The organization is the basic framework within which individuals and groups behavior occur. The quality and nature of the decisions made are influence by the nature of the structure. The external environment contains a range of influences that affect an organization. They include: socio-demographic, technological, economic and political factors. Political system means the way of authority and management style adopted by organizations.
Organizations as a part of external environment should pay attention to social ans cultural issues which make a significant contribution to the business. This may become even more important when the organization's strategy is taking it into new countries, or different forms of alliance and collaborative ventures. Organizations can contribute to the success of such plans by ensuring that social differences are considered when common policies are defined, that announcements are made in a way that is most effective for each culture, and that managers who have to operate across country borders understand the nature of the cultural differences involved, and adjust their own behavior to obtain the best result (Bartlett, Ghoshal, 1999). According to Storey (1989):
The drive to adopt HRM is...based on the business case of a need to respond to an external threat from increasing competition. It is a philosophy that appeals to managements who are striving to increase competitive advantage and appreciate that to do this they must invest in human resources as well as new technology (Storey 1989, p. 34).
With the commodification of products, increases in liquidity, and widespread availability of information, services and products have a great need for flexibility and creativity on the part of managers in order to secure high-quality revenue. With customer demands for products often requiring unique solutions in a very short space of time, teams can come together and then disband very quickly. These teams will broadly comprise a front office staff of relationship managers and a back office staff of product provision and research.
Congruence as a Part of HRM
The congruence, as a part of business process, can be explained as a link between corporate strategy and HR practices adopted by organizations. The overall aim of this process is to align performance with business goals. As modern organizations are operating in high-velocity environments, strategic goals may change and so communication of the business strategy and changes therein is ongoing. Wei (2006) states that: 'A great deal of conceptual illustrations assert that the employment of effective HR practices and the design of a HR system compatible with the firm strategy are imperative for the successful implementation of business strategies" (51). A higher level of professional autonomy and shared governance should be seen as the main features of the congruence. The congruence can be expressed through greater knowledge and expertise. It may also be based on the personal qualities of the employee and the manner in which authority is exercised. In contrast to traditional theories, expert power is based on new knowledge about technology and innovative methods used in profession. The congruence is based on credibility and clear evidence of knowledge or expertise; for example, the