1. HR ENVIRONMENT
Our approach is based on fulfilling career development, which is above all the result of open communications and
collaboration between our employees and our human resources teams.
The business environment incorporates strategic planning, resource management and organizational culture. Employees
are a crucial resource, implementing the strategic plans and creating the company culture. Traditional work environments
separate the strategic planners from other employees, but modern organizations often use human resources, or HR, as a
link between executives and employees. This creates an environment of innovation, with those responsible for the work
informing static planners of more lucrative methods.
HR management is based on the following:
 Integration: personalized welcome to department/unit, with a review of the Group‟s businesses.
 Training: enhancing competencies, adaptation to the Group‟s market environment.
 assessment: integration of each person‟s results, creativity, commitment and motivation
 Career development: develop internal mobility and add value by capitalizing on cultural diversity.
Environment (with special reference to Human Resource Management): means the totality of all factors, which influence
both the Organization and HRM sub system.
The environment furnishes the macro context and the Organization is the micro unit. The external environment is
comprised of those factors, which affect an organization‟s human resources from outside the Organization. Important
among them are:Economic;Social;Political;Governmental;Legal;Technological;Manpower in the
country;Tradition and culture;Customers;Other organizations;Trade Unions in other organizations.
Internal Environment
The internal environment also affects the job of a personnel manager. The internal environmental factors include
Organization objectives, policies, organizational structure, and the functional areas of the Organization with which the
personnel manager works continuously like finance, marketing and production. Impact of internal environment factors is
profound as they frequently and closely interact with HRM function in an Organization.
External Environment
The influence of external environment on HRM is also equally important, though the severity is comparatively less.
People are essentially self-managing. In other words, while people manage other resources, they manage personnel.
People themselves decide about the nature, time, and place of their employment. And people react to the changing
conditions and to the techniques of management unlike money, material and machine. The changes includes in the
external environment are: Technological obsolescence;Cultural and social changes;Changes in the policies of
govt.;Politics and the like.
HRM IN KNOWLEDGE ECONOMY
A Knowledge Economy requires success at three levels- sensing, mobilizing and operational sing. The combination of
competencies required is called organizational capabilities. Human Resource Management (HRM) is required to create
organizational capabilities in a knowledge economy. In this new environment, a human resource management has to step
out of the traditional mantle and assume new and dynamic role of managing capabilities that people create and
relationships that people must develop. More flexibility is required to facilitate adaptations and adjustments. The
responsibilities in Human resource management in a knowledge economy will be the demanding role of
1. Human capital Steward, who accumulates and conserves collective knowledge
2. Facilitator, who encourages learning, sharing and rewards knowledge accumulation
3. Relationship Builder, who creates synergy through cross cultural team work
4. Rapid Deployment Specialist, who is versatile in evolving flexible HRM architecture
Power, prestige and money flows into indispensible intellectual property. Intellectual capitals are bought and sold in
Human capital markets. Knowledge, rather than goods and services are the crucial components of the new world
economies. Knowledge Economy has spawned a global knowledge based organization transforming the world into a
single homogenous market. Human Resource Management is the epicenter of such profound transformation. As it is
drawn into greater prominence, it can create greater impact. Human Resource management should tap into the innovative
pulse of the nation and build networks and communication to ensure competence.
Economic development of nations has occurred in different stages- from mechanizing agriculture to industrialization and
post-industrialization enterprises. Economies progress from factor driven low end sectors to investment driven middle
end and innovation driven sectors at the high end.
India, a developing nation still hovers around the factory driven stage of development. As experts suggest, aggressive
automation of the manufacturing sector with Foreign Direct Investment can set the stage for development in the middle
end sector. But India‟s inefficient port and road infrastructure will not be able to handle the high volume rigours of such

2. dramatic progress. Therefore the salient approach would be to push for the innovation driven stage as India shows
vibrancy in the knowledge sector. This is corroborated by the Global Competitiveness Report.
CONCEPT OF SHRM
Strategic HRM defines the organization‟s intentions and plans on how its business goals should be achieved through
people. It is based on three propositions: first, that human capital is a major source of competitive advantage; second, that
it is people who implement the strategic plan; and, third, that a systematic approach should be adapted to defining where
the organization wants to go and how it should get there.
Strategic HRM is a process that involves the use of overarching approaches to the development of HR strategies, which
are integrated vertically with the business strategy and horizontally with one another.
These strategies define intentions and plans related to overall organizational considerations, such as organizational
effectiveness, and to more specific aspects of people management, such as resourcing, learning and development, reward
and employee relations.
The concept of strategic HRM appears to be based on the belief that the formulation of strategy is a rational and linear
process. This indicates that the overall HR strategy flows from the business strategy and generates specific HR strategies
in key areas. The process takes place by reference to systematic reviews of the internal and external environment of the
organization, which identify the business, organizational and HR issues that need to be dealt with.
Strategic HRM supplies a perspective on the way in which critical issues or success factors related to people can be
addressed and strategic decisions are made that have a major and long-term impact on the behavior and success of the
organization. The fundamental aim of strategic HRM is to generate strategic capability by ensuring that the organization
has the skilled, committed and well-motivated employees it needs to achieve sustained competitive advantage. Its
objective is to provide a sense of direction in an often turbulent environment so that the business needs of
the organization and the individual and collective needs of its employees can be met by the development and
implementation of coherent and practical HR policies and programmes. As Dyer and Holder (1988) remark,
strategic HRM should provide „unifying frameworks which are at once broad, contingency based and integrative‟.
EVOLUTION OF SHRM
Strategic Human Resource Management is the practice of aligning business strategy with that of HR practices to achieve
the strategic goals of the organization. The aim of SHRM (Strategic Human Resource Management) is to ensure that HR
strategy is not a means but an end in itself as far as business objectives are concerned. The idea behind SHRM is that
companies must “fit” their HR strategy within the framework of overall Business objectives and hence ensure that there
is alignment between the HR practices and the strategic objectives of the organization.
Evolution of SHRM
With the advent of new economy industries like IT and the mushrooming of the service sector, organizations all over the
world realized that human resources must be viewed as a source of competitive advantage as opposed to treating it much
the same way in access to technology or capital is concerned. What this means is that the practice of HRM is being
viewed as something that promotes the business objectives of the firms and not merely another factor in the way the firm
is managed. With the advent of today‟s economy where services account for a major share of the GDP and the fact that
the service sector is essentially people centric, it is imperative that the people first approach be embraced by the
organizations for sustainable business strategy. The practice of SHRM demands a proactive and hands on approach by
the management as well as the HR department with regards to the entire gamut of activities ranging from staffing and
training and development to mentoring and pay and performance management.
The Way SHRM works
If we take real world examples, many organizations in recent times have dedicated “people managers” whose sole
function is to look after the enabling and fulfilling needs of the resources. This is a marked change from treating people
as just resources to treating people as assets. For instance, Infosys states that people are its assets.
Elaborating on this point, one finds that organizations tend to leverage upon the capabilities of the people employed there
and ensuring that the “human capital” is nourished and nurtured as a source of competitive advantage. This translates into
a dedicated HR department and people managers in every group dealing exclusively with employee issues as opposed to
treating this as a line management function.
Conclusion
The times when management could arbitrarily dictate terms to the employees and tread upon their rights is something
that is not relevant anymore. With the ballooning of the white collar workforce, it becomes necessary for organizations to
pay more attention to the needs of the employees more than ever. Finally, the fact that organizations derive their strategy
from employees instead of imposing strategy upon them is the essence of SHRM.

3. TRADITIONAL HR VERSUS STRATEGIC HR
SHRM realizes that people can make or break an organization because all decisions made regarding finance marketing
operations or technology is made by an organization‟s people. So it accords highest priority to managing people and tries
to integrate all HR programs and policies with the overall corporate strategy. It compels people at all levels to focus more
on strategies issues rather than operational issues. More importantly it believes that there is no best way to manage
people in any given organization. Even within a given industry HR practices vary extensively from one organization to
another Armed with such a flexible approach. SHRM to develop a consistent aligned collecting of practices programs
and policies to facilitate the achievement of the organizations of the organization‟s strategic objectives.
Strategic HR shifts attention as against the traditional HR‟s focus on employee relations to partnership with internal and
external groups. The focus on managing people is more systemic with an understanding of the myriad factors that impact
employees and the organizations and how to manage multiple relationships to ensure satisfaction at all levels of the
organization, strategic HR is transformational in nature, in that it helps the people and the organization to adopt learn and
act quickly. It will make sure that change initiatives that are focused on creating high performance teams, reducing cycle
time for innovation or implementing new technology are defined, developed and delivered in a timely way.
Point of distinction Traditional HR Strategic HR
Focus Employee relations Partnerships with internal and external
customers
Role of HR Transactional change follower and respondent Transformational change leader and initiator.
Initiatives Slow, reactive fragmented Fast proactive and integrated
Time horizon Short term Short, medium and long (as required)
Control Bureaucratic roles, policies procedures Organic flexible whatever is necessary to
succeed
Job design Tight division of labor, independence
specialization
Broad4 flexible cross training teams.
Key investments Capital products People knowledge
Accountability Cost center Investment center
Responsibility for HR Staff specialists Lin managers
BARRIERS TO STRATEGIC HRM
Though strategic HRM looks convincing and essential, several barriers operate in the way of organizations taking to
strategic orientation of their HR functions. The first barrier is that most organizations adopt a short-term mentality and
focus on current performance. This is no surprise since stakeholders, particularly shareholders, expect quick rewards and
executives need to live up to these expectations.
The second barrier relates to the inability of HR executives to think strategically. They are unable to go beyond their area
of operation. Their knowledge about general business functioning, their awareness about technological advancements and
their ability to convince colleagues in other department is limited.
The third barrier is that most senior managers lack appreciation for the value of HR and its ability to contribute to the
organization from strategic perspective. Many understand only the conventional HR and fail to realize the contribution
HR can make as a strategic partner
A fourth barrier is that some functional managers as well and is concerned more with technical aspects of their areas of
responsibility than the human aspects.
A fifth barrier to strategic HR is the problem of quantifying many of the outcomes and benefits if HR programs. It is
believed that many of the outcomes of HR function are abstract – felt but not seen.
Yet another barrier to strategic HR is the fact that human assets are not owned by organizations and, therefore, are
perceived as higher risk investment than capital asset, particularly in highly competitive environment where key
executives are poached from competitors, there is a tendency to invest less in employees than in technology and
information, which are more propriety. This mindset and approach prevents organization from realizing the fact that it is
the people who invest technology and it is human brains behind revolution in informatics, and it is a competitive
advantage to invest in people.
Finally, strategic HR may be resisted because of the incentives for change that might arise. Taking a strategic approach to
HR may mean making drastic changes in the firm‟s architecture. Not many executives are prepared to accept such drastic
changes.

4. Short- term mentality/focus on current performance
Inability of HR to think strategically
Lack of appreciation of what HR can contribute
Failure to understand general manager’s role as an HR manager
Difficulty in quantifying many HR outcome
Perception of human assets as higher risk investments
Incentives for change that might arise
Barrier to Strategic HR
ROLE OF HR IN STRATEGIC PLANNING
Strategic planning outlines the best way to achieve an organization's future objectives. It is an ongoing process that
adapts to changing business conditions. Human resources functions --- staffing, compensation, training, performance
management, succession planning and compliance --- directly influence the organization's ability to achieve those goals.
They shape employee morale and motivation and have a direct bearing on the organization's competitive competency. As
businesses recognize human resources as a success factor, they have begun to shed their view of HR practitioners as just
resume processors and conflict resolvers.
Here are some reasons to include HR in the planning process (as well as in meetings of top management):
Selection and Staffing: When goals are set, its people who work to fulfill those goals. Having the right people in the
right places is vital, and if new hiring is to occur, finding the right people is equally vital.
Organizational Development: Strategic planning often encompasses change in workplace systems or processes.
Although individual departments are likely aware of the status of their own departments, HR folks are often aware of
group initiatives and changes that has occurred company-wide.
Training & Development: Research shows that only 20% of the workforce has the skills that will be required ten years
from now. That means training and development are guaranteed to be needed at some point of the strategic growth
process.
Assess Organizational Goals
Review each of the organization's goals as they relate to how the business is structured, specific jobs involved, the
number of employees required and the qualifications those employees will need.
Note any potential conflicts that might jeopardize these goals,
Share the implications of any organizational or philosophical changes the objectives and goals present with plan
authors so needed adjustments can be made before goals are set.
Forecast Needs
Compare the company goals by department to current skill inventory.
Consider anticipated attrition, competitive best practices, government programs and factors affecting the labor market
such as the economy, population and social trends.
Identify shortcomings in terms of internal mobility, job design, external hiring needs, location, training, diversity and
existing human resource activities.
Critique the HR department using a SWOT --- strengths, weaknesses, opportunities and threats --- analysis in the
areas of HR staff, level of service provided, programs, procedures, technology and communication.
Establish Human Resource Objectives
Use the needs assessment results and departmental SWOT analysis to develop HR goals and objectives that support
and complement corporate goals.
Set objectives that lend a competitive advantage in employee recruitment, development and retention, advises senior
professional in human resources Linda Gravett.
List how these goals will be measured and the frequency of their review.
Specify Programs
Identify changes needed to existing programs or standards.
Outline new activities or tactics to address performance management (appraisals, compensation, and benefits), career
management (training, succession planning, and recruitment) and employee communications issues.
Prepare the departmental budget.

5. UNIT-2
STRATEGIC FIT FRAMEWORKS
Strategic fit express the degree to which an organization is matching its resources and capabilities with the opportunities
in the external environment. The matching takes place through strategy and it is therefore vital that the company have the
actual resources and capabilities to execute and support the strategy. Strategic fit can be used actively to evaluate the
current strategic situation of a company as well as opportunities as M&A and divestitures of organizational divisions.
Strategic fit is related to the Resource-based view of the firm which suggests that the key to profitability is not only
through positioning and industry selection but rather through an internal focus which seeks to utilize the unique
characteristics of the company‟s portfolio of resources and capabilities. A unique combination of resources and
capabilities can eventually be developed into a competitive advantage which the company can profit from. However, it is
important to differentiate between resources and capabilities. Resources relate to the inputs to production owned by the
company, whereas capabilities describe the accumulation of learning the company possesses. Resources can be classified
both as tangible and intangible:
Tangible:
Financial (Cash, securities)
Physical (Location, plant, machinery)
Intangible:
Technology (Patents, copyrights)
Human resources
Reputation (Brands)
Culture
LINKING BUSINESS STRATEGY AND HR STRATEGY
The quality of HRs plays a decisive role in the success of small and medium enterprises. It's man who does the
production and makes working efficiency that boosts the working quality of enterprises.
Moreover, "the people recruited" in an enterprise or an organization creates the business culture which can highlight
enterprises' positions and make them different from competitors.
Unlike other resources such as finance or assets, HR is the significant factor which builds up an enterprise and leads the
enterprise development while financial resource is just the means to gain the targets proposed by enterprises.
Any enterprises' business strategy has its objectives that are the criteria to evaluate enterprises' working efficiency.
Business strategies can be referred in many types and calculated by various factors like objectives of production,
marketing and financial coordination. Enterprises mostly do not care about the connection between business strategies
and human resource policies or planning and plan implementation.
Enterprise managers need to know that HRM is much more difficult than machine operation. On the other hand, human is
not like robots; each one has his own advantages and disadvantages, different working competence. With careful
selection and good management, human resources in enterprises can be the key of business success. Conversely, it can be
the greatest risk.
Following table to see the reaction between business strategies and human resource policies:
1. Business strategies: Competition based on low cost
1.1 Enterprise's features
 Long-term investment
 Low cost for distribution channels
 Detail reports needed.
 Clear assignment of responsibility and accountability
 Simple product design
1.2 Human resources policies
Specific description of tasks or duties
Focus on rules and regulations
Careful training
Productivity-based payment
The aim of working efficiency assessment is to control.
2. Business strategies: Competition based on difference (high quality, customer service, etc.)
2.1 Enterprise's features
Reinforce marketing
Design new products

6. Put priority on research and development
Focus on reputation and quality of products and services
Attract skilled human resources
2.2 Human resources policies
Broad description of tasks and duties
General staff supervision
Outside service for some tasks
Teamwork, not individual work
Staff's competence-based payment
The aim of working efficiency assessment is to develop.
HR BUNDLES APPROACH
• Bundling refers to the development and implementation of several HR practices together so that they are
interrelated and internally consistent
• Each HR practice complements and reinforces the other
• Flexible production techniques need to be supported by bundles of high commitment HR practices such as:
 Performance –contingent pay
 Employment security etc
-High involvement HR practice that is complementary to other HR practices is introduced in a firm
-The new practice produces improvement in performance
-Also have drawbacks
BEST PRACTICE APPROACH
Human resources management requires expertise in several business functions. These functions include management
communication, performance feedback, incentives and recruiting. While companies approach these areas differently,
some best practices have emerged.
Open Book Management
Open book management refers to the practice of sharing company information with employees. In the human resources
department, this includes sharing information regarding department headcount goals, current outsourcing plans or the
cost to the company for contracting with various insurance providers. Management needs to discuss the reasons why the
company plans to outsource specific human resource responsibilities or explain the impact different insurance costs have
on the company's net income. Employees who understand the reasons trust management to be honest and embrace the
department's goals.
360-degree Feedback
Effective performance feedback creates a dialogue between the employee and manager regarding the employee's goals,
achievements and areas for improvement. Human resource professionals interact with employees outside of the
department regularly. The 360-degree feedback method incorporates feedback from individuals who work with the
human resource professional throughout the organization. This includes the employee's manager, the employee, other
human resource employees and employees outside of human resources.
Performance Incentives
Performance incentives prove a good motivator for employee performance when used effectively. In order for
performance incentives to be effective, the performance incentive must be linked to specific performance goals. Each
goal needs to be within the employee's ability to achieve in order to motivate performance. Goals that employees
perceive as impossible demotivate employees, rather than motivate.
Recruitment Job Description
Prior to recruiting new employees, hiring managers need complete job descriptions in order to choose the right person for
the job. Job descriptions detail the responsibilities of the person hired for the position. If the hiring manager understands
what these responsibilities entail, she can choose candidates by seeking characteristics on resumes that match those
responsibilities. She also can choose interview questions that ask the candidate information to determine how well the
candidate can address those responsibilities.
BUSINESS STRATEGY
Formulating a strategy is really about deciding what the objectives of the business are, and developing an overall strategy
for how they should be achieved within the business environment. This should be done in a way that best takes advantage

7. of the company's resources and core competencies (what it does best - its key competitive advantages). Strategy
formulation then needs to follow a process that includes:
1) Understanding where the business is now: externally - in terms of its markets, customers, competitors and general
business environment - and internally, in terms of its resources and competencies (SWOT Analysis).
2) Outlining objectives for the business in terms of where it wants to be - in order to continue towards (and hopefully also
to thrive and grow in) the future (Vision Statement and Mission Statement).
3) Developing strategies and tactics for the business as a whole - and the different functions within it in order to achieve
these objectives (Planning Strategy).
Fig: Business Strategy
Business Strategy in the Real World
In the real world a company's business strategy is not about business definitions and summary of relevant markets - it is
instead a unique formula for success that forms the foundation of a business plan as well as governing day-to-day
operations. To be effective it should cover one or two key factors that distinguish the firm from its competition and are
most expected to contribute to the firm‟s long-term success.
In its simplest form a company‟s strategy should be no longer than one page. And even this should be reducible to one
sentence - covering what is the business really there to do - what is its core value proposition. This then both adds focus
to the business and allows it to be easily and frequently communicated to employees so that a cohesive business focus is
always maintained.
HUMAN RESOURCE PLANNING
Human resources are an important corporate asset and the overall performance of companies depends upon the way it is
used. In order to realize company objectives, it is essential to have a human resource plan. Human resources planning
(also called employment or personnel planning) are essentially the process of getting the right number of qualified people
into the right job at the right time so that an organization can meet its objectives.
Human Resource Planning (HRP) is a forward looking function. It tries to assess human resources requirements in
advance keeping the production schedules market fluctuations demand forecasts, etc. in the background. The Human
resource plan is subject to revision, of course and is tuned to the requirements of an organization from time to time. It is
an integral part of the overall corporate plan and reflects the broad thinking of management about manpower needs
within the organization.
The basic purpose of having a human resource plan is to have an accurate estimate of the number of employees required,
with matching skill requirements to meet organizational objectives. It provides information about the manner in which
existing personnel are employed, the kind of skills required for different categories of jobs and human resource
requirements over a period of time in relation to organizational objectives, it would also give an indication of the lead
time that is available to select and train the required number of additional manpower.
More specifically HR planning is required to meet the following objectives:
1) Forecast personnel requirements: HR planning is essential to determine the future manpower needs in an organization.
In the absence of such a plan, it would be difficult to have the services of the right kind of people at the right time.
2) Cope with changes: HR planning is required to cope with changes in market conditions, technology products and
government regulations in an effective way. In the absence of an HR plan, we may not be in a position to enlist their
services in time.
3) Use existing manpower productively: By keeping an inventory of existing personnel in an enterprise by skill, level,
training, educational qualifications, work experience it will be possible to utilize the existing resources more usefully in
relation to the job requirements. This also helps in decreasing wage and salary costs in the long run.
4) Promote employees in a systematic manner: HR planning provides useful information on the basis of which

8. management decides on the promotion of eligible personnel in the organization. In the absence of an HR plan, it may be
difficult to ensure regular promotions to competent people on justifiable basis.
Importance:
Human Resource Planning is a highly important and useful activity. If used properly it offers a number of benefits:
Reservoir of talent: The organization can have a reservoir of talent at any point of time. People with requisite skills
are readily available to carry out the assigned tasks.
Prepare people for future: People can be trained, motivated and developed in advance and this helps in meeting future
needs for high quality employees quite easily. Likewise, Human resources shortages can also be met comfortably
(when people quit the organizations for various reasons) through proper human resources planning.
Expand or contract: If the organizations want to expand its scale of operations it can go ahead easily. Advance
planning ensures a continuous supply of people with requisite skills who can handle challenging jobs easily.
MEASURES OF HRM PERFORMANCE
HR Management Performance
HR management performance can be monitored through a number of measures.
HR management is an important function in any organization. HR Management performance is measured based on the
department's ability to manage key functions like recruitment and hiring, employee evaluation, training and education
and discipline and termination. Metrics monitored by the HR department and reported to management include numbers
of open positions, time to hire, turnover rates, evaluations completed on time, disciplinary actions and training and
development outcomes.
Recruitment and Hiring: The recruitment and hiring process is a critical HR function. Prompt hiring of qualified
candidates to fill open positions will ensure that the organization is able to remain productive. Commonly used measures
of success in recruitment and hiring include time to hire--the length of time it takes from when a job becomes open to
when it is filled--number of current job openings and satisfaction of hiring managers with the job recruitment and hiring
process.
Training and Education: HR professionals are often responsible for training and education and here, there are four
levels of evaluation of their management performance that include satisfaction of employees attending the training
session, evidence that learning has occurred during the training session, evidence of performance improvement back on
the job and overall impact on the organization.
Employee Evaluation: The employee evaluation process is designed to provide both the organization and the employee
with an indication of the effectiveness of their performance. HR management performance is related to the establishment
of an employee evaluation process--forms, timing and training of supervisors and managers on how to perform the
evaluation--timely completion of evaluations and the use of evaluation data to identify opportunities for improvement,
which might include the identification of training needs.
Turnover: Turnover rates are commonly used as measures of HR management performance. Voluntary turnover (when
employees leave to take another job or to move to a new area) may indicate dissatisfaction with the organization.
Involuntary turnover (through termination or layoffs) may indicate inadequate hiring, training or evaluation practices. HR
management may also learn about the drivers of turnover by comparing turnover among departments or positions. For
instance, turnover in call center environments is generally higher than turnover in management positions. If a company
experiences just the opposite, it may indicate an issue that needs to be explored.
SUSTAINED COMPETITIVE ADVANTAGES THROUGH INIMITABLE HR PRACTICES
Sustainable Competitive Advantage
Sustainable competitive advantage is the unique position that an organization develops in relation to competitors that
allows it to outperform them consistently. As this definition suggests, advantage can only be achieved by establishing a
clear and favorable differentiation from competitors. This difference must be tangible and measurable, and it must be
preservable over time (South, 1981).
Competitive advantage is a unique selling point that a firm has over other businesses. Having a competitive advantage is
essential for any business that wants to compete for the business of consumers. It is therefore necessary to manage for a
competitive advantage. Although it can be difficult to manage for a competitive advantage, it is relatively straightforward
when following a basic set of steps.
Decide on the type of competitive advantage that you want to achieve. There are two types of competitive advantage,
price advantage (when a business offers the lowest prices) and differentiation (when a company offers a unique product).
Identify the resources that are necessary for the type of competitive advantage that you have selected. For example,
resources necessary for a differentiation advantage might include superior design and marketing skills.

9. Gather the resources that you have identified. This can be done by creating the resources within the firm, for
example, by hiring the people you need or researching the information you need internally. It can also be attained by
acquiring external resources, such as by acquiring a firm that already possesses the necessary resources.
Manage the firm's resources to obtain a competitive advantage. This involves adding any additional resources that are
necessary and, in some cases, dropping some resources that are no longer needed.
Regularly review the firm and assess the competitive advantage. If necessary, make changes to the firm's resources to
maintain a competitive advantage.
According to Coyne (1986), competitive advantage is meaningful only if it is felt in the marketplace; that is, the
differentiation must be perceived as an important buying criterion to a substantial customer base. Such an advantage will
be sustainable, only if it cannot be imitated (Barney, 1991). In essence, a gap in the capability underlying the
differentiation must distinguish the producer from its competitors; otherwise, competitors can erase the differentiation at
will (Coyne, 1086).
In order to create such a gap, the organization must deploy its unique combination of skills and resources to exploit
environmental opportunities and neutralize threats. According to Barney (1991), three categories of firm-specific
resources are available for sustainable competitive advantage: (1) Physical resources are those tangible elements used in
a firm's production process, ranging from its plant and equipment to its access to raw materials; (2) Organizational
resources include the firm's structure and processes, from strategic planning systems to reward and control processes; and
(3) Human resources include the training, experience, judgment, relationships, and insight of individual managers and
workers in a firm (Barney, p. 101).
UNIT-3
HR SYSTEMS
A Human Resource Management System (HRMS) or Human Resource Information System (HRIS), refers to the
systems and processes at the intersection between human resource management (HRM) and information technology. It
merges HRM as a discipline and in particular its basic HR activities and processes with the information technology field,
whereas the programming of data processing systems evolved into standardized routines and packages of enterprise
resource planning (ERP) software. On the whole, these ERP systems have their origin on software that integrates
information from different applications into one universal database. The linkage of its financial and human resource
modules through one database is the most important distinction to the individually and proprietary developed
predecessors, which makes this software application both rigid and flexible.
Human Resource Management Systems enabled increasingly higher administrative control of such systems. Currently
Human Resource Management Systems encompass:
1. Payroll
2. Time and Attendance
3. Appraisal performance
4. Benefits Administration
5. HR management Information system
6. Recruiting
7. Performance Record
8. Employee Self-Service
9. Scheduling
10. Absence Management
The payroll module automates the pay process by gathering data on employee time and attendance, calculating various
deductions and taxes, and generating periodic pay cheques and employee tax reports. Data is generally fed from the
human resources and time keeping modules to calculate automatic deposit and manual cheque writing capabilities. This
module can encompass all employee-related transactions as well as integrate with existing financial management
systems.
The time and attendance module gathers standardized time and work related efforts. The most advanced modules
provide broad flexibility in data collection methods, labor distribution capabilities and data analysis features. Cost
analysis and efficiency metrics are the primary functions.
The benefits administration module provides a system for organizations to administer and track employee participation
in benefits programs. These typically encompass insurance, compensation, profit sharing and retirement.

10. STAFFING SYSTEM
A staffing system is a computerized system that enables an organization to manage employee data. Human resources
professionals use staffing systems to manage this information for many personnel functions. For example, HR
professionals use stored data to generate reports about the workforce.
Roles: The human resources department assigns roles to people who use the staffing system. Depending on a person's
position, she has access to employee records. Some generalists may have access to multiple types of information.
Specialists may only access one type of information, such as compensation rates for hourly and salary employees.
Significance: Many organizations collect data required under federal employment laws. HR managers can use the
staffing system to prepare reports on employees from the point of application through termination. For example, a report
might reflect the company's equal employment opportunity practices by showing the number of minorities hired by the
organization.
Benefits: The staffing system also enables the HR professional to provide staffing level reports to senior management.
For example, the personnel director might want to analyze the salaries of all employees or in specific departments or
occupations. This information can be compared to industry standards to determine whether the organization offers
competitive compensation.
Warning: The automated collection of employee personal data presents some possible security problems. The staffing
system must include safeguards so employees do not have an opportunity to use information for their own personal gain.
For example, collecting employees' Social Security Numbers may be required by law, but the employer must protect this
confidential information.
Retention: The organization must also plan for future staffing needs in the event of separations and retirements. That is
why HR managers can use the staffing system to analyze trends in recruitment and retention. For example, you can
generate a report about how long employees stay with the company by comparing hiring dates with termination dates.
The HR department can suggest improvements to senior management to improve employee retention based on other
methods, such as surveying employees about the work climate.
Potential: A staffing system may be used solely by the organization to make hiring decisions. This type of system guides
the organization through several hiring steps, from identifying the ideal candidate to applicant screening to offering the
job to the right person.
REWARD AND COMPENSATION SYSTEMS
The most effective reward and compensation systems align with objective, outcome-based evaluations of employee
performance. Each employee's performance measurement should reflect the organization's business strategy and financial
goals. Compensation should also reflect the employee's performance level and his or her contributions to the
organization's success.
Conventional wisdom and traditional compensation practices often prevent organizations from achieving strategic goals.
Organizations must align their compensation and reward systems with performance, for when they do, they will increase
productivity and achieve sustainable growth.
1. reflect an employee's performance and contributions
2. improve employee and customer engagement
3. increase productivity
4. focus employees on clear, objective, and measurable outcomes
5. link to the organization's strategic direction and business goals
6. reward employees who achieve results
Our compensation experts work with company leaders to formulate compensation and reward programs that integrate
with their strategic business objectives.
Our consulting process centers on accomplishing these goals:
1. review and assess the organization's strategic direction, initiatives, and functional practices, as well as
compensation-driven performance measures
2. develop a comprehensive understanding of the performance and compensation relationship within the
organization
3. create compensation and reward systems that are focused, simple, and designed to promote world-class
performance in every role
4. guide and support the client in moving from current pay systems to performance-based pay systems
Effective rewards and compensation systems can help organizations:
Align rewards with business performance and work culture.
Provide a basis for a competitive and differentiated reward package that reflects the internal and external value of

11. work.
Ensure that roles are effectively differentiated and leveled within the organization.
Enable the internal equity of reward programmes – parity among and between employee groups.
Ensure the external competitiveness of the compensation programme so that compensation is positioned against the
right comparator groups at the right levels.
Provide a link between performance management systems and how employees are paid.
Ensure employees have buy-in and understand new programmes and increase the commitment/engagement of
employees
CAREER DEVELOPMENT SYSTEM
Career development programs are not of recent idea and they were followed even in the recent past in form or the other.
There are four steps in establishing a career development system. They are:
(i) needs defining the present system,
(ii) vision determining new directions and possibilities,
(iii) action plan deciding on practical first steps, and
(iv) results maintaining the change.
Step 1> Needs: This step involves in the conducting a needs assessment as a training program.
Step 2> Vision: The needs of the career system must be linked with the interventions. An ideal career development
system known as the vision links the needs with the interventions.
Step 3> Action plan: An action plan should be formulated in order to achieve the vision. The support of the top
management should be obtained in this process.
Step 4> Results: Career development programs should be integrated with the organization on-going employee training
and management development programs. The program should be evaluated from time to time in order to revise the
program.
Steps and Tasks in Establishing a Career Development System:
Needs: Defining the Present System and establish roles and responsibilities of employees, managers, and the
organization. Identify needs; establish target groups. Establish cultural parameters; determine organizational receptivity,
support, and commitment to career development.
Assess existing HR programs or structures; consider possible links to a career development program.
Vision: Determine new direction and possibilities. Create a long-term philosophy and establish the vision or objectives of
the program. Design interventions for employees, managers, and the organization. Organize and make available career
information needed to support the program.
Action plan: Deciding on practical first Steps. Assess the plan and obtain support from top management.
Career development is essential to implement career plan. Career development consists of personal improvements
undertaken by the individual employee, training, development and educational programs provided by the organization
and various institutes.
Career Development Actions:
1. Job Performance: Employees must prove that his performance on the job is to the level of standards established, if he
wants career progress.
2. Exposure: Employees desire for career progress should expose their skills, knowledge, qualifications, achievements,
performance etc. to those who take the decision about career progress.
3. Resignations: Employees may resign the present job in the organization, if they find that career opportunities
elsewhere are better than those of the present organization.
4. Change the Job: Employees who put organizational loyalty above career loyalty may change the job in the same
organization if they find that career opportunities in other jobs in the same organization are better than those in the
present job.
5. Career Guidance: And counseling provides information, advice and encouragement to switch over to other career or
organization, where career opportunities are better.
COMPONENTS OF PERFORMANCE MANAGEMENT SYSTEM
Any effective performance management system includes the following components:
1. Performance Planning: Performance planning is the first crucial component of any performance management
process which forms the basis of performance appraisals. Performance planning is jointly done by the appraise and
also the reviewed in the beginning of a performance session. During this period, the employees decide upon the
targets and the key performance areas which can be performed over a year within the performance budget.

12. 2. Performance Appraisal and Reviewing: The appraisals are normally performed twice in a year in an organization
in the form of mid reviews and annual reviews which is held in the end of the financial year. In this process, the
appraise first offers the self filled up ratings in the self appraisal form and also describes his/her achievements over a
period of time in quantifiable terms.
3. Feedback on the Performance followed by personal counseling and performance facilitation: Feedback and
counseling is given a lot of importance in the performance management process. This is the stage in which the
employee acquires awareness from the appraiser about the areas of improvements and also information on whether
the employee is contributing the expected levels of performance or not. The employee receives an open and a very
transparent feedback and along with this the training and development needs of the employee is also identified.
4. Rewarding good performance: This is a very vital component as it will determine the work motivation of an
employee. During this stage, an employee is publicly recognized for good performance and is rewarded. This stage is
very sensitive for an employee as this may have a direct influence on the self esteem and achievement orientation.
5. Performance Improvement Plans: In this stage, fresh set of goals are established for an employee and new deadline
is provided for accomplishing those objectives. This plan is jointly developed by the appraise and the appraiser and is
mutually approved.
6. Potential Appraisal: Potential appraisal forms a basis for both lateral and vertical movement of employees. By
implementing competency mapping and various assessment techniques, potential appraisal is performed. Potential
appraisal provides crucial inputs for succession planning and job rotation.
UNIT-4
STRATEGIC OPTIONS
Strategic options are creative alternative action-oriented responses to the external situation that an organization (or group
of organizations) faces. Strategic options take advantage of facts and actors, trends, opportunities and threat of the
outside world. Strategic options can be identified after an institutional assessment, keeping in mind the aspirations (basic
question) of an organization. The tool „Strategic options‟ helps to identify and make a preliminary screening of
alternative strategic options or perspectives.
Process: The identification of strategic options is a creative process that can be done in small (sub-) groups of no more
than eight persons; meanwhile taking care that hierarchy does not restrict people to actively contribute ideas.
Groundwork: the formulation of strategic options can take place after institutional analysis, and after (or in combination
with) reaching clarity on the mission and aspirations of the organization. In other words, this tool formulates possible
responses to the opportunities and threats you identified by making an environmental scan, institutiogramme, and
coverage matrix and/or stakeholder analysis.
Steps to develop strategic options (SOP)
0. Assess the external context, in terms of opportunities and threats (e.g. from environmental scan, institutiogramme,
coverage matrix and/or stakeholder analysis)
1. Priorities and cluster opportunities and threats • If you have more than 15 of each, priorities (e.g. through voting) •
Brainstorm which opportunities and threats can be related to each other.
2. Develop strategic options. Formulate strategic options that: • Respond to one or more opportunities and/or threats • Are
actions (or results) related to output, input, mission, vision and/or relations • Are straightforward (clearly relate to
opportunities and/or threats)
3. Rate the options in terms of relevance to (note that this is only a preliminary selection) in the SOP matrix • the criteria
in your BQ, and/or • the mission and aspiration of the organization.
4. Follow-up • Implement internal organizational analysis of critical elements • Strategic orientation (SOR), the final
selection of a (set of) strategic options
HR Decision Making
Making business decisions requires a critical analysis of your business goals, particularly when the consequences of your
decision will have an impact on the status of employment within your organization. Outsourcing human resources
functions has become a growing consideration for businesses of all sizes. If you are planning to outsource any part of
your human resources functions, be prepared to examine your business needs, current staff expertise and the expense of
outsourcing versus in-house activities.
Decision Making is an act of narrowing down the possibilities, choosing a course of action and determing the problem‟s
potential consequences.
Steps to be followed:

13. Frame the issue: A problem well defined is half solved. But to define the problem by itself is a problem sometimes. If a
problem is not properly defined, the solutions are bound to be haphazard. In most of the cases, the problem is something
else than what it is looked at.
Generate Alternatives: One of the best ways to solve a problem is to clearly define it in front of your group and invite
suggestions. Agreed that many would be impractical in nature but one good alternative will invite positive change.
Choose the best alternative after determining the potential consequences: Accept the best but still consider the rest.
This helps problem solving during contingencies. Every solution has its pros and cons. Weigh the magnitude of benefits
perceived and then take a decision.
Analytical Skills
Analytical skills are the ability to visualize, articulate, solve complex problems and make decisions that make sense
based on available information.
DOWNSIZING AND RESTRUCTURING
Downsizing is a commonly used euphemism which refers to reducing the overall size and operating costs of a company,
most directly through a reduction in the total number of employees. When the market is tight, downsizing is extremely
common, as companies fight to survive in a hostile climate while competing with other companies in the same sector. For
employees, downsizing can be very unnerving and upsetting.
There are several reasons to engage in downsizing. The primary reason is to make the daily operations of a business more
efficient. In addition, downsizing increases profits by reducing the overall overhead of a business. In other instances, a
company may decide to shut down an entire division; a car company, for example, might decide to stop making sedans
altogether, thus cutting an entire department.
Numerous terms accompany downsizing. Employees may be terminated, fired, laid off, made redundant, or released. A
business may be optimized, right sized, or experiencing a reduction in workforce. Some of these terms have different
legal meanings depending on where one is in the world; a layoff, for example, may refer to a mass temporary release of
employees who will brought back in once business picks up, while a redundant employee is one who is asked to leave
permanently.
Downsizing refers to a company‟s decision to reduce its workforce for reasons other than
- Poor performance/Criminal conduct/Unethical behavior
Downsizing an Ethical Issue
 It is understandable that companies want to minimize their liability when they downsize
 There are economic matters to consider, which makes downsizing a management issue
 At its core, downsizing is an ethical issue, and the good manager is concerned not just with protecting the company‟s
financial and legal interests but also with honoring the dignity and integrity of the human beings who work on the
front lines and who are the lifeblood of the organization
Difference between Lay-Off and Downsizing
 In traditional layoffs, employees are asked to leave temporarily and return when the market situation improves.
 In downsizing, employees are asked to leave permanently.
Following changes observed in organizational culture after downsizing:
 Power shift from middle management to top management
 Shift in Focus from Individual Welfare to Organizational Welfare
 Change in working relationships (from being familial to competitive)
 Depression, anxiety, frustration, anger and bitterness in the downsized employees
Observations
 Downsizing is a toxic solution
 Ignoring all the signs pointing to a layoff until it‟s too late to plan adequately; then action must be taken immediately
to reduce the financial drain of excess staff is clear
 LIFO – Its irrational
 This approach may succeed from a legal perspective, but not necessarily from the larger and more important concern
of organizational health.
Restructuring is the corporate management term for the act of reorganizing the legal, ownership, operational, or other
structures of a company for the purpose of making it more profitable, or better organized for its present needs. Other
reasons for restructuring include a change of ownership or ownership structure, demerger, or a response to a crisis or
major change in the business such as bankruptcy, repositioning, or buyout. Restructuring may also be described as
corporate restructuring, debt restructuring and financial restructuring.

14. Executives involved in restructuring often hire financial and legal advisors to assist in the transaction details and
negotiation. It may also be done by a new CEO hired specifically to make the difficult and controversial decisions
required to save or reposition the company. It generally involves financing debt, selling portions of the company to
investors, and reorganizing or reducing operations.
The basic nature of restructuring is a zero sum game. Strategic restructuring reduces financial losses, simultaneously
reducing tensions between debt and equity holders to facilitate a prompt resolution of a distressed situation.
Corporate debt restructuring is the reorganization of companies‟ outstanding liabilities. It generally a mechanism used by
companies which are facing difficulties in repaying their debts. In the process of restructuring, the credit obligations are
spread out over longer duration with smaller payments. This allows company‟s ability to meet debt obligations. Also, as
part of process, some creditors may agree to exchange debt for some portion of equity. It is based on the principle that
restructuring facilities available to companies in a timely and transparent matter goes a long way in ensuring their
viability which is sometimes threatened by internal and external factors. This process tries to resolve the difficulties faced
by the corporate sector and enables them to become viable again.
MERGERS AND ACQUISITIONS
Mergers and acquisitions (abbreviated M&A) refers to the aspect of corporate strategy, corporate finance and
management dealing with the buying, selling, dividing and combining of different companies and similar entities that can
help an enterprise grow rapidly in its sector or location of origin, or a new field or new location, without creating a
subsidiary, other child entity or using a joint venture. The distinction between a "merger" and an "acquisition" has
become increasingly blurred in various respects although it has not completely disappeared in all situations.
The terms merger and acquisition mean slightly different things. The legal concept of a merger is different from the
business point of view of a "merger", which can be achieved independently of the corporate mechanics through various
means such as "triangular merger", statutory merger, acquisition, etc. When one company takes over another and clearly
establishes itself as the new owner, the purchase is called an acquisition. From a legal point of view, the target company
ceases to exist, the buyer "swallows" the business and the buyer's stock continues to be traded.
Motives behind M&A
The dominant rationale used to explain M&A activity is that acquiring firms seek improved financial performance. The
following motives are considered to improve financial performance:
Economy of scale: This refers to the fact that the combined company can often reduce its fixed costs by removing
duplicate departments or operations, lowering the costs of the company relative to the same revenue stream, thus
increasing profit margins.
Economy of scope: This refers to the efficiencies primarily associated with demand-side changes, such as increasing
or decreasing the scope of marketing and distribution, of different types of products.
Increased revenue or market share: This assumes that the buyer will be absorbing a major competitor and thus
increase its market power (by capturing increased market share) to set prices.
Cross-selling: For example, a bank buying a stock broker could then sell its banking products to the stock broker's
customers, while the broker can sign up the bank's customers for brokerage accounts.
Synergy: For example, managerial economies such as the increased opportunity of managerial specialization. Another
example is purchasing economies due to increased order size and associated bulk-buying discounts.
Merger & Acquisitions (M&A) term explains the corporate strategy which determines the financial and long term effects
of combination of two companies to create synergies or divide the existing company to gain competitive ground for
independent units.
Mergers and acquisitions often create brand problems, beginning with what to call the company after the transaction and
going down into detail about what to do about overlapping and competing product brands. Decisions about what brand
equity to write off are not inconsequential. And, given the ability for the right brand choices to drive preference and earn
a price premium, the future success of a merger or acquisition depends on making wise brand choices. Brand decision-
makers essentially can choose from four different approaches to dealing with naming issues, each with specific pros and
cons:
1. Keep one name and discontinue the other. The strongest legacy brand with the best prospects for the future lives on..
2. Keep one name and demote the other. The strongest name becomes the company name and the weaker one is
demoted to a divisional brand or product brand.
3. Keep both names and use them together. Some companies try to please everyone and keep the value of both brands
by using them together.
4. Discard both legacy names and adopt a totally new one. The classic example is the merger of Bell Atlantic with
GTE, which became Verizon Communications.

15. OUTSOURCING AND OFF SHORING
Outsourcing
For decades companies expanded their conglomerates by buying other companies. Initially these companies were related
businesses, often suppliers. Soon the conglomerates began buying companies with no relation. Profit motives and the
desire to be the biggest became sufficient motivation for acquisition. Ultimately, the conglomerates began to collapse
under the weight of the acquired companies. Profits started falling and companies began to retract to their "core"
businesses.
Next they discovered that they could shed even core functions by hiring them out to companies that could do them more
efficiently and, thus, less expensively. Payroll processing was subcontracted. Shipping was farmed out. So was
manufacturing. Companies were hired to do collections, customer call centers, and employee benefits. Collectively, this
was called outsourcing.
Outsourcing made sense. Specialized companies provided their services to many client companies at lower prices than
the client companies could do the work in-house. Both companies, the service provider and the client, profited from the
arrangement. Unfortunately, like the building of conglomerates before it, outsourcing got carried to extremes. Companies
began outsourcing work to the lowest bidder and lost sight of the effect it had on the company except for finances.
Outsourcing this work to "foreign" or "offshore" companies, solely to take advantage of lower labor rates in those
countries, became known as off shoring.
Off shoring
Off shoring has been going on for many years. However, it drew little attention when blue-collar job were being lost
because of the practice. Many hard goods manufacturing plants were moved to Central America and Indochina.
Recently, US-based companies have accelerated the practice of off shoring and have extended its reach to include so
called white-collar jobs. Large companies have transferred their call centers to India, for example, where labor rates can
be as low as 50-80% lowers than US rates. The off shoring of professional and technical jobs by US companies is done to
save money, but it has raised concerns. As the US struggles to recover from recession, the rate of job creation lags far
behind the expected pace. There is growing concern that this is due to off shoring.
Off shoring is neither the cure-all it has been portrayed by business nor the economy-destroying monster laid-off workers
claim. While off shoring does have financial advantages for businesses, these advantages are often far smaller than first
anticipated due to hidden costs. There are also non-financial costs to businesses from off shoring, including lowered
public perception and reduced morale/productivity from remaining staff. Off shoring can be beneficial for workers of the
US companies because their employers will be financially stronger and better able to compete.
DIFFERENCE BETWEEN INTERNATIONAL & DOMESTIC BUSINESS STRATEGIC PLANNING
A strategic planning for business is normally a long-term blueprint to develop and enhance the company's profitability,
product development and market share. These are the goals of all firms in a capitalist economy. However, domestic
investment and marketing is very different than going global.
Types
The main types of distinction between planning in domestic and foreign investment and trade can be summarized around
the idea of adaption. In general, labor in the developing world is less productive than in the developed world, and
infrastructure is often less developed. These important variables must be included in any long-range plan. It is often the
case that strategic plans for global businesses concern the desire to hire a cadre of local professionals to assist the firm in
integrating into the local economy. Without this integration, global investment might backfire.
Features
The main features marking the difference between strategic plans in the international and domestic economy concern the
diversity of potential markets and investments. The main issues revolve around adapting to the differing currencies,
regulations and political problems of different states. These are not issues in local investment in the developed world.
Considerations
There is generally one media and one overarching consumer culture. On the other hand, global marketing is radically
different, since it is often the case that products might be modified to avoid offending local sentiment, and local
regulations might be very different than in the India. Therefore, long-term planning in international business becomes
intensely political.
Benefits
This kind of adaptation necessary to "go global" might have benefits for the company. One major difference between
domestic and international strategies concerns the term of investment. Overseas investment and trading demand long
term goals. The adaptation process itself often takes a long time, and therefore, shareholders might begin taking a longer
term view if a firm goes global. This force toward the long term might not exist at the domestic level.

16. Effects
Ultimately, strategic planning on the domestic and the international front will develop two very different approaches to
firm goals. While the basic goals remain the same (profit, product development, etc), means to reach these goals differ
radically. The specialist in international strategic planning is dealing with far more complex variables in terms of
logistics, culture, political systems and human resources.
DOMESTIC AND INTERNATIONAL LABOUR MARKET
Labour Market: Labour Market refers to Labour, people who are able to work & want jobs in a country/ area.
Domestic labour Market:
• It‟s a labour market wherein employees belong to same nationality; or
• A labour market wherein workforce works for their own country.
Labour Market in India:
Consists of 430 million workers in 2010-12 growing 2% annually, with a stable worker-population ratio (40%).
Low level of open unemployment (3.1%) – high level of disguised unemployment, mostly in rural areas and in
agriculture.
Low level of women‟s participation in workforce.
Child labor's share in workforce declining, but in absolute numbers still quite large.
Labour market structure:
• Rural workers =8%
• Urban informal sector =32%
• Rural workers =60%
Threats to Indian Labour Market:
• Declining employment elasticity.
• declining agricultural growth
• Poor rural infrastructure
• Rapid Advancement in Technology
• Corruption (Scams like 2G spectrum, common wealth)
• Globalization
Weaknesses of Indian Labour Market
• Lack of capital
• Infrastructures yet needs improvement In rural sectors
• Employment guarantees scheme hold promise, but faces political and bureaucratic resistance.
• declining agricultural growth
• Need to move towards income security, more rational labour laws, and greater shop floor democracy.
International organizations types
• International Corporation
• MNC‟s
• Global Corporation
• Transnational Corporation
Reasons for Rapid Growth of International Labour Market:
• Increase in no‟s of global organizations and global completion
• To remove labor supply , funds, resources constraints
• To explore new markets
Challenges in International labor market
• Global Inflation
• Managing cross cultural diversity
• Political Concerns
• Disaster Management concerns
Domestic Labour Market International Labour Market
Labor belonging to same nationality Labor belonging to more than one nationality
Limited risks in domestic assignment Greater exposure to risks
Limited external factors to deal with Has to mange several external factors