In contemporary HR function roles, people professionals involved are actively engaged to assist an entity in delivering assigned corporate strategies and objectives. As evidenced in CIPD (2020a), due to prevalent business issues determining the HR context, different organisation objectives are distinctly offered in various organisations. In merging strategy, HR is critically involved in the overall process since they are assigned to ensure due diligence is adopted (Careerminds, 2019). In the provided case study involving two retail stores in a merger process capitalise on economies of scale, HR function is actively engaged in playing an instrumental function. Hence, this report provides an evaluation of different external factors that impact a business, HR function roles to support the organisation in the process of merging, strategy development, and ethical issues prioritised.
2.0 External Factors that Impact a Business and adopted Approaches
To capitalise on business environment competitive advantage, it is essential to establish external factors influencing organizational practices. In affirming this, CIPD (2020b) identifies organisations necessity for evaluating external environment factors in a business environment. This is for achieving relevant insights into external factors impacting organisation operations. Further, by carrying out external environment business analysis, HR and the senior managers are appropriately guided to make the best and strategic decision. Considering the case study in the merging organisations, identifying external factors could be critical for merging process success. This is specified in Rastogi et al. (2016) as the external factors that impact business is political, economic, social, legal, technology, and environmental factors. The different aspects, directly and indirectly, influence the two firms even after successfully merging.
One of the approaches used in the analysis of external factors that impact the business is the PESTEL analysis tool (CIPD, 2020b). As evidenced in figure 1, the PESTLE analysis tool is used in focusing on Politics, Economic, Social, Technological, Legal, and Environmental factors;
Figure 1: PESTEL Analysis Tool
Summarising the analysis presented in figure 1, the different noted factors could directly impact business success after the merging process. After a successful merger, there would be a possibility of altering the set policies, tax regime, and industrial regulations. Further, changes would be evident on clients’ preferences, trends of spend, demographics in population, innovation, and employment laws passed an entity scope. Also, comparing both internal and external factors in establishing the internal business could be altered the fitting external environment with SWOT analysis applicable (see figure 2);
Figure 2: SWOT Analysis
As evidenced in figure 2 above, both merging organisations are supposed to put their priority on the identified strengths by ensuring they capitalise on identified opportunities. Simultaneously, they would solve their weaknesses through the merger process with threats to capitalise on the business model (CIPD, 2020c). There would be a possibility of withstanding with existing external business environment aspects by achieving the process.
3.0 HR Function to Support Merger Process
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