Human Resource Practices

Human Resource Practices

Introduction

The purpose of this essay is to bring about an analysis of the human resource practices persisting in organizations. The analysis will be made based on different variables that play an essential role in developing a change in these practices. These variables are also known as moderators, which act by diminishing or accentuating the differences between domestic and international human resource management. The three significant variables, which will be thoroughly discussed in this essay, are the complexity, cultural environment, and attitudes of senior management. While considering the complexity, the essay will focus on the ways by which the organizations can overcome the complexities of having international operations, citing examples from recent business failures due to practices of human resources. Next, the essay is going to talk about the cultural environment that includes the effect of organizational culture on the business operations of the organizations. This will further shift on to the culture persisting in the international context of the business and the effect of this culture on the employees and employers. In the last section, the essay will discuss the attitudes of the senior management prevailing in the organizations. This segment will try to gain insights on the acknowledgment of the cultural differences by the top management and the way they could take suitable measures to cope up with these differences..

Discussion

The human resource practices, which are observed both in the domestic as well as in the international environment, could be affected by five different variables. These variables are also termed as moderators by various researchers (Jiang et al. 2017). The five essential variables are complexity, cultural environment, industry type, the extent of the reliance of the multinational firms on their domestic market, and the attitudes of the senior management towards cultural differences. Three of these five variables will be discussed thoroughly in the subsequent sections.

1) Complexity

Overcoming issues of conducting business operations in emerging economies

Complexity is an inevitable element that affects the international business operations of the organizations belonging to the advanced economies. These challenges might occur due to the lack of experience of these organizations in the global business environment. Most of the cases, these challenges come up due to the linkage of business with the emerging economies (Brewster 2017). Emerging economies are considered as those economies, which have started their economic reform process and have addressed economic issues like poverty, inadequate infrastructure, and overpopulation. In this regard, an organization might face several risks while it is aiming to tap newly emerging markets. The three essential risks in this context are environmental issues, lack of infrastructure, and ethical aspects.

Environmental issues occur when advanced economies such as the western firms try to compete on the dimensions of price and quality. The environmental problems consist of sustainability and regulation of the environment. Sustainability occurs while the firms try to balance economic growth with environmental management. The firms are required to enact stringently to regulate environmental factors. Lack of infrastructure is another factor that adversely affects the business operations of the organizations in the emerging economies (Spivack and Woodside 2019). Due to the lack of a fully developed distribution system, the advanced economies might face difficulties in carrying out operations in the emerging economies. Other issues could be ethical issues that vary from one country to another. Common ethical problems could be bribery and corruption. Bribery can occur due to social as well as cultural factors. Due to all these issues, the international operations of advanced economies might be hindered while they try to link up with the emerging economies. Therefore, these economies should come up with suitable solutions to eradicate these problems.

To reduce the environmental issues, the companies could come up with environment-friendly solutions such as developing green goals that would work towards sustainable development. While doing business with the emerging economies, the advanced economies should take care of the environmental condition and produce superior quality products that would suit the environment of the international marketplace. The next issue is the poor infrastructure of the emerging economies, which might disrupt the business operations (Lai et al. 2017). The companies can make the best use of the weak distribution system by developing a micro-distribution model. According to this model, companies can arrange for local entrepreneurs to distribute their products effectively. Electricity infrastructure is another common problem in this respect, and companies can mitigate this problem through the launching of cheap products that would be targeted towards poor customers. Sometimes, infrastructural challenges might create excellent opportunities for companies to emerge with innovative products for solving these issues.

Ethical issues about different economies could be solved if there is maximum understandability among the people regarding the moral behavior of the business. The businesses should amend their policies to create awareness among the local and internal people about the ethical dimensions of the company (Elger 2016).  Sometimes, the manager also fails to address problems ethically and decides wrongfully. The government of the local country can also play a significant role in eradicating this issue. The government can take practical steps such as promoting safe working conditions, guaranteeing rights to the workers, protecting the consumers from false advertisements, and many other actions.

Effect of human resource management on business failures

It has been observed that many aspects of human resources have been associated with the strategic alliances of different firms (Njoku et al. 2019). These aspects bring either success or failure to the operation of strategic partnerships at the international level. The characters, which have adversely affected business linkages internationally, will be elaborated further in the following sections.

1. a) Resistance to change

Due to international business linkages, there are a series of changes that gradually occur within the businesses. These changes might bring about a lot of problems and conflicts between the firm personnel and ultimately lead to the failure of the cooperation (Glaister et al. 2018). These conflicts can arise due to a variety of reasons. The executives might have a negative perspective of the alliances, due to non-compliance of their activities with the parent firm.

1. b) Job roles of the executives in the alliance firm

The firms sometimes assign poor employees to the alliance firm while they keep the best working employees for their internal jobs. This shows the lack of commitment of the parent firm towards its alliance (Heffernan et al. 2016). This also indicates that the parent firm is not seriously interested in co-operating with the international firm for its competitive advantage. This practice ultimately breaks the linkage of the firm with the global alliances.

1. c) Transfer of personnel

Another problem may occur when the staff is transferred to the alliance firm, and they face issues in understanding their job roles. They might face trouble in finding a suitable post for themselves (Wang et al. 2018). As a result, the person might not be able to develop their skills effectively and might result in the breakage of the coalition.

1. d) Lack of distribution of time between strategic and operative matters

Sometimes, the executives show a lack of dedication while devoting time to the management of the alliance. They fail to distribute time properly and tend to combine it with the time they dedicate to their firm (Farndale and Sanders 2017).  Many managers show reluctance to take part in the alliance as they have a perception that their duties would be assessed based on the production of the parent firm.

2) Cultural environment

Organisational Culture

Organizational culture can be defined as a system, which comprises of shared values, beliefs, perceptions, and assumptions of the people belonging to a particular organization. All these elements dictate the behavioral aspect of the people within the organization. All the actions of the internal people are influenced by these elements of organizational culture. Organizational culture also includes the expectations, experiences, and philosophical ideas that shape a particular organization (Scott et al. 2018). Culture also consists of the vision, values, systems, regulations, and principles of an organization, along with its beliefs, habits, and languages. According to Deal and Kennedy, organizational culture has been defined as the way things go on within an organization. All these principles regulate the working of an organization and guide them in tackling situations by setting an appropriate behavior for the employees.

The behavioral components among the employees directly arise due to the culture of the organization. Organizational culture directly influences the interaction of people within themselves, with the stakeholders and with the clients. Business managers play a significant role in the evolution and development of organizational culture. A deeply embedded and established culture helps to bring about moral ethics among the people of the business and help the organization in achieving its goals and objectives (Ogbonna 2019). This behavioral framework also ensures that the employees are satisfied with their job. Therefore, the three elements, that is, culture, leadership, and job satisfaction, can be conveniently linked together. Organizational culture is not a stagnant element but is subjected to change within an organization based on various aspects or factors. Due to the changing environment, such as market conditions, competitor position, and many other factors, an organization might decide to change its culture to increase the competency of its internal people for coping up with the changes.

Impact of organizational culture on international business operations

In the modern business environment, activities spread all across the globe. It is quite reasonable in such a situation that firms would find themselves competing in the international business environment. In such cases, a question arises regarding the impact of cultures of countries on the conventional methods of managing human resources. Through various studies, it has been observed that four culture-specific elements try to shape up the management of human resources across all boundaries. These four elements are status, performance, social benefits, and programs of the employees. The employees who are respected and valued within an organization automatically tend to ethical than other employees (Chión et al. 2019). The performance of the employees is also a determining factor for understanding the culture of an organization. The social benefits include the initiatives of the organization towards the society and culture of the foreign economy. This action is also influenced by the culture persisting within the organization. Finally, the different developmental programs introduced by the organization towards the enhancement of the employees help in creating an ethical culture within the organization and aids up its international business operations. However, organizational culture may negatively influence international business. This happens due to cultural differences between the parent country with a foreign country. Lack of shared values and norms might result in ineffective communication, trust, and knowledge between the two businesses. Therefore, the management should take suitable actions in curbing this gap existing between the two economies while operating its business internationally.

The implication of different cultures across boundaries

Organizations of recent days engage themselves in various global business activities, which require expansion of the business operations outside the home country of the organization. According to the research works conducted by Salk and Shenkar, it has been observed that international alliances of these companies reside at the influence of three kinds of culture, that is, national, organizational and occupational cultures. Other researchers like Pothukuchi have found out that the cultural differences of the partner influence the performance of the international alliance (Sullivan and Skelcher 2017). This is because these differences are directly related to the value-creating activities of the coalition. The employees of the parent firm, as well as its partner, must interact effectively such that the complementary resources can be shared, combined, and leveraged. It is essential for the people of international business to understand the importance of cultures across boundaries and study different national religions as well as organizational cultures.

The function of human resource in managing cultural differences

The human resource manager of the organizations can play an active role in maintaining the cultural differences of the host country with its partner. Some of the standard techniques that can be suitably applied are stated below.

1. a) Understanding the differences in culture

The human resource manager must understand the cultural diversity of all the employees, including the culture of the business partner. The perceptions of time, distance, communication patterns, and hierarchy are also required to be examined by the human resource manager. The HR department should be educated and appropriately trained such that they come up with new ideas for mitigating the culture gap.

1. b) Introduction of free speech

Appreciation and acceptance can be considered as two crucial factors while working with cultural differences across boundaries. HR and employers must join hands to create an environment for all the employees such that they can comfortably interact with each other irrespective of the cultural differences (Anjorin and Jansari 2018). There should be open communication sessions held at intervals within the office premises such that ideas and knowledge could be shared by the employees under a common platform.

1. c) The practice of effective communication

Miscommunication is a potential source of conflict between the employees as they fail to understand the language and expression of the foreign economy. Therefore, all the employees must be trained to learn about the style of speaking persisting within the businesses across the boundaries.

3) Attitudes of senior management

Acknowledgment of cultural differences by management

The management must take appropriate actions to bridge the gap between the cultures of the two businesses. An organization is said to be culturally competent when it excels in its ability to interacting with people from different cultures, social and economic backgrounds (Bonica and Bewley 2019). Being culturally relevant brings future success for the organization and develops its business effectively in the international environment. Human resource managers can adopt four components within their business framework to build their cultural competency.

1) Awareness – This is determined by the reaction of one employee towards another culturally different employee. Therefore, the managers have the responsibility to create complete awareness among the employee about talking to another culturally diverse employee.

2) Attitude – The management must examine any cultural biasness that occurs within the organization (Jones 2016). The human resource manager must also continually evaluate his own beliefs about cultural differences and work hard towards mitigating these cultural gaps.

3) Knowledge – Sometimes, employees hold prejudices regarding a particular, which is displayed in their behavior unintentionally. The HR manager must work hard to eliminate such biases of employees.

4) Skills – The most useful ability that can be developed by the management is a communication skill and make all the employees aware of all the differences that exist from one culture to another.

Along with the development of cultural competency, the HR manager must understand the present culture of the business, which includes all the beliefs, values, biases, and prejudices of the employees (Chae et al. 2019). The management must realize whether all the employees are satisfied with the present culture of the business. Due to strategic alliances, the employees might feel uncomfortable when exposed to a foreign culture. The management must realize this situation and amend the existing culture accordingly. Finally, the management should initiate training programs for understanding different language and communication styles of foreign companies.

Creative and effective ways of managing human resources internationally through cross-cultural learning

The development of cultural competence within the business is essential in gaining an awareness of the beliefs, values, work ethics, and work schedule of the employees. The management can adopt suitable cross-cultural strategies to become culturally competent in its business environment. Some of the skills can be described below.

1) Team building – The management can form groups within its business that would work together for a typical project. All the members of this group should have cultural differences (Truong et al. 2017). The management must examine their behavior, whether they perform effectively together, or create conflicts among themselves. Accordingly, the administration must take action towards the employees, not showing cultural behavior within the groups.

2) Communication – The management must provide suitable training to its employees such that they are capable of recognizing various communication styles across borders (Aitken and Stulz 2018).This would impact the interaction among the employees and enhance their ability to handle problems together.

3) Time – The management must realize that different cultures have different perspectives on time, and they balance their personal and professional lives accordingly (Barn and Das 2016). The management must keep their schedule of work impartially following the comfort zone of the majority of employees.

4) Calendars and holidays

The management must be completely aware of the structure of the timeline of the foreign country. The holidays should be kept in mind, and the management must schedule its meetings and conferences, excluding those holidays (Sorensen et al. 2017). The management can obtain the calendar of the foreign country and discuss it with the alliance firm to exclude the critical days from the schedule of the working days of the company.

Effect of mindset on the management of human resources

Many researchers have widely studied the relationship between individuals and organization and reviewed research on organizational commitment, psychological aspects, justice, and work motivation of these individuals (Solesvik 2017, September). It has been observed that the mindset of employees and the management works more in affecting the culture of the organization than the learned behavior of these employees. The dynamics of cross-cultural interfaces can be suitably observed through the actions of the employees that directly come from their perceived mindsets. The employees who possess negative opinions about a particular culture tend to create conflicts with those employees.

Sometimes, due to a particular announcement within the business about a community of people, some people might feel insecure and feel that they are getting neglected for having a different culture and a community (Hackley et al. 2018). Both social and organizational factors shape the mindsets of the employees in creating cultural differences within an organization. Therefore, the management must take suitable measures to eradicate such a mentality of employees. They must create awareness among the employees regarding the cultures prevailing across businesses all around the world so that their perceptions could be changed gradually. The most effective tool for improving the mindset of the employees is communication, and interdepartmental communication should flow smoothly across the organization to ensure its cultural competency.

Conclusion

From the above essay, it can be concluded that three essential variables, that is, complexity, culture and attitude of the management, affect the differences between the domestic as well as international human resource practices. All the variables have both positive as well as negative effects on the management of human resources while a business tries to link its business in an international environment.

References

Aitken, R. and Stulz, V., 2018. Factor analysis to validate a survey evaluating cultural competence in maternity care for Indigenous women. Australian Journal of Advanced Nursing, The, 36(1), p.25.

ANJORIN, R. and Jansari, A., 2018. Managing Cultural Diversity at Workplace.

Barn, R. and Das, C., 2016. Family group conferences and cultural competence in social work. The British Journal of Social Work, 46(4), pp.942-959.

Bonica, M.J. and Bewley, L.W., 2019. A Comparison of Mentorship Attitudes and Attributes Between Civilian and Army Healthcare Leaders. Military medicine, 184(5-6), pp.e255-e262.

Brewster, C., 2017. Human resource practices in multinational companies. The Blackwell Handbook of Cross‐Cultural Management, pp.126-141.

Chae, D., Park, Y., Kang, K. and Kim, J., 2019. A multilevel investigation of cultural competence among South Korean clinical nurses. Scandinavian Journal of Caring Sciences.

Chión, S.J., Charles, V. and Morales, J., 2019. The impact of organisational culture, organisational structure and technological infrastructure on process improvement through knowledge sharing. Business Process Management Journal.

Elger, B., 2016. Ethical issues of human genetic databases: a challenge to classical health research ethics?. Routledge.

Farndale, E. and Sanders, K., 2017. Conceptualizing HRM system strength through a cross-cultural lens. The International Journal of Human Resource Management, 28(1), pp.132-148.

Glaister, A.J., Karacay, G., Demirbag, M. and Tatoglu, E., 2018. HRM and performance—The role of talent management as a transmission mechanism in an emerging market context. Human Resource Management Journal, 28(1), pp.148-166.

Hackley, D.M., Mumena, C.H., Gatarayiha, A., Cancedda, C. and Barrow, J.R., 2018. A case study optimizing human resources in Rwanda’s first dental school: three innovative management tools. Journal of dental education, 82(6), pp.602-607.

Heffernan, M., Harney, B., Cafferkey, K. and Dundon, T., 2016. Exploring the HRM-performance relationship: the role of creativity climate and strategy. Employee Relations.

Jiang, K., Hu, J.I.A., Liu, S. and Lepak, D.P., 2017. Understanding employees’ perceptions of human resource practices: Effects of demographic dissimilarity to managers and coworkers. Human Resource Management, 56(1), pp.69-91.

Jones, K., 2016. Is She Mathilda the Hun: Attitudes Toward and Outcomes Associated with Women Managing in Male and Female-Dominated Cultures: Are There Differences?. Journal of Business Diversity, 16(1), pp.68-77.

Lai, Y., Saridakis, G. and Johnstone, S., 2017. Human resource practices, employee attitudes and small firm performance. International Small Business Journal, 35(4), pp.470-494.

Njoku, E., Ruël, H., Rowlands, H., Evans, L. and Murdoch, M., 2019. An analysis of the contribution of e-HRM to sustaining business performance. In HRM 4.0 For Human-Centered Organizations. Emerald Publishing Limited.

Ogbonna, E., 2019. Can organisational culture explain labour market disadvantage of ethnic minorities?.

Scott, T., Mannion, R., Davies, H. and Marshall, M., 2018. Healthcare performance and organisational culture. CRC Press.

Solesvik, M., 2017, September. Functioning of Smes, Cooperative Models and Management of Human Resources. In Solesvik, M.(2017). Functioning of SMEs, cooperative models and management of human resources: Editorial. Forum Scientiae Oeconomia (Vol. 5, No. 3, pp. 5-7).

Sorensen, J., Norredam, M., Dogra, N., Essink-Bot, M.L., Suurmond, J. and Krasnik, A., 2017. Enhancing cultural competence in medical education. International journal of medical education, 8, p.28.

Spivack, A.J. and Woodside, A.G., 2019. Applying complexity theory for modeling human resource outcomes: Antecedent configurations indicating perceived location autonomy and work environment choice. Journal of Business Research, 102, pp.109-119.

Sullivan, H. and Skelcher, C., 2017. Working across boundaries: collaboration in public services. Macmillan International Higher Education.

Truong, M., Gibbs, L., Paradies, Y., Priest, N. and Tadic, M., 2017. Cultural competence in the community health context:‘we don’t have to reinvent the wheel’. Australian Journal of Primary Health, 23(4), pp.342-347.

Wang, T., Thornhill, S. and Zhao, B., 2018. Pay‐for‐performance, employee participation, and SME performance. Journal of Small Business Management, 56(3), pp.412-434.