Impact of Business Issues on Human Resources at Ubisoft

Introduction:

The purpose of this report is to identify the key contemporary business issues and external factors affecting Ubisoft EMEA CRC and to assess the impact of these factors of the HR function.

This report will explore the following:

• Environmental analysis of the external environment impacting Ubisoft EMEA CRC and the HR function
• The role of HR in shaping strategies and practices at Ubisoft EMEA CRC
• How HR teams can identify and respond to changes within the environment

With teams in Consumer Support and Community Management, Ubisoft EMEA CRC is dedicated to defining the standards of player experiences across EMEA region (Europe, Middle-East, Asia & Australia).

CRC first opened its doors in September 2014 with a workforce of 35 across functions including HR, Finance, Customer Support and Community Management. As of November 2019, our headcount has grown to 220 staff, and specialisations such as Knowledge, workforce, fraud, quality and vendor management roles have been created. CRC currently has a HR team of 3 employees including the HR Director, HR Manager and HR Assistant

(172 words).

Assess a minimum of 4 different contemporary external factors impacting on the business and the HR Functions

PESTLE/ STEEPLE is a framework used to identify factors within the macroenvironment which can impact organisations and therefore influence strategic decisions. These external factors can highlight areas of opportunity and threats for organisations.

These factors include the widespread implications of political shifts and governmental legislation, rapid generational shift, and the increasing importance of technological advancements within the industry.

Political:

Political uncertainty caused by Brexit has had a significant impact on UK businesses and has put HR teams under huge pressures.  For many organisations, recruitment has been the area hardest hit, with 67% of organisations reporting difficulties in filling job roles (CIPD, 2019ᵃ).  60% of roles within Ubisoft CRC are multilingual roles, with most talent sourced within the EU. Attrition is a huge concern for HR Teams. The risk of EU citizens resigning as a result of Brexit requires a robust contingency plan.  HR teams will have to offer support to help them stay in employment within their organisation. (CIPD, 2017)

Technological:

Technological advancements have transformed the way in which organisations conduct their business and how consumers utilise and buy products and services and play a huge role in competitive advantage. Thanks to developments in technology, consumers are searching for accessible and quick solutions to solve their issues. Organisations must to keep up-to-date with the most cutting-edge technologies and implement them into their organisations to ensure customer satisfaction and operational efficiency if they wish to remain competitive.

This has impacted HR agenda in areas including recruitment, learning and development (L&D) and the structure. With more sophisticated technologies implemented in organisations for specialised and BAU activities, HR teams need to ensure any skills-gaps are filled through recruitment, upskilling and succession planning. New roles may be created to manage and maintain new systems. HR teams will have to create and deliver training to existing employees on using new tools and technologies. This new technology has financial implication on organisations and requires dedicated time from HR Teams to plan and roll out these plans in addition to their BAU duties.

Legal

It is imperative that businesses remain up-to-date and compliant with government regulations. The HR function is integral to ensuring success in this area. From hackers to human error – the gaming industry inherently exposed to data protection issues. General Data Protection Regulation (GDPR) changed the entire structure of the gaming industry. HR Teams has created and delivered training and workshops on GDPR and created new policies and processes to manage potential breaches.

Socio-Cultural:

A rapid generational shift is forcing businesses to rethink their organisational strategy in order to attract new talent. Millennials currently represent the largest section of the labour market (CIPD, 2019ᵇ). HR Teams play a vital role in ensuring that their organisation ‘develops the benefits mindset to: broaden the strategic perspective; align with organisational purpose; reflect organisational values; and deliver a benefits portfolio in a fast-changing environment to a more complex, demanding workforce’ (Abbott et al, 2019).

(503 words)

Analyse the forces that are currently shaping the organisations HR agenda.

HR practitioners play a vital role in driving decisions that help their organisations achieve long and short-term competitive advantage. The HR function has evolved from delivering the fundamentals that underpinned the employee lifecycle (such as administration, talent acquisition and compensation) (Farnham, 2017).

Human Resource Management (HRM) has transformed its agenda, focusing on sourcing & retaining the best talent, building and promoting a strong employer brand, improving performance process, and developing L&D (CIPD, 2007).

Figure 1: The development of the HR Function (Deloitte, 2019)

Major development in the macro environment e.g. commercial and regulatory rules, can affect organisations in different ways dependant of the sector.

There are 3 types of economic sectors:

• Private
• Public
• Voluntary

The marketplace is extremely competitive and dynamic, and organisations face multiple challenges from the general and task environment. HR teams are tasked with managing these forces and creating an agenda that tackles any potential threats.

Porters 5 forces is a model that can be used to evaluate the competitiveness of an organisation. The marketplace is extremely competitive and dynamic, and organisations face multiple challenges from the general and task environment. HR teams are tasked with managing these forces and creating an agenda that tackles any potential threats.

Figure 2: Porters 5 Forces (Porter, 1985)

Taylor and Woodhams (2012) outline the following areas as having the biggest impact on organisations and HR agendas:

1. ‘development in product markets’
2. ‘developments in labour markers’

Technology:

Technology is one of the biggest drivers of competition in the market. With this trend organisational strategies are moving towards artificial intelligence. The use and development of technology will transform HR practices such as recruitment and will change the traditional structures of HR.

Ulrich Model of HR Roles outline 4 key roles within HR. The increased use of technology within HR has streamlined certain HR tasks such as employee onboarding, recruitment and rewards & benefits management. Onboarding apps, interactive benefits portals and AI recruitment tools has significantly reduced the time spent of previously HR administrative tasks. This has removed the need for an administrative expert in most HR teams and questions the relevance of Ulrich’s Model of HR Roles as technology is slowly but surely removing the necessity to have a dedicated administrative expert within a HR team.

Figure 3: Ulrich Model of HR Roles (Ulrich, XXXX)

The introduction of recruitment tool Easyrecrue at CRC has saved the HR Team an average of 36 hours per week, therefore allowing time to focus on other tasks such as L&D employee wellbeing. The use of technology can also help improve compliance with regulations such as GDPR.

Organisations across all sectors face the same pressures to adopt technologies to remain competitive. However, technology within the private sector can be the sole differentiation factor that make an organisation succeed or fail. The use of cutting-edge technologies can give organisations competitive advantage by increasing levels of productivity, efficiency and compliance within the organisation and HR whilst lowering long term costs (initial investment in technology can be expensive). Moving forward, organisations would need to keep up to date with these trends if they wish to remain competitive, failure to adopt the newest technologies can make it impossible for organisations to gain competitive advantage but can also act as a barrier to new entrants due to the high set up costs.

Regulation:

Securing human capital data in the wake of GDPR is a high priority for HR Teams (El Khoury, 2017). Organisations across all sectors can face heavy penalties if they are found mishandling personal data. This has become problematic for HR teams as private data is often used as part of decision-making analysis. Under the legislation organisations, are only permitted to use data that is anonymised. To ensure consistent compliance throughout organisations, HR agendas must address GDPR by incorporating the fundamental elements of data protection and privacy compliance into the organisational culture and design (El Khoury, 2017).  HR teams may also choose to use employee engagement as a strategy to build trust by promoting operational transparency to motivate employees to share personal data for analysis. In response to these challenges, CRC has created a centralised GDPR management system to better manage GDPR related issues on a local basis. The HR team has investing resources into ensuring all staff at all levels are trained in not only understanding the regulation but also how to comply and the consequences of failing to comply through creation of policies, workshops and FAQ’s. Whilst this has been costly and time consuming for the small HR team. However, overall, this is a small sacrifice to ensure compliance, as failure to do so can result in heft fines, damage to employee brands and obvious legal implications.

Labour Market:

Labour market shortages and sociocultural changes are placing significant pressure on HR agendas. In a time where talent is scarce and organisations are competing to secure the strongest performers, HR teams must develop their employee brand, compensation & rewards and flexible policies in order to attract and retain the best candidates. As CRC is part of the Private sector, it is less directly impacted by economic pressures related to austerity. Organisations within the private sector have more flexibility to amend and change compensation packages as most salaries exceed the minimum and living wage.*

The type on tale available to organisations is also changing – trends suggest that there will be significant skills shortages across industries in the coming years due to an aging population (insert reference). HR agendas will need develop in order to integrate a huge influx of millennial workers. In order to successfully integrate these workers, Pfeffer (1985) suggests, ‘sensitivity to demographic effects can help provide a context to understand organisational behaviour.’ A good understanding of the different demographics within an organisation will help HR practitioners develop policies and practices that impact employees positively in the long term.

Policy have been successfully implemented at CRC and have helped to make it a more attractive place to all demographics by creating policies that allow employees more flexibility and better work life balance. These types of policies help CRC remain a strong competitor within the market.

Changes in the business environment are constantly evolving. HR teams need to make sure that they remain up to date with the forces that influence the business environment. Benchmarking is an excellent way for HR teams to ensure they are offering the most attractive conditions to employees and remain competitive.

Compare the strengths and weaknesses of two different tools HR might use for analysing the organisations business environment

There are many different tools and techniques organisations can use to analyse the business environment.

The PESTLE, (later evolving to ‘STEEPLE’) analysis is a framework that gives organisations an overview of contemporary forces within the external environment that can influence the wider business environment. It is a popular model that is often used to evaluate highly dynamic environments. (Gupta, 2013)

Figure 3: STEELE Analysis model (Drossou, 2019)

Organisations often forget to consider the forces that directly and indirectly affect them. STEEPLE analysis is helpful in presenting the ‘bigger picture’ of the business (CIPD, 2018).  The broad analysis of STEEPLE allows organisations to understand their position within the market and therefore highlights areas of opportunities such as upcoming trends.

The tool also highlights areas of risks within the industry and organisation. HR Teams and Senior Managers can then use this information to make informed decisions on how best to tackle these threats. STEEPLE analysis encourages organisations to take a proactive approach to strategic planning and update and develop their business strategies and targets accordingly in order to gain competitive advantage (Dwyer & Tanner, 2002) PESTLE is an easy tool to utilise and merely requires time to conduct the analysis.

However, it does have its limitations in terms of how effective it can be. Due to the nature of the business environment, environments factors are constantly evolving. Organisations need to make sure that analysis is conducted regularly, and that the data used is up to date. Organisations rarely have the time and resources to update this data (Kew and Stredwick, 2008). Without this, STEEPLE can be rendered ineffective.

This further highlights the need to use other tools such as Porters Value Chain

Porter’s Value chain analysis is a tool that organisations can use to analyse the used to primary and support activities of an organisation (Kew and Stredwick, 2008). The tool highlights the biggest areas of ‘added value’ within the organisation and areas of that require development. Unlike STEEPLE, Value Chain analysis explores the specificities of how an organisation operates rather than a general overview.

All analytical tools are unfortunately flawed for their own individual reasons. In order to conduct a more robust analysis of the environment, organisations but use multiple tools to conduct a thorough analysis of the external and internal environment.

(382 words)

References:

• Human Resource Management in Context: Insights, Strategy and Solutions, by David Farnham. Published by the CIPD. Copyright © 2017. CIPD. www.cipd.co.uk/Bookstore
• Three ways you can use AI in HR Now, by Rosie Nicholas. Published by CIPHR. 2019. https://www.ciphr.com/features/ai-in-hr/ Last visited: 06/11/2019
• The Recruiting Future Podcast: The Structure of Digital Transformation with Matt Alder and Dorothee El Khoury, Published by The Digital Transformation people 2019https://www.thedigitaltransformationpeople.com/channels/people-and-change/the-recruiting-future-podcast-the-structure-of-digital-transformation-with-matt-alder-and-dorothee-el-khoury/ Last visited: 01/11/2019
• CIPD (2007) The Changing HR Function Survey Report pg. 5
• [Consultation] Workforce Trends: the impact of Brexit - https://www.cipd.co.uk/news-views/brexit-hub/workforce-trends Last visited: 13.10.2019
• [In a nutshell: Article 90]  The evolving purpose of employer-benefits. Charles Cotton, Research and Policy Adviser, Performance and Reward CIPD 20 September 2019https://www.cipd.co.uk/news-views/nutshell/issue-90/employer-benefits Last visited: 13/10/2019
• PESTLE Analysis – CIPD. 17th December 2018. Last visited 01.11.2019
• https://www.cipd.co.uk/knowledge/strategy/organisational-development/pestle-analysis-factsheet
• Lew, J. and Stredwick, J. (2010) Human Resource Management in a business context. London: CIPD
• Taylor, S. (2011) Contemporary Issues in Human Resource Management. London CIPD
• Schwartz, M. (2001 The Nature od the Relationship between coprporations Code Of ||Ethics. Journal od Business Ethics.
• Reference: https://www.ibe.org.uk/frequently-asked-questions/3#faq273