Study notes

HRM Objectives & Influences

Whilst the precise HR objectives will vary from business to business and industry to industry, the following are commonly seen as important HR objectives:

Ensure human resources are employed cost-effectively

  • Pay rates should be competitive but not excessive
  • Achieve acceptable staff utilisation
  • Minimise staff turnover
  • Measure returns on investment in training

Make effective use of workforce potential

  • Ensure jobs have suitable, achievable workloads
  • Avoid too many under-utilised or over-stretched staff
  • Make best use of employees skills

Match the workforce to the business needs

  • Workforce planning to ensure business has the right number of staff in the right locations with the right skills
  • Effective recruitment to match workforce needs
  • Training programmes to cover skills gaps or respond to changes in technology, processes & market
  • Consider outsourcing activities that can be done better and more cost-effectively by external suppliers
  • Get the right number and mix of staff at each location where the business operates in multiple sites and countries

Maintain good employer / employee relations

  • Avoid unnecessary and costly industrial disputes
  • Timely and honest communication with employees and their representatives
  • Sensitive handling or potential problems with employees (e.g. dismissal, redundancy, major changes in the business)
  • Comply with all relevant employment legislation

Influences on HRM Objectives

The main internal and external influences which are likely to affect the human resources function are summarised below:

Internal influences on HRM objectives

Corporate objectives

E.g. an objective of cost reduction is likely to require HR to implement redundancies, job reallocations etc.

Operational strategies

E.g. introduction of new IT or other systems and processes may require new staff training, fewer staff

Marketing strategies

E.g. new product development and entry into a new market may require changes to organisational structure and recruitment of a new sales team

Financial strategies

E.g. a decision to reduce costs by outsourcing training would result in changes to training programmes

External influences on HRM objectives

Market changes

E.g. a loss of market share to a competitor may require a change in divisional management or job losses to improve competitiveness

Economic changes

E.g. the recession of 2009/10 has placed great pressure on HR departments to reduce staff costs and improve productivity

Technological changes

E.g. the rapid growth of social networking may require changes to the way the business communicates with employees and customers

Social changes

E.g. the growing number of single-person households is increasing demand from employees for flexible working options

Political & legal changes

E.g. EU legislation on areas such as maximum working time and other employment rights impacts directly on workforce planning and remuneration

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