Human Resource Management: Global Strategies and Challenges

This essay delves into the complexities of Human Resource Management (HRM) within multinational companies, exploring the challenges and strategies employed in a global context. It examines the standardization strategy, which involves a universal approach to managing employees regardless of their cultural backgrounds, and highlights issues such as non-alignment with universal approaches and diverse employee expectations. The essay then analyzes the localization strategy, where HRM practices are adapted to regional requirements, and discusses challenges like increased costs and difficulties in maintaining core job standards across different locations. Furthermore, the essay introduces the hybridization strategy, which combines elements of both standardization and localization, often utilizing a geocentric approach. The essay concludes by emphasizing the effectiveness of the hybridization strategy in overcoming the issues associated with standardization and localization, advocating for a geocentric approach that balances global standards with local needs and preferences. The essay uses examples of companies such as Capegemini and Google to illustrate these HRM concepts.

Running head: HUMAN RESOURCE MANAGEMENT
Human resource management
Name of the student
Name of the university
Author note

1HUMAN RESOURCE MANAGEMENT
Introduction
Global companies such as multinational organizations are having their business
operations and presence in different countries around the world. Though they are gaining profits
and competitive advantages from their worldwide operations, but they are also facing the
challenge with the management of their human resources (Hashai and Buckley 2014). This is due
to the reason that multinational organizations are having diverse workforce in place and these
employees are belonging from different social and cultural groups. Thus, the approach,
expectation and requirement of them are different from one another and it sometimes becomes
difficult for the multinationals to manage the diversified employees with having universal
organizational approach (Baran and Klos 2014).
In order to do so, different strategies such as standardization and localization strategies
are being initiated by the multinational organizations. However, in both the cases, there are
numbers of issues being faced by them. This essay will discuss about the issues faced by the
multinationals in initiation of localization and standardization and their relation to the
international human resource management activities.
Standardization strategy
In the international human resource management, there are some organizations that
follow standardization strategies in managing their human resources. This strategy refers to
following of the universal approach of managing the employees in every facility around the
world (Chowhan 2016). In this case, all the employees regardless of their social and cultural
background are being treated and managed in universal approach and any regional criterions are
not being considered. However, there are various issues being faced by the multinationals in

2HUMAN RESOURCE MANAGEMENT
initiating their standardization strategy. One of the key issues faced by them is the non-alignment
of the employees from different regions around the world with the universal approach of the
organization. In the majority of the cases, the universal approach of the multinationals are
inclined with the parent country of the multinationals. It may get difficult for employees from the
foreign countries to get adhered with these cultures (Heikkila 2013). Moreover, in the case of the
standardization strategy, the regional aspects are not being taken care of. Therefore, there is a
higher probability of having demoralized employees in place when their requirements are not
being met.
For instance, technology organizations such as Capegemini are having standardized
approach in managing their employees. In accordance to their standardized approach, employees
from different regions are being managed in the universal manner. Thus, their holiday list,
benefits and pay scale is same for all the facilities around the world. The key issue with them is
the lack of motivation with the employees (Ananthram and Chan 2013). Employees from south
eastern regions will get demoralized if they are not being given holidays at the time of their
festivals.
Another issue with the standardization strategy is the diverse requirements and
expectations of the employees. These diverse requirements of the employees cannot get fulfilled
with having standardized approach and it will cause origination of the issues with the employees.
In this case EPRG model of international human resource management can be used. In the
majority of the organizations who are initiating the standardization strategy, ethnocentric
approach is being promoted (Wiktor 2014). This is due to the reason that in the case of
ethnocentric approach, employees from the home countries are being selected for the managerial
positions. Thus, standardized approach can be maintained in the host country operations also.

3HUMAN RESOURCE MANAGEMENT
Localization strategy
Another strategy initiated by the multinationals is the localization strategy. This strategy
refers to the adopting modifications in the standard human resource management according to
the regional requirements of the employees. In this case, the employees around the world of the
multinationals organizations are being managed in different manners according to the differences
in their social and cultural backgrounds. Thus, the standardized approach of the organizations is
being localized based on the local requirements (Fan, Zhang and Zhu 2013). However,
multinational enterprises are also facing issues from the initiation of the localization strategy.
One of the key issues faced by them is the increased cost. This is due to the reason that initiation
of the localization strategy involves modifying the existing approach of the human resource
management according to the local needs. On the other hand, multinational organizations are
having their facilities in different countries and it is having the requirement to modify the
standard approach in different forms to suit with the employees in different regions. This will
obviously involve more cost for the organizations.
Another issue with the localization strategy for the multinational organizations is the
challenge in maintaining the core jobs throughout the world. This is due to the reason that with
the initiation of the different approach of the human resource management, the approach of the
employees towards the same jobs becomes different in different regions. Thus, the similar
effectiveness and the productivity of the employees around the world will not be same and it will
fluctuate (Sherif 2013). In major cases, companies with having localized approach of the human
resource management promote the polycentric staffing process. This is due to the reason that
with the help of the polycentric process, employees from the host countries are being employed

4HUMAN RESOURCE MANAGEMENT
in the managerial position, which helps them to having localized approach in place (Guo,
Rammal and Dowling 2016).
For instance, Google is one of the major organizations in the world and is having their
business operation in different countries. However, their approach to the human resource
management is different in India and the United States. Employees in the United States and India
are having different holiday list based on the regional preferences. Though, this is having
favorable impact on the motivation level of the employees but this is having issues in the
business operation. This is due to the reason that firms like Google have their standardized job
approach around the world. Thus, different employee management systems create issues in the
business operation.
Hybridization strategy
While there are various issues being faced by the multinational organizations from the
initiation of the localization and standardization, some multinationals are promoting the concept
of hybridization. This refers to the mixing up of the elements of both localization and
standardization and overcoming the identified challenges. In majority of the cases, geocentric
approach is being initiated by them (Chung, Sparrow and Bozkurt 2014). According to the
geocentric approach, employees from both the host and home countries are being employed
according to the organizational requirements and the skill sets of the employees. This helps in
having both approach of the localization and the standardization in the organization. Initiation of
the geocentric approach also helps in determining local requirements of the particular region and
also maintaining the standard approach of the organization.

5HUMAN RESOURCE MANAGEMENT
Conclusion
Thus, from the above discussion it can be concluded that multinational companies are
facing number of issues from the initiation of the localization and standardization strategies.
There are various issues discussed in this report. In addition, organizational examples are also
being used in order to identify the exact and specific challenges being faced by the multinational
organizations. This report also discussed about the effectiveness of the hybridization strategy in
order to overcome the issues identified. It can be concluded that initiation of the geocentric
approach will help to modify the standard approach of the multinational enterprises and adhere
with the local requirements and preferences of the particular region.

6HUMAN RESOURCE MANAGEMENT
Reference
Ananthram, S. and Chan, C., 2013. Challenges and strategies for global human resource
executives: Perspectives from Canada and the United States. European Management Journal,
31(3), pp.223-233.
Baran, M. and Klos, M., 2014. Competency models and the generational diversity of a company
workforce. Economics & Sociology, 7(2), p.209.
Chowhan, J., 2016. Unpacking the black box: Understanding the relationship between strategy,
HRM practices, innovation and organizational performance. Human Resource Management
Journal, 26(2), pp.112-133.
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.
Fan, D., Zhang, M.M. and Zhu, C.J., 2013. International human resource management strategies
of Chinese multinationals operating abroad. Asia Pacific Business Review, 19(4), pp.526-541.
Hashai, N. and Buckley, P.J., 2014. Is competitive advantage a necessary condition for the
emergence of the multinational enterprise?. Global Strategy Journal, 4(1), pp.35-48.
Heikkilä, J.P., 2013. An institutional theory perspective on e-HRM’s strategic potential in MNC
subsidiaries. The Journal of Strategic Information Systems, 22(3), pp.238-251.
Sherif, S., 2013. Macroeconomic policy, localization and reducing unemployment: The crucial
human resource issues for the UAE. Competitiveness Review: An International Business Journal,
23(2), pp.158-174.

7HUMAN RESOURCE MANAGEMENT
Wiktor, J.W., 2014. Internationalization and the Structure of the Company’s Marketing Strategy
on International Markets—Theoretical Remarks. Chinese Business Review, 13(10), pp.642-658.