INTERNATIONAL HUMAN RESOURCE MANAGEMENT: AN OVERVIEW OF ITS EFFECT ON MANAGERS IN GLOBAL ORGANISATIONS

duPlessis, Andries J. Interdisciplinary Journal of Contemporary Research In Business 2. 4 (Aug 2010): 178-192.

By managing international human resources (IHRM) correctly, it can enable a business to compete more successfully in the world market place. The last two decades have seen a gradual transition in style and substance from personnel management to human resource management, and recently to international human resource management. Human resource managers could consult local representatives of an overseas business regarding: local culture, employment aspects, safety, customs and traditions in order to operate in harmony with a local company’s procedures; different ethical and business standards can also lead to negative experiences. Because of various changes in socio-economic and legal-political requirements that differ from country to country designing remuneration packages could be different from ‘domestic-based’ human resource management. Doing business globally is a critical and important step because of the possible incompatibility of perceptions or standards in the company’s human resource’s policies and practices. It is not easy to manage pay packages of staff in a large multi-national company who are all earning at different rates; employees are more satisfied if they feel they are being paid what they are worth, especially those who are seconded to work overseas for a specific period.

Globalisation and Adjustment

The removal of geographical borders when conducting business, and the subsequent erosion of cultural and distance barriers, has stimulated international business, and caused HR practitioners to develop new concepts and skills to manage people outside their traditional boundaries. According to Härtel, Fujimoto, Strybosch and Fitzpatrick (2007) globalisation is widely regarded as a prime catalyst for IHRM. Fifteen years ago Yip (1995) explained already that there are four major drivers of globalisation:

* The global market with its consumer needs, wants and expectations;

* Production and labour costs in different countries;

* Government rules and regulations regarding taxes, tariffs, quality control and import/export restrictions;

* Competitors’ actions.

All these require a particular understanding and response from HR managers, which will enable them to see how different LHRM is from domestic-based HRM in their home country.

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More than a decade ago Kamoche (1997: 213) said the literature reflects a strong sociopsycho logical and welfare concern which echoes the notion of ‘adjustment’ Thus when a company’s business representative is going overseas to explore a new region it is a challenge for that person to adjust to a new lifestyle, language, conditions of employment or different ways of operating HR activities. Failure to adjust is often unacceptably high. Gomez-Mejia et al (2004) report comparatively high failure rates (as evidenced by a premature return) among US expatriates of 20-40 %, which is roughly three to four times higher than those experienced by European and Asian companies. HR managers need to utilisehuman capital in order to conduct the business more efficiently and effectively when a business intends to expand to an overseas market. HR managers could consult local representatives of an overseas business regarding: local culture, employment aspects, safety, customs and traditions in order to operate in harmony with a local company’s procedures.

Please answer the following questions with a focus on the above mentioned article:

Rationale

According to this article corporation should rethink and redefine their HR strategies in order to manage their international/ global activities.

Objective

1. Read this article carefully.

2. Please highlight the role of HRM within

3. Discuss the impact of the innovation oriented strategy on the strategic role of HRM.

4. What should HRM do to transform the strategy of innovation of a company into realty?

5. What are the implications of the above mentioned strategy for the staffing process of organizations in Dubai/ UAE?

The report must:

Analyze – the strategic role of HRMand the staffing process according to the concepts

in the textbook and in the class.

Evaluate – the linkage between a firm’s overall strategy on the activities of the HR managers?

Discuss – the influence of this strategy of the staffing process of companies in Dubai/UAE

Apply – the ideas and recommendations of the article on a local context.

Business Report Contents

Please focus on key ideas that reflect Specific, Measurable, Attainable, Results-Oriented, Time bound initiatives.

References to a good range of literature, which extends beyond that introduced in the module, are given and are cited appropriately in text and within the list of references using the Harvard system.

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