globally managing human resources

Copyright 2000 - South-Western College Publishing

Globally Managing Human Resources

Copyright 2000 - South-Western College Publishing Module 25 - 2

Module Overview• Introduction & Overview

• Global Megatrends

• The Difference between Domestic & Global HR

• Global Corporate Evolution

• Implications for HR Management

• Why Global HR is Important

• Core Global Competencies

• Strategic Issues

• Relation to Frame

• Conclusion & Debrief


Signs of the Globalization

Foreign Investment in the US is over $2 trillion

Global Trade

Standards &

Regulations

Over 400,000 international students from 150 countries study in the US

US Corporations Employ over 60 million overseas workers

Over 3 million Americans work overseas

24 Hour Financial MarketsGrowth of giant

multinationals & global corporations

Creation of superblocs

NAFTA,EEC,ASEA


Global Megatrends

• Globalization• Learning Organization• Global Technology• Business Ethics• Creativity• Emerging Roles of Women• Changing Global Workforce

Marquardt & Engel, 93


Globalization Trends

Traditional sources of competitive advantage (low cost, technology, access to capital) are not sufficient to provide a sustainable edge

Contemporary approaches point to core competencies & human assets as keys to success in the global market

Pucik, 92


Global HR Management

HRM: Those functions undertaken by an organization to effectively utilize its human resources

Global HRM: Involves the procurement, allocation, and utilization of human resources across more than one nation on an international (between nations), multinational (many nations), or global scale


Key Distinctions

• Global Players• Cultural Diversity• Geographic Dispersion• Environmental Differences


Global Players

• Parent Country Nationals (PCNs)• Host Country Nationals (HCNs)• Third Country Nationals (TCNs)


Cultural Diversity

• Intracultural• Intercultural• Cross-cultural• Multi-cultural


Environment

Language Religion

Politics

Family

ClassStructure

NaturalResources

HistoryEconomics

Education


Global Corporate Evolution

GlobalMultinationalInternational


The Global Corporation?

An organization that:

• Has fully & globally integrated its operations

• Has the ability to optimize marketing, purchasing, people, engineering, & manufacturing activities world-wide

• Has become an “insider” in every nation where it operates

• Has a global strategic perspective with a capability for local differentiation

Adler, 93


Why Corporations Go Global

• Increased foreign competition in domestic markets;

• Expanded free trade policies;

• Improved telecommunications & information systems;

• Lowered transportation or production costs;

• Access to foreign technology, skills, knowledge, human, & natural resources;

• Opportunities for larger profits;

• Worldwide financial systems & global money markets


Importance of Global HR

• Reduce unnecessary waste of HR resources

• Improve effectiveness in diverse environments

• Improve ability to identify viable business environments

• Increase competitiveness

• Improve satisfaction and retention of personnel

• Prevent business loss due to cultural insensitivity


Selection and Staffing

Other cultures:religion, political affiliation, socio-economic status, union affiliation, age, sex, appearance

US themes:merit & qualifications

objective

legalistic, fair

job-centered

Arvey, Bhagat, & Salas, 91


Organizational Design

Old Forms: New Forms:

tall flat

complex simple

hierarchies networks



Training and Development

Training for expatriates– only about 1/3 of US MNCs offer any training

about 2/3 of European & Japanese MNCs do– if done, not comprehensive– language training, cultural knowledge,

environmental brief– spousal involvement– duration of training

(US: 1 week : Japan: 1 year)Arvey, Bhagat, & Salas, 91


Compensation and Benefits

• Housing and utilities• Education allowances for children• Cost-of-living allowances• Hardship on-site allowance• Foreign service premium• Tax equalization & protection• Stock ownership• Retirement benefits



Performance Management

Other cultures:– only for certain levels (too costly)– subjective; emphasis on human relations– trait-based

US themes:– objective– job &

behaviorally based (observable)

– emphasis on outcomes


Global Competencies

Global perspective

Local responsiveness

Synergistic learning

Adaptation

Foreign experience

What to pack......?


Organizational Competencies

• Organizational Learning

• Continuous Improvement

• Competitive Organizational Culture

Pucik, 92


Global Strategic Options

CulturalCulturalAccommodationAccommodation

Cultural SynergyCultural Synergy

CulturalCulturalAvoidanceAvoidance

CulturalCulturalDominanceDominance

Cultural CompromiseCultural Compromise

Adler, 97


Strategic HR Orientations

• Adaptive Orientation

• Exportive Orientation

• Integrative Orientation

Taylor, Beechler, & Napier, 96


Relation to the Frame

• Transactions

• Translation

• Transition

• Transformation


Amoco CaseQuestions for discussion:• How can you as leader of this intervention best justify adapting

Amoco’s HR policies and practices to be more global?• What aspects of the existing HR system should be changed and

why? Provide specific recommendations as to how the system should be modified and when?

• What steps would you take to ensure the HR system change process is well managed?


Conclusion & Debrief

• Key Lessons?• New Insights?• Personal Perspectives?• Additional thoughts, questions or comments?

Copyright 2000 - South-Western College Publishing

“It is time for people to move beyond an awareness of the urgency of global competition and begin to

develop skills for success in the global arena”

Adler, 93


Global HR Outcomes

ORGANIZATIONAL LEARNING

COMPETITIVE ADVANTAGE

CONTINUOUS IMPROVEMENT

SKILL

ENHANCEMENTS

globally managing human resources

Documents

global marketpucik

global hr managementhrm

hr managementwhy global

global strategic perspective

human resourcesglobal

utilization of human

foreign technology

core competencies human