Strategic Strategies of Gillette

Topics: Human resource management, Multinational corporation, Human resources Pages: 11 (3509 words) Published: March 20, 2011
During the last decade, increasing attention has been paid to the area of international human resource management (IHRM), which is concerned with human resource management issues of multinational corporations (MNCs) (Schuler et al., 1993). It has found that human resource policies and practices are the source of sustained competitive advantage to firms (Pfeffer, 1994). But diffusing HR policies and practices within multinational corporations (MNCs) to subsidiary management teams can be problematic, for example, how to align HR policies and practices with the rest of the organization (i.e. global integration) and how to adapt HRM practices to the local environment in which the subsidiary is operating (i.e. local adaptation). Furthermore, scholars point out that national origin of the MNC is a major influence on the trade-off between global integration and local adaptation.

Now, Gillette Group has a plan to set a subsidiary in Shenyang of China which is a advanced city in China. So choosing effective HR practices is very important for the development of this subsidiary. In this report, first, some practical HR methods of Gillette Group will be introduced and illustrated, and then through analyzing the differences between US and China to find out the barriers. Finally, some practical HR practices will be chosen to diffuse in Gillette’s Chinese subsidiary. 1. Strategic IHRM of MNCs

1. Strategic IHRM
HRM practices have a long history. Before the mid-1980s, most practices had focused on the low level, routine tasks such as recruiting, record-keeping, wages and rewards (Storey, 1992). Fombrun et al. (1984) pioneered the development of the concept of strategic HRM and started linking HRM functions with the organizational overall strategy. Strategic HRM mainly referred on activities involving HR planning and HR policies such as internal career opportunities, performance appraisals, employment security, training systems, profit-sharing plans, voice mechanisms, participation in decision-making, and the degree to which jobs are defined (Storey, 1992). Strategic HRM perceives people as critical organizational investments, strategic resources and competitive advantages which determine the success and failure of an organization (Pfeffer, 1998). Therefore, HRM has gone through the transition from task-oriented HRM to people-oriented SHRM. Strategic IHRM is defined by Schuler et al. (1993) as ``human resource management issues, functions, and policies and practices that result from the strategic activities of MNEs and that impact the international concerns and goals of those enterprises'' 2. Generic MNC Strategies

In dealing with environmental complexities and uncertainties, MNCs have a range of alternative strategic choices to manage workforce in host country. On the one hand, MNCs desire some level of consistency in their HRM practices across countries (i.e. global integration). On the other hand, MNCs have to adapt their HRM practices to norms and regulations in the host country (i.e. local adaptation) (Dowling, 1989). In the face of this basic dilemma, MNCs could adopt one of three general strategies: the ethnocentric, polycentric or geocentric strategy (Dowling, 1989). MNCs using the ethnocentric strategy transfer the headquarters' HR practices to their overseas subsidiaries in order to maximize the headquarters' control and integrate subsidiaries; this results in little, or no, local responsiveness. At the opposite extreme is the polycentric strategy in which MNC adapts totally to local situations such that HRM practices are virtually identical to those used by local firms. A third general strategy, the geocentric strategy, attempts to balance both global integration and local adaptation by having some HRM practices dictated by corporate headquarters yet allowing other practices to be influenced by local pressures. 2. The practical HRM in Gillette Group

3.1 Background of Gillette
The headquarter of Gillette is...
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