International HRM and Global Talent

This assignment delves into the field of International Human Resource Management (IHRM). It requires an analysis of scholarly articles on various aspects of IHRM, including the sub-national embeddedness of international HRM practices, global talent management strategies, perceptions of business cultures in different regions, and the ethical implications of IHRM. The assignment encourages students to examine the convergence-divergence debate regarding HRM practices in a globalized world and consider the influence of institutional forces and cultural contexts on IHRM approaches.

International HRM

Table of Contents
INTRODUCTION...........................................................................................................................3
Reasons Why Companies Decide To Operate Internationally........................................................3
Outsourcing:.....................................................................................................................................4
Advantages of Outsourcing:........................................................................................................4
Disadvantages of Outsourcing:...................................................................................................5
Strategic HRM Approaches that Organisations Operating on a Global basis may take:.................5
HR Challenges: ..........................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
In order to achieve organisational objectives and take a competitive advantage companies
aim to manage its organisational activities at international level. International human resource
management is a process of procuring, allocating and utilizing the human resources globally. It
can be difficult for companies to develop, manage and control the business operations at
international level. In this research report, researcher has focused on the reasons why companies
go global, approaches of HRM, what are the issues and challenges that they need to face,
challenges for HR department and the advantages and disadvantages of outsourcing the business
operations (Harzing and Pinnington, 2010).
Reasons Why Companies Decide To Operate Internationally
The following are the reasons why the companies decide to operate globally: Competitive Pressure: This is the main reasons why companies choose to carry its
business operations globally. In domestic market, there may be numbers of competitors
who deals in similar products and services. To reduce or avoid this competitive pressure
of the competitors, companies choose to carry its business beyond the country. To divert
the attentions and resources of the competitors towards operations at home to safeguard
its domestic market (Scullion, 2011). Attractive Cost Structure: It is another reason why the companies operates globally.
When companies sees an opportunity of more production at lower cost, companies
decides to carry its business operations beyond the boundaries of countries. Companies
decides to go in such areas where the demand is more and cost of production is at lower
side. It becomes easier and profitable to market their products and services in those
geographic areas. More Customers: When the company sees that there are fewer customers in domestic
market and more customers in international market, then also companies decide to go
global (Harris, Brewster and Sparrow, 2008). To attract more number of customers in
international market companies carry its business operations at global level. Slow Growth in Domestic Market: When the company knows that the growth in
domestic market is too slow then also it decides to carry its business operations at global
level. The reasons for slow growth may be inflations, political or government
interruptions, interest rates and other reasons. Higher growth in international market and

more chances of success are the reasons why companies go beyond the boundaries of
country. Suppliers follow their customers: when the suppliers follows their customers then also
company decides to go global. Customers wants international presence of their suppliers.
Advertising industry is the best example for that where a multinational company will
select the advertising agency which has a presence in all the markets where the
multinational is selling its product (Brewster, Sparrow, and Houldsworth, 2007).
 Advantage of first mover: Companies wants to take first mover advantage from the
competitors when they decide to operate globally. The first mover gets several benefits
from the international market. The company can quickly gain traction in new market as
being first. The companies also tries to create monopoly of its products ans services in the
new market as there are fewer competitors or no competitors (Harris, Brewster and
Sparrow, 2008).
Outsourcing:
Outsourcing is a practice in which a company or an individual performs their roles and
responsibilities for another company. This practice is used to reduce costs by transferring some
work to outside people from the organisation (Harzing and Pinnington, 2010). Companies wants
to take specialization in their work from outside people and it is proved to be a cost effective
strategy for the companies.
Advantages of Outsourcing:
 It is a cost saving strategy for the organisations. It saves costs such as employee
compensation costs, office space costs and other costs associated with doing a particular
work.
 Companies can focus on core business by outsourcing some work from outside people.
For example a grocery store can add a florist in operations and store can focus on the core
business that is grocery (Brewster, Sparrow and Houldsworth, 2007).
 Organisations can improve their quality in products and services by getting the work
done from the experts.
 By providing quality products and services, companies can provide maximum
satisfaction to the customers.

 Outsourcing provides operational efficiency to the organisations as it gives exposure to
vendor specialized systems (Harris, Brewster and Sparrow, 2008).
Disadvantages of Outsourcing:
 Risk associated with outsourcing is at higher side on several times as it provides legal
exposure to the outside people. For example if your car gets damaged, the car
manufacturer carries the burden of correcting the car and its outsourced parts from the car
maker.
 Many times it is difficult to measure the quality provided by the outside people.
Companies needs to handle the situations in which the outside people has provided poor
quality in services.
 There may be some kind of language barrier when the individual is hired from other
country and there may be a communication gap in between (Scullion, 2011).
 The outsourced employee may not have proper knowledge about the organisation, he
may not have that passion that a regular employee have.
 Legal compliance and securities and labour issues in different countries may be another
disadvantage from the outsourcing of work.
Strategic HRM Approaches that Organisations Operating on a Global basis
may take:
Strategic approach is a strategic planning that includes planning, directing and making
decisions by allocating resources in the most appropriate way. It is a step by step process,
companies can not operate directly without knowing much about the other country. The
following are the steps that the organisations operating globally may take: Break glass ceilings of ''Local National'': The companies who wants to carry its
business operations beyond the boundaries of the country, it needs to end favouritism
towards the managers who are the nationals of the country in which the organisation
operates (Delbridge, Hauptmeier and Sengupta, 2011). Identify the essential activities: The second step is to identify the activities that are
necessary to get success and companies required to perform those responsibilities to
achieve targets. After that companies needs to define skills such as functional, technical
and soft skills to achieve success in international market. In every six months period, the

skills team of IBM update their role description to keep the pace up according to the
market. Build Global Database: The next step is to build a global database to identify the
company's talent. In order to compete with the multinational companies, firms needs to
build a global database and needs to work on that. IBM has compiled a database for its
senior managers for last 20 years to promise middle managers and tracking them all with
annual reviews (Almond, 2011). Identify Leadership Skills: After building the global database, companies are required to
identify its leadership capital. The leaders require all the essential skills to manage and
control the teams. Assess bench strength and skills gaps: The next step is to assess the employee strength
that the company possess. The employees should be capable of performing the duties of
higher authorities. There should not be any gaps in the skills of the employees. IBM has
applied skills gap analysis for a period of six months in order to broader its personal base.
Unilever has also used a nine point competency framework for its senior managers
(Scullion and Collings, 2011). Institute succession planning: Companies needs to plan well for the employees. They
need to make sure that the employees hired by the HR manager, can work for longer
period. This approach provide assistance in controlling the labour turnover of the
organisation. The biggest strength of multinational company is their employee strength,
they are reliable and trustworthy and can not leave the organisation in tough situations.
 Challenge and retain talent: The last step is to retain the talent and face the global
challenge. International assignments and cross border task forces are the best ways to
face the challenge and develop the skills of good managers and retain those managers.
Unilever has followed this approach of retentive development and able to develop good
as well as the best managers (Brewster and Bennett, 2010).
HR Challenges:
Human Resource management of every organisation faces different challenges in their
business environment. These are the challenges that needs to be faced by the management in

order to achieve success in the future. The following are the different challenges that the human
resource department faces in the business environment: Recruitment Issues: Recruitment issues are the main challenge that every HR
department faces in current era. The HR manager are responsible to hire those
employees who can work efficiently, effectively and remain associated with the
organisation for a longer period. For this, the organisations required more skilled,
knowledgable and expert employees. They need to identify the right people in the
recruitment and selection process and hire only those capable employees for the
organisation (Collings and Wood, 2009). Merger and Acquisition issues: At the time of mergers and acquisition, the
responsibilities of HR increases significantly. They are liable to manage the changing
environment. They need to communicate with the employees and provide them visible
incentives for the changing environment. If any work is due, it needs to be finished
quickly and they need to establish a clear link between change and business
improvements. Financial Risks: When the companies decides to operate internationally, then companies
may face several risks such as financial risks, technological risks and other risks. It
directly impacts the business operations of the firms. The HR manager needs to solve
this issue by providing a clear vision of the improvement to the employees and the
benefits can also be provided to manage such risks (Beardwell and Claydon, 2010).
 Competitors: The challenge from the competitors always affects the performance of the
business entities. HR manager is liable to identify the strategies adopted by the
competitors and take decisions accordingly for own company. The competitors always
encourages organisations to work hard and sustain in the competitive environment. By
evaluating the performance and strategies adopted by the competitors, HR department
can ensure the right working direction for the organisation.
In order to face these challenges in the future, companies needs to plan well. From the
beginning, companies needs to hire right employee at right time at right position. They need to
make sure that the employees of the organisation gets timely motivation from the managers and
leaders. The motivation helps in providing job satisfaction to the employees (Story, Barbuto and
Bovaird, 2014). The issues related to labour turnover can also be solved by recruiting right

people in the organisation. All the employees needs to get ready all the time to face different
challenges that can impact the business operations.
CONCLUSION
In this research report, the researcher has explained the different reason why companies
decides to carry its business operations at international level, what are the issues that the
company faces in different circumstances. The researcher has also explained the strategic
approaches that the companies adopts when they decide to go global. The researcher has given
several examples from IBM and Unilever to define those approaches in effective manner. The
meaning, advantages and disadvantages of outsourcing has also been discussed in this report.
The issues in operating businesses overseas has critically evaluated by the researcher (Harzing
and Pinnington, 2010). The future recommendation about how to improve or how to face those
challenges has also been given by the researcher in this research report.

REFERENCES
Books and Journals
Harzing, A.W. and Pinnington, A. eds., 2010. International human resource management. Sage.
Brewster, C., Sparrow, P., Vernon, G. and Houldsworth, E., 2007.International human resource
management. London: Chartered Institute of Personnel and Development.
Harris, H., Brewster, C. and Sparrow, P., 2008. International human resource management.
CIPD Publishing.
Scullion, H., 2011. International human resource management.
Delbridge, R., Hauptmeier, M. and Sengupta, S., 2011. Beyond the enterprise: Broadening the
horizons of international HRM. Human Relations,64(4), pp.483-505.
Almond, P., 2011. The sub-national embeddedness of international HRM. Human relations.
Scullion, H. and Collings, D., 2011. Global talent management. Routledge.
Brewster, C. and Bennett, C., 2010. Perceptions of business cultures in Eastern Europe and their
implications for international HRM. The International Journal of Human Resource
Management, 21(14), pp.2568-2588.
Collings, D.G. and Wood, G. eds., 2009. Human resource management: A critical approach.
Routledge.
Beardwell, J. and Claydon, T. eds., 2010. Human resource management: A contemporary
approach. Financial Times/Prentice Hall.
Story, J.S., Barbuto Jr, J.E., Luthans, F. and Bovaird, J.A., 2014. Meeting the challenges of
effective international HRM: Analysis of the antecedents of global mindset.
Paik, Y., Chow, I.H.S. and Vance, C.M., 2011. Interaction effects of globalization and
institutional forces on international HRM practice: Illuminating the convergence‐
divergence debate. Thunderbird International Business review, 53(5), pp.647-659.
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.
Janssens, M. and Steyaert, C., 2012. Towards an ethical research agenda for international HRM:
The possibilities of a plural cosmopolitan framework. Journal of Business Ethics, 111(1),
pp.61-72.
Varma, A. and Budhwar, P.S., 2013. Managing human resources in Asia-Pacific (20).
Routledge.
Belcourt, M. and McBey, K.J., 2010. Strategic human resources planning. Nelson Education.
Marler, J.H., 2012. Strategic human resource management in context: a historical and global
perspective. The Academy of Management Perspectives, 26(2), pp.6-11.
Ulrich, D., 2013. Human resource champions: The next agenda for adding value and delivering
results. Harvard Business Press.

Online
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