Offshoring Strategies, HRM Challenges and International Business

This report delves into the multifaceted aspects of offshoring, particularly focusing on its implications for international human resource management (HRM). The analysis begins by defining offshoring and its relationship to outsourcing, highlighting the relocation of business operations to different cou...Read More

Running head: OFFSHORING
OFFSHORING
Name of Student
Name of University
Author’s Note

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Abstract
Offshoring deals with contracting with a different organization in order to perform a
particular part of their business related operation. Difference between the domestic resource
management as well as international human resource management is the fact that it includes
added knowledge along with responsibilities that are needed due to various operations that
are foreign in nature. These factors include language, some national as well as local
regulations along with governing business operations and laws with a particular foreign
country, company benefits, present exchange rates, as well as incentives and career outlooks.

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Introduction
Offshoring could be described as a specific process where a particular organization or
business tends to relocate or move a specific part of the operations to a different nation.
Outsourcing deals with contracting with a different organization in order to perform a
particular part of their business related operation (Oshri, Kotlarsky and Willcocks 2015). For
example a particular company might decide outsourcing its operations in the field of
accounting to a particular organization which has specialization in accounting, instead of
having an in house department having to carry out this operation (Willcocks, Lacity and
Sauer 2017). Thus a particular company might outsource the activities carried out by
accounting department and if the operation is carried out in a different country, it would also
be called as offshoring.
Body
Offshoring has various advantages as well as disadvantages, it helps a particular
business in dividing a specific area of operations to a different group of professional’s
situated in a different country. In order to achieve a specific competitive advantage
exploitation of various human resources is very important (Solli-Sæther and Gottschalk
2015). In order to be in a competition as well as have various advantages, it has been
important to manage various resources that are internal in an effective manner. For a
particular benefit that is sustainable in nature in a specific competition, creating value is very
vital but it must be rare along with inimitable and non- sustainable. Various local policies
include performance management, human resource planning, staffing, development and
training, compensation and industrial relation (Virtaluoto, Sannino and Engeström 2016).
These policies might face issues when they are to be implemented in the offshoring. The

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three categories that have been selected for this particular assignment include staffing,
training and development and compensation. The issues with these categories are as follows
International human resource management functions deal with numerous activities
that are related to the employees as well as contractors of a particular business organization.
The most vital is considered as staffing requirements of that particular organization. It is
irrespective of the fact if the staff members are outside contractors or staff members (Tate
and Bals 2017). Some more functions include recruiting as well as training employees along
with ensuring the fact that they have been performing at various levels that had been expected
or even better, handling various issues related to performance along with making a criteria
that management policies as well as personnel confirm to regulations and laws (Kaur, Singh
and Majumdar 2018). International Human Resource management is responsible to deal with
the matter of how a particular company manages its employee compensation as well as
benefits, employee records as well as personnel policies along with their practices.
Staffing: The main difference that had been noticed between the international human
resource management and the domestic human resource management is the responsibilities
needed and the added knowledge needed due to various foreign operations (Willcocks, and
Lacity 2016). There are three strategies for staffing that can be utilized by a company while
they enter into an overseas market, every strategy has their advantages as well as
disadvantages. The initial strategy includes the home country national, this particular strategy
uses various employees who are from their home country for living and working in that
particular country (Bruccoleri, Perrone and Mazzola 2018). These people are named as
expatriates. The next strategy for staffing is called host country national strategy, this means
employing people who had been born in the nation where business would be operating. The
last country national strategy describes the scenario in which the organization involves in
employing people from a completely different country from host or home country (Lee, Mol

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and Mellahi 2017). There had been various categories in which the success of expatriate can
be determined. These factors include motivational state, job factors, language skills, family
situation, and relational dimensions. The likelihood that the assignment would be successful
depends of various attributes, these attributes includes relational dimensions, job factors,
language skills, motivational state, and some more (Drahokoupil 2015). Proper selection,
training can prevent the failure of these activities.
Figure 1: phases of expatriate adjustment
(Source: Drahokoupil and Fabo 2019)
Recruitment process: understanding the staffing strategy that could be used for the
purpose of hiring the appropriate person for various assignments that would be carried out
overseas. An ideal candidate for an assignment in overseas has numerous characteristics,
these characteristics include managerial competence, training and adaptability
(Virtaluoto, Sannino and Engeström 2016). As discussed previously, while selecting a
particular expatriate or a specific third country national for a specific job, which assures
the fact that the candidate has all the qualities because they are the key considerations
while hiring the perfect person. Some costs that are associated along with the failure of a
particular expatriate or a third country national can include damage to the relationships
between host countries, the motivation of host country staff, costs that are as linked with
the recruitment as well as relocation of the employees, possible losses of the employee
after the employee returns, various missed opportunities to develop the entire market

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(Tate and Bals 2017). The success of a particular overseas project has numerous complex
factors, the overall process of selection for a particular individual must be entirely
different from the overall process of selection while hiring in a domestic manner (Kaur,
Singh and Majumdar 2018). The process is supposed to start with job analysis. Analysis
of job as well as description of job must be different for various overseas assignment,
because various competencies are very important for the success. Most of these
competencies, has very less concern with the ability of the person to carry out the job but
have been related to the staff’s ability to carry out the job in a particular new culture
setting (Bruccoleri, Perrone and Mazzola 2018). Some more competencies that could be
considered include experience in extroverted, working internationally, stress tolerance,
cultural experiences and language skills.
Figure 2: selection process of overseas assignment
(Source: Hansen, Larsen and Larsen 2016)
Training: most of the training might include various cultural components that were
cites by almost 73 percent of expatriates as a key ingredient for success. The main goal of
the training is not helping an individual to learn various languages or the cultural
traditions but ensuring the fact that they have been immersed in sociocultural aspects of a
specific new culture where they have been living (Drahokoupil and Fabo 2019). A
particular business researcher had identified two pathways for the purpose of adapting to

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a completely newly introduced culture. Firstly people tend to adjust quickly from the
perspective of psychology but not in social perspective. Individuals might take more time
in adjusting, they said that for the purpose of being completely immersed as well as
understand and hence be productive in a specific culture, and the individuals must have
sociocultural adaptation. A particular individual who has the ability to adjust from a
perspective of sociocultural ends up performing in a better way, this is because the
individual has a deep level of understanding of the culture. The key decision that has to
be carried out in this particular case include the fact that where the training would be
taken place. Five main categories of training an individual for a particular overseas
assignment include language, culture, goal setting, managing family as well as stress and
repatriation. Training regarding the language is considered as basic but one of the most
vital components of the training. To most of the international assignment, English is
considered as the business language, this provides an advantage to the organizations.
Despite of this factor, a huge amount of employee’s time is spent in works that are placed
outside where the mastery of the local language would be a necessity. Besides this, being
able to discuss as well as negotiate in mother tongue of the country could give the
employees great advantage while working offshore. The main goal of the cultural training
is to train the individuals what are the actual norms in a particular culture. Some of these
norms include etiquette, management styles, history, religion, food geography, logistics
aspects like transportation as well as currency, policies and some more.
Conclusion
From the above essay, it can be concluded that the vital difference among the
international human resource management and domestic resource management is the fact that
it includes added knowledge as well as responsibilities that are necessary due to various
operations that are foreign in nature. The factors include language that is national as well as

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local regulations along with laws, governance of various business operations with a particular
different country, present rates of exchange, and advantages of the company as well as
incentives and career outlooks. International human resource management, individuals should
understand the differences in a clear way and hence be ready for keeping people from other
company informed regarding them for preventing embarrassing situations as well as
unintentional affronts from taking place. Human resources as well as management activities
when various developments in human resources has been considered as a specific profession.
The latter had been targeted in a specific manner for the purpose of development of a
personnel inside various organizations with the help of development of career, development
of organization as well as training activities. These functions had been through significant
evolutions at the time of various decades so that they are able to act as major roles in the
activity of staffing. This particular assignment discusses regarding some aspects that are
important to highlight in the process of offshoring various departments of an organization.
The areas that has been highlighted in this particular assignment includes training, staffing
and recruitment processes. These processes are very different in the ways they are being
carried out nationally and internationally.

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