The paper 'Impact of Human Resource Management on Company Performance' is a wonderful example of a Management Essay. The current competitive business environments are rapidly becoming globalized. This is apparent from the basis that more multinational companies are entering international markets by exporting their products to foreign countries, entering into business agreements with foreign companies, and building branches in other countries. Due to global competition, organizations throughout the globe are forced to initiate changes in order to pace up with the competition. Through this, they attempt to gain a competitive advantage over other business corporations which can be realized through international expansion.
A decision of entering foreign markets, developing new branches, and other necessary facilities overseas is not an easy matter and a considerable number of issues pertained to the surface of the human resources (Becker, 1998). A decision to participate in global business deems it necessary for appropriate adjustments to be made so as to reflect factors more so cultural aspects that differ across the globe. The stability and nature of political systems fluctuate in both stability and character, with contracts becoming unenforceable due to internal political factors.
Besides, human resource laws and regulations differ between countries in detail and character. Considering a multinational corporation such as MacDonald’ s and Finland a country in Western Europe, laws pertained to employment and labor unions make it difficult to trim down the number of workers because necessary payments to former employees can be extremely high. However, equal employment legislation exists to differing degrees. In Finland for example, laws address sexual harassment and employment discrimination issues. It is essential as a manager to recognize how cultural forces represent a significant concern affecting international human resource management.
Culture is an aspect affecting the business environment in Finland, is composed of the societal forces affecting the beliefs, values, and actions of its citizens. According to Hilton as cited in (Armstrong, 2008), cultural diversity certainly exist between countries. Getting employees from different tribal or ethnic backgrounds to work as a team may be exceedingly hard. As an aspect, culture has to be factored into consideration because of two reasons. First, it is the culture that determines other factors for example economic, political, legal, and human capital factors.
Effects of culture on human capital are apparent because if education is highly valued in a certain culture, then members of such a community as is the case with Finland attempt to increase their human capital. (Towers, 2001) economic conditions vary also from one nation to another. Many less developed countries are amenable to foreign investment in order to create jobs for their increasing populations. However, in developed countries such as Finland, levels of unemployment are high, but wage levels and employment restrictions remain high.
Internationalization of corporations in developed countries such as the United States of America has grown more than the rate at which human resource management is growing. However, there is a considerable difference between domestic human resource management and international human resource management in several ways. International human resource management places more emphasis on activities and functions such as orientation, relocation, and translation of services to aid employees to cope up with the new and different environments outside their own country. Assistance with investment management, tax matters, home rental, banking while on company operations, and coordination of visits at home is an issue handled by the human resource department.
Therefore, it deems necessary for a corporation such as the MacDonald’ s to have a full-time staff of human resource personnel dedicated to seeing the process of globalization attain its success in Finland. This team has to stay updated on international programs, policies, and concerns. To attain this, my human resource department in Finland ought to be responsive to the political, cultural, and legal environments of this country.
In order to make this a success, it is a mandate incumbent upon my department to ensure that a remarkable effort is made to create a code of conduct for employees in order to provide explicit clarification on certain legal and ethical standards of Finland. Participation in international human resource management essentially depends on the globalization phase of a company. Considering the fact that MacDonald’ s will be in the first phase of globalization, its products shall only move across national boundaries. MacDonald’ s shall therefore not employ people in other countries except a few managers who will be bestowed with the responsibility of negotiating business agreements which will entail selling and buying of complete services or products.
To excel, MacDonald’ s ought to understand the cultures and develop effective strategies to overcome communication barriers so as to negotiate agreements. Such negotiations are usually done by expatriate representatives who are not extensively employed by import-export firms as by multinational enterprises. Human resource practices and policies remain relatively unchanged from the company’ s traditional home-base practices (Claydon, 2009). During the second phase of globalization, have strategic corporate units located in overseas countries.
However, part of MacDonald’ s services or goods may be produced from the main country, then possibly moved to another country for additional assembly, and eventually distributed to other countries where they are sold by employees of the MacDonald’ s. It is essential to me as a human resource manager to make use of expatriate managers who are sent from headquarters to supervise foreign operations. Such a team of personnel plays significant and strategic roles. It is of the essence to utilize such resource persons as they coordinate between headquarters and subsidiaries, ensure the quality and effectiveness of the organizational control system, implement strategy, and manage global information systems.
They also gain expertise skills in international businesses that are vital to ensuring that executive positions are replaced by competent replacements with the indispensable international perspectives and experience. During the final phase of globalization, specialized functions may be performed in Finland for example, research, production of goods, and engineering. In order to meet the demands of MacDonald’ s, both products and people have to be extensively moved across the boundaries of this nation in order to meet the demands of the company.
In such a stage, it is essential to make moderate use of MacDonald’ s expatriates in Finland. It is essential to develop staff operations in Finland where international employees will have to be classified into different categories. However, from the fact that these employees are from different countries and thus have diverse cultures, each of these employees presents a unique human resource management challenge. This deems that I will be informed in regard to the customs (cultures) and laws of the respective countries where I outsource my employees.
It will be a requisite condition to establish appropriate record-keeping and payroll procedures to ensure compliance with varying requirements and regulations. According to (Storey, 2003), many multinational corporations use expatriates to ensure that business operations in the overseas are effectively linked with the parent corporations. So as to maximize available resources, it is essential to abide by the acceptable code of ethics in Finland. Business ethics fundamentally factors into consideration the following aspects: deviating from actions that can result in civil lawsuits being imposed against the corporation, shunning from actions that are bad in the view of the code of ethics of the company, avoiding breaking criminal laws while undertaking work-related activities.
It is paramount for me to consider these issues since they essentially affect the operations of the company and more seriously can cause losses and taint the image of a company. To ensure that the appropriate code of ethics is observed, it is important to assign public relations experts and corporate attorneys to escort workers to their daily undertakings.
Any instance an employee goes against the narrow route of acceptable behavior, it remains an incumbent mandate upon these experts to provide proper guidance. Perceptibly, this solution would be a financial catastrophe if exercised in practice because it would cost the attorney more and public relations expenses than would save from appropriate employee acceptable code of conduct. As noted in (Becker, 1998), there is a symbiotic relationship between ethics and the business in which ethics emerges from a corporation that is business-oriented. For instance, it is profitable to make products that are safe because this will lower the chances of having product liability lawsuits.
Equally, it may be in the financial interest of the corporation to respect the privacy of the employee, because this will boost employee morale and improve work efficiency. Additionally, these expatriates are utilized in the development of international capabilities within an organization. Utilization of expatriates is the importance since they can provide an immense talent that can be utilized as the organization expands its operations more widely into more countries. The incorporation of such host-country nationals is crucial if the organization wishes to establish explicitly that it is making a commitment to the re6spective country and not just merely setting up a foreign operation.
(Towers, 2001) Host country nationals are often more informed about the laws, the politics, culture, and how business is done better than a foreigner can do. In the words of (Claydon, 2009) the use of host-country nationals is a way of emphasizing the global approach that is being adopted. The process for selection of an international assignment should provide a real picture of the work, culture, and life to which an employee may be sent.
Thus as a manager, I will have to prepare a comprehensive description of the job to be done. Such a description should entail responsibilities that would be unusual in the home country. These responsibilities might entail interpreting local work codes; negotiating with the public officials; and responding to moral, ethical, and personal issues for example personal freedoms and religious prohibitions. Nonetheless, the process of selection should attempt to lay more emphasis on diverse employment factors based on the degree to which the foreign environment is different from that of the home country and the extent that one would have gained experience with the local culture.
\Besides, if an expatriation candidate is willing to work and live in a foreign environment, a suggestion of his tolerance of cultural diversity ought to be obtained. Finding workers who can meet the demands of working in a foreign environment is among the challenging decisions for many organizations to discern to an extent that multinational organizations have been hesitant to send women on overseas missions (Claydon, 2009).
Most human resource managers assume that women do not desire to be sent on international missions, however, the actuality is that the rate is equal to that of men. As a manager, I will engage a translational team of professional staff comprising both men and women to conduct international business. Such teams may prove useful more so in undertaking duties that the entire firm is not yet structured to carry out. I will utilize such a team to transcend the current organizational structure to adapt the strategy for diverse geographic areas, communicate between the subsidiary in Finland and headquarters, and transfer technology from one part of the world to another.
Primarily, the fundamental duty in forming a translational team is convening together an appropriate of employees who can effectively work as a team to attain the goals of the entire corporation. A number of corporations attempt to build diversity into their teams so as to maximize responsiveness to the particular needs of diverse countries (Claydon, 2009). In order to ensure effective delivery of service to the entire corporation, employees that work under my leadership will have to undergo a number of activities for example; continuing employee development, training and orientation, and readjustment development and training.
However, the training and orientation that both the expatriate employees and their families receive in order to effectively utilize resources while in a foreign country include; interaction adjustment, work adjustment, and general adjustment in culture, living conditions, history, and language. Continued involvement of expatriates incorporate employee development and career planning are vital activities. If MacDonald’ s has to be effectively managed in an international setting, then I as the human resource manager need to be trained and educated in global management skills.
According to (Becker, 1998), I have to develop a number of abilities; to manage highly decentralized organizations, sensitivity to issues of cultural diversity, to seize strategic opportunities, awareness of global issues, competence in interpersonal relations, and skill in building community. In establishing compensation schemes for my employees, I will consider variations in living costs, laws, and tax policies. It is of concern to compensate employees for the costs of schooling of children, housing, and yearly transportation for their family members and themselves.
It is further necessary to recognize that both labor and employee relations differ from one nation to another. When international operations are factored into consideration, concerns related to security, and health safety ought to be evaluated. It is paramount to comprehend the relevant labor-management laws, practices, and regulations before starting operations in countries overseas. Another similar aspect to be considered is the provision of emergency evacuation services. It is thus indispensable to purchase coverage for employees from organizations that provide emergency services, for example, Global Assistance Network and International SOS.
To ensure that the grievances and views of employees are properly addressed and thus resources well managed, it is essential to form a workers union. However, the role of unions differs from one country to another. This however depends on several factors for example; mobility between labor and management, the level of per capita, level of employment, and homogeneity of labor. Nonetheless, labor relations in Finland differ from those of other countries in several respects; in Finland, organizations negotiate the agreement with the union at the national level through employer association representing their specific industry.
There is a tradition in Finland for salaried workers to be unionized. All these workers' union-related terms and conditions are essential for me as a human resource manager to understand in order to ensure that work issues affecting my employees are channeled to relevant departments and properly addressed.
Armstrong, M. (2008). Human Resource Management Practice. London: Kogan Page.
Towers, D. (2001). Global Business. Oxford: Oxford University Press.
Claydon, T.(2009). Strategic Human Resource Management. New Jersey: Prentice Hall.
Storey, W. (2003). Relationship Between Global Business and Culture. New York: Pocket.
Becker, M. (1998). Impact of Human Resource Management on Company Performance. London: Kogan Page.