Navigating the future: “Unleashing the power of strategic human resource management.”

 

PEOPLE AND ORGANIZATIONS : PRINCIPLES AND PRACTICE IN GLOBAL CONTEXTS. 

( by M.D.E.I.M.Muthugalage - 23042637)

Human Resource Management in Multinational Organizations.

Human resources management is an integral part of organizational strategic management. This becomes more complex when handling an international context than in domestic set up as many differences between Headquarters and subsidiaries. HRM policies to be set up in a manner to avoid discriminations in religion, race, caste or nationality.

In the same time cultural differences have a great impact on handling duties. Therefore, cultural flexibility is an important factor to consider when formulating HRM policies and hiring people.

The role of International Human Resource Management (IHRM).

International HRM is a term which encompass all the HR practices evolved into a Global frame work. The process is more complex than the domestic and managing a global work force is having great challenges. Therefore, HR professional need to advocate the following and be responsible to handle things diplomatically to avoid many of the discrimination. 

Following are the key traits to think from initial level

• Talent management including recruitment 
• Expatriation and repatriation 
• Training and developing 
• Compensation 

 

Typically, the business will be managed from the ‘parent’ or home country in which it is headquartered, but it will operate from various international locations. Well-known multi-nationals include Apple, Amazon and Unilever, but smaller businesses can class themselves as MNCs if they have subsidiaries in two or more countries. 

Main objectives of IHRM

Generally, IHRM includes the objectives of typical HRM. However, the extra challenges coming up in global context need to be managed in way of different approach to overcome inherent challenges, risk platforms and operational barriers.

These include: 

1.  Recruiting and retaining staff with the specific skill set and global mindset to take on international assignments and meet the business’s strategic goals. 

2. Training and developing staff in both hard and soft skills. Cross-cultural and local market training is particularly important for expatriate workers who must acclimatize to their new environment. 

3.Compliance with international laws. International 

    HR Managers must fully understand and comply with the labour and tax laws of each country it operates in. Failure to do so could result in major legal and/or financial penalties for the business. 

 

For clarity, a multinational corporation (MNC) is one with a business presence in various countries. Typically, the business will be managed from the ‘parent’ or home country in which it is headquartered, but it will operate from various international locations. Well-known multi-nationals include Apple, Amazon and Unilever, but smaller businesses can class themselves as MNCs if they have subsidiaries in two or more countries. 

 

  

Key areas to be concerned over

 

·   Personal goals

Supporting employees to reach their personal goals in the paramount requirement. Organizations need to address for recognize and reward employees, provide required skill training, arrange compensation and to ensure maintaining of a healthy work–life balance.

 

·   Organizational goals

Reaching to organizational goal is a key concern. Hiring the right talent, facilitating for growth, facing local and global diversity and make use of resource in a manner to have a fair ROI is the key objectives.

 

·       Functional goals

This a fundamental concern and need to make clear setup to help different staff to communicate effectively, understand work procedures and allow to engage effectively in cross functional operation.

 

·   Societal

This includes focusing on business’s legal and ethical responsibilities to employees and society at large. Especially adhering to labour laws, regulatory requirements, migrant policies, health procedures, following religious and cultural values are the key concerns.

 

Different approaches in IHRM

 

Multi National Organizations (MNOs) have different approaches in structuring their IHRM functions.

 

1.Centralised 

 

Most of the organizations keep centralized management operation from it’s main Headquarters and their sub departments are located in respective regions to simplify the operational issues.

 

2.Decentralised 

HR administration is handled regionally, and policies and procedures reflect local differences.

 

3.Hybrid 

Eventually the organizations mostly push into Hybrid operation with it’s homogeneous work pattern. Both remote and in house operation is carried out and they need to hire people in a manner to have collaborative structure.

1. Home country nationals: 

Employees from the country where the business’s headquarters are located. These employees will be relocated overseas on an ‘expatriate assignment’.

2. Host country nationals: 

Employees from the country where the company has set up a subsidiary.

3.Third country nationals: 

Employees who work in either the home or host country for the company, but who aren’t nationals of either. 

HR Challenges in global economy

Current world run with advanced technological, communication and logistic platforms and it has succeeded in integration worldwide markets.

Organizations are preferred to operate in different regions in the world and obviously employees need to move around the world expatriates need to be adopted for the new social, cultural and also economic diversity in different regions.

 

Especially employees facing different magnitude in different economies and shaping out the business operation to reach for common business goal is very challenging. Sourcing tangible and intangible resources, collaboration of human capital in different perspectives and also approaching multi traditional client base requires different expertise.

HR has a great role in talent acquisition, train and develop, looing after personal aspirations and provide wide range infrastructure facilities for them to operate successfully and passionately.

This need a both short term and long-term strategic vision and work diplomatically having understanding the constant changes and be flexible to adopt policies in accordance. Reviewing and upgrading  the HR policies frequently and go for best industry practices avoid possible interruptions in different layers, provide grounds to operate  competitively in any market.

References

Armstrong, M 2000, Strategic Human Resource Management: a Guide to Action, Kogan Page Publishers, London.

Brewster, C., Mayrhofer, W., & Morley, M 2000, New Challenges for European Human Resource Management, McMillan Press Ltd, London. 

Dickmann, M., Brewster, C., Sparrow, P 2008, International Human Resource Management: A European Perspective, 2nd Ed., Routledge, Canada. 

Harris, M., M 2007, Handbook of International Human Resource Management, Lawrence Erlbaum Associates, New York. 

Harzing, A., W., & Ruysseveldt, J., V 2004, International Human Resource Management, 2^nd Ed., Sage Publication Inc,

 Californiahttps://library.oapen.org/handle/20.500.12657/60253