Human resources manager in international expansion

tender resources manager in multinational enlargementABSTRACTThe world all-embracing dimension of military man Resources work may not have high influence in some businesses. But in some business it does posses a lot of influence. several(prenominal) presidencys that have world wide activities, needs to be staffed but with some diametrical comparisons in the terms and conditions of employment. This is where the importance of planetary kind-hearted resource caution and the role of outside(a) human resource manager arise. internationalist human resource manager must be responsible for framing new Human resources policies and strategies that gets in line with the kettle of fishs ethical and religious issues for which managers need to posses both explicit and tacit noesis. This research highlights the importance of this knowledge and its transfer from the p bent country to the armament country in line with the other objectives of this research. INTRODUCTIONThe evolution o f significance in International Human Resource Management originates from the augment of ball-shapedisation. This substantial ontogeny can be seen very obviously over the past half century. This term explains the propagation of international trading relations, foreign direct speculation, worldwide mergers and acquisitions, faster and affordable transport and swift technological revolution. Amalgamation of markets multi- across the nation was involved by orbiculateization and the intricacy was done on a regional level as well which is enthused by the rise of potential and authoritative markets in china, India and Eastern and Central Europe. Multinational companies are yet other visible manifestations of globalization. As companies overstate domestically to a certain level they then try and expand internationally. This is when the role of International Human Resource Management comes into action. The objective of this research is to 1. invest the role of International HR Mana ger. 2. To provide justification for the chosen geographical area. 3. To discuss the role of IHRM in relation to companys global involvement. The chosen geographical location for this research is India, for which the justification would be revealed during the course of the research.LITERATURE REVIEWInternational HRM can be defined as the set of distinct activities, functions and processes that are enjoin at attracting and maintaining an MNCs human resources. It is thus the aggregate of the discordant HRM systems used to manage great deal in the MNC, both at home and overseas. Taylor, Beechler and Napier, 1996, pg 960. there are various molds that best explain the International Human Resource Management. These models have been put forward to illustrate how the HR function is configured. The Schuler et al. (1993) model explains us the integrative stray work of international HRM. This is a conceptual frame work that tried to record HRM activity to the diverse strategic requirem ents for consolidation and topical anesthetic responsiveness. Schuler et al. (1993) defines strategic international HRM as Human Resource Management issues, functions, policies, practices that result from the strategic activities of multinational enterprises and that impact the international concerns and goals of the enterprise.International Human Resource Management can in addition be referred to as a scrupulous type of devolution activity and spreading out of HR role. As and when an organization starts to develop its international activities, the organization inexorably sets up the degree of decentralization, but internationalization is not just a form of decentralization. This is considered to be one of the most complex forms of the same and involves unalike types of language, culture, economic and political systems, legislative frame works, management styles and conventions and diversification that stay within those national boundaries. (Torrington, Hall and Taylor, 2005, pg 695). Perlmutter (1969) proposed a model that was purely network based, illustrating the globalization of companies. This model was initially implemented in the international human resource management prose, rather than the international business field from where it originated. Kobrin (1994) identified the classification in human resource management issues such as training, recruiting, selecting people and resources as the prime reason why international Human resource theorists adopt the Perlmutters model widely. Perlmutter (1969) initially defined three organizational types based on managements mindsets. They are ethnocentric, polycentric and geocentric organizations. Later he came with the fourth type of organization which is called the regiocentric organization. THE ETHNOCENTRIC expectation reflects a spotlight on home country values and methods of operating. The consequence is the key positions are filled by the parent country nationals which give them a high degree of direct control over the subsidiaries. THE POLYCENTRIC MINDSET focuses on armament country values and methods of operating. The key positions are filled by local employees and the parent company is less interested in homogenizing the organizational culture.THE GEOCENTRIC MINDSET focuses on global operation methods and values. These values are not nationally specific but transcend national boundaries and become almost multi-cultural. This approach involves best people for the job and the selection is done from all over the global organization.THE REGIOCENTRIC MINDSET recognizes regional operational methods and values. The organization is normally structured along regional geographic lines (e.g. Europe, America, Asia Pacific Rim) and employees are transferred within these regions allowing certain degree of integration and recognizing regional diversity. Perlmutter (1969).ROLE OF INTERNATIONAL HUMAN RESOURCES MANAGERThe primary role of the human resources manager of a company that is expandin g internationally for the first time is to meditate new HR strategies and policies based on the organizations business policy. They must keep in mind the issues in the geographical location where the company is going to operate. Those issues may be varied starting from political issues, dig out issues, religious issues and diversity issues. The next important role would be the transfer of knowledge. Knowledge is defined in terms of its explicit and tacit qualities (Nonaka and Takeuchi, 1995). Polyani (1962) states that tacit knowledge is the one that can be articulated and explicit knowledge is something that cannot be articulated. Both these knowledge has different methods of acquisition and accumulation purposes. Lam (2000) argues that explicit knowledge is mostly generated through reckoning and inference and can be acquired through instruction, training reading and listening and tacit knowledge is acquired through exposure in different environments, face to face conferences. Close interaction plays a critical role in dissemination of this knowledge.As per the supra argument by Lam (2000), we can say that it is mandatory for an international human resources manager to posses both explicit and tacit knowledge. pellucid knowledge allow for help the manager in framing international HR policies and strategies based on organizational objectives. This can also be communicate to as the internal factors in international expanding upon. Where as the external factors include the political issues, the opportunities and threats which they might experience. This requires the manager to posses abundant tacit knowledge which is acquired through experience. To be more specific on the roles we can consider the work of Tregaskis, Glover and Ferner (2005). They examined the role of international HR networks in 13 different Multi-national companies and outlined the role of the HR manager. These include 1. Global policy development. 2. Global HR policy accomplishment. 3. Best practice conception and allocation. 4. Utilization of the distributed HR expertise. 5. Creating buy-in to policy initiatives. 6. Information Exchange. 7. Socialization of the HR community.These roles are self explanatory and it underpins the relevant knowledge requirement of the person involved in the international setting.JUSTIFICATION OF THE CHOSEN AREAThis research will proceed further based on the assumption that the UK based organization is planning to expand its operations in India. India is one of the largest democracies in the southern Asia. India draws a high level of international attention with a GDP of growth rate of 8.1 percent in the first quarter of the financial year 2005-2006. This increase from 1.9 percent in 1995 to 3.4 percent in 2004. Major growth rate can be found in the industrial and the services sector with a growth rate of 8 percent in 2005. there are quite a few challenges that the organization might have to face during its expansion in India. Th is is outlined by Beardwell and Claydon (2007, pg 626).INFRASTRUCTURE The combination of weak authoritarian mechanisms and the improper flow of FDI which is found more in non core sectors have dependent the flow in core sectors and Energy. Wider skill up gradation seems to be es displaceial in India for e.g., more manpower is required in the information and the communication Industry.CORRUPTION This is another challenge that could be faced by the organization. This is the reason that the FDI flow in china is comparatively higher. The government of India has implemented the Rights to Information transaction in 2005. Setting up of the vigilance commission is also an important step taken by the government.GROWTH WITH EQUITY Despite the fact that thither are more jobs being created, these jobs are in the unorganized sector with poor wages and benefits and there is less job security. But the government is victorious necessary steps to improve job opportunities and enhance skills devel opment by ensuring education for all. Beardwell and Claydon (2007, pg 627), outlines the advantages an organization that enjoy despite the arousing the challenges. They areLANGUAGE Advantage of wide knowledge in English language is evident in most graduates who come from across a billion universities in India which makes recruiting quality candidates very easy.SKILLS highly skilled people from the field of software and information technology are one of Indias competitive advantages. India though highly recognized for unskilled cheap labor produces a number of graduates from the field of mathematics and science from a number of colleges.DEMOCRACY The egalitarian nature of the Indian state provides a sustainable distribution of resources with an equitable distribution of resources and opportunities. This may help India address the challenges of poverty, inequality, low equality and per-capita income.DIVERSITY The key to understanding the Indian context is its diversity. Managers with an experience in a diverse organization are regularly equipped to adjust as well as respond to the increasingly diverse international work place.PROSPECTS India on description of its competitive advantage continues to gain employment within global division of MNC. The probability of this change happening is high with a projected growth of 9-10 percent which was predicted by the World Bank. DISCUSSION AND EXAMPLESIHRM and Companys Global InvolvementThis discussion will mainly focus on role of IHRM in companys global involvement followed by examples of two organizations. Vernons (1996) stage model of organizational change and the steps are listed below PHASE 1. DOMESTIC Focus is on the market, with unique products and services. There are no requirements of cultural diversity and the HR needs are not demanding in international terms. I.e. expatriate assignments cross-cultural (Dunbar, ET. Al., 1989). PHASE 2. INTERNATIONAL There is an increase in competition and international markets gain significance for profit. The HR now performs vital role in attaining control of local operations.PHASE 3. transnational The product/ service reaches maturity, there is a rise in competition and a fall in price. The best people are chosen for international postings for increasing profits and the recruitment of international manager would be from those with the knowledge of parent culture.PHASE 4. GLOBAL The previous three stages were based on graded structures. This phase functions on the postulation that the business unit will need to operate in all the three phases continuously. It is in this stage the demarcation surrounded by the expatriate and local managers disappears and management of dual demands of integration and local responsiveness takes place in the organization. (Doz and Prahalad, 1986). Phase I Domestic Phase II International Phase III Multinational Phase IV Global Primary Orientation Product or Service Marketing Price scheme Strategy Domestic Multi Domestic Multi National Global World Wide Strategy Allow Foreign Clients To buy Product/service Increase market Internationally, canalize technology abroad. Source, Produce and Market Internationally Gain global strategic competitive advantage Staffing Expatriates None (Few) Many Some Many Why sent? Junket To sell control or transfer technology Control Coordination and Integration Whom Sent? ok performers, salespeople Very good performers High- potential Managers and top executives get Reward Project to get Job done Project and career development Career and organizational development Career Impact Negative disconsolate for domestic career Important for global career Essential for executive suite Professional Re- entry Somewhat difficult Extremely difficult less(prenominal) difficult Professionally easy Training and Development None Limited Longer Continuous throughout career For Whom No one Expatriates Expatriates Managers Performance appraisal Corporate bottom line Subsidiary botto m line Corporate bottom line Strategic positioning Motivation Assumption bullion motivates Money and adventure Challenge and opportunity Challenge, opportunity, advancement Rewarding Extra money to compensate for foreign hardship ______________ Less generous, global packages ____________ CareerFast impression Domestic Domestic Token international Global Executive Passport Home country Home country Home country, token foreigners Multinational incumbent Skills Technical and managerial Plus cultural adaptation Plus recognizing cultural differences Plus cross- cultural interaction, influence and synergy Source Adler and Ghadar, 1990 cited on Beardwell and Claydon 2007. The table illustrated above was proposed by Adler and Ghadar, (1990), which illustrated the IHRM in relation to the companys global environment relating various aspects with Vernons model of organizational change. Examples The two organizations that will be considered as examples in this research are Barclays bank a nd British airways. Barclays is a UK based organization which is expanding globally at a considerable rate. Barclays bank has been operating in India for just a bridge of two years. Within a short span of time they have gained the title as the most respected foreign banks of the country. This bank is led by Mark Jones, who is the Managing Director in Asia. The company has its own corporate social responsibilities. In 2008 52.2 million pounds was invested in community projects and over 57, 361 employees in over 50 countries was involved in one of them. www.barclays.in (2009). Theoretically speaking Barclays in now on PHASE 3. THE MULTINATIONAL STAGE, as illustrated by Vernon (1996). The organization employed a director who has the knowledge of the parent culture. They have five branches across India and currently have their efforts focused on financial inclusion, entrepreneurship, and education and Helping people into Employment. The ethnocentric and polycentric mindsets of Perlmutt ers (1969) model best suits the companys International HR management practices because Barclays key positions are filled by parent country nationals as well as nationals from the host country. When considering the case of British Airways, they are slightly different from Barclays. This difference occurred because British airways are a huge organization with over 80 years of history. though they have their hubs only in London, they have their operations in six continents and in over 69 countries and India is one of them. They serve to more than 36 million passengers every year. They believe in offering diversity, more development, better training than their competitors. www.britishairways.com (2009). This organizations international HRM strategy can be compared in contrast with the permutters (1969) geocentric and regiocentric mindsets of the people because they involve best people from all over the globe and at crucial stages employees are transferred within a particular region. Br itish airways is currently in the PHASE 4 which is the GLOBAL PHASE as they are operating on all the prior three stages.CONCLUSIONThis research analyzed the international human resource management using a range of academic models and theories. The role of human resource manager during a first international expansion was clearly related to the knowledge transfer and the organizational strategies and policies. This research can be a useful tool for a domestic company whose future day plan is to expand their business globally. After analyzing the advantages and challenges in India it gives the organization a clear picture as to what are the issues that can be expected, both internally and externally. Advantages are those which the organization must be prepared to utilize, and the challenges are something which they must be ready to face. Keeping in mind the role of the IHRM in organizations global involvement, the stages for organizational change, and the advantages and challenges th ey might face in the host country, the organization can really make an excellent start in their proposed geographical location. REFERENCES1. All some British Airways, available at http//www.britishairwaysjobs.com/baweb1/?newms=info1 accessed on 24 August 2009. 2. About Barclays (2009), available at http//www.barclays.in/about/about_us.htm accessed on 24 August 2009. 3. Adler, N. and Ghadar, F. (1990) strategic human resource management A global perspective, in Pieper, R. Human Resource management An International Comparison. 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