| WORD COUNT: 2050
[hrm 307 – international human resource management]
Research Question: It has been suggested that global companies ‘are chartacterized by geographical dispersion, demands for rationalization and differentiation, and cultural diversity.’ (Bratton & Gold, 2012) What challenges do these factors present for international HR directors when designing core HR functions such compensation, training, recruitment and selection? Do these challenges suggests that managing International HR is inherently more difficult that managing HR in a large domestic firm?
Global companies have a demand to be culturally diverse, rationalised and differentiated due to their characteristics of being geographically dispersed and their important role in the process of globalisation (Bratton &Gold 2012).In order to achieve such expectations, the importance of strategically managing human capital is continually emphasised as it would immensely determine the organisations’ strategic orientation and competitive advantage (Landets & Lertxundi 2012). However, it is these unique characteristics that present challenges for global companies when designing core human resource functions such as recruitment and selection, compensation and training. Often for global firms, one of the main and most strategic decisions to make is to determine whether to implement HR practices and policies into new subsidiary environments or to adapt into these new environments with localised practices (Landets & Lertxundi 2012). Each of these functions has to take into consideration of external and internal environment changes, coordination between subsidiaries, cultural differences, and much more. This essay aims to identify and discuss these present challenges for the above mentioned core functions and emphasise these issues by corporate examples. Furthermore, by responding to these challenges, it intends to identify whether managing international HR (human resource) is fundamentally more difficult when evaluated against a large domestic firm. In comparison to domestic environments, greater emphasis and considerations are required for conducting recruitment and selection processes on a global scale in order to combat a more complex environment and different procedures. Examples of these differences include differences in national culture, organisational size, government regulations and ownership type (Darwish at.el, 2013). This is very important as ineffective and inefficient international staffing affects not only the subsidiary itself but also the multinational corporation as a whole (Kang & Shen 2013). The most essential decision that global companies have to make is to decide their approach in recruitment strategy, whether or not to recruit internally or externally, taking policies from home country, host country, a third country or combination. Global companies can choose between ethnocentric, polycentric, geocentric and regiocentric staffing decisions. In an ethnocentric approach, global companies would employ employees from their home country for all subsidiaries aboard with no interference with localisation. Polycentric approach allows the company to employ local citizens for roles at the subsidiaries while home country running the headquarters. Continuing on, geocentric approach disregards cultural differences while concentrating on which candidate best suits the role available. Lastly, global companies who choose to utilise regiocentric approach divide their operations into geographic sectors and divide staff between these sectors (Darwish at.el, 2013). Influences and pressures for global companies to be culturally diverse and comply with different external environments create challenges for international HR management when deciding which approach to take on. During the designing process of their approaches, managers must be aware of local cultural norms, external laws and regulations that are unfamiliar to...
References: Bloom, M, Milkovich, G.T& Mitra. A. 2003, ‘International compensation: learning from how managers respond to variation in local contexts’, International Journal of Human Resource Management, vol. 14, no. 8, pp.1350 – 1367.
Cieri, H.D, Dowling, P.J, Lowe, K.B & Milliman, K.B. 2002, ‘International compensation practices: A ten-country comparative analysis’, Human Resource Management, vol. 41, no. 1, pp. 45-66.
Darwish, T.K, Irain, Z, Mohamed, A & Singh, S. 2013, ‘An analysis of recruitment, training and retention practices in domestic and multinational enteprices in the country of Brunei Darussalam’, The International Journal of Human Resource Management, vol. 24, no. 10, pp. 2050 – 2081.
Davoudi, S.M.M, & Kaur, R. 2012, ‘International human resource management: Managing people multinational enterprises’, A Journal of Multidisplinary Research, vol. 1, no. 2, pp. 41-56.
Dickman, M & Muller-Camen, M. 2006, ‘A typology of international human resource management strategies and processes’, The International of Human Resource Management, vol. 17, no. 4, pp. 580 – 601.
Kang, H & Shen, J. 2013, ‘International recruitment and selection practices of South Korea multinationals in China’, The International Journal of Human Resource Management, DOI:10.1080/09585192.2013.770777, pp. 1-18.
Kidger, P.J. 1991, ‘The emergence of international human resource management, The International Journal of Human Resource Management’, vol. 2, no. 2, pp. 149 – 163.
Landets, J& Lertxundi, A. 2012, ‘The dilemma facing multinational enterprises: transfer or adaptation of their human resource management system’, The International Journal of Human Resource Management, vol. 23, no.9, pp. 1788-1807.1
Sparrow, P.R. 2007, ‘Globalisation of HR at functional level: four UK-based case studies of the international recruitment and selection process’, International Journal of Human Resource Management, vol. 18, no. 5, pp. 845 – 867.
Su, Z, & Yeganeh, H. 2011, ‘The effects of cultural orientation on preferred compensation policies’, The International Journal of Human Resource Management, vol. 22, no. 12, pp. 2609 – 2628.
Please join StudyMode to read the full document