Scanning: Identify early signals of changes and trends. Monitoring: following some key indicators affecting organizations. Forecasting: an attempt to protect the possible impacts on the organization. Assessing: describing the impact monitored trends and make a adjustment of the possible outcomes.

1. Environmental Influence on HRM

2. Stages of Analysis
• Scanning: Identify early signals of changes and
trends.
• Monitoring: following some key indicators
affecting organizations.
• Forecasting: an attempt to protect the
possible impacts on the organization.
• Assessing: describing the impact monitored
trends and make a adjustment of the possible
outcomes.

3. Environmental Scanning
Environment is anything outside organizational
boundaries.
It is the systematic monitoring of the major
factors influencing the organization.
The goal of scanning the environment is to
identify trends that might affect the formulation
and implementation of both organizational and
HR strategies.
The organization and environment are tightly
integrated. Managers are influenced by the
culture in which they operate.

4. Sources of Information
• Publications: HR professionals can gather information from different
newspapers, business publications, and HR magazines, journals, and
newsletters for scanning environment.
• Professional Associations: HR professionals and executives belong to
a number of organizations that publish newsletters and updates on
current events. Many of these organizations have committees that actively
scan the regulatory scene for upcoming changes.
• Conference and Seminars: Most professionals keep current and
emerging trends by attending conferences, seminars, and workshops
across the world.
• Professional Consultants: Organizations often hire consultants to
research and interpret these trends for them.

5. Method of Forecasting: Competitive
Intelligence
• It is a formal approach to obtain information
about our competitors.
• The simplest method is to study their websites
for information about their strategies and plans
for product launches.
• Some companies hire competitors’ employees
to obtain insider information about future
plans.
• All the information must reliable and correct.

6. Challenges in Environmental Scanning
• Inability to accurately predict the future and to isolating what really
is important to HR.
• It would be difficult to forecast the flattering of organization,
downsizing, the impact of technology, outsourcing, and
telecommuting.
• Isolating the critical form the insignificant. Four ways to identify
significant areas:
(i) Are there ripple effects?
(ii) How profound are the impacts on people's priorities, roles, and
expectations?
(iii) How large is the impact scope?
(iv) Will the change endure over time?

7. Techniques for Scanning
• Trend Analysis: is a quantitative approach that
attempts to forecast future personnel needs
based on extrapolating information from
historical changes in or more organizational
indices.
• Delphi Technique: is a process in which the
forecasts and judgments of a selected group of
experts are solicited and summarized in attempt
to determine the future of employment.

8. Techniques----
• Impact Analysis: looks backward in order to
look forward. Past trends are analyzed. A
panel of experts then attempts to identify
future probable events and study their effects
on the extrapolated trends.

9. Environmental Factors
 Economic Climate: HR managers are concerned with
unemployment rate, value of currencies, amount of
public debt, interest rates because they affect.
Sometimes HR acts as predictor of the economy. A
drop in demand for employees can predict an
economic slowdown. Anything to do with the economy
touches the management of HR.
 Globalization: is the growth in flows of trade and
financial capital across borders. Globalization affects
sovereignty, prosperity, jobs, wages, and social
legislation.

10. Environmental Factors----
• The labor market: a labor market is the area from which an
organization recruits it employees. The number of people available
for work depends on factors such as the unemployment rate,
geographic migration, graduation rates, and so on. The labor market
influences an organization’s ability to implement strategy.
• Political and legislative factors: Governments can influence
the business environment through political programs that result in
changes to laws and regulations. The employer-employee
relationship is governed by a legal framework that includes
common law, constitutional law, and contract law. The actions
organizations take have to be legal, and the law is relatively clear on
what is and is not legal.

11. Environmental Factors---
 Technological factors: technology is the process by which inputs from an
organizations environment are transformed into outputs. Technology includes tools,
machinery, equipment, and software. Every HR function has the potential to become
managed electronically.
 Demographic factors: is the study of population statistics, that affect HR profoundly.
(I) Diversity: the ability to exploit diverse talent will gain competitive advantage.
(II) Generational Difference:
 The supply of workers, known as baby boomers( born between 1945 and 1961),
exceeds the demand for them in middle management.
Baby busters (born between 1963 and 1980) who are very well educated and trained.
Gen X employees(born in late 70s and 80s) are now entering the workforce and live
with technology all their lives.
Gen Y(born between 77 and 97) are totally comfortable with technology and have a more
global and tolerant outlook.

12. Environmental Factors
• Social and cultural factors: employees are
shaped by the norms and values of the society
in which they live. Balance between personal
life with work life, increasing workplace
flexibility, job sharing, telecommuting, elder
care, and child care, employee well being, etc.
Violence in the workplace is also attracting
attention. Some other issues are right to
privacy, work-life balance, contingent workers,
stakeholders,

13. Stakeholders
• The board of Directors
• Senior Management
• Supervisors
• Employees
• Unions

14. Responding to External Factors
• A Proactive Approach: companies can analyze
the business environment to determine the
impact on the organization and actions that
the organization needs to take.
• Organizations can use SWOT analysis to
determine the impact on the organization.