Human Resource Management for International Business Machine - Case Study Example

Name: Institution: Title: International Human Resource Management Professor: Course: Date Due: Introduction Human resource management is a fundamental part of an organization and mainly deals with the administration of the company’s workforce. It therefore, needs laying out policies, which will guarantee that the labor force, and resources available will facilitate the realization of institutional aspirations. Armstrong (2006) asserts that human resource management apart from its managerial characteristics it is also exemplifies risk management for the firm, which in the end makes certain legislative conformities. Its base propagates from the assumption that the labor force targets varying goals and fulfillment of different, individualistic and corporation needs. In this event, effective human resource management escalates productivity, ensures provision of necessary resources and ensures cohesion for achievement of goals. On the other hand, international human resource management is human resource management at a multinational level. It is thus a typical entity of human resource management characterized by enlisting, instructing, dismissal and performance appraisal among others. International human resource management is thus concerned on linking single domestic human resource management in making a domain of resource management. It is hence primarily concerned about management of labor force, which belongs to a country in which the auxiliary is located; third state employees and domestic country workforce. Consequently, it involves various processes in which when working collaboratively achieve organizational goals in this case International Business Machine Corporation objectives. Through various international personnel integrating service provision, for instance recruitment, management of skills within the firm, cost planning, wages and salaries, payroll, labor relations and inductions. As a result, the firm is able to make obtainable momentous multinational economic reimbursement to its various branches worldwide (Armstrong, 2006). Background of the organization International Business Machine is an American technological firm based in New York. The firm hence deals in the manufacture and sales of computer software and hardware. Furthermore, it tenders hosting and consultancy services in computer related fields. It is thus considered second largest technological trading firm in the global market capitalization. Initiated in 1911 as the computing tabularizing recording company through the amalgamation of Tabulating machine firm, international time recording firm, computing scale company and the Bundy manufacturing. It hence has employed various personnel who are the driving force of the firm. In this event, it employs corporate ethical strategies in conjunction with human resource management to ensure the flow of work within its staff. Human resource management is the core facet of the organization (McGraw, 2010). The structure of the company was set back in the 70s. However, several setbacks faced the firm due to the changing technology, increasing multinational competition and issues affecting the environment. In a move to salvage the firm, the executives focused their energy towards responding to the changing times. Therefore, it majored on prioritizing key issues. International business machine is a corporation, which mainly focuses on progressive growth of profits. This is depicted from the past years whereby it abandons any activities, which did not contribute positively towards profiting of the organization. Its profits have been thus increasing progressively over the years since the initiation for instance in 2000- 2009 its annual earning per share increased from 10% to 12% reaching highs of $10 per share. The organization, therefore, wants to engage in strategic share buybacks, robust encroachment in the existing global markets and to take possession of firms that structure its foundations (Morgan, 2007). Goal IBM goals and strategies IBM is composed of IT specialists who nearly amount to about 20,000 specialists. Therefore, IBM looks at itself as knowledge based organization. However, where is the knowledge? There are various ways, which IBM employs to determine the skills of its employees in a quantitative manner. The strategy, which is skill measurement, began with need to develop success rates. Therefore, for the firm to make most of the skill inventory the main goal is to have access to reliable data. The main goal of IBM hence focuses on improvement of skills for career advancement hence the objective needs to emphasis on the process. Therefore, the procedure needs to be done extensively and vast preparation, interviews and drawing consensus from various decision makers within the firm. However, IBM has a vast experience based procedures. During the process IBM hence the organization classifies its employees and assists them bring together an extensive application portfolio which is usually a large manuscript of about 40-50 pages. The document then outlines experiences, the course so far undertaken and other organizational factors. The application is then submitted to the board executive members. When the application is accepted, the candidates are then scrutinized with the executive members. Thereafter the board members then vote to pass out the candidate (Hamel, May – June 1990). Lou Gerstner, the former chairperson of IBM so far outstretched the firm’s turnaround during the early 1990s. He was vividly remembered for his strategic saying whereby one does not matter what the strategy is as long as the organization has one. Therefore being lucid about the organization’s strategic objectives enhances the firm to focus and assists the executives to comprehend how to align their resources and make wise decisions on a daily basis. On the other hand, strategic planning does not necessarily affect a triumphant strategic process. For instance considering President Dwight that is Eisenhower’s military wisdom, he asserts that plans are not anything and planning is everything. However, the president by no means found the relevance to the plans themselves in this event plans are indispensible. There are various ways to best practice resourceful and strategic planning such as the one employed in IBM. The timing factors in this way will be different depending on the industry (IBM business), market pressure, IBM culture and the size of the business. For instance, IBM utilizes the opportunity such that the firm has several branches and hence strategies are made locally. The strategies are then communicated to the main offices where they are approved due to different market structures and cultures in various regions (Sanghera, 23 Sept. 2003 pp. 16). During the past years strategy time horizon has been a popular practice however nowadays is hard to plan for the next two or three years ahead. For instance, Meg Whitman the CEO of eBay affirmed that in the past firms used to have strategic meeting annually however this is not the case today, as many firms seek to have the meetings after every two weeks. Thus, strategic planning in IBM is oriented towards the firm’s state of affairs in a specific time in the existence of the organization. Though there are a number of proven and more efficient techniques and can be adopted by any organization: IBM best strategies IBM has so far employed various strategies in order to optimize its business ventures and in the end maximize its profits. For instance, the firm has structured plans, which are ever progressing and flexible during business phase. Through gradual and steady improvement, the philosophy provides a guideline throughout the planning process. After making the relevant plans and strategies, the organization then communicates the strategic plan for criticism to enhance the measure of quality planning. Therefore, the planners of the firm focus on action strategies and critical thinking. Hence, the primary planning takes place at the firm’s unit level. However, in the various branches of the organization the planning process and the strategic design vary greatly and use different approaches. The structure of issues and opportunity creation, prioritization, appraisals and opinion of different issues has uniform organizational relevance (APQC, 1996). Recruitment and international assignment Recruitment is a procedure that is used by firm’s for instance IBM to screen it is yet labor force for a particular job. This is intended to obtain qualified personnel. Therefore, during the recruitment process firms that are mid-level and large-level firms usually holds on to professional recruiters or rather outsource recruitment agencies that are well suited to do this. Thus, the institution of recruitment has four major facets: employment charities, executive and professional recruitment agencies, and employer branding and human resource staff. There are various stages in the recruitment process such as sourcing candidates through adverts and other sensitization techniques, screening of the potential candidates using various methodologies selection of the candidates using the outcomes of the selection techniques, and on-boarding hence ensure the candidate is able to deliver timely and effectively. The institution of recruitment has one main objective that is to provide the firm with the candidate to a client for price. There are various spectrums of agencies. These are paid on conditions that they deliver a candidate that remains within the clientele’s desires. On the other hand, there are agencies that are paid a retainer to ensure clientele satisfaction to achieve the best candidate. They are then paid a percentage of the candidate’s salary for the period, which the candidate is still in probation (Glover, 2006 pp 5-26). Effective recruitment and selection of employees is fundamental in IBM especially in the iHRM department for both international and domestic duties. The iHRM if managed well and efficiently will affect significantly on the organizational performance and hence creation of a positive image of the organization. Ineffective recruitment has a number of challenges especially to the expenditure if the firm. For instance, lowered morale, and high labor turnover are just some of the arising issues. During recent surveys, show that, as at 1990s the employee turnover for IBM was 12,500 pounds for both the managerial and other staff related to the IT department. Thus, IBM adopted a strategic approach towards countering this negative effect. In this event the IBM iHRM were involved in defining job roles and the related competencies through proper investigation of the labor market and involving both internal and external organizational factors of IBM. This targets matching available labor potential with organizational needs. Though various ongoing issues indicate hard-to-fill spaces in certain positions, IBM polling depicts that about 20% of the organization is facing hardships in filling certain posts. The major cause of this is skill shortage in the labor market (Glover, 2006 pp 9-26). Issues Fountain (2000 pp. 45-62) asserts that during 1990s one of the recruitment process carried out in IBM realized fewer information technology, electronics and computing professionals were women and yet female representation in the fields were decreasing. Therefore, by not making use of the available human capital employers are in this way lessening the pool of talent they can easily select. In this event, the underutilization of the valuable section of the labor is under effective more especially when jobs are hard to fill in during skill shortage periods. The implication for this would rather be diverse when more female labor force is absorbed in less or inadequately skilled occupations that rarely use their potential to the fullest. Therefore, this depicts that the IBM is operating below its productive potential hence the economy. In this case IBM operating at a low productive rate would effect a less growth rate realization. Moreover, it is easier to meet clientele expectations if the labor forces that are production and service delivery are diverse as the clientele themselves. These results to managers to be more committed to an ethical standpoint to promote gender balance and hence optimum utilization of talent as a remedy to diminished service and production. International compensation/ remuneration Remuneration is the cumulative compensation that the labor force ought to obtain trading with the services delivered to the employer. In most cases, remuneration consists of monetary rewards that are wages or rather salary in the case of permanent employment. The impact of the international growth economy is a major force in the business world. This is specifically in iHRM. This practice is inevitably faced by Multinational Corporation (MNC) in doing businesses overseas. MNCs should therefore synchronize strategies and processes that effectively foster the balance between the demands and requirements of host country nationals. International compensation is the most intricate elements of iHRM. The pay systems should hence conform to local laws and background of the employee compensation and on the other hand perfectly fitting into worldwide MNC policies. MNC that is IBM should put into practice the use of motivational incentives and recompense among the labor force based on national affiliation (Wetlaufer, 1996 pp. 11-12). International business has so far been around for very many years. However, the progressive trend of MNCs that is IBM is a recent phenomenon. Therefore, most of the firms that do business overseas were dominant during the 50s and 60s were the Americans, when IBM was still in its initial stages. During the 70s and 80s the nature on MNCs diversified and become worldwide in nature. MNC is a ordinary worldwide phenomenon of the global economy and hence are playing a very significant role in the global economy. Most of the MNC are characterized with their developmental markets that are completely outside the conventional economic powerhouses for instance the US, and EU. Developing markets are presumed to lure at least more than 45% of the world’s GDP with its current trend. The essence in this is that consumers are increasingly demanding for more IBM products and services because of the affluent element and per capita income amplify (Wetlaufer, 1996 pp. 11-12). International training and development IBM has various foundations of international training that were established because of the progressing industrial world. Their mission is to further social and economic progress in the developing nations to harness potential. Their programs are well designed too cultivate and escalate the capacity of local, voluntary, private and public avenues for the strengthening of human resources. This will propagate the firm to assign internal duties to various individuals who do not necessarily belong to the mother country. Thus, skills and human capability are most vital resources for development. Since the embracement of foundations of international training the firm has far accomplished various business deals in other countries for instance the increased profits for its sales, endorsing on how best the society can adopt IBM products and diversification of services that is filling the IT skill gap. Technology waits for nobody and the newest release and next versions of products are inevitable hence need for international training. Moreover, IBM enhances one to optimize IT skills through the courses that it offers, available via IBM e learning on sites. The building of capacities to manage development within the organization is therefore vital in ensuring the economic and social progress of the firm (Schneider & Barsoux, 1997) The world leading firms use deployment of talent us a strategy for their success. For a fully globalised growth, the firm needs to promote the sharing of knowledge, expanding their branches into other localities, and executing management plans. Therefore, International business machine ensures implementation of policies that are coherent with the assignees for the purpose of efficiency. Therefore, the firm has structured an assignment delivery constitution through employing technology to manage international affairs. For the firm to harness its resources, effectively it needs to instigate global mobility considering risk management issues. As trade barriers withdraw, developed countries are pursuing market opportunities in other countries where competence and effectiveness are essential. Therefore, the firm with performance appraisals, scorecards, corporate ethics and other tools recruit international assignees (Schneider & Barsoux, 1997). Recommendations Recruitment: The firm should put into consideration the vacancy they want to fill is well defined. Hence the iHRM will be able to have comprehensive know how on where and how to advertise the role. Thus, the firm should also consider how they should decrease contract hours from the onset and adopt the quality part-time working model. Thus a major transition should be effected on the policies that retain employees rather than otherwise. Moreover management of flexible working force should be looked into and analyze when the and how to make full use of potential labor force. Therefore, the firm should employ competency-based approach for recruitment programs. The firm should be able to strengthen recruitment and retention services. Improve the International human resource through effective staffing. Thus as the recruitment challenges escalate turnover rates inflate combined with the rising demand of additional workforce compared to labor force provided. Funds should be allocated specifically to decrease misallocation of funds and other deceptive practices, which are paramount to exist in a multinational organization. Moreover, training of employees should be comprehensive and wide which will in the end fine-tune the visions of the organization and motivate staff. The firm should endorse mechanism to spot verified the accuracy of individuals within the firm (Griffen, 1996). Remuneration: IBM should staff its organization through the recruitment of expatriates from the organization through the structuring of international cadre of managers. In the end, the organization should have its own cadre of globalists. The firm should comprehend its local markets to ensure that the markets are too small to sustain more growth to foster international activities. Expatriates should be employed to foster the expansion of the firm and remuneration of its employees. The firm should have a mission of building new markets and tap potential resources in the developing nations. IBM is thus making good moves to increase its overseas operations (Wetlaufer, 1996 pp. 11-12). Conclusion IBM characterized by International human resource management promotes global productivity and the effectiveness of MNCs. To attain a highly productive company the firm emphasizes empowerment of international employees, training and staffing and effective recruitment of personnel. Strengthening of the organizational hierarchy and effective utilization of its employees keep the organizations running smoothly to achieve multinational standards. Organizations should therefore have external surrounding to align the working force through provision of skillful training and implement foundations that are reliable for the IBM’s productivity. Through international human resource, organizational policies are thus, transitioning into more efficient globally shaped to fit international standards. Therefore, the organization should have a clear objective in restructuring and betterment of the international employee standards provided by international human resource management. Bibliography APQC. (1996). Strategic Planning: Final Report. Houston, TX: American Productivity & Quality Center. Armstrong, M. (2006). A Handbook of Human Resource Management Practice (10th ed.). London: Kogan Page. Fountain, J. (2000). ‘Constructing the information society: women, information technology, and design. Technology In Society 22 , 45–62. Glover, J. a. (2006). Employment and Organisations. London: Routledge. Griffen, R. W. (1996). International Business: A Managerial Perspective. New York: Addison-Wesley. Hamel, G. a. (May – June 1990). The Core Competence of the Corporation. Harvard: Harvard Business Review. Morgan, T. P. (2007, May 21). IBM Outlines its Long-Term Financial Goals to Wall Street. The Four Hundred, IT Jungle . Sanghera, S. (23 Sept. 2003). You Should Be Bonkers in a Bonkers Time. Financial Times, London Edition , Features p16. Schneider, S. a.-L. (1997). Managing Across Cultures. New York: Prentice Hall. Wetlaufer, S. (1996). Foreign subsidiaries: Determining executive compensation. Harvard Business Review, , 11-12. Appendices MNC – Multinational Corporation GDP- gross domestic product iHRM – international Human Resource Management IT – Information Technology Read More