7BSP1303: International HRM Essay on Performance Management Practices

This essay delves into the concept of International Human Resource Management (IHRM), emphasizing its role in utilizing human resources globally to achieve organizational goals and competitive advantages. The essay begins by exploring Performance Management Systems (PMS), followed by strategies to enhance their effectiveness across global subsidiaries, supported by relevant theories. It then provides a comparative analysis of HR practices in India and the USA, highlighting the differences in implementing PMS. Key performance management activities like goal setting, performance appraisals (including 360-degree feedback), regular reviews, and linkage to reward systems are discussed. The essay also highlights the importance of transparency, fairness, and avoiding discrimination in performance management. The impact of Hofstede's cultural dimensions on HRM practices is examined, with specific attention to power distance, individualism, uncertainty avoidance, masculinity, long-term orientation, and indulgence in both India and the USA. The conclusion emphasizes the need to consider cultural aspects when implementing performance management activities in different countries.

HUMAN RESOURCE MANAGEMENT

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The essay reflects on the concept of ‘International human resource management’. It is a
process of effectively utilizing the human resource at the global level to achieve
organizational activities and competitive advantage over its competitors (Harzing &
Pinnington, 2010). Focusing on the essay structure, the initial section includes information
based on Performance management System (PMS). The second section focuses on strategies
for gaining effectiveness in performance management practices throughout the global
subsidiaries of a firm. It involves the application of relevant theories. The following section
includes ‘India’ and ‘USA’ as an example to critically demonstrate the differences in HR
practices while implementing PMS. The key purpose of the essay is to emphasize on
variation in performance management activities by considering two specific countries.
Performance management
Performance management is the process of developing a healthy work environment or setting
in which employees are able to perform to the best of their abilities (Gruman & Saks, 2011).
Activities
Goal setting is the foundation of good performance management. It refers to providing clear
instructions to employee about performance expected from them. Organization expected
performance is determined in terms of ‘key result area’. It assists the employee in performing
work as per the given instructions. It allows employees to focus on the requirement. Thereby,
it improves the employee performance by minimizing confusions.
Performance appraisal is the regular review of employee performance and contribution to the
company. It is also referred as annual review. It involves assessing employee performance on
specific pre-established criteria. 360 degree appraisal is a form of employee performance
review. It refers to gaining feedback from all the possible sources. In the workplace, it
involves gaining employee feedback through customer reviews, peer groups and superiors. It
aims at determining how the employee is functioning in the organization (Lawler, 2015). A
regular review is one of the significant forms of performance management activity. It
involves providing regular feedback to the employee. It provides an opportunity to the
employee to seek his/her areas of improvement. Additionally, it contributes to developing
better interpersonal relation between employee and respected authority (Cappelli & Tavis,
2016).

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‘Linkage to reward system’ involves offering incentives (monetary and non-monetary) and
other benefits. This practice is highly beneficial in gaining quality performance from the
employees. It motivates the employee to yield best possible outcome. This practice is proved
to be highly favourable in performance management.
Employee development plan is referred as ‘employee growth plan’. It is a process to help the
employee to improve skills and gain additional knowledge to fulfil the responsibility towards
the organization. It is a form of training to assist the employee to deliver best outcome (Patel ,
2019). Developing the use of all these practices will aid the organization in improving the
employee performance in the workplace. A higher attention should be laid in regularly
discussing the outcomes and results of the performance with the employee (Aguinis et al.,
2012).
Strategies for effectiveness
To gain effectiveness in performance management arrangements, the Human resource
manager has to be transparent and fair with employees. They should avoid discussing the
problems associated with performance at the end of the year. Therefore, problems should be
discussed as when they arise. Example: An employee is showing consistently low
performance. It develops the duty of the respected authority to communicate with the
employee to ensure the reasons for low performance. It will allow the authority a chance to
assist the employee in improving performance. This develops more chances of gaining better
performance. Therefore, the authority should address the problem at the correct and suitable
time. Failure in complying with this may yield negative results based on performance
(Boyne, 2010).
The authority should avoid favouritism. This develops a sense of self-doubt in one employee
against the other employee (Pollock, 2018). Example: ‘Employee A’ (low performer)
performance should not compared with ‘Employee B’ (high performer) performance. Rather
authority should assess employee performance based on set criteria of performance. It will
not contribute to any forms of unfairness with employee. Additionally, it will not hinder the
interpersonal relation between Employee A and B.
The authority should try to develop positive and fine interpersonal relation with its human
resource. It will motivate the employee’s to easily and freely share their concerns for delay,

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poor and low performance. This will allow the authority to take appropriate measures for
solving their concerns associated with performance (Rimon, 2019).
A higher emphasizes should be laid in avoiding discrimination among employees with
disability or protected characteristic (Zenger, 2017). Example: The organization should
consider the workforce diversity of the organization. They should provide adequate means
and resources to employee with disability. This will allow the disabled employee to find
assistance in performing works like other employees. However, these practices and strategies
do not guarantee success. Additionally, they may yield different result in different countries.
They are economical in approach but time consuming in nature. Developing common set of
performance management activities in global subsidiaries is not appropriate. This is because
every country differs in its diversity of cultures, customs and practices (Selden & Sowa,
2011).
Literature
According to Jon M Werner (2014), International Human resource management is a set of
activities emphasizing on human resource management at the international level. It includes
HRM functions like Recruiting, selection training, and appraisal. Firms operating at
international level attain the high need for international human resource management
(Werner, 2014).
According to Fadil Osmani and Gelina Maliqi (2012), performance management focuses on
employee performance. It involves undertaking steps to improve their performance. Gaining
quality performance is one of the key issues faced by organization. Therefore, they should opt
for suitable strategies to gain better outcome from the human resources. Additionally, they
state that organization should develop the use of key performance indicators to review
employee performance (Osmani & Maliqi, 2012).
Ian O’ Boyle (2013), states that there are multiple techniques for performance management.
In business environment, employee performance is evaluated through different aspects. Large
numbers of business units relies on tradition approach for managing and assess their
employee performance. Additionally, he states that 360 degree and feedback method has
gained higher significance for performance management (Boyle, 2013).
According to Amber Qureshi and Mubashir Hassan (2013), the authorities should avoid
punishing employees for their low performance. Relying on these strategies will develop a

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negative working environment in the organization. They should try to find out the reasons for
deviation from ideal performance and taking appropriate measures. The organization should
offer healthy and learning environment to its employees. It will help the employee in
devoting their full attention to their work. It will aid the organization in gaining fine outcome
from its human resources (Qureshi & Hassan, 2013).
Hofstede Cultural Dimension
Hofstede Cultural Dimension is a framework to understand the cross cultural differences
prevailing between countries. It assists in determining that business activities vary within
different cultures. It focuses on six different cultural dimensions and their impact on business
practices (Hofstede, 2011).
The figure represented below includes India and United States of America as an example. It
determines the level of cultural differences prevailing between India and United States. In
this figure, India and USA are represented by Blue and Purple bars.
Figure 1: Country comparison
Source: (Hofstede Insight, 2019)
Dimensions
Power distance focuses on inequality in the distribution of power (Forbes, 2014). India attains
a higher rank whereas USA ranks low in power distance. High power distance in India
depicts that high difference in the distribution of power prevails in India. Low power distance
in USA states that flat, decentralised decision making and participative leadership style is
encouraged. In Indian franchisee, the authority should adopt ‘360 degree’ performance

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appraisal technique. This is because low power distance that authority does not possess
adequate knowledge about employee to review performance. In American franchisee, the
authority should develop the use ‘employee growth plan’. This is because less formal relation
operates in low power distance. Therefore, the organization will find an ease in developing
‘employee growth plan’ by easily seeking their suggestions.
Individualism society lays high focus on achieving personal objectives. They have a habit of
being independent and self-reliant (Lukes, 2019). Mediate level of individualism operates in
India. This states that Indian employee focus on achieving personal as well organizational
goals. They consider themselves as a part of the organization. However, high degree of
individualism prevails in USA. According to higher ranking in individualism, employees lay
more attention in fulfilling their self-objectives. They do not consider themselves as an active
part of group in an organization. Thus, the company should offer ‘group training’ in Indian
franchisee to boost their performance. In American franchisee, it should opt for ‘mentoring’
to increase and improve employee performance.
Uncertainty avoidance is the extent to which uncertainty and ambiguity is tolerated by people
(Mindtools , 2019). In both the countries have achieved mediate ranking in this index. This
states that Indians and Americans tolerate uncertainty and ambiguity to some extent only.
Therefore, it develops the need of the organization to impose rules and regulations to
minimize uncertainty. Therefore, the organization should develop the use of suitable training
programs in Indian and American franchisee. They should avoid using newer methods of
learning as Indians and American employee might not prefer them.
Masculinity society is driven by high competition, material rewards and assertiveness.
Individuals operating in this society lay high attention on materialistic achievements. Both
the counties are driven by masculine society. However, USA achieved a slight higher rank
than India. Therefore, the company should offer ‘financial incentives’ for higher performance
in both the franchisee.
Long term orientation dimension involves focusing on future and avoiding short term success
to gain long term benefits. India scores comparatively high in comparison to USA. This
clearly states that Indians lay higher attention towards their future. USA low ranking depicts
that they prioritize their ‘present’. To improve employee performance in Indian and
American franchisee, the company should offer long term benefits to Indian employees for
boosting their performance. They may offer ‘life insurance’ schemes to them. In case of

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American employees, the organization should try to seek the present need of their employees.
Thus, they should motivate the American employee to fulfil their need (in the form of
rewards) in return for their higher outcome and performance.
Indulgence is the degree to which people try to control their desires. India has achieved a low
ranking whereas USA ranks above in this dimension. This states that Indians attains high
control over their wishes and aspirations. In contrast, Americans devote adequate attention in
fulfilling their wishes and desires. They dedicate their time in leisure activities as well. In
American franchisee, the company should offer rewards like ‘Tickers to tour and travelling’.
This will align with their preference for leisure activities and it will contribute in enhance
work performance (Hofstede Insight, 2019).
The essay summarizes on managing employees performance. From the above discussion, it is
analyzed that Human resource management deals with utilizing the full benefit of employees
operating in an organization. Performance management is a significant concept in HRM. It
involves reviewing, managing and undertaking steps to improve employee performance. It
aims at retaining best possible output from them. It is evaluated that Goal setting, Linkage to
reward system, employee development plan, and regular review are some of the suitable
activities for performance management. It is acknowledged that there are additional strategies
as well to gain effectiveness in performance management. It includes avoiding punishment,
discrimination, comparison, and providing healthy and learning environment to employees.
Additionally, it is realized that these activities and strategies may vary in their result in
different countries. From Hofstede analysis it is analyzed that organization has to take
different approach in Indian and USA as they differ in their cultural dimensions. Hence, it
concludes that performance management activities should be implemented by considering the
cultural aspect of the host country.

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