International Human Resource Strategy - Assignment Example

? International Human Resource Strategy Executive Summary This report is written by the International Business Development Manager of Wal-Mart which is a retail hyper store in United States of America. This report contains the strategic human resource management options available to Wal-Mart for its potential venture in Thailand which would see the American retail giant joining hands with BIG C from Thailand. The joint venture would prove to be a successful joint venture, which is evident from the findings of this report that Thailand some of the best workforce in the world. These evidences are gathered with the help of strategic tools such as PESTLE analysis of Thailand which would be helpful in providing an inside into the fundamental human resources requirement and the potential candidates from within Thailand to fill the new job places. The human resource practices of Wal-Mart will also be evaluated with respect to the impact of the business environment on the global horizon. To support the evidences presented in the report, the author will provide theoretical background pertaining to international human resource management and see if Wal-Mart’s human resource function are in accordance with the international standards or are there any changes required in the strategic human resource management of the retail giant. The author would conclude this report by demonstrating the skill set and personality traits. These traits are required to achieve organizational goals and objectives successfully. It is possible with the help of strengthening the relationship with the colleagues. International Human Resource Strategy Overview of Thai Retail Sector The net worth of Thai retail sector stands at Baht 1.4 trillion as of 2011 and is considered an important pillar of country’s economy. The sector reported a sector growth of 5% by the end of 2011 with the Retail Sale Index of 186.5 for the same period. Due to the economic reforms introduced by the government in post-political crisis scenario has helped the sector gain strength, the major contributor being the export sector within the retail industry (Thailand Retail, Food & Hospitality Services, 2011). PESTEL Analysis of Thailand Political Environment After the political crisis stretching from 2008 to 2011, Thailand is on the road to recovery and brings stability in its infrastructure to invite tourists to the country, which has always remained the focal industry of Thailand, and open new doors for business. The positive political outlook and the development of infrastructure along with the security provided to the individuals (Henry, 2008), Thailand is considered as shoppers’ heaven and both nationals and foreigners spend enormous amounts on the purchase of items available at retail stores. Economic Environment Majority of Thailand’s economy depends upon the gross domestic product of the manufacturing sector which accounts for about two third of Thailand’s exports. Whereas, exports are the area which generates most of revenue for Thailand’s government and the country is considered as one of the biggest exporters of manufactured goods in the world. The reforms introduced by the New Government in Thailand have helped the economy to stabilize. Since coming out of the recent political disturbance, Thailand has invested $ 57 billion on the development of infrastructure for local and international businesses (Naranlala School of Industrial Management and Computer Science, 2013; Trueba, Esteban, 2011). Society/Culture of Thailand Years of political and economic crisis within the country had produced the urge to achieve national goals and objectives amongst the Thai society. For this reason, Thai businessmen and working class is considered as hard workers so that they can achieve what they want. Merit regarded as being essential for qualifying for fields in the life. Huge number of foreigners, some of them residing within the country and the majority of them coming into Thailand as tourists, has heavily influenced the lifestyle of Thai people. Corruption at middle and lower level are found in abundance, but the senior management of majority of the companies comprises of visionists and skillful individuals. With respect to the retail industry, Thai shoppers fulfill the traits of consumers whom shop impulsively (Naranlala School of Industrial Management and Computer Science, 2013; Trueba, Esteban, 2011). Technological Environment These efforts result in a favorable business environment where the only survival is in the form cutting costs of production with the help of technology. The policies implemented by the National Science Society and Ministry of Trade and Business Development compel organizations to invest in research and development. Also, it ordains to identify ways of delivering products and services of superior quality quickly. With respect to the retail industry, the technological outlook is valid where organizations use different computerized Management Information Systems to increase the efficiency of their operations and bring down costs (Naranlala School of Industrial Management and Computer Science, 2013; Trueba, Esteban., 2011). Ecological Environment Thailand is surrounded by major economies in Asia such as Malaysia and Cambodia, whereas on the northwest of the country, Myanmar is located. Thailand’s ecological environment is getting polluted day by day with the increasing industrial development in the country. The air pollution is caused by Motor vehicle, and the major source of water pollution is industrial waste. Businesses, which put efforts in reducing the carbon emission because of their operations and supply chain activities, are appreciated by the Thai government and are rewarded with incentives (Naranlala School of Industrial Management and Computer Science, 2013; Trueba, Esteban, 2011). Legal Environment For businesses, different Legislations and regulations have been passed by the Judicial System and Government of Thailand. These Legislations and regulations are aimed at keeping the quality of services and products provided to consumers and at the same time, ensure that healthy competition does not influence the performance of businesses and does not deprive organizations to conducting socially and morally sound business practices (Naranlala School of Industrial Management and Computer Science, 2013; Trueba, Esteban., 2011). Value Chain Analysis of Thai Retail Sector The major emphasis of majority of the Thai hypermarkets stays on the preferences of the customers. The whole value chain mechanism is integrated in such a manner that it helps retail stores to monitor customer trends in purchases of products so that the suppliers and distributors manufacture and supply end goods and services according to the requirement. Majority of the hypermarkets enjoys superior power over the suppliers as their requirement for goods and services is ever increasing which provides a little room to suppliers and distributors to bargain on the prices. The expansion of sales revenue of the retail sector compels suppliers and distributors to operate on economies of scale due to the ever increasing demand of raw material and finished goods by the retail sector (Chawla, 2012). Introduction to Wal-Mart Wal-Mart is a multinational USA based retail business, founded by Sam Walton in 1962. The headquarters of Wal-Mart are located in Bentonville, Arkansas, and this is the place where the corporation started its business by opening a hypermarket. Wal-Mart is the largest employer in the private sector of the world, employing around 2 million employees at around 9000 different locations all around the world (Wal-Mart Corporation, 2012). Recruitment and Selection Process Wal-Mart depends on the use of technology to recruit staff in the organization. For this purpose, the retail giant uses social media, and other online mediums of marketing to advertise job openings in the company. Moreover, only online applications are considered for employment opportunity with the company and people looking for temporary or part time jobs are preferred in majority. This method of recruitment provides a competitive advantage to Wal-Mart over its competitors in the Thai market because Wal-Mart would master in cost leadership tactics by doing so (Porter, 1985; Porter, 2008). The training and development of the company focuses on empowering employees to come up with innovative ideas regarding service delivery to the customers. In this sense, employees’ involvement in the decision making is encouraged. This is the reason, when it comes to performance evaluation and management function of the human resource managers at Wal-Mart; they demand high standards regarding on-job performance and develop an intense job design. The low-cost strategy adopted by Wal-Mart compels it to adopt strict compensation management policies and the outlook of human resource market in Thailand suggests that it would provide a labor force which does not ask for huge salaries (Walmart, 2013). To give a general outline of the potential candidates to fill up job places in Wal-Mart’s Thai operations, Rodger’s Seven-Point Plan is used. Attribute Requirement Physical Make-Up Young, Good Looking, Smiling and Fluent in English Attainments Minimum high college qualified, Skills in operating computer and computer based-systems, Prior experience of direct interaction with customers General Intelligence Basic sense of communication, customer interaction, product and service description Interests A visionary with capability to transform ideas into practicality to achieve organizational objectives, Physically fit and Socialite Disposition Self-dependent, charismatic personality, efficiency in handling organizational issues Circumstances Students looking for part time jobs are preferred Table 1 Key Attributes Required to Fill Job Positions at Wal-Mart (Rodger, 1985; Molander & Winterton, 1994) Effectiveness of Recommended Strategies The implementation of above mentioned human resource practices, Wal-Would be able to attract the best talent available in the country and achieve its organizational goals. This can be done by equipping the work force with essential knowledge, communication tactics with the customers, service and product knowledge, Wal-Mat’s history and the company aims and objectives that is required from them to achieve (Nejati et al., 2008). Difference in Global and Local Human Resource Management The strategic human resource management practices of Wal-Mart in America aims at attracting the best and highly qualified workforce throughout the three levels of organization’s work force, i.e. Senior management, Middle management and Lower staff. This is because the educational system in the country enables the individuals seeking quality studies and the legislative clauses of employment laws require fair treatment at workplace which includes competitive salaries to be paid to the employees. Whereas in Thailand, the educational system is not well established and the labor force is available at cheaper rates in the country. Moreover, the cultural, social, economical and organizational culture differences would also affect the human resource practices of Wal-Mart. To overcome this issue, proper training and development programs, considering the personal, social and professional requirements of the suitable candidates to fill key positions in the company, should be implemented. Moreover, employees should also be trained about the work related behavior expected at Wal-Mart, how the organizational systems work, organizational culture, background and hierarchy should also be provided to the employees in Thailand (Nejati et al., 2008). Human Resource Management and Organizational Performance The theory of employee participation required organizations to adopt human resource management strategies that empower the employees to take part in decision making processes and contribute towards organization development so that the goals and objectives of the organization can be achieved. By empowering employees, an organization ensures that employees keep looking for opportunities to strengthen their skills and acquire further knowledge to master their set of skills. At the same time, empowering employees ensures that the employees come up with innovative product and service delivery ideas to enhance organization’s performance. Wal-Mart is proposed to encourage its workers in Thailand to take responsibility for their respective jobs and adopt a decentralized operational system which would ensure that employees work in teams under leaders and focus on achieving their team goals which would eventually be adding to organization’s efforts to achieve strategic goals and objectives. Moreover, employees should be encouraged to come up with suggestions regarding service delivery systems or visual merchandising of the products and etc (Marquis & Huston, 2009). Issues in Developing Human Resource Strategy for Wal-Mart in Thailand Hofstede (1984) proposed his famous typology which describes the differences found amongst the nationals of different countries. These differences were evaluated on the basis of national cultures, dominance of gender, differences in the distribution of power, level of individualism and uncertainty or avoidance found amongst the people belonging to different nations. These background indicators help organizations to develop their reward systems, as these indicators influence the individual requirements and expectations of the employees from an organization. The evaluation of Thailand on the basis of Hofstede’s model reveals that inequality prevails in Thailand within the society, the social structure of Thailand promotes collective efforts towards achieving what is aimed at and the society is less assertive and competitive where male dominates and strict rules and regulations are implemented to disallow individuals from committing uncertain activities thus resulting in less risk taking ability (The Hofstede Centre, 2013). Keeping these facts in view, it is recommended to Wal-Mart that it pay rewards to the good performers in Thailand in the form of maximum learning opportunities and monitory rewards. Management Skills Required The ideal approach that will help the manager to win support from the employees in Wal-Mart’s Thailand operations would be Laissez-Faire leadership approach (Hughes et al., 2008). A manager believing on this leadership approach would be suitable in Thailand’s environment as he or she would allow the workforce to accomplish organizational tasks with team work, empower them to make key decisions towards achieving organizational goals and objectives and promote innovativeness in job performance and process completion strategies (Pride et al., 2010).In this manner, the manager would be able to win the trust of the employees and build long-lasting relationship with his or her colleagues (Mosley & Pietri, 2008). Conclusion With the review of available literature and human resource theories, this business expansion report provides an insight into Thailand’s retail hyper market sector. From the analysis of different macro and micro economic factors that influence retail market trends in Thailand, it has been found that Thailand offers unlimited benefits to the multinational businesses in retail sector which will be enhanced in the future with the economic reforms introduced by Thai government. Therefore; it is recommended that Wal-Mart should enter Thai retail sector by adopting a Joint-Venture strategy with one of the big retail companies already established such as Big C. List of References Chawla, v., 2012. Retail Industry in Thailand. [Online] Available at: [Accessed 15 September 2013]. Henry, A., 2008. Understanding Strategic Management. Oxford : Oxford University Press. Hofstede, G., 1984. Culture's Consequences: International Differences in Work-Related Values. CA: Sage. Hughes, R., Ginnett, R. and Curphy, G., 2008. Leadership. New Delhi: Tata-Mcgraw Hill. Marquis, B.L. and Huston, C.J., 2009. Leadership Roles and Management Functions in Nursing:Theory and Application. London: Lippincott Williams and Wilkins. Molander, C. and Winterton, J., 1994. Managing Human Resources. London: Routledge. Mosley, D. and Pietri, P., 2008. Supervisory Management: The Art of Inspiring, Empowering and Developing People. Ohio: Thomson Higher Education. Naranlala School of Industrial Management and Computer Science, 2013. PESTEL Analysis and Study of Various Sectors of Thailand. Gujrat Technological University. Nejati, M., Shafaei, A. and Nejati, M., 2008. ssues in Global Business and Management Research: Proceedings of the 2008 International Online Conference on Business and Management (IOCBM 2008). NY, London: Universal Publishers. Porter, E.M., 1985. Competitive Advantage. London: The Free Press. Porter, M.E., 2008. On competition. Boston, MA: Harvard Business School. Pride, W., Hughes, R. and Kapoor, j., 2010. Business. Ohio: South-Western Cengage Learning. Rodger, A., 1985. The Seven Point Plan. NY: Nfer-Nelson Publishing Company Limited. Thailand Retail, Food and Hospitality Services, 2011. Thailand Retail Sector Overview. [Online] Available at: Read More