Challenges of HRM in the Global Environmentâ€Myassignmenthelp.Com

Question: What Is the Challenges of HRM in the Global Environment? Answer: Introducation In the contemporary business scenario, human resource management (HRM) can be defined as widespread in terms of strategies and organisational policy development. Modern HRM has replaced the traditional way of personnel management in the MNEs following the international settings. Precisely, human resource management involves academic theoretical concepts and modern business practices that can be utilised for managing the human resources in an efficient way (Demortier, Delobbe and El Akremi, 2013). Through the identification of the best theoretical concepts and management techniques, the terms of HRM has been set according to practices and disciplines. However, in the competitive business status, MNEs operating at the international level must identify the challenges associated with the HRM in the global environment to structure the best practices according to the order. In the rapidly transforming corporate landscape, the evolution of the HRM is required so that HRM can deliver the app ropriate business-driven functions leading towards a strategic corporate direction. In the particular essay, the HRM functions in the global environment have been analysed on a brief note to understand the foremost challenges of HRM in the international business context. As the current business world alters at a substantial pace, HR professionals need to make significant adjustment dealing with the local as well as international HRM issues associated with the context of business. In addition, identifying the HRM issues will not be enough to mitigate the problems (Guest and Conway, 2011). Evidently, defining the problem suitable solutions must be evaluated in order to achieve the desired result. The main purpose of the essay paper is to identify the leading human resource management challenges. By elaborating the challenges of HRM, the study has provided a list of recommendation that can be taken into consideration to put an end to the issues. Perhaps, the proactive approach should be shown in dealing with the management issues related at the international HRM as dis cussed in the study. Modern organisations must capitalise the alternating business environment through the implementation of better strategic decision-making. Therefore, the role of the HRM has become so crucial while establishing the management practices according to the internal strengths and weaknesses. By developing the most striking changes, HRM of an organisation can influence employee engagement, competencies of the human resources, and sustainability of workforce leading towards long-term viability of the business (Vashishth, 2012). Through the identification of the fundamental trends in HRM at the international level, organisational management can draw significant competitive advantage. Apparently, accurate human resource measures and planning as per the right prediction can deliver suitable strategic direction to the workforce. Precisely, integration of the objectives of both the organisation and HRM can be recognised as an essential aspect in HRM (Foot, Hook and Jenkins, 2016). Admittedly, gro wing business competition has increased the roles and accountability of modern HRM to reinforce the trend based on global perspective. In the context of business management, organisational HRM has adopted substantial resources such as internet and information technology (IT) to enhance the productivity of workforce minimising the organisational costs. On a bigger perspective, globalisation has increased the quality of HRM as new technologies and strategic management have been utilised by the HR professionals to achieve HR target in a cost-effective way (Fisher, Schoenfeldt and Shaw, 2016). However, IT and internet cannot be defined as the only major trends in developing the productivity of HRM at the global level. Notably, the changing workforce demographics have become one of the significant aspects in HRM (Dam, 2013). As a result of the consequences, the diversified workforce including different knowledge, culture, skills, and competencies, etc must be managed in an efficient way to draw competitive advantage. Herein, the identification of HRM challenges will become so much important. In the underlying section, th e leading challenges of HRM in the global situation have been illustrated. Linking the Organisational Strategy with HR Strategy and Practice The recognition of the link between the corporate and business strategies with the HR strategy and practices is not a new concept in the global business environment. The theory of McKinseys seven-S framework has been developed twenty years back to align the seven organisational variables such as strategy, subordinate goals, systems, structure, staff, style and skills for improving the effectiveness of the organisation (Dowling, Festing and Engle, 2013). On the other hand, the importance and role of human resources to organisation success has broadened due to knowledge driven and technology driven characteristics of businesses in the recent environment (Scharf, 2012). Global companies such as Coca-Cola have successfully evaluated strategic interventions and management model to link the corporate strategy with HR strategy and practices to achieve sustainability. Furthermore, with increased globalisation and competition in the market, the needs to link corporate strategy with HR policy have become important for the survival of the organisation in the global business market. Hence, it is important for the strategy makers to understand the changing business environment and link the business strategies with HR policies to seek competitive advantage and survive in the global industry. Hiring and retaining the best workforce in rapidly changing business dynamics In the contemporary business environment dwindling population of youth in the developed countries has contributed towards skill and knowledge shortages. Also, increasing rate of unemployment has become a substantial worry for HR Managers to select the best hiring and retention practices (Speculand, 2012). As a result of the consequences, cross-border migration can be identified leading towards demographic changes. For instance, McKinsey and Company, one of the leading consultancy services, has utilised modern hiring and retention policies such as online recruitment and staff performance evaluation to hire and retain the best talents at a lower cost. Therefore, modern HRM has to deal with cultural as well as demographic diversity to hire the human capital based on efficiency and talents (Jain, Rangnekar and Agrawal, 2016). Hence, the modern organisational HRM needs to set the best selection and recruitment policies for the different set of demographics i.e. young, people disabilities, aging people, and women etc. based on the scenario, it is one of the biggest challenges for the HRM to offer healthcare practices, flexible working schedule, and diverse management styles as per the suitability of the targeted workforce (Langley, 2013). Evidently, by offering substantial accommodation and compensation, HRM needs to promote employee retention as well. Aligning best technology practices to incorporate the Human Capital Prospects During the corporate strategic decision-making, identification of the steady improvement opportunities of the human capital should be important to analyse. In the global perspective, cross-broader management of human resources can be identified as one of the most comprehensive challenges for HRM (Reilly, 2015). By assessing the cultural differences and complexities of HRM, modern managers need to incorporate the human capital prospects in strategic decision-making by using communication technology. Most importantly, global growth of contemporary businesses hinges on the role of the HR leading towards integrating the labour force (Clancy, 2015). It is the responsibility of HR led teams to counter the differences in culture and workforce diversity so that dissimilarities can be merged wisely. For example, Apple Inc has utilised evident manufacturing technology to be the most innovative business and marketers. The sales and marketing strategies of Apple Inc have led to growth of the bus iness. By predicting the opportunities that can be offered by the human capitals, HRM needs to integrate the local culture with the international culture to improve the workforce efficiency (Jacobi, 2014). Meanwhile, understanding the diverse culture and inclusion of uniformity in management can be a tough task to be completed. Managing Global Operational Risks Invariably, balancing the corporate culture and societal culture can be identified as one of the most comprehensive issues in HRM while promoting workforce diversity (Bratton and Gold, 2017). Some of the most convenient cultural attributes can be modified according to the need of the target demographics. For instance, significant control management attributes can be altered. On the other hand, human right policies, ethical code of conducts, and integrity cannot be negotiated at any cost. Modern companies such as Google Inc have effectively identified the global operational risks to reduce the conflicts within the system. Precisely, the company has created a corporate culture to solve the issue. Based on the HR complexities, HR managers need to face challenges regarding bribery, confidentiality, integrity, loyalty, and other aspects (Ingham, 2010). Motivated by the organisation mission, vision, values, and ethics, it can be difficult to impose the most comprehensive cultural elements overwriting the existing ones. Therefore, maintaining the balance in corporate and community culture can be a leading HRM issue in the global environment. The Perceptive of subtlety of employees qualification to develop HR leaders In order to manage cultural diversity in the workplace, organisations need to develop HR leaders who are prepared to deal with the challenges regarding diversity. Precisely, educating the managers to develop the best diversity management practices is not an easy task, to say the least (McBain, 2007). Significant training and development programmes, learning courses, and investment will be required to establish the leadership traits. Moreover, communicating the culture and collaboration of the values can be other significant challenges in developing globally prepared leaders. Evidently, Microsoft Corporation has valued the understanding of subtlety of qualification and merits of the candidates to influence the productivity. During the management of cultural diverse workforce, the efficiency of the leader will be crucial to direct the employees towards the right direction. Herein, failing to complete the task can create substantial damage in productivity of the firm (Ax and Marton, 200 8). Therefore, it is a significant challenge for HRM to develop the best leaders who can control and manage diverse values, ethnicities, and policies at ease in the international environment. Maintaining a better understanding of Regulations and Legal directives The continuous up gradation in employment laws, regulations, and legal directives have also created substantial challenges for HRM. At the international level, HR managers need to have significant knowledge and understanding of regulations and legal directives regarding hiring employees, compensation and benefits, rights of the employees, safety and health practices etc. For instance, during selection and recruitment, the Disability Act, the Human Rights Act, the Discrimination Act, Health and Safety Regulatory Act, etc should be considered so that any legal obligations can be avoided (J. Phillips and P. Phillips, 2014). Alternatively, during the management of workforce, minimum wage rate system, workplace discriminations, and labour practices should be taken into considerations. Therefore, management of HR can be a constant challenge if any of the legal regulations has been ignored. In order to tackle the HRM challenges in global environment, a list of recommendation has been provided in the study as below that can be considered for betterment of the practices: Take Transparent and Positive Approach: In order to deal with the transitions affecting the productivity of the employees, transparency in communication must be introduced at the organisational forefront. Meanwhile, such influential communication approach can deliver tangible support to the employees dealing with the issues in the international human resource management (IHRM). Invest in the right technology-enabled collaboration: In the IHRM, selection and recruitment has been one of the major aspects. Therefore, through investing in right technology suitable for hiring, training, and appraisals, HR managers can increase the overall standards of the workforce leading towards sustainability. Consider Demographics: In the current scenario, considering the right set of demographics will be evident in IHRM. For instance, hiring the right sort of personnel equipped with experience, skills, and knowledge can save substantial capital for an organisation. Therefore, it will be significant to select the candidate from right demographics i.e. young group. Provide Training and Career development Programmes: In order to deal with the challenging issues of IHRM, suitable training and career development programmes must be introduced to develop strategic recruitment and selection procedure, crucial employee retention plan, and solving HR related issues in a more effective way. Promote Innovation and Change Management: In order to remain up-to-date with the latest HR trends, innovative concepts and ideas must be introduced among the employees. Alternatively, such efforts will increase to manage the process of change management that can be utilised to influence the diversified work culture in a positive manner. The role of human capital professionals has affected the business proposition of the leading corporate firms, to say the least. Creativity and innovation have become the need of the hour in mitigating the challenges with HRM in the global environment. Precisely, if organisational HRM can overlook the problems related to HRM, the effectiveness of scores will be reduced on a substantial note. As a result of the consequences, suitable human capital practices must be reinforced identifying the challenges affecting the performance of the firm in a negative way. Evidently, organisational people can be identified as the leading power of a firm. Therefore, the ability of the HR professionals can dictate the terms whether an organisation will be able to control the HR issues affecting the firms sustainability. By considering strategic vision and demographics, HR managers can replace traditional strategies with the new ones encouraging the workforce. Consequently, by promoting innovation and c hange management, the leading issues associated with the organisational human resource management can be dealt in a logical manner. Cultural diversity in HRM Employees are the backbone of every organisation that leads to the survival and success of the firm. In the current business environment, the workforce is made up of a diverse population of people belonging to different cultures and ethnic backgrounds. The cultural diversity in workforce creates multicultural and multiracial organisations that have both positive and negative implications of the organisational practices (Scharf, 2012). The international cultures or diverse workforce brings in better skills, experiences and abilities for the organisation to meet the growing challenges of global market. On the other hand, it becomes quite difficult for the human resource management to maintain a balance among the individuals belonging to international cultures in order to utilise the diversity of skills, competencies and knowledge (Losey, Meisinger and Ulrich, 2015). On the other hand, the global business environment has witnessed the importance of Human Resource Management in both public and business life. According to Sderlund and Bredin, (2016), the number of workers employed by the multinational enterprises has significantly increased in the last twenty years that have resulted from the expansion of the activities of the foreign affiliates of the MNCs across the globe. As per the study, around 73 million people work for the foreign companies in the year 2008, this is three times the population in the year 1990 (Rhodes, 2016). Currently, the figure has increased by around five times by the end of 2016. Hence, it becomes quite difficult for the Multinational organisations to control the diverse workforce with variation in cultural and ethical practices. Hence, every organisation needs to develop international HRM policies in order to maintain peace and harmony at workforce. On the basis of the above discussion, the paper has been developed to a nalyse the importance of considering the international culture while developing the HRM practices and policies. On the other hand, the study aims to discuss and evaluate the impact of international culture on the current human resource management policies and practices. Furthermore, the essay also presents necessary strategies that must be considered by the human resource managers of a global institution to control the diverse workforce and take advantage of the variations in skills, knowledge and capabilities. Most of the authors focus on the theory formulated by Gerhart Hofstede to understand the differences in international cultures. According to Hofstede (2001, p.25), culture is a mental programming or pattern of feeling, thought and action that an individual acquires in the childhood and applies throughout the life. The national culture is a category that is studied to explain different phenomena in the human resource management such as organisational structure, leadership style, and motivation. Moreover, the concept of differences between international cultures is proven to be suitable tool for developing the contents of HRM practise and policies for managing the individuals belonging to different regions (Snell, 2007). Furthermore, Hofstede (2001) differentiates the culture into a dimension on the basis of the relations between people. The dimension is known as Individualism and Collectivism. Alternatively, Fons Trompenaars differentiates the international culture on the basis of two dimensions known as individualismVs communitarianism and universalism Vs particularism. Additionally, the cultures can be differentiated on the basis of motivational orientation and attitudes toward time (Snell, 2007). For example, Hofstede identifies three dimensions on the basis of motivational orientation, namely femininity Vs masculinity,power distance and amount ofuncertainty avoidance (Hofstede, 2001). On the other hand, Trompenaars identifies two dimensions on the basis of attitudes toward time namely outer Vs inner time and synchronic Vs sequential. In the same manner, Hofstede also differentiates the socio-cultural dimension according to the attitude toward time as a short term Vs a long term orientation. Henc e, the differences in the cultural dimensions explained by Fons Trompenaars and Greet Hofstede can be used to understand the variations in the national culture (Snell, 2007). In addition, the theories can be applied in order to observe the implications of international culture over the HRM practices of different organisations. The cross cultural management issues are faced in a range of business activities especially in the human resource management functions of an organisation. In the current business environment, the management of geographically dispersed workforce belonging to different cultural background has emerged with a new segment of HRM that is known as International Human Resource Management (IHRM) (Machado, 2015). The primary objective of the IHRM is to manage the cross cultural conflicts and develop a workforce that will enhance the performance of the organisation. However, the internationalisation of businesses has made it important for the management to make changes in the way it operates in the domestic country. The primary level of changes has been evident in the field of human resource management. For example, it is important for the HR managers to consider the local laws and regulations of the host country. On the other hand, the behavioural changes and practices of the local people must be considered while planning the HRM practices and policies (Morley and Scullion, 2014). Any sort of misconduct can lead to adverse legal implications and loss of internal reputation of the firm. Hence, with increased globalisation of business, the HRM practices and policies are highly impacted by the differences in the international cultures. The inability of the management in considering the cultural differences among the workforce can result in adverse implications over the performance of the organisation. The challenge of workplace conflicts increases with variation in culture and inappropriate management of the workforce activities (Nkomo, Fottler and McAfee, 2015). Furthermore, it is important for the HR managers to understand the behaviour and cultural practices of the local employees in order to minimise the conflicts and develop a corporate culture in the firm. On the other hand, it is important to note that the influence of international cultures on the HRM practices in the multinational organisational can be analysed and monitored in all its segments. Hence, the paper analyses the impact of certain dimensions of international cultures on the key functions of the Human Resource Management, such as recruitment and selection of applicants, training and development of workers and performance appraisal and remunerati on of the workforce. Recruitment and Selection The differences in the international cultures have several impacts on the recruitment and selection procedures used by the multinational organisations. For example, the values of the recruiters influence the sources of recruitment used by the HR department of a firm. According to Holbert (2016), if the recruiters come from the region having individualistic values, the HR department will use the recruitment sources such as newspaper advertisements, employment agencies, online recruiting and other sources that do not have personal contacts (Holbert, 2016). Alternatively, if the recruiters belong to a region with collectivistic values, the HR department primarily uses the relationship or personal oriented recruitment sources such as networking at job fairs and referral of other employees. The differences can be evident by observing the recruitment sources used by multinational companies like Apple Inc and domestic companies like a retailing store in Asia. It can be seen that Apple uses recruitment sources that do not have personal contacts. On the other hand, a retail store in China will use sources with personal contacts to recruit a new employee. Moreover, the system of values of the candidates also influences the recruitment process. For example, if the applicant belongs to individualistic values, it is assumed that the individual will prefer an organisation or job that will enable the person to express their personal quality and achievement (Jain, Rangnekar and Agrawal, 2016). The applicant will prefer to work in a job that offers opportunity for advancement and degree of autonomy. On the other hand, if the candidate has a collectivistic value, the individual will apply for job that will offer them to work in a cooperative environment within a team. In the same way, the differences in culture also influence the selection process of an organisation (Sderlund and Bredin, 2016). For example, the selection criteria used by Apple Inc. in the United States will be q uite different than in China. The recruiters of Apple in the United States will prefer applicants who have individualistic values and focuses on results by working proactively and autonomously. In the case of China, the selection criteria of Apple Inc. will focus on choosing an applicant from collectivistic culture who will be willing to work in a group. Hence, the recruitment and selection function of the Human Resource Management Practices is highly influenced by the differences in the international cultures. Training and Development The differences in the international cultures also influence the training and development programmes of an organisation such as McDonalds. For instance, a strict and formal way of communication is used to interact between the coaches and trainees in high power distance cultures. Moreover, the influence of the culture can be evident in the design of the training and development programmes. According to the researches, it can be seen that Anglo-American employees with individualistic culture prefer goal oriented and individualised training programmes with a competitive learning environment in company like McDonalds (Parry, Stavrou and Lazarova, 2013). Alternatively, employees of Latin America with collectivistic cultures working in McDonalds are found to prefer informal environment and unstructured training methods during the training programmes that focus on experimentation and active participation. Furthermore, the employees from Asian culture in the same organisation prefer training methods based on group performance using formal training sessions (Holbert, 2016). The Asian people working in a multinational company also prefer a cooperative learning environment that will promote knowledge sharing and mutual benefit of the participants. On the basis of the differences in culture and background of the majority group, the multinational organisations need to make changes in the training and development practices in order to manage the preferences of the employees. Hence, the differences in the international culture have a direct impact on the training and development practices of a global firm. Performance Appraisal and Remuneration Finally, the differences in international cultures also influence the performance appraisal system of a multinational organisation. The influence of culture on the performance appraisal system can be identified at every stage of the process. Firstly, the culture affects the criteria that are used to measure the performance of the employees as well as the techniques that are used by the HR management to provide feedback to the workers (Rowley and Warner, 2013). In order to understand the influence of culture on the performance appraisal system, the two different types of criteria namely the contextual performance criteria and task performance criteria are used. According to research, the individualistic culture prefers using the task performance criteria for evaluating the hard work of the employees. For instances, Google uses the task performance criteria with the employees in the United States. According to this criteria, the performance of the workers are compared to organisational standards, responsibilities and task determined in the job description of a particular position (Filstad and Gottschalk, 2010). Alternatively, the collectivist culture prefers using the contextual performance criteria for judging the work of the employees. The contextual performance criteria makes the HR managers evaluate the performance of the workers on the basis of their innovativeness, cooperation with the team and assistance provided to others. In the same manner, Google uses the contextual performance criteria in dealing with the job performance of the employees in China. In other words, the individualistic culture manager emphasises on evaluating performance on the basis of individual performances, while the collectivist managers emphasises on group results and teamwork. It is important for the international HR managers to identify the cultural differences among the workforce and develop a better understanding of the cultural practices of the individuals belonging to different regions (Schuler and Jackson, 2007). A proper understanding of the culture helps the HR managers of multinational organisations to develop HRM practices to meet the different needs of the workforce. In order to manage the cultural diversity of the workforce, the managers must recognise that the people have differences, be they physical, cultural or generational (Speculand, 2012). The managers must celebrate the differences by encouraging the employees to show their individualities. The encouragement of showing their differences will help the management to utilise their knowledge to grow the business over the global market. Furthermore, the managers must focus on knowing their employees by encouraging them to interact with the management team. The attitude of the employees must be assessed while conducting employee reviews and assessments. It is the responsibility of the managers to identify and monitor the problems faced by the employees of the minority groups while working in the organisation (Sparrow, 2009). The HR managers must discuss the issues with the employees in a non-argumentative manner. Additionally, the managers are also responsible to develop strategies to mitigate the issues faced by the minority groups. For example, the managers must encourage employees to work with other workers belonging to different cultures or generations. Hence, it is important for the HR managers to focus on developing international HRM policies that will mitigate the issues of cultural differences. The recruitment and selection methods must be developed keeping in mind the culture of the majority groups of the country in which the company is operating (Sparrow, 2009). On the other hand, the international human resource managers must focus on developing corporate culture to mitigate the issues of cultural differences. Corporate culture can be implemented by promoting employee voice arrangements and encouraging workers to speak about their problems (Vashishth, 2012). Finally, cross-cultural training programmes can be initiated to influence the individuals to work with people belonging from different cultures and ethnic backgrounds. On the basis of the above analysis, the global Human Resource Management faces the issues of cultural differences that impact the HRM practices of the organisation. 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