International human resource management
Introduction
International human resource management is the process of directing people in international ventures dealing with activities in at least two countries. It is a fact that the success of any business and trade depends entirely on the quality of human resources and the efficiency these resources are managed and exploited at the international levels. Any business or trade acquires a competitive and productive edge when it has an efficient and competent pool of employees. We know that numerous organizations carry out their business in and around the world. Therefore, it is a significant stress on the need to manage international employees (Budhwar, 2016). The efficient management of foreign employees is a significant determinant of the success or failure of any business. However, it has become a challenge in procuring, training, and retaining employees for international companies and organizations. Global human resource management plays an essential role in the effective management of employees from different locations and nations.
First, it facilitates organizational management. Different social practices shape competencies that determine how a firm competes. Such exercises can have tremendous significance in firm performance. HRM guidelines are meant to improve organizational effeteness by developing factors such as skills, talents, and creating a favorable workplace. International human resource management bridges the opening between rhetoric and reality. According to Schuler, Jackson, and Tarique, (2011), there is a vast general space between the rhetoric and the truth that should be bridged. Organizational staff may start with definite motives of doing things, but making them a reality is complicated. Such cases arise following the contextual problems in the process, such as short term leadership, limited support from the managers in line, other business priorities, and the inadequate infrastructure of supporting the process. However, an essential role of the human resource manager is to seal such spaces making an effort to ensure inspirations and translations to sustainable and practical steps.
International human resource management enhances employees’ relations and meeting diverse needs. It creates an environment where relationships among the people that is productive and harmonious through a partnership between management and employees. Also, it implements and develops laws that equalize and embrace the requirements of its collaborators and avail management of diverse labor force, considering individuals and group uniqueness in employments, personal requirements, and aspirations.
Important theoretical concepts and methods
Currently, the business environment is changing, and many of the international organizations are adapting to that, from striving purposes. This perspective also interferes with the role of human resource management, making it global in the way it manages people. Some of the factors that influence the relevance of HRM today are: internationalization of the business and organizations, value based on the knowledge asset, increased level of technology, and finally, diversity as discussed.
First is the internationalization of the business. The measure of the distance between countries in terms of economic integrations is concise from each other. According to Fisher, and Härtel (2003), by the end of the year 2005, the number of agreements involving regional trade already undergoing negotiation that concluded was almost 300. Today, it is evident that countries are closer economically than before. It is a slow process for the middle enterprises, so to have an international presence, they consider entry modes like facilities expansion, exportations and importation merging and acquisitions, joint venturing, and licensing. In other words, the larger world of the business tends to change from international to multi-international to global like structure. For instance, the situation with Swedish Ingvar Kamprad, some of the wealthiest businessmen who transformed just a slam business dealing with a variety of goods such as matches, Watches, wallets, and jewelry into one of the largest private-owned companies in the world, with over 200 stores in over 30 countries generating over 12 billion annually. For an organization with a business plan without internationalization is not promising at all. However, it is most likely to fail immediately; another more significant, national, and international competitor comes in.
One of the vital determinants of the success of an organization in the international venture is the practical utilizations and management of its knowledge asset. The whole idea becomes more relevant as organizations realized that the most valuable asset they have is their human labor. So the ultimate utilization of the human capital can increase the knowledge asset value within any business, which is found in the brains of the people working in it. Experience, educations background information, ideas innovative, and creativity composes are intangible asset that uplifts the competitiveness of the whole organization and enables them to make the right steps in the market place. Those experienced in globalization point out those successful organizations depend on knowledge to outline strategic advantages. Otherwise, if they fail to do so, they end up wasting time redoing what has been done missing out on the expertise already available.
According to Von, Drost, and Teagarden (2002), the complexity of managing global operations of an organization has resulted in technology adoption in IHRM. One of the organizations that adopted this is Rexel group, a world-class company, whose growth rate has been as a result of acquisitions. The Rexel Group is now in over 30 countries, with more than 25,000 workers. In order to achieve this goal, human resource management ought to install a human resource information system across all the HR departments. The installed HRIS ceases to provide effective management by coming up with reports to give international visibility of all the operations help in local arrangements. More so, the installation of the system also facilitates consistency, uniformity, and convergence of all the HRM policies and practices.
Current innovations
It is now evident that international human resource management has made innovations in the last few years, as the hiring process, people’s analysis of software systems has changed dramatically. Unlike there before, where employees were given an upper hand to their satisfaction levels, currents innovations are more of enlightening the overall HR culture. As per Von, Drost, and Teagarden (2002), organizations have advanced from back-office data to management of the people analytics. Making reports via the dashboard is analog in most of the companies today, and concentration is more on predictable patterns. Cornerstone, oracle, and vizier are the most recommended HR tool currently used in facilitating HR operations to enhance the whole process of employees. Most of them come with the advance possibilities of predicting employee retention and even help in strategies like doing jobs to get higher performance.
Another current innovation by IHRM is learning management systems. Regardless of the employees’ position or position in the organization, acquiring current trending skills is essential for updates. As a result, consistent learning is now a pivotal innovation in the HR sector. Availing learning opportunities to the employee is also a core factor in every organization aiming to progress.
Besides, Von, Drost, and Teagarden, (2002) asserted that reality is among the current trends in IHRM and one can make such a confidential claim that VR and AR are the currents innovations in today’s HR culture, which gives an upper hand for the learning market and performance for organizational staff. The simulation process is the distinguishing feature that helps employees in preparing on how to respond to a real-life situation. The recruitments process ensures that recruits are given exposure to a real-life situation. Moreover, there are options for a candidate to take a virtual tour of the company and get an exposure to the organization culture personally.
Lasts current innovation in IHRM is the effectiveness of the HR process. There before, the process involved the automation, but currently, the process is shifted to the efficiency of the HR process, not just automating everything. As a result, the responsibility is left on the mechanism to increase productivity, such as considering people’s analytics, team-centric companies, and possible use of hired employees as well as active labor. Afterward, HR is required to work on employees’ focus, engagement, and burnouts and build strategies following requirements.
When it comes to employees’ involvement, a lot has changed. The whole process is digitized, and employees are offered many fitness apps with the aim of proper work and life balance. Santos (2016) puts it out that maintaining a sustainable workforce by moderating professional and personal life enhances productivity, and the final result is a profitable company. Organizations are now initiating seminars to improve work-life balance in a business environment.
Potential ethical dilemmas
Potential ethical affairs for international human resources managers have come up with business globalization and the increase in multinational companies. Different languages, cultures, and ways of conducting business create a field of challenges. Therefore IHRM should make tough decisions to harmonize the company and ensure it is working within the required practices and inevitably working on miscommunication and lack of cultural awareness. As per Marchan, Welch, and Welch, 1999), they should train their employee about the suitable code of conduct before releasing them to international destinations. Training helps employees in coping with different practices overseas. Also, inadequate cultural awareness could be portrayed by a lack of nature in other cultures. So, HR should take full responsibility to provide training and the right knowledge to employees to enable a successful transition to the new culture awaiting them.
Privacy is a severe matter for many international businesses. According to Marschan, Welch, and Welch (1999), privacy policies vary in different locations. European Union as strict privacy policies than the U.S, and when the two sets of rules conflicts; human resource manager is left to decide which rule to apply. For instance, a European company that is doing business in the United States will have to the option to abide by the EU’S policies or the more relaxed laws in the U.S. However, some of the corporations opt to campaign for their country’s standard due to the belief that it the best operating version to produce cooperate results, together with protecting their employees in other countries
Case study analysis
Case study analysis related to the topic of IHRM is right in the appendix. Precisely, a case study concerns international compensation management, particularly at multinational account firms in Australia. Clients are on the move to increase revenue by increasing the volume of sales, whereas employees expected to influence production are not motivated by the inducements in other countries like the United States due to the nature of Australia culture. People from Australia are trying to achieve goals but never try going beyond them. Besides, employees are not active in constructing business bridges as the Australian business culture is transactional. In other words, it is meant for reacting to current needs; in fact, experts identify themselves as technicians instead of a salesperson. Following this, alternatives are to be put in place to curb the employees’ traits.
On the issue of the stakeholders and their interest in the case study, the following are the observations made. The top-level management had an interest in working on the subject of less motivation on employees to facilitate the team and in enhancing the actual production of the whole process. On the other hand, employees are the different stakeholders as their performance negatively brought about the issues arising as they encounter difficulties in their daily work. Trainers’ practitioners and the training managers are other groups of stakeholders. Their interest was to create a training course that could cut across the whole organization. Furthermore, additional stakeholders are the company’s clients, and their attention is to provide service to the company through buying, which would be improved if the employees deal away with the issues affecting them.
The general human resource management problem of the case study is as follows; clients are exploring channels to generate an increase in sales income. They have already contacted the social-democratic country for inhibition selling internally and externally. However, workers internally, are not encouraged to enhance productions since they generally miss the trust to leave their comfort zones, to imitate those who are successful and seek continuous improvements. Australians are continually working towards realizing their dream but never think of going beyond the realized dreams. Instead, it is meant to respond to the current needs simply as professionals refer to themselves as technicians instead of the sales force.
The theoretical concept that is associated with the case study is the concept of cross-cultural learning. This framework argues that the idea of cross-cultural differences can arise at any time in a working environment where workers are working together in completing a particular task and make an informed decision. In the past few years, a business located in a specific region thrived in a particular region only. Whenever there were incidences of integration commence, business, and overall interaction, the broad-scale was large, and the incidents were less frequent, with the advanced means of transport, infrastructures, technology, globalization, international business and cross-cultural interaction have become common and widespread. Research shows that not only large business that partakes in intercultural communication but also a small business, students, employees comes across a variety of different cultures on regular bases.
Although people are living a very culturally diverse life, for businesses, managers, and employees, the issue of dealing culturally different from theirs is paramount. Study shows that the importance of effective cross-cultural diversity management argues that today’s world; the cost of the business to overlook the importance of effective cross-cultural diversity management is substantial. As a result, managers who are dealing with a different company and are behaving as that company’s agent, and if managers fail to observe cross-cultural differences, the company as a whole takes a hit. This theory is relevant to the case study by enhancing international communication and teamwork in the entire business environment in different parts of the whole world, and this is the main requirement by the multinational account firm in Australia. So, it can be observed that the critical human resource management problem of the case study is cross-cultural differences in business environments. It impacted the morale of employees, making them less motivated in business productivity as their different backgrounds meant different cultures, and they needed to improve their communication skills to enhance team and not avoiding each other. Besides, it can be identified that for such cases, it is vital to design intercultural classes to teach staff to undertake responsibility in complex environments to avoid being annoyed.
Evaluating the effectiveness of practicing international human resource management
It is evident that people and talents are vital to any business planning to success, and HR is the center of finding, bringing, and retaining these two. According to Schuler, Jackson, and Tarique (2011), to know that HR is delivering everything needed effectively, it is by auditing the HR compliance concerning the entire legal requirement around him. It is the least exciting area where the HR team takes considerable time and attention. However, compliance is essential and something that needs regular monitoring, but it should be done in conjunction with considering those in line with the organization’s strategies. As per Fisher and Härtel (2003), key things to note are policies and practices, employee training, and employees undertaking essential procedures.
Technology had made it more comfortable in measuring HR effectiveness. For instance, lengthy and expensive annual staff monitoring are slowly being replaced by a short survey that requires employees to answer quick and straightforward questions regularly. It allows the HR team to come up with a clear picture of the staff available and quickly reply to the issues raised. In other situations, a “happy or not” terminal is used in getting daily anonymous feedback from staff. They are placed in the area with high traffic and ask the employees simple questions as they respond by selecting between one of the four smiley faces indicating how they feel.
Conclusions
To conclude, it is possible to identify significant success factors in effectively managing international human resource managers. Businesses and companies depend on the HR department to handle duties related to hiring, compensation, and relations. To increase value and back up the success of the business, HR personnel should understand the business, develop, and execute functions. According to Giousmpasoglou and Marinakou (2017), these factors are categorized, namely: consolidated leadership, human resource evaluation, structural strategy and cultural evaluation, and finally, monitoring of M&A resources. Besides HR to effectively manage, they should ensure constant communication with the members, the establishment of a strong network, creating strong structures, increased membership, and protection of the public interest. Regarding this, the moment the HR from the different entity is integrated into a new firm, and the teamwork begins. All the other factors are implemented in the integration phase, like new structure, process, and cultural Improvements, begin. Besides, leadership should be proactive for problems realization and solving them.
References
Budhwar, P.S., 2016. International human resource management. Edward Elgar Publishing Limited.
Fisher, G.B., and Härtel, C.E., 2003. Cross‐cultural effectiveness of Western expatriate‐Thai client interactions: lessons learned for IHRM research and theory. Cross-Cultural Management: An International Journal.
Giousmpasoglou, C., and Marinakou, E., 2017. Culture and managers in a globalized world. In Handbook of Research on Human Resources Strategies for the New Millennial Workforce (pp. 1-27). IGI Global.
Marschan-Piekkari, R., Welch, D., and Welch, L., 1999. Adopting a common corporate language: IHRM implications. International Journal of Human Resource Management, 10(3), pp.377-390.
Santos, R.P.D., 2016. New trends on expatriation and challenges for IHRM: state of the art (Doctoral dissertation, Instituto Superior de Economia e Gestão).
Schuler, R.S., Jackson, S.E., and Tarique, I., 2011. Global talent management and global talent challenges: Strategic opportunities for IHRM. Journal of world business, 46(4), pp.506-516.
Von Glinow, M.A., Drost, E.A. and Teagarden, M.B., 2002. Converging on IHRM best practices: Lessons learned from a globally distributed consortium on theory and practice. Human Resource Management: Published in Cooperation with the School of Business Administration, The University of Michigan and in alliance with the Society of Human Resources Management, 41(1), pp.123-140.