1 / 12

The Role of Globalization in HR Policy and Practice

The Role of Globalization in HR Policy and Practice. 2. International Commerce. Engaging in international commerce without investing in foreign factories or facilities exporting —the firm sells its products and services in foreign marketplaces

faunia
Download Presentation

The Role of Globalization in HR Policy and Practice

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. The Role of Globalization in HR Policy and Practice 2

  2. International Commerce • Engaging in international commerce without investing in foreign factories or facilities • exporting—the firm sells its products and services in foreign marketplaces • Intermediaries-third parties who specialize in importing and exporting. • licensing—the licensor leases the right to use its intellectual property to another firm, called the licensee, in exchange for a fee • franchising—a special form of licensing which allows an independent organization, called the franchisee, to operate a business under the name of another, called a franchisor, in return for a fee • contract manufacturing—a firm outsources the creation of its products to another country which surrenders a major amount of control over the processes • management contracts—a company sells its management (and sometimes technical) expertise to a company in another area of the world

  3. International Commerce • Engaging in international commerce through foreign direct investment (FDI). • alliance—one firm identifies an appropriate organization with which to “partner” allowing the firm to make a direct investment very gradually while sharing its risk with a knowledgeable, experienced other party • joint ventures—partners create a new, separate company that is owned jointly by the venture partners • strategic alliance—companies agree to partner with one another, but do not set up a separate entity • sole ownership—a firm owns an operation in a foreign country in order to ensure that they have full decision-making authority and operational control

  4. International Business Strategies • FDI management strategies: • multilocal—a business is managed as a collection of relatively independent operation organizations, each of which is focused on a particular domestic market • very decentralized; each division free to customize its own products, create its own advertising and promotion campaigns, and utilize whatever production techniques best serve their customers • export—a business views the world as a single marketplace and strives to create standardized goods or services that will meet the needs of customers everywhere • centralized; power and responsibility vested in company headquarters • global—a business which tries to combine the benefits of an export orientation and multilocal organizations to achieve global-scale efficiencies, while remaining locally responsive to their customers

  5. Choosing an International Strategy • Factors influencing the choice of international strategy. • general environment issues • economic systems • legal systems • political systems • socio-cultural systems • language diversity • religious beliefs

  6. Choosing an International Strategy • Factors influencing the choice of international strategy. • organization’s task environment • cost pressures • competitive rivalry • ease with which organizations may enter or leave the industry • degree of power over the company maintained by suppliers and customers • organization’s internal strengths • culture • management expertise • information systems’ amount and sophistication • ability to detect and respond to consumer trends

  7. Domestic Versus International HR • Complexity of operating HR on an international basis. • legal issues • cultural differences • amount of foreign investment in relation to the company’s domestic investment • senior management’s attitudes toward international operations

  8. Unique Challengesin International Joint Ventures Source: Adapted from O. Shenkar and Y. Zeira, “Human Resource management in International Joint Ventures: Directions for Research,” Academy of Management Review 12 (1987) pp 546-557. Reprinted with permission

  9. International HR Management Strategies • Four general IHRM strategies: • ethnocentric—foreign subsidiaries have little autonomy, operations are typically centralized, and major decisions are made at the corporate headquarters • key positions in management are held by parent company nationals (PCNs) • polycentric—foreign subsidiaries are treated as a distinct entity with some level of decision-making authority • initially PCNs fill strategic upper-level management positions. • host country nationals (HCNs) fill middle- and lower-level management positions, eventually training and moving upward to take over for PCNs

  10. International HR Management Strategies • geocentric—relationships between headquarters and foreign subsidiaries tend to be extremely collaborative, with each participant contributing important information, perspective, and decision-making factors • best person is found to fill the position, regardless of what country they come from. • regiocentric—scaled-down version of the geocentric model with a strong regional headquarters that is vested with considerable power to manage its operations and operates very collaboratively and independently with the subsidiaries with the region

  11. International Business Assignments • Use of PCNs to: • increase communication • provide expertise • maintain control • Trends in international business assignments. • higher use of third-country nationals (TCNs) and home country nationals (HCNs) • declining length of international assignments • short-term assignments • developmental assignments • strategic assignments • long-term assignments

  12. Global Leadership • Globally competent managers and leaders—knowledgeable, effective, well-rounded individuals who could be sent anywhere on the globe to run an operation. • skills • integrators who see beyond obvious country and cultural differences • diplomats who can resolve conflicts and influence locals to accept world standards and commonalities • cross-fertilizers who recognize the best from various places and adapt it for utilization elsewhere • knowledge • in-depth understanding of world markets: their potentials and problems • thorough grasp of all elements of the global supply chains and distribution channels • skillfully embrace cultural diversity

More Related