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 MANAGING PEOPLE IN GLOBAL ORGANISATIONS

INTERNATIONAL HUMAN RESOURCE MANAGEMENT

MMN126829 (GCU) / MMN126846 (IEG)

© OWNER’S COPYRIGHT
ABSTRACT

The study aims to evaluate the aspect of international human resource management, its

general impacts on the corporate world business and the way it facilitates different

strategies involved in managing human workforce globally.

The evaluation will focus on explaining human resource and what it to corporate activities.

The study equally discusses the challenges and practices affiliated with people management,

including feasible recommendations for the challenges.

INTRODUCTION

BACKGROUND TO THE STUDY

Human Resource Management (HRM) is indeed the lifeblood of an firm or organisation

when it comes to defining the processes of achieving corporate success. This is because that

aspect deals with how the core individuals that make up the workforce of a company are

recruited, conducted, managed, trained, administered and converted as valuable human

assets to the said company’s operations. So when it comes to the execution of such HRM

processes in other regions or countries as a result of a company’s global expansion, then

there is what is called International Human Resource Management (IHRM).

The cited definition of Fan and Kumar (2021) described the concept of human resource

management as those set of distinct activities, processes and functions that are focused on

the maintenance and development of human resources at more than a national level.
On an equal note, Ukessays (2021) explained that International Human Resource

Management (IHRM) is all about the problems and unfolding issues that multinational

companies manage when it comes to their individual human resources. In this definition,

the purpose of International Human Resource Management is associated with the corporate

administration of expatriates and international workforce through that different stages of

internationalisation.

“International Human Resource Management (IHRM) is simply a set of activities targeting

human resource management at the international level. It strives to meet organizational

objectives and achieve competitive advantage over competitors at national and

international level.

IHRM comprises of typical HRM functions such as recruitment, selection, training and

development, performance appraisal and dismissal done at the international level and

additional exercises such as global skills management, expatriate management and so on.”

(Tutorialspoint, 2022)

AIMS AND CONTRIBUTION OF INTERNATIONAL RESOURCE MANAGEMENT TO

INTERNATIONAL ORGANISATIONAL STRATEGY GLOBALLY

Indeed, the concept of human resource has expanded from merely interviewing and

prepping the administrative wing of an organisation to hire prospective individuals as staffs.

Gone are those days when managing human resources is mostly restricted to the domestic

operations of a business institution or company.

International Human Resource Management has long been changing and expanding in tune

with evolving corporate practices around the world. The ‘international’ part connotes the

involvement of a company’s business operations outside its home country

In relation to the above illustration, Vance and Paik (2006) described the context of

‘international’ as a company’s operational issues happening away from the national or

domestic market of the said company’s headquarters. Whereas, they termed the global

context as the combination of both in the management of the entire enterprise.

Globalization is one of the key contributions which International Human Resource

Management (IHRM) has facilitated in the corporate world businesses. Globalization, in this

sense, is basically the increasing integration of a company’s business activities into the

economy of a place, especially in the quest for cheaper labour force, business expansion and

free trading (meaning international trade with the absence of government encumbrance

through harsh duties, tariffs and political laws). There is equally the establishment of a much

needed brand presence in between countries in an interconnected market where the

economy of both benefit from each other. The economic benefit of globalization has also

helped when it comes to improving immigrant labour laws, encouraging global competition,

facilitating the successful introduction of new and already known company products into a

new market, creating more employment between countries, and so on. These contributions

have urged many expanding companies to consider more innovative means to harness their

global workforce.

“Economic growth has linked the human capital development process by focusing strategies

of human resource management to address performance management plan concerns or

challenges. For instance, a study has found that performance management planning is part
of the human resource process where managers help companies implement some strategic

and organisational changes. Then through the human resource process, the HRM is

expected to have the commitment and willingness to focus on improving the performance

level of individual staff and encouraging more performance assessment and staff welfare.”

(Gerald, 2018)

In other words, International Human Resource Management (IHRM) is all about the

methods of overseeing the workforce of an organisation both at home and abroad. The aims

of IHRM include:

 Ensuring that organisations manage and organise language training programme and

counselling in culture

 Another aim is to encourage the organisational awareness, technical capabilities and

managerial know-how of human resource employees and mangers

 Another aim is to secure the career paths, welfare packages, and performance

rewards of workers globally.

 To help proffer much better managerial ideas in handling global business operations.

 Encouraging more plausible actions of work practices around the world.

 To empower campaigns helping to spread more corporate awareness on the

application of newer and better performance management strategies of human

resources.

 Bringing down cultural biases, marginalization and differences to promote cultural

amicability within global workplaces.

 The encouragement of non-vindictive and ethical human resource tactics among

global companies.
KEY CHALLENGES ASSOCIATED WITH MANAGING PEOPLE WITHIN GLOBAL

ORGANISATIONS

Bhagyashree (2022) stated that there are three main International Human Resource

Management activities which are Allocate, Procure and Utilize. He revealed that these three

major activities also encompass normal domestic activities like compensation, training and

development, industrial relations, performance management, human resource planning,

and the hiring of employees. In addition, he asserted that the corporate application of

IHMR also involves the workers of 3 countries, namely:

 The country of origin or home country where the organisation’s headquarters is

likely located.

 The host country which harbours the said company’s subsidiaries or branches.

 Then there is the third country which are third party sources of cheap labour and

finance.

From the foregoing, it is obvious that the main challenges of International Human

Resource Management (IHRM) will potentially be from people. These challenges

usually range from the cultural to the physical due to different cultural factors. Thus,

the Key challenges affecting people management globally are listed below:

 Cultural shock and differences: The relocation of staff or the process of expatriation

usually brings about the unexpected need to adaptating to another culture in

another country. Culture shock is a psychological state of confusion and anxiety that

occurs in a staff being exposed to an alien environment alongside its cultural

inferences.
 In a related analysis, Scullion et al (2007) presented how a company’s social capital is

reliant on the cultural stances of its staffs and the country in which it wanted to

establish business. For instance, cultural beliefs, dressings, cuisine, modes of

greetings, gender treatment and interactions, religion, and so on are elements of

culture shock which overwhelmingly influence the social capital of a globalizing

company. Social capital, which is described as value and goodwill created as a result

of the social interactions between foreign and origin staffs, might affect the

company’s social capital. Them there would be no market value returns on the

product and services sales of the company.

In other words, not taking enough time and appropriate resources to study the

cultural environment of a new location for business target might lead to a disaster

concerning the staffs, logistics and product marketing.

 The cost of internationally sourcing for human resources can be quite on the heavy

side. While funding is expected to not be a problem for majority of the multinational

companies, the sheer amount of money spent on the selection and training process

of new foreign staffs could turn to an accounting and logistics nightmare. There is

equally the consideration of compensating expatriate staffs based on the target

country’s tax and labour laws, except there is an existing tax treaties as enabled by

the diplomatic ties of the company’s country and the target foreign country.

 It can be overwhelming for the human resource (HR) managers to effectively manage

a workforce that is too diverse. The HR managers are expected to know the

differences between the remote and in-office resources so as to make appropriate

staff decisions. Thus, this is where the managers are implement practices that unite

the workforce to enhance creativity, productivity, and efficiency.

 Complicated labour and local laws: Sometimes it can be difficult for a company to

expand its business to the market of another country due to the latter’s volatile or

complex laws. Operating under such circumstances is highly likely to cause instances

where the company would break the staff compensation rules and thus incur

damages to its brand and profits.

 Setting ethical rules that would be suited for a diverse workforce: Having a diverse

workforce on a global scale is usually a big socio-political plus for a company’s image.

However, this may likely lead to the challenging cost of having to find a general

ethical rule that can guide the workplace attitudes of individual staffs. Being from

different backgrounds will surely elicit clashes of interests on projects and staff

interactions. A workplace culture of inclusivity and talent growth can be used by HR

managers as one of tactics to promote ethical growth among their diverse staffs.

 Immigration challenges: Both multinationals and respective governments have

always been at loggerheads on this issue. While many foreign governments are

trying to maintain control on their national security and population, private giant

companies whose business operations are equally benefitting the same governments

are always in need of more hired hands (preferably cheap immigrant or local labour)

for their vast business activities. And on several governments’ part, there is a

constant dilemma of not having enough capable workers from their citizenry to run

their industries so they won’t need immigrant labor.

“Europe’s governments are trying to curtail the influx of illegal immigrants, adding

new regulations every year to restrict entry as well as the movements of those

apparently looking for work. Two years ago the EU adopted a common visa policy,

and it soon will begin requiring airlines to inform immigration officials of tourists
 who fail to use their return tickets. But efforts to control the wave of illegal

immigrants come up against economic and cultural forces that foster it. Many

Europeans are happy to employ the new immigrants because they tend to work for

less money than previous generations of transient laborers. Particularly in Spain, the

cost of integrating these largely Catholic, Spanish-speaking immigrants is much lower

than integrating those from Africa and the Middle East. The trend also serves the

diverging demographics.” (Vance and Paik, 2006)

ORGANIZATIONAL STRATEGIES FOR MANAGING PEOPLE IN GLOBAL ORGANISATIONS

 Company’s approach to cultural values: Geert Hofstede made a comprehensive

research that lays a globally recognized emphasis on how workplace values are really

influenced by culture. According to Hofstede, culture is best defined as the collective

programming of the mind, thereby distinguishing the members of one group or

category of people from others. (Hofstede Insights, 2022)

Also, Hofstede theorized some cultural dimensions models which he used in

analysing people’s diverse cultural orientations. Some of them as briefly explained

below include:

Power Distance Index (PDI): In this dimension, the ordinary people in the society

always expect power to be distributed unequally. There is an acceptance of

hierarchy in power and benefits distribution. However, people from societies with

low PDI index are prone to get vocal and active against the uneven distribution of

power and benefits.

Individualism versus Collectivism (IDV): This dimension raises a socio-cultural

preference between ‘I’ or ‘we’ among the people within a society. It is either
individuals are expected to care for themselves and immediate families alone or

individuals expect the collective help from the majority.

Masculinity versus Feminity (MAS): This is described as a reflection of a “tough vs

delicate” cultural orientation among the people of a society. For instance, there is a

dimensional belief that the male side preferably symbolises material success,

heroism, fierceness, societal respect and strength in a largely competitive society. On

the other hand, the female side is expected to reflect meekness, care, being delicate

and obedient.

Uncertainty Avoidance Index (UAI): This cultural dimension reflects the level at

which the people of a society feel disturbed ambiguity and uncertainty. In this place,

the society deals with the truth of an unknown future and ponder on whether they

can control its outcome or not.

Hofstede believed that societies with a high level of UAI maintain unchanging beliefs

and codes in lifestyles while societies with little or no UAI have a more relaxed,

practical and tolerant attitude towards life and the unknown future.

All of the above cultural dimensions accurately project the culturally influenced

mentalities of people along the lines of religion, traditions, gender equality, societal

hierarchy and distribution of power, societal ambition, etc. Indeed, it is not far-

fetched to believe that all the individuals making up the workforce of a multinational

company must certainly belong to any of the extreme opposites of these cultural

dimensions. This is all related to the indispensable importance of getting the

background information of a country’s socio-cultural and political stance concerning

the above factors before a company embarks on a global expansion. This is equally

applicable to HR managers who are in charge of hiring qualified employees into their
 company’s workforce. Understanding cultural dimensions greatly helps companies

from facilitating employee chaos as a result of a misunderstood staff or business

environment.

 Ukessays (2021) explained a critical approach towards managing people within an

organisation. These well-researched approaches were more suited for initial

recruitment of potential workers for a company. They are accordingly listed below:

Ethnocentric: The same policies being used by HR management of the company back

in home country are used in controlling overseas or hired foreign staffs. In order to

facilitate this strategy, top managers or expatriates who are nationals in the

company’s home country are appointed into key positions to control subsidiaries.

Polycentric: The subsidiary office independently recruits local HR managers to

oversee staff management according to suited foreign situations. The foreign office

independently manages the people in its workforce.

Geocentric: This strategy involves recruiting and stationing individuals who are

considered the most qualified and capable for maximizing any location to intensify

global results. Their capabilities are also adapted to suit any regions for managing

the people recruited to work under them. An instance is when a Nigerian is

appointed to oversee the Human Resource department of a British electronics

company in a subsidiary office located in Egypt.

Region-centric: This strategy entails the coordination and recruitment of the most

capable within the region where a company’s subsidiary office is located. However,

the HR manager can be from any country within the region, with appropriate

communication being maintained with the head office. An example is appointing a

Chinese HR manager to head an office in Singapore.

  Use of incentives and benefits: In the aspect of applying innovative organisational

means of satisfying people who make up their workforce, some multinationals are

taking up radical and highly unexpected methods in ensuring the well-being and

maximum performance of their staffs. Google has been ranked one of the best

multinational companies that go all out to create great working environments for

their staffs.

According to the report of Human Resources MBA Staff (2022), Google’s

headquarters office in California has a seven-acre sports complex, indoor roller

hockey rinks, travel vouchers, cash reward packages, some wellness centres, and so

many hours of subsidized massage appointments given to their staffs every year.

 Another organisational strategy that is using effective action plans by HR managers

to evolve with the global trends of managing people. For instance, HR leaders can

motivate their respective departments in organising cultural awareness programs

that educate on different belief perspectives, race and gender identities.

PRACTICES AND INTERVENTIONS UTILISED TO EFFECTIVELY, EFFICIENTLY AND ETHICALLY

MANAGE PEOPLE IN GLOBAL ORGANISATIONS

So far so good, it is has been made clear that the strategies that will make the management

of a company’s human capital more efficient are the ones geared towards mental health,

empathy, and moral motivation. It is a general believe that people, regardless of their

professional qualifications, race, academic backgrounds, religious beliefs, life’s experiences,

and so forth will always be emotional beings. However, the general emotions of most

people are discovered to be attached to certain aspects of some of the aforementioned in

one way or another. The cultural dimensions of Beert Hofstede fully explain this theory in

relation to the relationship between human mental well-being and workplace activities.

Wong (2019)' s exposition posited that company incentives like free meals, games and

happy hours are not enough to stand as full support for the overall well-being of workers.

Wong also added the indispensable importance of HR leadership to encourage cultural

change and inclusion through sincere and empathic means of communication. A reference

was made to how Johnson& Johnson (a globally renowned pharmaceutical company) has

initiated Mental Health Employee Resource Groups (MHERGs) as an approach applied from

the lowest staff hierarchy to the topmost at work.

Other practices that can be used to effectively manage people within organisations include

according to Ukessays (2021) include:

 Cultural assimilation: This involves the creation of awareness among the workers of a

company on each other’s cultural backgrounds and things like the customary ways of

greetings. The idea of being appreciated and noticed will be reflected in the minds of

the workers whose cultures are being learnt for enhancing smoother employee work

synergy.

 Language training: This is a usually overlooked area that many globalised companies

still do not invest much in as much as they invest in the professional trainings of their

foreign staffs. Language is the key to every form of communication and most

important to understanding an alien culture. Giving the people in a workplace

language training goes a long way in effectively managing misunderstandings and

communication crisis.

 Field experience: This deals with the physical or hands-on experience that

employees, especially locally hired ones in a foreign region, are given in order to
 considerably blend in with their highly trained Western colleagues. Programmes like

this promote more sense of belonging and commitment among subsidiary workers

or expats.

 Environmental briefings: Making a thorough background research and getting

information is very critical to the logistics and communication of a company

intending to establish in a new market. Finding information about things like political

stability, social development, economic growth, cultural practices and geographical

terrains are very critical towards effective people management. After all, information

gotten about a company’s prospective personnel in a foreign land is important to the

recruitment success of the said company.

CONCLUSION AND RECOMMENDATION

As stressed by Oppong (2017), one of the frequent challenges of HRM is dealing with the

notion of unitarism. The idea of unitarism is seeing a company as a cohesive whole in which

both workers and employers work together for a common good and that of the company. It

should be all about securing a long-term partnership of management and staff members

with common interests. This is best achieved through the universalistic approach and

contingency approach. Both approaches seek to identify a set of HR practices that are

beneficial for the whole organisation and still promote non-toxic and ethical workplace

practices in said place.

People will always be moved by what they see, hear or think about. Workplace, being a

gathering of people from different backgrounds, is prone to constant miscommunication

and many mental-inducing stress activities. Managing such circumstances can be very

overwhelming, even for a multinational company. However, the best way is to go about
making IHRM strategies presented in ways that will include and not exclude workers so as

not to create an impression of bias. Communication is one the easiest and best way to make

workers interact on what they are experiencing on the job so far–which includes among

themselves and with their bosses. This way will aid activities like mental health programmes

to get successful and not end up wasting financial resources while discouraging the

company human resources.

And referencing the opinion of Wong (2019), company policies, beautiful environments and

quality assurance statements can only hope to be effective if the workplace practices are

not overwhelming the mental health of its staff both nationally and globally. This is stating

that making people-oriented policies, work ethics and welfares are the best way to securing

smooth human management and business success for any company. Google is at least a real

life example in that regard.

REFERENCES

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Available from: https://www.economicsdiscussion.net/human-resource-management/what-

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research over the past fifty years: A bibliographic analysis.

Available from: https://www.sciencedirect.com/topics/economics-econometrics-and-

finance/international-human-resource-management

Gerald, R., 2018. How Strategic International Human Resource (IHR) Strategies can manage

Organizational Performance Challenges. Archives of Business Research. University of

Maryland Global Campus, Vol.6, No.10, pp.1-2.

Available from: https://www.researchgate.net/publication/32887356

Tutorialspoint., 2022. Human Resource Management (HRM)- International.

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https://www.tutorialspoint.com/human_resource_management/human_resource_manage

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https://hi.hofstede-insights.com/national-culture

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Kumar, S.A., Suresh, N., 2008. Productions and Operations Management (With Skill

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Wong, B., 2019. What Companies like Google, Johnson & Johnson, RetailMeNot And SAP are

Doing to Change the Culture of Workplace Mental Health.

Available from: https://www.forbes.com/sites/mindsharepartners/2019/12/19/what-

leading-companies-are-doing-to-change-the-culture-of-workplace-mental-health/?

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