Role of MNCs in Employment Relations - Coursework Example

THE ROLE OF MNCs IN EMPLOYEE RELATIONS Introduction MNCs are the fore runners of the industrial revolution. In fact, MNCs are the real system shapers of every industry. Hence the policies and execution have its own importance in the industrial revolution to a great extent. The internal and external policies of MNCs do affect the market to a great extent. To a company is concerned, Employee Relations considered being so important. Employee relations are the set of management and staff working policies and practices in the working environment. The liaison with employee representative bodies, its monitoring procedures, and developing proposals for consideration are significantly turn as ER of the Human Resources Department .The association between ER and with representative body, developing proposal for consideration and monitoring procedures is solely responsible for the effective employee relations in general.. Background Before discussing the role of MNCs in the Employment Relations, let’s have a look on the function of a MNC. A multinational corporation (MNC) is an organisation that manages to provide services in more than a country. These MNCs have solid and well prepared financial budget proposals every year. This could be something bigger than that of some countries. As far as international relations and local economies are concerned, MNCs have a very strong influence is there in all level. MNCs have the mighty role of influence in employee relations. (Business management: a practical and interactive approach. 2nd edition. Sandton : Heinemann) When considering the case of globalization, MNCs have rather good role in it in almost all cases. We can see countries compete with one another in the following cases: 1. Facilities, 2. Tax revenue, 3. Employment, 4. Economic activity, Such as tax breaks, pledges of governmental assistance or improved infrastructure, or tax environmental and labour standards etc. are being offered to MNCs as incentives. As far as the establishment of MNC facilities are concerned, all these processes are very much significant. (Employment Relations& MNCs, Fourth Edition Author Bamber,G., R.Lansbury and N.Wailes (eds) Publisher: Sage, London. 2004) Besides all these efforts, multinational corporations are to affect governments, since there is a lot of government action directly affects corporate behaviour. In a peculiar organisation, the local business laws’ and regulations’ changes can be limited to a MNCs power. In fact MNCs are larger firms with solid style of work with stringent policies to execute with. Let’s have a look at Employee Relations It is observed that the ever-changing nature of employee relations work in MNCs through interviews with HR and Employee Relations managers to provide a glance of current attitudes and practice. What does an employee relation mean? The findings of the research are the following: Employee Relations (ER) can be seen as a set of soft skills of philosophy. The significance of employee relations continues to shift from various organisations, such as collective bargaining and trade unions to the relationship with individual employees. Their employee relations policies and aspirations the ideas of employee voice and the psychological contract have been accepted by employers and reflected in Communication is the policy making tool without which ER is ineffective. Simple instruction is well established in the involvement. The important term communication is necessarily a two-way process; ER offers managers a framework for monitoring a range of powerful indicators. They are employee attitudes and behaviours, of the state of the employment relationship. But above all, it represents a notion that employees should understand, identify with and commit themselves to the objectives of the organisation they work for. THE ROLE OF MNCs IN EMPLOYEE RELATIONS As far as ER is concerned, there is a big role in it. In fact, the MNCs pave a lot of opportunities through their internal and external policies. That will be discussed with respect to the following aspect. The major thing is to analyse differences between ER and other MNCs based on their policies. An international part of the of the particular Employee Relations management co-ordination processes for MNCs can be constituted through fax, international travel and global group meetings. The system of export is unsuited for the demand of international Employee Relations management which can be lead to may more problems in a wide level. POLICIES OF MNCs The external business policies and internal policies are the vital boost up factors in MNCs as in any other organisation. While considering all these, one can see the following points come under the categories. 1. Solid ER, 2. Terms regarding work nature, 3. Wages, 4. Duty, 5. Conduct, 6. Dos and don’ts 7. Competition with counterparts, 8. In terms of their competitive strategy, 9. Marketing strategy, 10. Customer satisfaction 11. Product diversification, 12. Channelisation, 13. Decentralisation, 14. Unity 15. Co-ordination and Control 16. Customer care All these vital points formulate a policy to perform well. Most significantly, all these policies are taken by the top level expert committee. So they have a strong impact in the field of operation and ER. STRATEGY, STRUCTURE AND SYSTEMS OF MNCs Strategies of one’s own will not make any firm fast growth oriented. Organisation structure and systems also play significant roles in turning a strategy successful. For instance, in a rigid, bureaucratic organisation where everything is done based on written orders, strategies sensitive to time will not work. Control systems should also be tuned to implement the strategy. For instance, the success and growth of an organisation operating in a highly competitive environment depends on the quality of items, lead time and attitude and behaviour towards customers, often more than on price. In such places, ordering and delivering systems have to be closely monitored to ensure competitiveness and resultant growth opportunities. For example, it may not be possible for it to charge a price that is higher than what the competition is charging, especially during the first one or two years. A detailed analysis of the competitive situation will also help in identifying the gaps and opportunities that may be available for exploitation. One of the most disturbing thoughts that come to an entrepreneur's mind during the conception and implementation stages of setting up a small enterprise is how he would reach the numerous prospective customers. They may be scattered in a wide geographical area. Many products are such that they require the help of marketing intermediaries — wholesalers, distributors, retailers etc, — to reach the ultimate consumers. Through their contacts, experience, and specialisation, these intermediaries make the product available and accessible to the target markets. Since intermediaries are independent organisations, they have their own ways of doing business. Their expectations and requirements regarding price, discount, credit, promotional support, and mode of delivery of the product may vary quite considerably. However, these usually conform to the trade practices that are prevalent in the market. Understanding the prevailing trade practices, therefore, forms an essential part of market assessment exercise. These four things - namely, analysis of the market demand, the competitive situation, and the trade practices, and the employee relations — are important for sound market assessment. In fact, Employee relations are more important since it affects the in house and market alike. MNCs are significantly focusing in all these vital areas in order to have a better performance in the market and to control and co-ordinate in the MNCs itself. BUSINESS SYSTEMS IN THE NATIONAL LEVEL AND ITS INFLUENCE All MNCs continue to be rooted in their countries of origin and their function for the operating counties goes smoothly as far as their performance is concerned. Cross-national variations in all cases are diminishing, in the face of the economic and technological aspects of centralisation, including the activities of MNCs themselves. However, their specific features can be retained by national models. The sustenance of systematic national differences has been demonstrated by international surveys of corporate practice.( ANSOFF HI. 1984. Implementing strategic management. New Jersey: Prentice.) The distinctiveness of national business systems has been strengthened by the important analytical literature and the theoretical and empirical ideological aspect in recent years. Different vital aspects of business systems linked each other in a complex whole, can be lead to the business behavioural aspects in different nations (Business management: a practical and interactive approach. 2nd edition. Sandton : Heinemann) To what extent, behaviour of MNCs from different countries can be influenced by the national difference? This is the key analytical question. When to the behaviour of MNCs are specified, the linkage from the common level of the business system must be specified. When the MNCs of their home country business culture is concerned, generally, there can be seen a number of constraints on the assimilation. Being the constraints of host country regulation as the first point, there are certain areas of HR and IR, Local isomorphism is more likely to be considered. . There are some elements of national business systems which make little sense in isolation from the constellation of features in which they are integrated in the home nation in an ideological way. EXTERNAL AND INTERNAL POLICIES All the Multinational giants have strategic choice, when we consider the internal and external policies as given earlier; there are two primary strategies available to them at hand. By adopting local patterns which may differ considerably from those of the country of origin is the first one can be adapted to the host country’s environment. The first reason is the organisation adopts a particular international labour division which makes the transfer of home country practices is redundant to a certain level. The second reason is to try out a cross-national isomorphism. This is introducing host country operations from country-of-origin patterns. It may imply the work organisation in most of the cases where establishment of enclave systems of training are located in the host environment. In fact in some cases it is dissimilar in nature and function. With the mixing of motivational characteristics and recruitment of workforces will cause appropriate imported form of organisational practices. There can be the possibilities of rather more effective variants. Internal isomorphism can be developed by MNCs that not affected to home or host country practices is considered to be the first one. The shifting patterns of MNC behaviour is caused by the interaction of home and host country variables. This causes to show some consistency as between MNCs of the same national origin and other nationalities. But it can be varied vary according to how a given home country model conveyed with different host country environments. Here it is rightly pointed out as the second one. However MNCs of different pattern in European countries, cause patchy. In most of the cases it is evidently non-existent. BEHAVIOUR OF MNCs All these are economic factors directly s influenced by the national institutional framework being operated in different countries. All are in a concern how the control and co-ordination of economic activities in vivid national systems are becoming crucial in getting access to system of property rights. This would give the MNCs a sense of advantage in the economic aspect is concerned. Managerial careers and management developments as solid internal policies The recent studies emphasises that the national differences managerial careers and management development are being organised. So it is inevitable to identify clear national models of management development for better performance. It is regarded as the most important determinant of future careers is the selection of potential managers at the point of selection itself.. It get powerful sponsors and flaunt the highly visible achievements are seen as the reward for political skills when the potential managers are into the organisation. In order to develop a cross-national corporate culture and integrating international operations in a unique way, in MNCs, management development can be expected to play a pivotal part. It is from the recent developments, one may hypothesise that MNCs develop strategies for reducing the constraints of their national systems.. (Mead, R (1998) International Management, London, Blackwell) There are systematic structural approaches there in now days. In respect of managerial careers, co-ordinating and Structuring work co-ordinating and structuring work is concerned, the question for research, therefore, is to examine how national systems influence the policies and practices of MNCs particularly at the international level. (CUSUMANO MA & MARKIDES CC 2001 Strategic thinking for the next economy San Francisco: Jossey-Bass.) Here we can see it as an effective tool of internal policy. As far as the latest studies are concerned, the comparative research pays much more attention in the organisation of work within firms in different countries. There are a lot of horizontal differentiation of tasks and functions in majority of the UK firms. By other national systems, characteristic patterns of work design are effectively evolved in all sense. A homely environment is given great importance to flexible work organisation in UK MNCs. Hence all these reasons, it is suggested that MNCs should continue the enclave techniques by work organisation exporting patterns and its cluster policy base. It is also suggested that from careful recruitment and selection of mighty skilled workforces it is to continue vocational training, functional flexibility, team working and the systematic integration of quality into work operations. These are all significantly seemed to be very much mandatory. (MOAGI G. 2002. A growing problem Progressive Retailing, 24, July) CONCLUSION The internal and external policies of a MNC is vital to the firm is concerned in every aspect. But to the point ER are concerned, the both the policies will affect the market opportunities fruitfully. If we take the internal and external policies as a framework of action, it will do boost up the performance level to a great extent, not only in the ER aspect but in the whole performance level in general. Reference 1. Employment Relations& MNCs Fourth Edition Author: Bamber,G.,R.Lansbury and N.Wailes (eds) Publisher: Sage, London. 2004 2. Mead, R (1998) International Management, London, Blackwell. 3. ANSOFF HI. 1984. Implementing strategic management. New Jersey: Prentice. 4. CUSUMANO MA & MARKIDES CC. 2001. Strategic thinking for the next economy. San Francisco: Jossey-Bass. 5. Business management: a practical and interactive approach. 2nd edition. Sandton: Heinemann 6. MILLER A & DESS GG. 1993. Strategic management. 2nd edition. New York: McGraw-Hill 7. MOAGI G. 2002. A growing problem. Progressive Retailing, 24, July. 8. NIEMAN G & BENNETT A (Eds). 2002. Business Management – a value chain approach. Pretoria: Van Schaik 9. O’BRIEN JA. 1996. 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