How Does Internal Environment Affect Hr Strategy

The changes in the organization’s internal and external environment that impact on Human Resource plans and strategies

Business in today’s modern world is operating in highly dynamic environment consisting of various internal and external factors. Business therefore are required to consistently evaluate themselves both internally and externally as an attempt to survive, grow and to maintain a competitive edge.

The business environment has three key perspectives which involves the internal environment, and external environment which further comprises of micro and macro environmental factors according to Kotler et al (2009).

The internal environment includes factors such as organizational direction, human resource, finances, business processes

• HR plays an imp. Role in dynamic and competitive environment where organizational activities have become more tactical which requires enhanced individual competency. With shift in firm focus from employee efficiency to employee effectiveness, HR practices have become crucial since they have the organizational capabilities e.g. staffing, skills, culture, rewards and system aligned with business strategy.

• To align business strategy with operations and processes HR practices should improve on HR operational efficiency by improving on design and delivery of basic HR operations and extending HR functional role to strategic role reducing demarcation between HR and system processes.

• HR should assume a strategically proactive role from reactive by clearing understanding the business and other functional areas such as production, marketing, finance to define and create strategic alternatives and add value to the

GE systematic recruitment process help GE recruit best highest level of intellectual capital for right job. Apart from hiring best GE also follows the “promote-from-within” policy to achieve best fit in organizational culture and processes. In Training and Development process HR has incorporated process like “Leadership development” and “Six Sigma” in its global management culture to impart technical and managerial skills to help achieve company strategy of operational efficiency. The company has also incorporated training methodology such as “Action Learning” technique and “Change Acceleration Process” to equip employees with changing business requirement and change management issues. The compensation and benefits are designed in a way to provide incentives for superior performance aligning employees towards business strategy of operational