Introduction
The concept of globalization, in a real sense, is the product of modern age though the existence of its weaker forms can be traced in the sixteenth century, which refers to the process through which different organizations and corporations build influence of international scope (Beck, 2010). Globalization has extensively influenced today’ business scenario, and it has certainly changed the role of Human Resource Management (HRM) and how important the role of human resource management has become in managing the organization (Perkins, 2003). A better idea of this situation can be gathered from the fact that the success of large organizations in the modern age depends heavily on the insight of their management into the globalization. The companies that are successful in coping with these requirements are very likely to enjoy a competitive advantage over those that do not (Kokemuller, and Media, 2015). Globalization has impacted business in many dimensions where human resource management is one of the main keys.
This report presents the challenges that global landscape has provided to the HRM in managing the organization and its resources. The report focuses different human aspects of human resource management as well as how HRM can influence for appropriately managing the human resource of the organization. The challenges discussed in this report are diversity, leadership in the organization, professional development of the employees in the organization, and training of the HRM. These challenges are critical in today’s competitive business environment because they influence the productivity of the human resources as well as in retaining and attracting quality human resource in the organizations.
Challenges of Human Resource Management
Diversity and Role of Human Resource Management
A plethora of studies has been made on the effective approaches to diversity management among the workforce though a few decades back, entrepreneurs were hardly familiar with this term (Barak, 2010). As the companies and organizations are growing, their percentage of interaction with culturally diverse stakeholders is increasing. This increasing trend of diversity has created significant challenges for human resource management in managing the employees from diverse cultural, religious, ethnic, and geographic background (Bae, and Rowley, 2002) and many organizations have changed their policies to meet these changing trends (Briscoe, 2014). Considering this changing trend, human resource department of large organizations have started realizing the importance of dealing with this complex matter in the most effective manner. Diversity management is the name of this realization (Bradely, and Media, 2015). Diversity is very helpful for the organizations, however, it has to be managed appropriately (Marschan-Piekkari, Welch, & Welch, 1999). Companies not only have the issue of diversity recruitment, but their customers also belong to many different regions and cultures. So, it is very difficult to manage this cultural and linguistic gap between them, because the values and meanings of even certain gestures are different in different cultures (Choy, 2007). For example, in the American culture, nodding means someone understands the thing being said. While in the Japanese culture, it is an indication that the thing is being listened. By the same token, showing palm in the American culture refers to “stop”, whereas it is considered insulting in Greece (Merritt, 2010). That is why it is necessary for human resource management to have a good understanding of the values and trends in different cultures so that they may come up with the best solutions which are accepted by everyone (Jackson, 2002).
Aycan, Kanungo, and Mendonca (2014), in their book have discussed about diversity at the work place in unique and interesting manner, as they have merged three main concerns of modern business including organizational behavior (OB), cultural diversity management (CRM), and human resource management (HRM). To them, regardless of certain challenges posed by globalization, it has provided modern organizations with great opportunities of boosting their productivity. According to Aycan, Kanungo, and Mendonca (2014), HRM can leverage on the diverse workforce and the best combination of different core competencies possessed by them if they follow a strategic way. Understanding the basic concepts of organizational behavior is very helpful when it comes to this. The authors condemn the modern theories that emphasize the need of diving into complex patterns of CRM. Rather, they believe that this purpose can be better achieved by sticking to fundamentals. They give the example of Maslow’s hierarchy of needs and many other basic concepts of organizational behavior and conclude that an organization can achieve the highest level of cultural management if it is successful in addressing the basic needs of its employees. According to this standpoint, the globalization has enhanced the overlapping of CRM, HRM, and OB to such extent that they hold very little significance while detached from each other.
Leadership and its Challenges
Globalization has impacted business in many dimensions where leadership holds key importance. It has made the concept of leadership undergo a transition. Creation of a novel term “global leadership” is the result of this trendsetting influence of globalization (Brewster, Sparrow, and Harris, 2005). Global leadership involves much more complexities as compared to traditional one, due to its vast scope of responsibilities (Dekker, 2013).
Mintchell (2008), who is excited about the nature of his job that allows him to interact with leaders at automation industry on different issues, holds that global leaders have both benefits coupled with challenges. The rapid pace of globalization of businesses is gradually adding to both of them. In an interview with an automation leader, he found that the main issue faced by some leaders in internationalized organizations is to make everyone understand about an impending or implemented change. It is hard to communicate effectively across the board what that change means and how the company will have to respond to that and therefore, the role of human resource management is critical in ensuring and in aligning that the employees working with the managers or the leaders are in the same direction. Thus, leaders in today’s organization need support and help from the human resource department in achieving the best out of the employees.
Dekker (2013), also explains the same idea adopting a subjective approach to the matter. The author establishes that the requirements of global leadership are at divergence from that of the conventional model of it. In organizations or corporations that have international influence, it is very common to observe a culturally diverse workforce. However, it is never easy for any leader to handle this cultural diversity. He has to be blessed with sheer insight into the typical behavioral approach of employees belonging to any culture (by avoiding stereotype or bias) to establish an effective relation with them. A leader can only hope to take his organization at the peak of profitability if he has its employees working at maximum potential. And, they will be utilizing their core skills if they enjoy a high level of job satisfaction. And, the cultural harmony created by an efficient leader through his policies plays a massive role in providing employees with the desired level of job satisfaction (Dekker, 2013).
In a book, “The Global Leadership Challenge” authored by Black, and Morrison (2014), the phenomenon of global leadership and the underlying challenges have been elaborated in one of the simplest and the most interesting manners. The authors argue that the complexity of this large scoped leadership lies in the fact that the world is big, dynamic, and full of complexities. That is why the leaders with good strategies to counter these issues remain successful in adding to their output. On the other hand, those who come up with simple, old-fashioned, or uniform techniques are very likely to get defeated in this race.
Professional Development of Employees
Connelly (2000), identifies another area of influence of globalization on HRM and this area is professional development of the human resource. Today, many small and big organizations are striving to get their workforce professionally developed. For this reason, organizations may cope with the emerging requirements mainly resulting from globalization. Some employers provide a special allowance to their employees to get them qualified by University and other send them to training networks where they are supposed to build their working skills. Marchington and Wilkinson (2005), also support this idea by stating that the PDS (professional development scheme) originated in the year 2001 and it has become an essential requirement for HRM. In the modern scenario of business, human resource managers with a traditional set of skills only are not considered efficient enough to handle the tasks of management. The reason is that globalization has added so many complications in what a human resource manager has to do. Now every manager has to be a sum of an effective set of qualities and deep thinking ability as well as sufficiently qualified. PDS is recommended to polish their skills in conformity with the modern definition of management. The concept of professional development is based on the idea of ‘thinking performer’. It implies that any manager having gone through the process of professional development can think, analyze, and base his decision on deep insight and precise approach to the organizational matters.
Organizational structure is no more as it was a few decades ago. Business expansion has become the matter of routine. Globalization has made organizations redefine their policies and update their patterns of management emphasizing on the intensive need for the change of organizational behavior and management style (Debroux, 2015). According to Collings (2012), policies of HRM are critical in achieving the best out of the employees. Furthermore, today’s business scenario is much more complicated than it has traditionally been. Therefore, it requires extra effort on the part of organizations, and professional development is a part of this extra consideration (Connelly, 2000). Hence, without the shadow of any doubt, globalization has a compelling and revolutionary impact on human resource management and its policies.
Smith and Tillema (2006) have also made a remarkable contribution to that by conducting a survey to evaluate how far organizations consider employee development to be essential to organizational performance. The survey was focused on 100 employees working in 24 organizations based in Netherlands. Findings of the survey unfolded many interesting facts. For example, a higher percentage of coordinators believe that on personal skill development is considered as a requirement of modern business scenario. However, they also remarked that the implementation of such assessment is not free from difficulties due to lack of tools utilized for this purpose.
It must also be kept into account that the employees with developed skills prove to be assets for their companies. Hence, this part of globalization’s impact promise many benefits for organizations by making them leverage the added skills and expertise of their workforce as a result of professional development (Bradely, and Media, 2015).It has also been found that organizations that invest and professionally develop the skills of the employees can motivate and retain the employees. When organizations invest in employees, they feel that they are part of the organization and organization wants to invest in them. Thus, this strategy motivates the employees and also helps in retaining them for a long time.
Training of Employees
“Reinventing HRM: Challenges and New Directions,” edited by Burke, and Cooper (2006), is one of the most important books dealing with the theme of new trends in HRM. These new trends are mainly the product of transition from localization to globalization. Training can also be placed distinctively in the list of trendsetting impacts of this evolution. Now human resource managers strive hard to come up with the most appropriate plans regarding training programs to be held on an organizational level. In these programs, employees are introduced to different techniques that either can help in building their existing capabilities, or in acquiring new skills. Bradely, and Media (2015), also strongly agree with this standpoint by holding that the emergence of new technology and many other trends in today’s business scenario necessitate for organizations to keep the knowledge the skills of their workforce updated. For example, call-centre based companies have to teach their employees what possible innovative techniques they can utilize to attract the attention of maximum potential customers. By the same token, a company will be in the need of training their employees if they are going to include new software in their IT infrastructure. In training sessions, HRM provides a complete presentation on how to use that newly introduced software.
Nevertheless, it is not only challenges that stem from this so-called globalization, but it has also opened up new vistas towards organizational growth and enhanced productivity. For example, the emerging correlation between training and employee motivation has unfolded a totally new dimension on which HRM capitalize to boost the profitability of the concerned organization. For example, it has been said that the trained employees have a far more motivational approach to their assigned tasks than untrained ones (Griffeth, & Hom, 2001). The basic reason behind this tendency is the fact that employees after being trained can accomplish certain tasks more easily or with less difficulty as compared to otherwise, because training, on one hand, adds to their level of expertise, and on the other, shows them the most exact way of carrying out a specific task. Hence, training proves to be motivation booster for the workforce. And, the prevalence of motivation is a healthy sign for any organization. Further implications of training may be in the form of increased quality of work or reduced turnover of employees (resulting into a better level of employee retention) (Gagne, 2014).
Implications and Recommendations
Human resource management has received much influence from globalization. Much advancement has taken place not only in its basic role, but it has also been extended into many new considerations. Traditionally, HRM has been confined to recruitment, selection, and maintaining the database. But, globalization and increased competition have opened up the doors of several possibilities for it. For example, now HRM has to undertake cultural diversity management, CSR, formulate policies to enhance workengagement, and much more. Therefore, the modern HRM is totally divergent from its classical form (Campbell, 2015). Globalization has impacted the role of HRM in many aspects same as it did with leadership, employee retention, employee development and training of the employees (Bradely, and Media, 2015).
Globalization has caused several alterations with the traditional approach to the concept of leadership. Under its influence, many new concepts and theories have also been introduced, and many of them are being practiced on the large scale (Urip, 2010). Cultural Diversity Management is another of chief products of globalization. However, the importance of cultural management was considerably unfolded 30 years ago by Hofstede (1980), who emphasized on the need of several techniques to be adopted by the leaders even at that time for strategic cultural management. In the current business scenario, where organizations tend to expand at a rapid pace, the need for cultural management can be felt at its peak. In the modern age, the level of organizational productivity is highly conditioned with cross-cultural management (Perkins, 2009).
Continuous improvement in the processes and policies to ensure that policies encourage employees so they can perform at their optimum level.
Increased training for the managers as well as the employees related to manage diversity. This will help employees to cope up with the challenges of cultural diversity and ensure they all perform as a team for the betterment of the organization.
HRM should keep focus on career growth and development of the employees as this will help them in motivating and retaining the employees.
Encourage quality performers by rewarding them. This may not necessarily be monetary rewards, but non-monetary rewards can be valuable as well.
Conclusion
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References
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