Gowan HRM 4e PPT Ch02

Chapter 2: Organizational
Demands and Environmental

Influences
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Learning Objectives
After reading this chapter, you should be able to:
1. Describe how differences in company strategies shape the primary HR

activities.
2. Explain how company characteristics influence the way employees are
managed.
3. Discuss the role of organizational culture in effective employee management.
4. Explain how employee concerns influence employees’ interpretation and
response to different HR activities.
5. Discuss the impact of labor force trends on how companies manage
employees.
6. Identify how advances in technology affect employee management.
7. Explain the challenges of managing employees in a global context.
8. Understand how ethics and social responsibility influence managerial
decisions.
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Strategy
A company’s plan for achieving a competitive
advantage over its rivals. Positioning and making
decisions about how to attract and retain
customers relative to the competitors.
• Cost leadership strategy

• Differentiation strategy
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Company Characteristics
• Size
• Resources available
• Stage of Development
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Organizational Culture
• The set of basic assumptions, values, and beliefs of
a company’s members
• The informal or unwritten side of organizations—
how employees talk to one another, interact with
customers, and the practices used to manage
employees
• Culture represents the values that organizational
members share
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Employee Concerns
• Psychological Contract
– The perceived obligations that employees
believe they owe the company and that their
company owes them
• Work/Life Balance
– The balance between the demands of work and
the demands of employees’ personal lives
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Employee Concerns (continued)
• Justice— Employee expectations
about how they should be treated at
work.
– Distributive
– Procedural
– Interactional
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Labor Force Trends
• The Aging Workforce- Size of group 55 and older
increasing dramatically
• Demographic Diversity
– Number of women expected to grow 8% from
2016 to 2026
– Fastest-growing groups: Hispanics and Asians
– Migration and birth rates
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Technology
• Continues to shape the nature of competition
and how companies conduct business
• Influences the types of competencies
employees must possess
• Has expanded how we think about work
• Changes how employees function within a
company
• Telecommuting
• Gig workers
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Globalization
• Exporting products and services
• Sending work to foreign companies
• Setting up production or service facilities in
other countries
• Establishing international joint ventures and
partnerships with foreign firms
• Competing with international companies in
domestic markets
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Globalization (continued)
• Influenced by trade agreements among countries
• North American Free Trade Agreement (NAFTA)
– Canada, United States, Mexico
– Gradual removal of tariffs, trade barriers on most goods in
North America
• European Union (EU)
– 28 countries to enhance political, economic, and social
cooperation
– A single market
• Asia-Pacific Economic Cooperation (APEC)
– 21 Pacific Rim countries
– Reduce tariffs, trade barriers to free trade
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Recently there have been growing concerns
in the United States and the United Kingdom
among citizens and politicians over the effects
of globalization on domestic jobs.
• U.S. attempts to renegotiate NAFTA
• Withdrawal of the United Kingdom from
the European Union
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• Domestic Strategy
• International Strategy
• Multinational Strategy
• Global Strategy
• Transnational Strategy
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• Offshoring
– Practice of sending work that was once
performed domestically to companies in other
countries or opening facilities in other countries
to do the work at lower cost
– Influences how investors view a company
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• Global Factors
– Economic Considerations
• labor costs vary dramatically across countries
• the availability of qualified labor
• a country’s unemployment level
– Cultural Differences
• Individual collectivism, power distance, uncertainty avoidance,
masculinity/femininity, long-term vs. short-term orientation are some
ways to understand cultural differences
– International work experience is now one of the major
requirements for promotion to higher-level managerial
positions
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Ethics and Social Responsibility
• Organizations are increasingly expected to cope with HR
challenges in an ethical way
• Eight Stakeholder Groups
– Shareholders
– Community
– Governance
– Diversity
– Employees
– Environment
– Human Rights
– Product
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Ethics and Social Responsibility
(continued)
• Ethical actions and socially responsible behavior
can foster a positive reputation that spurs
additional consumer support
• To encourage ethical behavior in employees
– Appoint an ethics officer
– Monitor aspects of company’s culture
– Provide ethics training
– Perform background checks on new employees
– Regular staff meetings to discuss responsibilities
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Chapter 2: Organizational

Demands and Environmental

1. Describe how differences in company strategies shape the primary HR

• Cost leadership strategy

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