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Business Issues and the Contexts of Human Resources

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Business Issues and the Contexts of Human Resources
THE ROLE OF THE HR FUNCTION IN MANAGING (along with others) THE ORGANISATION

1. Identification and analysis of major forces shaping the HR agenda within the organisation.

Background
A leaked report, obtained by the Labour Party and compiled by the Association of Chief Executives of Voluntary Organisations (Acevo) has claimed that the charity sector is facing local and national government funding cuts of between £1bn and £5.5bn in the current financial year.

According to an article in Third Sector Online, dated 5 March 2012, The National Council for Voluntary Organisations (NCVO), said the past year had been an "annus horribilis" for charities facing a triple whammy of increased demand, rising costs and an unprecedented fall in income.

The current economic conditions create uncertainty for the organisation over funding streams and we already know that the Charity is facing cuts in 2012-13.

Context and Rationale
Main forces currently having an impact on the Charity stem from the severe austerity measures put in place by the coalition government as these have greatly impacted upon public sector funding. The Charity, similar to other organisations is facing significant cuts to its income at national and local levels. These factors along with our previous trading position have necessitated the Charity reviewing its strategic and operational plans.

To secure its future the Charity must respond to these difficult circumstances. As a result the Senior Management Team, which includes the Director of Human Resources, has reviewed the strategic direction of the Charity in order to respond to the opportunities for growth and expansion that will come as the political and economic cycles revolve.

72% of the operating costs are spent on staff salaries. Any attempt to absorb a significant reduction in income requires a reduction in staff levels. With this in mind, the Human Resource team has been strategically involved in the development of a proposed



References: Armstrong, M (2012) Handbook of Management and Leadership (3rd edition) March 2012 Johnson, Whittington & Scholes (2011) Exploring Strategy 9th edition P.55 Porter, M (1996) BPP Learning Media, Business Essentials Vol.2 July 2010 P36 Other

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