The paper delivers the human resource policies and its impact on the company performance and growth prospect. The study more focuses on the HRM policies and practices in the cross border region to identify the most potential HRM policies and practices based on the nature of the business and the preferences of the target region. In this context, Gomes et al. (2015) stated that implementation of potential and suitable HRM policy ensures the desired level of workforce performance and delivery of the expected outcomes through consistency and efficiency. Key purpose of developing the study is to recommends the international companies on selection and implementation of relevant HRM policies across the companies in different region to produce the business oriented outcomes. The study furthermore, has incorporated some examples of global industries to spot most suitable and relevant international HRM policy to apply the same throughout the business in global platform.
2. Human Resource Management
Human resource management is the section of a business that operates on the staff management strategies and leading the organisational workforce towards business objectives and compliance of the organisational policies. Therefore, human resource management coordinates the skills and knowledge of the employees to incorporate the same in the operation for producing expected outcomes (Gomes et al. 2015). However, Chung et al. (2014) opposed that human resource management entails influencing workforce for technical and operational involvement integrating the policies and practices with key goals. Thus, quality output and expected business production also depends on the voluntary involvement and willingness of taking responsibilities rather than being driven through instructions. The human resource management incorporates motivation, rewards, instruction follow, communication, performance evaluation and interest of employees.
3. International HRM
The international HRM is little different from the HRM as mentioned above in terms of HRM standardisation and policy implementation. In the opinion of Caligiuri (2014), international human resource management insists the company to procure, motivate and utilise the skills and knowledge of potential individuals in both domestic and international plant of the company. Therefore, HRM at global context enlighten creating employment opportunities in local to improve the state of the economies in global. Therefore, maintenance of the International Human Resource Management is a big challenge for the company to maintain the workforce at both the corporate section and the foreign or subsidiary firm operating in other territories. In that aspect, difference in the government policies on human resource at different countries would create a great obstacle in implementing a standard HRM policy and practice across the firm. Thus, under the International Human Resource Management, the company needs to work on diversified HRM policies according to the government rules and legal framework.
Based on the above discussion, it is clear that the global brands are highly focused on the IHRM rather implementing the domestic HRM policies and procedures as it covers a broader area of workforce management. Another reason for the development and execution of international HRM is as follows:
- Globalisation has influenced the mobilisation of the resources across the international region rapidly to generate the flow of fund for better exchange rate.
- The IHRM leads to an effective management of organisational staffs through integration of local policies and regulations with traditional and typical HRM strategies of the host country.
- Global operation of the HRM also leads to protect the company from underperformance due to presence of alternative way of generating income through consistent performance and operation.
- IHRM creates the network of a company across the global region that in turn shifts the traditional or hierarchical organisational structure to a network organisation to conduct a better and improved communication mechanism and shared value strategy.
4. HRM Policies
The HRM policies reveal the set of rules on the Human Resource Management on which the workforce management and control is dependent. The policies assist the management of an organisation to offer the benefits to the employees based on the national legislations and capability of the staffs. Following are some HRM policies that the company need to follow in both domestic and international region.
Health and Safety Policy
This is one of the necessary policies and government act that every organisation in the international region needs to follow assuring healthy environment for the employees. The policy also discloses that the workplace is free from occupational hazards and other physical and psychological obstacles. In this regards, Cooke (2014) commented that assured workplace health improve the commitment of the organisational staffs through development of proper coordination and teamwork within and outside the particular task group. In the UK, the health and safety policy is comparatively sound than the other territories. On the other hand, the policy also entails the sustainability of the existing workforce and thus, production volume with assured quality.
Minimum Wage Policy
Minimum wage policy or act refers to the minimum amount to be disbursed to the employees against the contribution of the same in allocated roles and responsibilities. Therefore, objective of longer sustainability in the concerned industry influences the companies to offer the minimum daily wage to the employee based on the responsibilities and capability of the staffs. In context of this act, Weber et al. (2013) stated that the key purpose of this policy in an organisation is to provide the money that would help the staffs in fulfilling the exact need of the staffs in the livelihood. Thus, the amount of minimum wage varies over the countries and industries operating in the same region.
Reward deals with the return to the employees against the performance and dedication in the allocated responsibilities. In most of the countries, the reward policy incorporates the financial and non-financial benefits improving livelihood of the staffs or a part of the expectations. Therefore, the types of rewards are also dependent on the current roles and responsibilities along with the level of operation the staffs is working under. In the words of Dickmann et al. (2016), rewards policy aims to motivate the staffs for better performance and improved production volume to attain higher profitability in future. On the contrary, reward policy often creates additional cost in terms of pay packages, tour packages and incentives absorbing a significant amount of profitability in future.
Equal opportunity is another crucial policy to avoid the workplace hazard due to gender diversity and account of physical disability. In this context, this policy in the emerging market or the developing region is often breached due to lack of proper awareness and knowledge on the impact of the inequality on company performance. In the opinion of Weber et al. (2013), equal opportunity act is highly sound in economically developed countries like UK, US, Australia and Germany where the capability and performance is measured with the same parameter irrespective of the gender and other disabilities of the staffs.
Compensation is all about return to the staffs against the contribution to the company goals and objectives. Therefore, the policy depends on the government rules and regulatory framework to disburse justified compensation for the contribution of the employees in the company operation. The compensation involves the retirement plan, delivery of injury compensation and compensation against volunteer retirement from the current responsibilities. Therefore, based on the government and accounting principle of the international accounting standard, the compensations are disbursed on the basis of provident fund, tax laws and other monetary benefits to the staffs.
5. Critical evaluation of the Multinational Companies
Most of the global brands from different industries are shifting from the domestic HRM to the International Human Resource Management to access the benefits of the same and disburse better amenities to the staffs while involving the staffs in its profit and revenue generation goals. Some of the companies having the plan to take the IHRM approach are Avon, General Electric, Wipro, CocaCola, Honda and Toyota. In case of Avon, IHRM in the company has enforced the management of the business in introducing the internet as an effective communication channel to develop an improved and integrated communications system in generating sales and revenue. In this context, Dickmann et al. (2016) stated that use of online channels as communication media has allowed the company workforce to share the knowledge and other internal information to make appropriate and sound decision on the business operations. As IHRM increases the area of operation across the globe, it also creates the opportunity to its existing staffs to work under cultural diversity and staffs from distinct regional and traditional values. On the other hand, implementation of IHRM in the global brands also creates the obstacle of resistance and thus, the organisational conflict from diversified ethical and cultural values. Therefore, under the shade of effective IHRM, companies have faced severe difficulties in terms of compliance of local and national HRM policies aligning to the key goals and objectives of the organisations. In this context, Weber et al. (2013) cited that maintenance of the cultural diversity within the company would increase legal cost at global regions. Avon has also introduced the training within the organisation at its domestic and foreign entities to attempt standardising the operational platform for a unique and justified way of operating the business. Moreover, the regular leadership program has also been an essential part of the IHRM program to develop efficient leadership within the global operational platform. Moreover, from the statistics, it is also transparent that the popular global brands as mentioned above are highly focused on the equal opportunities and thus, introducing sufficient number of female candidates in the management and other responsible business activities. In the words of Dickmann et al. (2016), the approach of women empowerment and involvement in decision making leads to fulfil the needs of the female customers automatically complying with the equal opportunity policy of the national government.
More sample on International Human Resources Management
From the above discussion, it could be inferred that International Human Resource Management is a broader area of implementing the Human resource policies at both the national and global context. Thus, under the IHRM the global organisations would access the scope of operating under cultural diversity and thus, improved business outcomes through shared value and flow of information among the staffs. However, the same would also develop difficulties as the needs of different counties according to economic state of the same. However, in presence of the benefits of the company as well as the individuals working in the company, most of the large scale companies have attempted incorporating IHRM in its business operation to enlarge its operational area and the scope of generating revenue for a longer financial sustainability.
Unique HRM Policies:
The global companies would follow its own HRM policy across the globe throughout its operation in different regions. In that case, the global brand would consider the business goals and objectives to develop suitable and most relevant HRM policies to be implemented at its all sections and operational segments. However, such policy would need to incorporate the national legislations and legal framework to look after proper compliance of its HRM practices. Hence, such integration would further attain acceptance of the company practices to its authority to gain further benefits from the same.
Combination of Multinational Legislations:
Unlike the above way of HRM practices, the international HRM practices would also combine the cultural; diversity within its existing policies and practices to make the rules adoptable for the staffs from different cultural background. Therefore, in the era of resource mobilisation, the staffs would be transferred and recruited based on needs and capability to equally look after the operation throughout the organisation.
Localisation and Regional Diversification:
Concentrating on the opinion of Jim Pinto, “Go Global, Think Local”, multinational organisations would localise its policies and practices to gain active cooperation and legal benefits from the local government and other commercial authorities. Therefore, through localising the HRM policies based on the national culture and legal framework, the business entities would be better run with distinct HRM policies at its foreign divisions. However, in that case, the host countries needs to employ sectional authority in its each division to conduct better coordination and compliance of HRM policies and practices, aligned to the key goals and objectives.
- Caligiuri, P., (2014). Many moving parts: Factors influencing the effectiveness of HRM practices designed to improve knowledge transfer within MNCs. Journal of International Business Studies, 45(1), pp.63-72.
- Chung, C., Sparrow, P. and Bozkurt, Ö., (2014). South Korean MNEs’ international HRM approach: Hybridization of global standards and local practices. Journal of World Business, 49(4), pp.549-559.
- Cooke, F.L., (2014). Chinese multinational firms in Asia and Africa: Relationships with institutional actors and patterns of HRM practices. Human Resource Management, 53(6), pp.877-896.
- Dickmann, M., Brewster, C. and Sparrow, P. eds., (2016). International Human Resource Management: Contemporary HR Issues in Europe. Routledge.
- Gomes, E., Sahadev, S., Glaister, A.J. and Demirbag, M., (2015). A comparison of international HRM practices by Indian and European MNEs: evidence from Africa. The International Journal of Human Resource Management, 26(21), pp.2676-2700.
- Weber, W., Festing, M. and Dowling, P.J. eds., (2013). Management and International Review: Cross-Cultural and Comparative International Human Resource Management. Springer Science & Business Media.