and mechanics on how they are
operationalized must also be spelled out clearly. After the policy has been
approved, the organization must ensure that it is communicated to the
employees. In some organizations, policy review is regularly scheduled to make
sure that the policy is updated and responds to current situation the
organization faces.
External Factors
External factors affecting the human resource management function of
any organization include political, legal, economic, social and technological
factors. These factors are interrelated and affect human resource management
to varied extents and intensifies.

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Political
Political factors pertain to actions of the government, which are reflected
in laws and policies. Setting up a business entails securing the necessary
business permits, which is an organization first interaction with the
government. In addition to business permits, tax laws, labor laws,
environmental laws and ordinances, like zoning, in the local government that a
business operates in, also affect an organization. Beyond these, the general
stability of the government affects the existence of any business because in
many ways, this influences the confidence of the business community to
establish an enterprise or to increase investments.
Tax laws and labor laws are among the most important laws that affect
HRM. Tax laws not only affect potential gains and losses of an organization;
they also affect the compensation system of an organization. For example,
because tax rates in the Philippines are progressive-that is, the higher the
income brackets get higher tax rates-compensation systems are designed such
that the higher the compensation package, the lower the proportion of cash
compensation to lower tax due. However, labor laws form a great part of the
environment that governs HRM.
Economic
A business exists to provide goods and services and in so doing generates
profits. A key to understanding the influence of economic factors to HRM is to
look at the basic factors of production: land, labor and capital and their factor
prices such as rent, wages and interest rates, as well as product prices. This
discussion focuses on labor, wages and general price level. These factors are
interrelated and as each item is discussed, the dictum “ceteris paribus” (other
things being equal) is invoked.
Demand for labor is a derived demand. It is a function of the demand for

goods and services. When the demand for an organization’s good and services.
When the demand for an organization’s good and services is high and is
expected to increase, an organization will need more manpower to produce
such goods and services.

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On the other hand, the supply of labor depends on the population and its
characteristics, the general level of prices and government policies, among
others.
Attitudes of individuals toward work and actual working affect the supply
of labor. For example, not all individuals want to work during the graveyard
shirt, thus the supply of labor available for that shift may be lower compared to
an 8 a.m. to 5 p.m. shift. Alternative uses of an individual’s time also affect the
supply of individuals willing to work on jobs that require overtime work or for
organizations that have a six-day workweek instead of a five-day workweek.
Others want to spend time with family, travel or volunteer work.
Economists have simplified the choice between working and spending

time for leisure. Leisure is a form of consumption that generates utility and is
considered to be a normal good, which means that as income increases, more
of it is consumed. On the other hand, work provides the monetary resources
through which an individual can consume leisure.
The individual supply of labor is depicted by a backward bending curve.

It is argued that a person’s willingness to supply labor is a trade-off between
the amount of time the individual wants to spend at work or leisure, which
depends on the wage rates. When one spends time at work, a certain level of
wage is earned, but when one decides to spend time for leisure, one forgoes
this earning. An increase in wages at lower level induces the individual to
increase the amount of time devoted to work. This is because leisure has
become relatively more expensive, and the rational individual will substitute
work for leisure. The individual will devote more time for work because the
price of leisure is getting more expensive. This is called the substitution effect
of a wage increase. However, as the individual has worked more and has
earned more income, the individual has worked more and has earned more
income, the individual is in a better position to purchase leisure. Because
leisure is a normal good, more of it is consumed at higher levels of income. This
is termed the income effect of a wage increase. Price level also affect the
decision to supply labor. When inflation is high, it becomes imperative for
individual members of the household to look for employment to be able to
afford the cost of living. In addition, some government policies, like those on
compulsory education, also affect the number of individuals who are available
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for work. Government-required licensure examinations also affect labor supply,
more specifically, it limits the number of individuals who may practice a certain
profession.
Supply of labor affects several human resource management functions.

For example, the availability of manpower in an area affects recruitment and
search costs. When there is sufficient supply of manpower, there are more
individuals to choose from. This may shorter time spend on recruitment and
selection, hence, lowering selection and recruitment costs. Moreover, the
quality of manpower affects recruitment time and costs as well as the need for
training. When the quality of manpower is high, the search time for the right
person for the job would be shorter and the cost would be lower. Likewise, the
need for training would be lesser, hence, the training cost will also be lower.
Social Factors
Social factors consist of elements characterizing the society or group that
an individual belongs to including the underlying beliefs and values that affect
behavior and expectations from work. The former elements include
demographic factors such as gender and age distributions, marital status and
educational levels while the latter influences are cultural.
Demographic factors in the environment have significant impact on

human resource management. They define the quantity and quality of the
sources of organization’s manpower in terms of gender, age, marital status and
educational attainment. They also affect the profile of employees in the
organization which will influence the way in which they have to be managed.
The Philippine household population reached thee 100 million mark in

2015. Based on the 2010 data, population is projected to reach 109,921,400 in
2017. Of the figure, 50.4 percent are males and 49.1 percent labor force
participation rate of females. Functional literacy rate of population 10 years old
and above in 2013 was 88.7 percent for males and 92.0 percent for females.
Availability, composition in terms of age and gender and quality of

manpower in terms of education all affect the effectiveness of recruitment. In
addition, the composition of the sources and type of applicants an organization
eventually hires influences the strategy an organization pursues in attracting
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retaining them. For example, married applicant may be attracted to
organizations and would most likely stay when hired if an organization has
family-friendly policies and flexible working hours. Meanwhile, young
applicants may be attracted to opportunities for further learning and growth
that an organization offers. Female applicants are attracted to organizations
that offer equal opportunities for advancement to both males and females. The
quality of manpower applicants in terms of skills and educational attainment
will have an impact on the amount of training of the organization needs to
provide when they are eventually hired in an organization.
National Culture
“Culture is the collaborative programming of the mind which
distinguishes them members of one group or category of people from another.”
Thus, it describes not individuals, but groups of individuals who happen to
share certain patterns of thoughts, feelings and behavior as they experience the
same social environment. Individuals learn values and acceptable behavior
from the training they get from parents and caregivers at home. Once the child
learns to socialize with other children, the child discovers a sense of belonging
to a group other than family members, from their playmates, community and
church. Sources of influence expand as the individual goes to school and work.
However, one’s behavior is not attributable to culture alone. There are also
personality traits that are unique to the individual, which are acquired from
both heredity and learning. The latter is influenced by both the unique
individual experiences as well as those shared by others. Thus, when an
organization hires an individual, the person’s attributes include those that are
uniquely their own and those taken from a collective experience from infancy.
Dimensions of Culture
Identifying important dimensions of culture is useful in describing and
comparing cultures. Hofstead (1980) identified four dimensions in his book
Culture’s Consequences: International Differences in Work Related Values. These
include power distance, uncertainty avoidance, individualism versus
collectivism and masculinity versus femininity. As a result of his collaboration
with Michael Bond from the Chinese University of Hongkong, a fifth dimension
of culture was added to the list. A sixth dimension was subsequently added
based on the work of Minkov (2007), which utilized the World Values Survey.
The six dimensions are:
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1. Power Distance describes how a society accepts inequality in social
situations. Such acceptance of inequality is defined from below and not
imposed from above.
2. Uncertainty Avoidance describes how a society is comfortable or not, with
unknown or unstructured situations. It is not risk avoidance, but the
degree of tolerance for ambiguous situations.
3. Individualism versus Collectivism describes how individuals in a society
are bonded to groups. At the individualist end, individuals tend to their
own, while at the collectivist end, individuals in a society are part of a
group that looks after them or they can lean on for guidance and
protection.
4. Masculinity versus Femininity describes the degree to which a society
exhibits traditional male or female role. The characteristic of being
assertive, ambitious and achievement-oriented is at one end of the
continuum and at the other end is being modest, caring and nurturing.
5. Long-Term versus Short-Term Orientation describes whether or not
individuals in society focus on the past and present or the future. The
long-term end of the continuum corresponds to Bond’s Confucian
Dynamism, which includes values like hard work, perseverance and
thrift among others. On the other end are values that include respect for
tradition, personal stability and respect for social obligation among
others.
6. Indulgence versus Restraint describes the degree to which a society
allows the gratification of desires to enjoy life and have fun on one end
versus control of such desires through strict norms on the other.
Influence of Culture on HRM

The implications of national culture on HRM are far-reaching. Employees
can be more proactive in managing their career by tracking their own
developmental activities online and making sure they are on track with the
developmental activities required of them to progress in the organization.
Moreover, the delivery of compensation and benefit has also benefited

from technological advancement. Salaries are delivered to employees through
automated teller machines (ATM) where employees may withdraw their
salaries, anytime and anywhere. In addition, the application leaves and other

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benefits are also done online. Through the company intranet, employees can
access answers to questions they may have about HR.
Performance management has also been done through the internet

although feedback sessions are still best done on a face-to-face basis. Attitude
surveys and other feedback gathering activities are also done online. Results of
such surveys are easily processed and delivered to respondents much faster.
Employee monitoring is also facilitated through the use of global positioning
systems. Other devices such as biometrics have enabled organizations to
determine whether or not employees have been away from their workstations or
not doing any productive work.
About four decades ago, much of the record-keeping task of HR was done
manually. Nowadays, a Human Resource Information System (HRIS) enables
several organizations to keep records of employees, to provide better HR
practices and services, to enhance employee performance, as well as to provide
management information and to make sound decisions regarding human
resources. In the Philippines, the use of HRIS has increased and most
organizations use HRIS in payroll management, time and attendance tracking
and safekeeping of personnel and benefits records.
More than the information that can be derived from the HRIS, it provides
a rich source of data that management can analyze to improve the performance
of employees. For example, it will be easier for organizations that have HRIS to
determine the respective profiles of their best and worst performing employees.
Organizations can also use data stored in the HRIS to determine which sources
of applicants provide the best fit for the job and the organization. In the areas
of training and development, it is easier to monitor the various training
programs attended by employees and which ones are still needed, how many
and which employees are progressing and who are not and why. Organizations
can also use HRIS data to determine factors that affect commitment, job
satisfaction and retention. In fact, HRIS has the potential to provide data
needed to supply the answer to HR-related questions in an organization.
However, one must be mindful of these questions to ensure that data need to
provide answers are collected and stored in the HRIS.

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Summary
Human Resource Management practices do not exist in a vacuum. They
are influenced by several factors in the internal and external environments of
an organization. Factors in the internal environment include strategy,
corporate culture and policies. In the external environment, political, economic,
social and technological factors affect human resource management.
Issue for Resolution

Gloria is the vice president for HR of one of the largest news and
entertainment providers in the country. Included in its portfolio of businesses
are two national newspapers, five provincial newspapers, four radio stations, a
film and television production business and an advertising company. The
company maintains independent websites for all its businesses including its
newspapers which feature breaking news 24/7 and the latest on current events
and issues from within the country and around the world. Gloria is currently
reviewing the company’s HR strategy that supports the company’s online
presence. Advances in information and telecommunication technology have
made it necessary to review how the company hires its people for the different
businesses and the way it produces and distributes original content on its
various websites. The new vice president for Business Development wants the
company to maximize its online presence by launching an “app” and
establishing an integrated official website with the aim of removing redundant
content from the different website while ensuring that each website continues
to faithfully serve its target market.
a. What challenges do the organization face in the implementation of the
new online presence strategy?
b. What perspectives or frameworks are useful in understanding these
challenges?
c. What can be done to ensure the successful implementation of the new
strategy?

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HUMAN RESOURCE

BACHELOR OF SCIENE IN INFORMATION

Course Code : HRM323

Course Title : HUMAN RESOURCE MANAGEMENT

Course Credit : 3 units/54 hours

BULACAN POLYTECHNIC COLLEGE

Bachelor of Science in Bulacan Date Developed:

Bachelor of Science in Bulacan Date Developed:

COURSE TITLE : HUMAN RESOURCE MANAGEMENT

MODULE TITLE : THE ENVIRONMENT OF HUMAN

NOMINAL DURATION : 4 Hours

SPECIFIC LEARNING OBJECTIVES:

Bachelor of Science in Bulacan Date Developed:

A core function of HRM is to support strategy. Thus, HRM is strongly

External Lego Political

Strategy Organizational Culture

Bachelor of Science in Bulacan Date Developed:

Implementing a strategy need alignment of the different functional areas

Bachelor of Science in Bulacan Date Developed:

In between the subconscious and the visible levels is the level of

Human resource management is influenced by corporate culture as it

Bachelor of Science in Bulacan Date Developed:

In developing a policy, objectives must be clear and the rationale behind

Bachelor of Science in Bulacan Date Developed:

Demand for labor is a derived demand. It is a function of the demand for

Bachelor of Science in Bulacan Date Developed:

Economists have simplified the choice between working and spending

The individual supply of labor is depicted by a backward bending curve.

Supply of labor affects several human resource management functions.

Demographic factors in the environment have significant impact on

The Philippine household population reached thee 100 million mark in

Availability, composition in terms of age and gender and quality of

Influence of Culture on HRM

Moreover, the delivery of compensation and benefit has also benefited

Bachelor of Science in Bulacan Date Developed:

Performance management has also been done through the internet

Bachelor of Science in Bulacan Date Developed:

Issue for Resolution

Bachelor of Science in Bulacan Date Developed:

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