The influence of HR risk on overall business risk in e-commerce business sector of India

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Paddambail, Sunayana
Issue Date
MSc Management Practice
Dublin Business School
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Every business needs some specific skills in the employees in-order-to be competitive. Employees help organizations in achieving organizational goal and objectives and this will help organization in developing and sustaining competitive advantage. In pursuing these goals and objectives, organizations face different types of risks, which may hinder organization in achieving its targets. Employees may play a crucial role in managing risks. The HR practices in the organization may play its role in maintaining harmony in the organization. If the employees are trained, motivated and appreciated then the organizations are more likely to successfully manage the risks. An evaluation of link between human resource management practices and organizational risk is vital for keeping organizational risk to an acceptable level. India is one of the leading countries of the world. IT industry of India is a major contributor in economic prosperity of the country. Being a service organization, human resources are the most important resource for e-businesses. Despite this importance of human resources for these IT organizations, these organizations face lots of challenges in managing human resources which at time resulted in lots of financial and business loss. A field survey was carried out with an aim of evaluating impact of human resource management practices and risks on overall business risk, and to develop a management strategy to manage business risks. The context selected for the achievement of this research aim is the e-commerce sector of India. The findings of the research project indicated that need assessment, employees’ policies and code of conduct, performance appraisal, employees’ compensation, employees’ training and development and employees’ firing and exit are key dimensions of organizational risk. A further analysis revealed that employees were satisfied for most of the factors yet employees reported dissatisfaction about presence of strict code of conduct, pay equity, compensation based on factors that were not in the control of employees, poor succession planning and not valuing information obtained during exit interviews. Employees were also concerned about product, market and industry risks. All of these things needed solutions so several recommendations were made in the next section. It is suggested that employees should be given proper orientation training, employees code of conduct should be for essential areas only, there should be equity in compensation and employees should be paid in accordance with their level of efforts. Moreover, businesses should listen to the outgoing employees and based on this information, prevent future employee turnover. It is also suggested that e-businesses should engaged in co-optition and use HRM related practices to control business risk.