1.0 Introduction

In the modern HR function, people professionals involved in this area are engaged in assisting an organisation in delivering its corporate strategy and objectives. According to CIPD (2020a), due to the prevailing business issues that determine the context of the HR, their objectives are delivered differently in different types of organisations. In a merger process, HR plays a critical role in the entire process as they are tasked with ensuring that due diligence is followed (Careerminds, 2019). In the case study, which include two retail stores merging to leverage from economies of scale, HR function would play a critical role. In this report, an evaluation of the external factors impacting on the business, role of HR function in supporting the organisation in the merger process, approach in the strategy development and ethical issues put into account.

2.0 External Factors Impacting on Business and Approaches Selected

To leverage competitive advantage in a business environment, it is essential to identify the external factors that influence organisation operations. To affirm this, CIPD (2020b) notes that organisations need to evaluate the external environment of their business operations to gain insights into the external factors that impact on their organisation. Also, through external analysis, HR and senior managers can be guided in strategic decision-making. Taking into account of the case study merger companies, successful identification of their external factors would be instrumental to their success after the merger. According to Rastogi et al. (2016), the main external factors that potentially affect any business include political, economic, social, legal, technological and environmental factors. These factors have a direct and indirect impact on the operations of the two business, even after the merger process.

The first approach applicable in the analysis of the external factors impacting the business, PESTEL analysis tool can be used (CIPD, 2020b). As shown in figure 1, PESTEL focuses on politics, economic, social, technological, legal and environmental factors;

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