Human Resource Management in a Global Economy

This report discusses the issues faced by Fox Flight Aircraft in Australia and other countries, including lack of communication, poor product quality, diversity management problems, and issues related to training and development. The report also explores theories and perspectives on the HRM performance link and provides recommendations for effective global leadership, diversity management, performance appraisal, and training.

Running head: HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
Human Resource Management in a Global Economy
Assessment Task №3 - Individual written report
Date: 01/05/2018
Student Name: Sviatoslav Iskra
Student Number: 19177563
Subject Code: 2018-IBU5HRM(SY-SP1)
Instance Coordinator: Ms Banafsheh Peyrovian
Subject Coordinator: Dr Seyed M. S. Khaksar

1HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
Table of Contents
1.0 Introduction...............................................................................................................................3
2.0 What are the issues....................................................................................................................3
2.1 Lack of interaction and mutual communication....................................................................3
2.2 Poor product quality...............................................................................................................4
2.3 Problems related to diversity management............................................................................5
2.5 Issues and Training and Development...................................................................................6
3.0 Theories and Perspectives on the HRM Performance Link.......................................................6
3.1 Universalistic perspective......................................................................................................6
3.2 Contingency perspective........................................................................................................7
3.3 Configuration perspective......................................................................................................7
4.0 Human Resource Management Dealing with Issues.................................................................7
4.1 Better Communication between Headquarter and Subsidiaries.............................................7
4.2 Diversity Inclusion.................................................................................................................8
4.3 Proper Performance Appraisal in Every Subsidiary..............................................................8
4.4 Proper Training and Development.........................................................................................9
5.0 Conclusion.................................................................................................................................9
6.0 Recommendation.....................................................................................................................10
6.1 Plan to Present to the Organization......................................................................................10
6.1.1 Effective Global Leadership..........................................................................................10
6.1.2 Measures to Monitor Diversity Management................................................................11
6.1.3 Reviewing Employee Performance...............................................................................11

2HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
6.1.4 Effective Training Session............................................................................................11
6.2 Implementation Plan............................................................................................................13
References.....................................................................................................................................14
Appendix.......................................................................................................................................16

3HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
1.0 Introduction
Human resource management is global economy deals with management of employees in
business environment that is increasingly global in its expansion (Cascio & Boudreau, 2016).
The purpose of this study is to explore the issues associated with Fox Flight Aircraft in Australia.
Apart from operating in Australia, the organization also operates in the countries like China,
Singapore and Vietnam. However, the organization is facing declining profit level in the
business operation. The CEO of the organization is being high stressed with the potential
takeover of the organization. The organization need effective communication and proper
performance review of the employees for resolving the issues. The study will highlight the issues
associated with the organization. The study will discuss the ways in which the organization will
be dealing with the issues to prevent its repetition. Apart from that, some solid recommendations
with their implementation plan will be demonstrated in the study to eliminate the issues.
2.0 What are the issues
Based on the analysis of work done, the identified issues within the airline "Fox Flight"
will be considered in more detail:
2.1 Lack of interaction and mutual communication
The analysis points to a serious gap in the relationship between subsidiaries. According to
According to Okhoro (2012), such problems can be related to the company's etiquette policy,
which does not correspond to the cultural perception of the chosen region. The confrontation
between the host country and the subsidiaries is more likely a consequence of the lack of
understanding in the relationship. A similar example is the giant trading network Wel-Mart.
Employees had to smile at customers regardless of the situation and buyers did not correctly
understand this kind of flirting. Naturally, company ignored that, while the management staff
openly opposed this policy and clashed with each other. As a result, Vel-Mart had to leave the

4HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
German market in 2006, mostly due to such an ethical problems (Fenton-O'Creevy et al., 2008).
Based on this example, the initial weak preparation of the airline "Fox Flight" for the
internationalization of business existed before the emergence of problems.
2.2 Poor product quality
The quality of the aviation company's products is a priority area, as both the company's
profit and reputation depend on taking appropriate measures within the specified 6 months. This
is most likely a consequence of interrelated problems in the management of human resources in
the host country and production sites - China and Vietnam.
Quality is closely related to the mentality of the country in which this product was
manufactured (Haak-Saheem et al., 2017). Therefore, strategic search frequently begins with the
nearest neighbors so that there would be an opportunity to stabilize possible negative
consequences of production (Furusawa & Brewster, 2016). Since the HR diversification is
bearing fruit mainly in the long term, competitors such as Oneworld, Star Alliance, SkyTeam
and others, risking their reputation and serious financial losses in strategic search, have mutual
assistance agreements (McGraw,2004). Fox Flight, apparently with cheap tariffs, did not take
into account the importance of analysts and experts from the markets of China and Vietnam in
the critical aircraft parts production and without support is in a threatening situation now.
Jackson and Deeg (2008) cover three defining cultural confrontations between the US and China:
 Investment versus autonomy
 Hierarchy against egalitarianism
 Mastery versus harmony
From a comparison of the key culture indicators, it can be concluded that the USA and
Australia have relatively similar indicators, and both countries are equally different from China
in cultural aspects (Figure 1, Appendix).
These confrontations indicate a difference in outlook, which means the need of: time,
team diversification and training costs for specialists to ensure approximately equal standards.

5HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
As it is already noted, such an issue is a consequence of the interrelated problems of all "Fox
Flight" HRM elements including HR diversity management, International performance
management, staff training and development.
2.3 Problems related to diversity management
Age Discrimination
Tensions between young and experienced have existed for many years. Young employees
of "Fox Flight" are under pressure from senior comrades and have oppositional views on their
proven approaches. Modern studies explain the relationship of such discrimination to differences
in the traditions of societies and religious views of people (Haak-Saheem, Festing & Darvish,
2017). There is logic in this, according to Asian traditional norms of behavior, seniors opinion is
always prioritized, while the values of the cultures of developed states support the superiority of
modern, young and fresh solutions. This discrimination consequence is the elite institutions
creation within the structure of the company.
This will affect on young necessary specialists are likely to leave the team. Then, elites
shall support other kinds of discrimination associated with cultural worldviews, and then, over
time, will cease to take into account other points of view and with the company's standards
(Haak-Saheem, Festing & Darvish, 2017). In addition, a large number of people whose rights
have been violated will sue with company, which means regular financial losses and bad
reputation presence (Kshetri, 2007). The quality of modifications, products and production
without new ideas will deteriorate - this will serve as a loss of the company's stakeholders and
then the issue of Fox Fligt's departure from the country's market will only is a matter of time.
2.4 International Performance Management Issue
International performance is closely associated with international performance appraisal
of the employees (Jackson & Deeg, 2008). However, such international performance appraisal is
lacking at ‘Fox Flight’. Moreover, performance appraisal is only conducted by the human
resource managers of Australia, but the other subsidiaries are not performing the same. The

6HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
headquarters of the organization adopt very ad hoc approach in their performance review without
considering the economic factors of the organization. In this way, the employees of the
organization are not getting proper value for their contribution in organization’s overall
performance level. Furthermore, lack of performance review and career opportunities are
demoralizing the motivation level of the employees that can even hamper their productivity
level.
2.5 Issues and Training and Development
Training and development should be concerned with every aspect of organizational
activity (Budhwar & Debrah, 2009). Fox Flight is facing the issues of training and development
in regards to the expatriates leaving Australia and being transferred to the countries like
Singapore, China and Vietnam. Moreover, the expatriate training provided to these employees is
very limited within half a day. There is also lack of feedback avenues for the employees to
provide feedback on the effectiveness of expatriate training. Most of the employees are unaware
about their career prospects, as the human resource managers do not use career development
plans properly.
3.0 Theories and Perspectives on the HRM Performance Link
3.1 Universalistic perspective
Kshetri (2007) seven practices is an example of this view, where he holds that
employment security, selective hiring, self-managed teams and decentralization of decision-
making, high contingency pay, extensive training, reducing status distinctions and barriers, and
extensive sharing of information all will have a positive influence on organisational performance
independent of organisation and other conditions. Essentially, scientists holding this view believe
that it is not necessary to adapt the HR practices in accordance with any particular strategy or to
any specific organisational context (Budhwar & Debrah, 2009).

7HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
3.2 Contingency perspective
In contrast to the universalistic perspective, scientists holding a contingency perspective
argue that the relationship between the relevant independent variables and the dependent
variables will vary across different levels of contingency variables. The organization’s business
strategy is considered perhaps the most important contingent factor within the HRM-
performance literature. The various HR activities that the organization carries out must be
aligned with the organization’s business strategy, or other contingencies for having an effective
impact on performance level of the organization.
3.3 Configuration perspective
In the configuration perspective, the focus lies on the synergistic effects that the HR
practices can create when they are grouped together and exercised in a coherent manner (Tarique
et al., 2015). It is argued that the total effect that can be achieved is far greater than the sum of
the effects for every single practice. In accordance with this view, the systems of innovative HR
practices had a significant impact on production workers’ performance, whilst changes in
individual practices showed small to non-existing effects.
4.0 Human Resource Management Dealing with Issues
4.1 Better Communication between Headquarter and Subsidiaries
The major problem of Fox Flight is the lack of communication between the headquarters
and the subsidiaries. Hence, the employees of every subsidiary are not being aware of the
common goals and objectives of the organization. In this way, they are not being able to
concentrate on the overall goals and objectives, which are ultimately reducing the quality of the
products. Hence, the organization should immediately be concerned with smooth communication
between the headquarters and different subsidiaries. Moreover, the organization should be more
concentrated on enhancing the effectiveness of virtual communication among the employees of

8HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
different subsidiaries. It will enhance the social cohesion among the employees of different
subsidiaries. In this way, they will be better able to concentrate on common objectives and goals
of the organization for improving overall quality of products (Lazarova et al., 2014). Hence,
proper communication among subsidiaries would hinder the repetition communication issue in
the organization.
4.2 Diversity Inclusion
One of the major issues of Fox Flight is that the organization does not embrace the rich
values of working with the diverse working groups. Furthermore, the senior staffs are intolerant
to work with apprentices leading to a strained relationship among them. Hence, the organization
should immediately set the diversity policies with adherence with the legal policies for managing
and respecting the employees regardless of their race, gender, age and culture. Moreover, human
resource managers of the organization must adhere with the Equal Employment Opportunity act
for providing equal employment opportunity to the employees regardless of their diverse
backgrounds. Such legal policies would definitely influence the human resource managers to
recruit the employees based on their talents and skills rather than on their diverse backgrounds
(Albrecht et al., 2015). The organization can also implement the informal policy of diversity
training for better implementing enhancing the cultural understating among the diverse
employees. It will definitely enhance the respect of the diverse employees for each other
(Sekiguchi et al., 2016). In this way, the diversity issues would not be repeated again in future.
4.3 Proper Performance Appraisal in Every Subsidiary
From the supervision of the organizational issues, it has been seen that only the HR
managers of Australia are concerned with the performance review of the employees. However,
other subsidiaries of the organization are not concerned with the performance review of the
employees. Moreover, the headquarters are highly ad hoc in their performance appraisal
approach. In such approach, the human resource managers should implement effective human

9HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
resource appraisal process as per the general economic condition of the organization (Ilo.org
2018). Moreover, the organization should concentrate more on the recognizing the performance
level of the employees rather than rewarding them with monetary rewards. It will keep the
organization balanced regardless of their declining profit level. Furthermore, the organization
should implement the formal and informal rules regarding the performance review set by the
employees of union. It will definitely minimize the gaps between the employers and employees
of the organization and would never the repeat the issue of performance reviews and appraisals.
4.4 Proper Training and Development
Fox Flight is not capable of providing effective and adequate expatriate training to the
employees, who are leaving Australia and are being transferred to the countries like Vietnam,
China and Singapore. Hence, the organization should immediately concentrate on providing
effective expatriate training to the employees, who are leaving their home country and are being
transferred to foreign subsidiaries. It would definitely help them to understand the culture and
social tradition of the foreign countries (Jackson et al., 2014). Hence, they will be better able to
adjust with different cultural and social tradition of the foreign countries. Apart from that, the
HR managers should demonstrate right career development path for the employees for
encouraging towards more productivity. It will definitely reduce the potential repetition of issues
in training and development of the organization.
5.0 Conclusion
While concluding the study, it can be said that Fox Flight Aircraft is suffering from
declined profit level. The CEO of the organization is worried about the potential takeover of the
organization because of lowering profit level. The working team of Australia is not performing
well and there is communication breakdown across the teams and management. Apart from that,
communication breakdown can also be observed among the different subsidiaries of the
organization like China, Vietnam and Singapore. Hence, lack of work performance of the

10HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
employees is ultimately reducing the quality of the product. Apart from that, the organization is
having an issue of embracing the rich values of working with diverse people. In such context, the
organization should immediately start hiring diverse employees for embracing diverse talents in
improving the quality of the product.
The headquarters of the organization is highly ad hoc in reviewing the performance level
of the employees. In such context, the headquarters and different subsidiaries of the organization
should adopt systematic performance review method for precisely measuring the performance
level of the employees. On the other hand, the expatriates of the organization are not getting
adequate expatriate training to accommodate with the new culture and social tradition of foreign
subsidiaries. Hence, the organization should immediately arrange effective expatriate training in
to the employees leaving Australia and are being transferred to the foreign subsidiaries.
6.0 Recommendation
6.1 Plan to Present to the Organization
6.1.1 Effective Global Leadership
Fox Flight can effectively manage its smooth communication among the global
subsidiaries through implementing effective global leadership. Moreover, effective global
leaders can ensure engagement and inspiration of the diverse group of employees in challenging
work environment across the national boundaries. Such leaders can better understand the
different expectations of diverse employees across the countries. In this way, the organization
will be able to better communicate their required information and resources to the global
employees equally for better engaging them towards improving the quality of the products. In
this way, such leaders can perfectly improve the quality of products of the organization.

11HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
6.1.2 Measures to Monitor Diversity Management
Fox Flight needs to take diversity management initiatives for mitigating the diversity
issues. In this context, the organization is recommended to undertake the measures for
monitoring the effective diversity management to resolve the issues practically. In such
initiative, the organization would undertake some effective measures like workforce
composition, staff turnover, internal staff survey and others for tracking the effectiveness of the
diversity management programs. Such measures would definitely assess the degree of
effectiveness of the program to ensure diverse employees are getting equal value for their
performance and talents. In this way, such strategy would surely resolve the diversity issues
associated with the organization.
6.1.3 Reviewing Employee Performance
In case of the issues in performance appraisal process, the organization should adopt
systematic performance review process for measuring the performance level of the organization
as per the organizational standard. Moreover, the organization is recommended to adopt some
measures for reviewing the performance level of the employees. In this way, the global HR
managers of the organization would be able to identify the strengths and weaknesses of the
employees in regards to their work performance. Hence, based on such record, the managers can
arrange reward for the strong performance of the employees and provide training to the weak
performers for the betterment of their performance.
6.1.4 Effective Training Session
In order to mitigate the issues of expatriate training, the organization should implement
proper training session for the expatriates of the employees, who are leaving Australia and are
being shifted to the foreign subsidiaries. In such context, Fox Flight is recommended to provide
on-the-job training to the employees, who are shifted to the foreign subsidiaries. It will provide
hands on experience to the employees on their new culture and social tradition for the foreign

12HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
subsidiaries. On the other hand, the subsidiaries of the organization should initiate knowledge
sharing mechanism for better enhancing the training effectiveness through exchanging of
knowledge among diverse employees.

13HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
6.2 Implementation Plan
Recommended
Plan
Purpose of the
Plan
Where Why Resources Metrics for Success Evaluate
Success
Effective Global
Leadership
Global leaders can
effectively manage
the virtual
communication
among the
subsidiaries of Fox
Flight
Headquarter
of Fox Flight
Global leader in the
headquarter of the
company would
have centralized
control over all the
subsidiaries of the
organization
Budget, time,
external business
consultant to take
communication
decision, board
of directors
 Level 1:
Measurement of
employee
awareness
regarding business
goals
 Level 2:
Measuring the
changes in
employee behavior
 Level 3:
Measuring the
impact of business
outcome
 Level of
collaboratio
n among the
subsidiaries
of the
organization
 Improvemen
t in the
quality
standard of
the product
Measures to
Monitor
Diversity
Management
This plan will be
implemented for
resolving the
diversity issue and
tracking the
progress in the
diversity
management plan of
Fox Flight
In every
subsidiary of
the
organization
The plan will be
implemented to
every subsidiary of
Fox Flight for
resolving the
diversity issue in
every subsidiary
External trainer
for diversity
training, time,
budget, diverse
employee set
 Workforce
composition
 Staff turnover
 Internal staff
survey
 High level
of employee
collaboratio
n
 High level
of employee
engagement
 Higher
employee
productivity
Reviewing
Employee
Performance
This plan will be
implemented for
systematic
performance review
of the employees
In every
subsidiary of
the
organization
It will be
implemented in
every subsidiary for
measuring the
performance of the
employees of every
subsidiary equally
Performance
evaluator, time,
budget, HR head
 Consistency in
employee
productivity
 Ability of
employees to meet
their job target
 High level
of employee
productivity
 Equal
evaluation
of employee
performance
in every
subsidiary
Effective
Training Session
This plan will be
implemented to
provide effective
expatriate training
being transferred to
foreign subsidiaries
Mostly in
home
country
Australia
This plan will be
primarily
implemented in
Australia so that the
employees can get
expatriate training
before shifting in
any other subsidiary
External
expatriate trainer,
time, budget and
employees
leaving Australia
 Knowledge of
expatriates
regarding foreign
culture
 Hands on
experience of the
trainees regarding
the expatriate jobs
 Adequate
knowledge
regarding
the foreign
culture
among the
expatriates
 Willingness
of the
employees
to shift in
foreign
subsidiary
Table 1: Implementation Plan

14HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
(Source: Created by Author)

15HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
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17HUMAN RESOURCE MANAGEMENT IN A GLOBAL ECONOMY
Appendix
Country Comparison (Figure 1)