Human Resource Management

Role of Globalization in Managing People

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Introduction to Human Resource Management

In present scenario, globalization is playing a very significant role in managing people across different countries in an effective manner. Globalization is something which can be termed as multidimensional process that helps in transforming activities at national and global level in an insightful way along with communicating also at a sharp rate. However, it involves number of ups and downs in it. The extent to which globalization is affecting people and organization depends on nation to nation (GLOBALIZATION, 2014). As nowadays every firm which is working at international level is having the manpower from different countries, to manage them has become typical. In this report, there will be a study on various implications that are there on workforce of an international organization due to globalization. There will also be a discussion on comparative and international human resource management in order to deal with people across nations. Along with that, various competencies that are needed in HR manager of a global organization will also be in focus (Kazi, 2011).

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Implications of Globalization on Workforce

From ancient time to new market scenario, globalization implies various changes as well as transformation to the nature of work and organization. The way in which people are treated in globalised firm has changed totally than that of earlier times. As in international organization, people are from various nations on which their attitude, beliefs, perception and values are based. This is the reason; to manage them has become a difficult task as every individual is different from the other (Wang and et.al, 2010). But, it can be critically analyzed that if they are not being managed in an effective way, there will be a threat of their termination to other companies. Earlier, to deal with employees was an easy task but now it has become complex.

One of the main reason is competition too as many competitor firms are there in the market in each type of industry. An international organization always faces a threat of employees to switch over on other firms if they are not satisfied. For this purpose, business entity try their best to make them satisfied with number of initiatives like attractive salary packages, perks and incentives and along with that various other non-monetary facilities like medical, housing etc too (Muriente, 2005). However, if employees would not be given with these things, to make them happy and willing to work would not be possible. It will ultimately leads to less productivity and hence loss in organization’s profit and goodwill. The most important role is played by the work environment of organization which needs to very healthy and positive. Otherwise, people would not stay in the firm for a long period.

Importance to Manage Employees Across Different Countries Effectively

Business can get a lot of advantages by making people satisfied in international organization. It can act as a competitive advantage too as if employees are satisfied in an international business entity; it will lead to high productivity and goodwill as well. The highly skilled and knowledgeable staff will be in firm only which will provide high profits from their abilities (Skinner and Blackey, 2010). But to retain employees in a long duration requires many efforts and a long time as for this purpose, it needs to prepare various long term strategies. These plans provide competitive strength to the organization and through this, business can survive with more sustainability. The old practices and systems to make employees stay in firm are longer useful. As they are human resources only, who carry out all the functions, to manage them effectively by making them satisfied is has become essential (Too and et.al, 2010).

In an international organization, most of the things depend on economic environment of that country. If the financial condition of the nation is sound, tom pay employees with high salaries would be possible for the firm. On the contrary, if there is recession in the economy, then company would not be able to pay high packages. It will lead to employee turnover which ultimately affects profits of the international organization (Ahlstrom and Bruton, 2009). For the firms which operating globally, the competitive advantages are like innovation, quality and cost leadership. It helps in attracting customers with reasonable cost and innovative features and in retaining them by providing superior quality. All these competitive advantages totally depend on the human resources of the company as they will be the only one who would provide products or services to the ultimate customers with the use of latest technologies (Brewster and et.al, 2000). For competitor firms in international market, it will be easy to copy techniques but to duplicate management of human resources of the organization will not be possible for them.

For organizations that are doing their business at an international level are required to handle employees to an extent that they will be happy with what they having and also can make society satisfied. For this, first, to understand their culture and beliefs is important as through it, to know about their perception about particular things will become easy. It will also show their needs which will be fulfilled by the firm to make them happy and convince to stay in organization (Tielmann, 2010). In spite of the fact that if it will be beneficial for the international enterprise, if their culture is not being considered, to know about their needs will become a typical task which can create dissatisfaction for the employee. A person who is not satisfied would not stay in the firm and thus company may have to bear a loss because of his retention (Khalil, 2005).
Selecting suitable employees for international organization across nations by cross cultural management

In present scenario, as organizations are performing its activities in different countries and operated their business there, to recruit people from that respective country is necessary. In every branch of the organization, it has become trend to have people from different economies so as to make operations easy to carry out in the nations of which they belong. However, if it would not be done, some barriers on the basis of language and communication may occur (TRENDS IN ORGANIZATIONAL CHANGE, 2014). Every nation has its own unique set of beliefs and values; the behavior of employees of different countries reflects way of their society and economy in which they operate. It helps in recruiting and managing people at work by understanding their culture and attitudes. In accordance with the specific operations that are based on culture of country, human resources are being selected. It can also be termed as cross cultural management of people (Ordiz and et.al, 2003).

The extent to which globalization has changed the way of managing people in an international organization is very high and totally depends on the nationalities of individuals working there. In order to organize, conduct and manage people, nationality plays a significant role. On the contrary, if these issues are not given with due care and importance, it can create biases in the enterprise and conflicts would also arise (Politis, 2005). For human resource managers, it has become a very important task to aware about the cultural differences of people so as to make policies and procedures accordingly. They need to frame all their plans and strategies in such an order that there will be equality for all the employees without any discrimination. However, if they do not do so, people from distinct cultures would not feel recognized and may leave organization due to discomfort zone (Sims, 2007).

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With respect to the cross cultural differences in personnel of an international organization, process of recruitment and selection is made and conducted. The training and development programs for them are also organized in accordance with their culture only that suits them the most and which will be according to their values. Rewards and performance appraisal of people are also made by keeping in mind their culture and attitudes (Tatnall, Osorio and Visscher, 2005). So by an international organization, it is required to frame standardized policies and practices which can be implemented throughout the world in the nations which are having its branches. It will help the enterprise to make all employees follow same set of rules and regulations without having nay problem which will be acceptable by them easily. On the contrary, if policies are not made according to the cultural differences of employees, they would feel difficulty in executing this and dissatisfaction will arise within them (Brewster and et.al, 2011).

Comparative and International Human Resource Management for Dealing With People at Globalised Level

In accordance with comparative human resource management, the extent to which people differ from each other with respect to their culture and nation is being analyzed. There may be chances that some economies in which an international organization operated are well developed while some are still developing. All these countries have their own labor markets, education systems, employment and trade laws (Huemann, Keegan and Turner, 2007). People from different nations have specific cultural expectations from the firm which needs to be realized by HR manager so as to fulfill them for retaining employees in a long term. As employment laws differ from country to country, it is necessary for international organization to manage human resources accordingly (Jagoda, 2014). It helps in dealing with employees in a more effective way. However, if they are not handled effectively, they would leave their jobs and switch over to other organizations.

In terms of international human resource management, organization that has operated its business at a global level needs to manage people from distinct nations by nurturing them through cost effective practices. In this, international firm is required to have thorough knowledge about the legal, institutional and cultural circumstances of the nations in which it is running its business. It needs to consider the rules and regulation imposed by government there so as to know what is allowed and restricted (Jackson and Malthis, 2010). It will help in reducing risk which can be occurred due to implications by not following the rules of government. On the contrary, there is one major disadvantage with firms operating globally, that is, if it would ignore the legal and political environment of those countries, it may have to pay a huge amount as a penalty. Along with financial loss, goodwill and market price of shares of the enterprise would also decrease (Lähteenmäki and Laiho, 2011).

Globalization and Canging Face of Human Resource Management

In order to have suitable candidates at right places, proper human resource planning is needed. It is the responsibility of the human resource manager in each branch of international organization to formulate realistic plans with full commitment and coordination with the efforts of top management. People from different countries would be recruited and selected in such a manner that they can handle operations of their respective nations (Lepak and et. al, 2006). It will also help in understanding the specific needs of customers of that market. In spite of this benefit, one major challenge with this is that if these factors are not considered, it may create blunders for the enterprise. They are being selected so as to meet global challenges by making appropriate mix of employees in terms of their knowledge, skills and culture (Benett, 2002).
Another major factor that HR manager of an international organization has to consider for managing workforce is to handle the diversity in them because of different culture, attitudes and values. He is responsible for making those policies for people by which they can perform their activities without having any problem. The human resource manager is the only one who sets guidelines in organization to make people follow that in order to provide respect to each culture. But, it can be critically analyzed that if success of the company depends on him, he can also destroy the firm with his wrong decisions (Bradly, 2005). That is the reason; to have an effective resource management is essential to survive.

To become adaptable with globalization, these firms are having various policies in which special provisions for people from different cultures are stated. Like, for people Hindu, Muslim and Christians, separate places to worship is there. In present scenario, because of having so much competition due to globalization, people of distinct nations are selected. The human resource management department is responsible for giving respect to each ethnicity and to the people with cultural differences (Cuyvers and et.al, 2011). However, if it would not be so, to make these employees stay in the company would no longer be achievable for an international organization.

Reward Management and Employee Participation

In world of globalization, for managing people with cultural diversities, reward management would also prove to be very effective. As if international organization will provide more wages than that of offered in their home countries, people would get ready to join that firm and to leave their nation. These firms are needed to advertise themselves on internet for recruiting people across borders as in globalization, nothing works on free basis. For every activity, some amount is required (Brady, 2010). In terms of keeping people willing to work in international organization, to make them involved in all activities and to make their contribution in decisions has become common. It helps in making them feel recognized which lead to increase their satisfaction level and also willingness to perform more. On the contrary, in this case, there may be conflicts arise due to the reason that some may not be in favor of other’s opinion (GLOBALIZATIO, 2014).

Various development and training programs are being organized by the organization that has operated globally so as to make employees learn the culture of the company and to perform their activities accordingly. It helps in having similar working in all branches of the international business entity through these programs. However, it can be critically analyzed that to provide chances to employees for participating in development programs and give their contribution; some may feel partiality (Kazi, 2011). It can have a negative impact on their performance and also on working environment. In the firms running their business globally, due respect and consideration is given to people and to their culture. It takes many initiatives in order to make good relations with all employees of different countries so as to retain them and to earn high profits in markets. But critically it can be evaluated that these initiatives require high investment and efforts (Wang and et.al, 2010).

Competencies in an HR Manager in an International Organization

In present scenario, the human resource manager which is selected by international organization generally has some specific competencies that are essential to be in him. The most important proficiency among them all is the flexibility. He needs to be flexible enough so as to deal with all types of employees, that is, there should not be any matter regarding different cultural differences in between people. However, if leadership and managerial style would not be flexible and is rigid enough, he would not be able to handle diverse workforce (Muriente, 2005). Also, manager of human resources in these companies are aware about the importance of team work as staff in different country cannot work properly without coordination in their activities. He is the one who make employee’s efforts coordinated so that target can be achieved effectively on specified time.

Communication also plays an important role is one of the very important characteristic of human resource manager in international organization. To deal with employees at global level, communication of the manager is usually very effective and understandable to the personnel. He is generally ware with all the languages that are being used in the nations where the organization is running its operations. It can be critically analyzed that, it there will be communication barriers from the end of HR manager, employees cannot work properly and goal cannot be achieved on time (Skinner and Blackey, 2010). It is because, if people would not understand their responsibilities towards organization and if interaction between staff of all associated nations will not be effective, then their efforts would go in wrong direction.

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Challenges in Managing Workforce in International Organization Due to Globalization

In order to manage the workforce in international organization, due to globalization, various challenges are there which firm needs to face. In terms of challenges, major role is played by ethical issues of every nation. It is not important that the ethics of one nation will be similar to that of other country also. Likewise, for employees with cultural differences also, ethical issues may vary (Too and et.al, 2010). Company operated in international market is required to follow the ethical norms of the nations in which it is running its business. But, it can be critically analyzed that if these issues are being ignored, company may have to pay high penalties for that. In order to save itself from any risk and to manage people effectively, organization needs to understand and follow the ethical norms of the country. Increase and decrease in goodwill of international organizations depends on ethical issues to a very high extent (Ahlstrom and Bruton, 2009).

Another major challenge is the technology that is being used in different nations. International organization is required to follow those techniques only that are being used in all economies where it is performing its operations. It helps in satisfying customers with use of latest methods and by providing them products and services with highly innovative features and superior quality. Employees also get benefitted by learning the way to implement new techniques which elaborates their knowledge (Brewster and et.al, 2000). On the contrary, one major limitation behind this is that there may be chances for some employees to not accept the change in their work style. It may lead to some conflicts in the firm and among employees as well as there will be risk for them to leave organization. It can create a huge loss for the business and would negatively impact its brand image.

Conclusion

From the above report, it can be concluded that globalization is having its impact on the way to manage people in an international organization to a very high extent. This report is showing various implications on workforce which can create mismanagement for the firm. It includes communication barriers and lack of coordination among employees. Importance of training and development programs to make personnel with cultural differences and in distinct nations comfortable with each other so as to bring sustainability in business (Tielmann, 2010). The effects of various factors of globalization, if they are not followed are also presented here. From this report, it can be wind up that the human resource manager of an international organization needs have various capabilities so as to deal with employees of all regions in which operations of business are taking place.

References

  • Ahlstrom, D. and Bruton, G., 2009. International Management: Strategy and Culture in the Emerging World. Cengage Learning.
  • Benett, R., 2002. International Marketing: Strategy Planning, Market Entry & Implementation. Kogan Page.
  • Bradly, F., 2005. International Marketing Strategy. Financial Times/Prentice Hall.
  • Brady, L. D., 2010. Essentials of International Marketing. M.E. Sharpe.
  • Brewster, C. and et.al., 2000. Contemporary Issues in Human Resource Management: Gaining a Competitive Advantage. Oxford University Press.
  • Cuyvers, L. and et.al., 2011. The labour market consequences of globalisation and regionalization. International Journal of Manpower.
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