Will MNCs ever be able to adopt unified cross-national HRM strategies, policies and practices? Human Resource ManagementHuman resource management (HRM) involves the basic practices of business supported by intellectual skill. The first and foremost principle of HRM is to treat the employees as humans rather than sheer instruments for running a business. The company should strategies a technique for implementation of its business goals by understanding the psyche of its employees which brings out the quality of the HRM in it. The parameters of HRM have evolved to a larger dimension, where its policies are not limited to personnel, but involve the preventive factor of a company’s possible setbacks.
A company’s beliefs should be of such a nature that all the employees, including the managers, should be well versed with the policies and philosophy of the HRM. Amongst the various functions of the HRM the most prominent ones are: the kind of staffing, whether employees to be recruited or independent contractors to be hired, engaging and training the best employees in the company and making sure of their higher performance, and handling of performance issues.
The activities of the HRM include even the managing of the company’s approach to achieve profit, taking care of employees’ accounts and the personnel strategies. The personnel policies include in it the guidelines as to the behaviour of an employee in the company, the basic knowledge that an employee should have during joining and the various rules and regulations that should be followed by all the employees. This piece of literature is provided to all the employees by the human resource department. Thus, they should be well versed with the basic needs required by the company from its employees.
The functions of the HRM have changed a great in the near future. Earlier the personnel departments in companies took care of the paperwork company and they also dealt with the various recruitment functions and concerned themselves with the payments of the employees. Organizations, (1) now-a-days are considering human resource as an advantage that can grant continued competitive benefit. The changing situations in the business environments have augmented the importance of human resource. These changes result from predominance of globalization, alteration in the demographics of the employees, attention on accomplishing greater profits by means of technological changes, growth, intellectual capital and unending alterations that all companies today are undergoing.
In such circumstance if a HR department exists that is extremely supervisory in conduct but lacking integration, then it becomes difficult to provide for the competitive benefit prerequisite for any company. Studies show that, companies whose HR systems have attained the excellence in operational matters, and are associated with the strategic business goals have had very fine financial returns. Nature of HRM in multinational corporationsMultinational corporations are huge business organizations which have their distribution or production processes spread all over the world, through holding or subsidiary companies.
The offices of such MNCs are situated in major metropolitan areas, international cities and cities having ports, in order to meet the needs of the local consumers and to gain access to find the resources like cheap labour and raw materials easily. The role of the HRM differs in every company in the multinational sector. There is also difference in the functioning of the HR manager in relation to the varied companies.
Another dependant factor is the location of the manager. The manager may either be located in the headquarters or it may be onsite. The obtaining, assigning and efficiently exploiting the human recourses in a multinational company may be defined as international HRM. If the MNC is a smaller one and its only job is to export products, having small offices in foreign locations, then, the work of the HR manager is quite simple. But in case of international companies, the role of HRM intensifies and it requires accomplishing the inconsistent strategic purpose.
Their first priority should be to incorporate human resource practices and policies across varied subsidiary companies located in various countries so as to achieve diverse corporate objectives. Along with it, the HRM’s approach should be flexible enough so that it may go for the important differences found in the HR practices and policies that are more effective in other cultural settings and businesses. The problem of balance integration, i.e. controlling and coordinating from the headquarters, and the problem of differentiation, have since long been identified as the common problems that the HRM faces in the global setup.
Many people argue that international HRM is very much similar to that in the domestic setting, yet others point out that there is considerable disparity between the two. The nature of HRM in MNCs can be described better by bringing forth the varied disparities in its functioning in view of the domestic HRM. The HRM in the MNCs or rather the international HRM include in it more tasks, it has to deal with varied types of functions, includes in it continuously changing perspective, needs more interference in the personal lives of employees, it has more pressure from the outside sources and takes into account a greater risk than its domestic counterpart.
As compared to the domestic HRM, international HRM has a broader perception of even the most basic HR policies. This is basically found suitable for those HR managers who operate from a MNC headquarters.