Environment plays an important role in the development of the business activities. The organisation has the external environment which consists of macro-economic factors such as Growth, GDP, Inflation etc. and Internal Environment which have the micro-economic factors such as the Work force cost, price of products, demand and supply etc. Both the environments have the impact on the organisation.
For example, there is a company let’s suppose X which operates in the country Y that has the low skilled labour force. From last 3 years country does not have the growth rate more than 2%. The development in the field of technology has not much evolved. This has the impacted the various companies working. As the company don’t get the enough labour force so they try to manage the work with the less number of employee and the pressure is much on the employees. The growth rate of the country is much less so the new product in the market may not have much demand. The company X try to export its product to other counties which also include the transportation charges to the company because of low demand in its own existing company. The laws are not much effective in the country. All the factors internal and external effects the business.
Each factor effects the development and the management of human resource services. The development comes when units of the company works properly. But it is not always right as when the company has faced a natural calamity in past it would take a time to grow up. The GDP of the country is low then the development would be affected. It creates the huge unemployment also. This would create the less market to the company product. This would reduce the product demand in the market which in turn reduce the price of the product.
The development happens when the external and internal factors favours the organisation business.
The development and the management of the human resource activities mainly happens by the help of code of conducts and practices in the organisation as well as by the help of finance. The revenue generation would help to give the fair pay to the worker. It helps the company’s business too as the Human resource would directly impact on the business working. The developed economy has the high rate of skilled employees who does not require the training mainly with would benefits the company in terms of money and time. This would be utilised for other production purpose. The external factor as the inflation is high and the demand of the product would be less then the people buying behaviour would be affected so the revenue generated to the company would be less hence the employee’s activities would be affected by this.
The government rules of the country would also affect the development and management of the human resource. For example, Country government which orders that the company should not allow the immigrants to its boundary because it reduces the jobs of the country people which in turn increase the unemployability in the country. This would impact on the working activities of the human resource in the company. It would also bound the company to manage the employee.
As the company resides in the environment so it would be majorly affected by any type of changes in the external environment.
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