The Success of International Human Resources Management - Essay Example

Introduction Thesis statement The view taken in this essay is the key issues that an HRM department needs to address before expanding overseas are: staff employment, culture shock, and staff remuneration. Body 1(Staff employment) The success of international human resources management (IHRM) is critical for any international business (multinational enterprises), with Apple Incorporation included. There is a difference in Human Resources Management (HRM) in both domestic and International levels. The domestic HRM is referred to as the logical and strategic approach to the management of valuable organizational assets. IHRM broadly refers to the application and learning of all human resources management activities that impact on the practice and development of managing human resources in organizations on a worldwide environment scale (Brewstera & Bennett, 2010). Therefore, the main work of HRM includes the training and development, resource planning, performance management, industrial relations, staffing, and compensation and benefits. In this case, we study how Apple incorporation can solve its HRM issues which include Staff employment, culture shock, and staff remuneration issues. HRM is a critical factor for Apple Inc. both locally and internationally. This is because the company has both local presences in the United States (home-country) and also in other countries (host-countries). Hence, this report analyzes Apple Inc. human resources practices and policies on a global scale. Apple incorporation HRM strategies Apple Inc. is an American based multinational company and was founded in the year 1976 by Ronald Wayne, Steve Jobs, and Steve Wozniak. The company deals with the sales of computers, cell phones, and software. Apart from the United States, the company also has a presence in seventeen countries where it runs a total of 475 retail stores. The company has a successful trusted brand and customer loyalty. Unlike the vertical (flat versus tall) organizational hierarchy practiced by many organizations, Apple Inc. practices horizontal hierarchy and also practices a strong corporate culture. The company has a corporate culture that promotes innovation, creativity, moderate combativeness, and top-notch excellence (Panmore Institute, 2015) The corporation is also famous for attracting, employing and motivating talented employees and encouraging them to excel through its employment program. A practice that has seen a boost in their product sales for many years (Greenberg, 2015). Moreover, despite the company’s success stories, the company has also faced HRM challenges in its subsidiary companies in various countries in abroad such as Europe and Asian continents. The fist issue is the employment staff issue about organisations employ the home-country staff, the host-country staff or a third-country staff (Hartel & Fujimoto,2010). So Apple has employed both the home-country and host-country. Most of the employees on the higher level are come from the home country and the once of the lower level in the company come from the host country (Hartel & Fujimoto,2010). On the one hand, some organisations prefer to employ home-country staff. There are some reasons for this situation. The first reason is home-country employees are familiar with the information of the company, such as company’s culture, structures, and systems (Brewstera & Bennett, 2010). The second reason is specific technical requirements (Schuler & Jackson,2007). Home-country staffs are knowledgeable about the company's long-term technical training and management training so that they may be better than local people. The third reason is administration and financial control (Schuler & Jackson,2007).Due to their loyalty to the company probably higher than the host employee and can communicate well with the headquarter. Of course, hiring the staff, who are from the home country, to work aboard in a more-distant culture also have many disadvantages. Communication is the first weakness. It is really hard to trade where there is a communication barrier. It may result in their poor job performance, and they may feel homesick (Hartel & Fujimoto,2010). Secondly, an expatriate may need a long time to increase his or her global management capabilities and competencies (Schuler & Jackson,2007). Furthermore, expatriates may spend a long time on adapting culturally, because they often need to take to understand the local culture, laws, and commercial customs. When they are not familiar with the local environment, their business ability may be limited (Hartel & Fujimoto,2010). Finally, expatriates’ remuneration is very expensive. It may be both more complex and more costly than those for local employees (Taylor, et al. 2008). That is why many of Apple Company employees are employed from the host country. The employ many employees from host countries so that they avoid spending much money on salaries. This is because expatriates are expensive to employ. Companies need to not only invest a lot of money for training expatriates but also arranging their accommodation (Howe-Walsh & Schyns, 2010). In fact, Hartel and Fujimoto claim “it is widely believed that expatriates packages cost an organisation two to four times more than if it were to employ a local employee” (p.190). Most of these challenges can be minimized by Apple Incorporation in these foreign countries by first researching on their business infrastructure (Taylor, et al. 2008). This activity can be established if the companies objectives are met. Some of the objectives of a company expanding in other countries include: performing research and development (R&D) in the country of interest for the company, minimizing the costs base of consistent with customer value, preserving the flexibility to modify the geographical configuration of the company’s production network to achieve changing conditions, having the flexibility of modifying the geographical configuration of the company’s production network to meet the dynamic conditions, maximizing shareholder and value and profits, gaining access to the required technology, and retaining the flexibility to use the available labour force (Taylor, et al. 2008).. On the other hand, also, many international companies who like to employ employees from the host country and there are some causes. Firstly, host-country employees being able to provide a lot of valuable information about operating in the oversea (Hartel & Fujimoto,2010). For example, they can offer specific knowledge expertise about the local culture, the local market and social situations which are. Hartel and Fujimoto (2010) argue that “as home-country staff often find it difficult to get this information because local people will frequently only divulge it to other local” (p.187). Secondly, the cost of host-country employees may be cheaper than expatriates and third-country staffs (Taylor, et al. 2008). Finally, the host-country staff assists in building a friendly relationship between Multinational Corporation (MNC) and the local government. In contrast to these advantages, there are also some disadvantages. For instance, the host-country employee’s loyalty for the company may be not high, so they often job-hop. It may cause a serious loss of business for the company because it results in a high turnover for the MNCs. In conclusion, MNCs employ home-country staffs, host-country staffs or third-country staffs depending on the company’s situation. For Apple company, they employ both the host-country staffs at low-level employment and home country staffs at the senior managerial level of employment. The host-staffs are paid salaries according to the labour laws of the individual specific country of the country it is operating in. BODY 2(Culture Shock) The differences in national and MNC cultures found in different countries are always the most important and difficult challenges faced by Companies that are expanding in other different countries about HRM. These MNCs mostly encounter culture shock problems if they expand into another country which has very different cultures. This usually mainly happens when these big companies do not have the knowledge business culture of their host countries and hence make them make mistakes at their personal interactions with the host country and the country’s business policies. Hofstede (as cited in Shen & Edwards, 2006,p,132) states “culture shock in the sense of highly divergent values and norms which have a strong influence on the viability of using management systems in one country that were developed in another country.” Cultural differences are mainly reflected in the economic, labor laws, values, traditional culture, religious beliefs, language and government (Taylor, et al. 2008). These differences also result in some conflicts. One such conflict is that of managerial decisions making because cultural differences can affect the manager has different business ideas which will lead to different decisions (Miah & Bird, 2007). For example, some enterprises make decisions by collecting the group’s opinions. In contrast, other companies make a decision by the boss. Secondly, conflict of values. Different countries’ values can be very different in areas (Miah & Bird, 2007), such as the performance in the treatment of nature, the treatment of human nature and the consumption. Thirdly, labor conflict, because each country has different labor laws and labor structure. For instance, some countries emphasize the employee’s personal history and interpersonal relationships. However, there are some countries who emphasize staff’s personal abilities (Miah & Bird, 2007).There are many warning signs of culture shock. For example, feelings of being rejected by members of the new company branch and local community (Hartel & Fujimoto,2010). Clearly, the cultural shock will be a lot of negative impacts on expatriates. Most expatriate failures are caused by not being able to adjust to the new environment and the new culture, therefore Apple Incorporation need to have pre-departure training which can help its home country employees learn how to recognise and manage culture shock, including how to deal with feelings of loneliness and homesickness (Hartel & Fujimoto,2010). Things like laws, governance, and history, are different in all countries all over the world. Which is why, the more an MNC expands in other countries, the more it finds it difficult to conduct business (Taylor, et al. 2008). One of the advantages of expanding into other countries is that it brings about intercultural understanding among the company’s home and hosts country employees. It also allows the MNC companies to employ employees with very high skills and knowledge across the world. This allows the company to develop quality talents from its employees and have the ability to perform better (Taylor, et al. 2008). Apple Incorporation is an example of an MNC that has experienced problems regarding employee sourcing, planning, and recruitment because it is a very complicated and expensive exercise (Miah & Bird, 2007). For example, apart from normal home-country employment processes, the MNC employment for a company such as Apple incorporation in other foreign countries includes employing expatriates which are challenging because it involves relocating them from one country to another. Staffing practices and policies in various foreign countries have also become complicated during the expansion plans and processes. These problems also are also prevalent for MNCs seeking other business ventures in foreign countries such as joint ventures, and traditional subsidiaries (Hartel & Fujimoto,2010). Conclusions The employees who are working for companies that have expanded overseas such as Apple Inc. together with the help of their respective HRM departments should find a way of blending their own culture and the new culture of another country so that they can adapt and avoid issues such as culture shock. This will help them to modify the behaviour of their company management which will help the company in becoming more efficient in both social and business situations. For the MNCs such as Apple Inc. to succeed in keeping their employees happy and better their operations in other countries, they should focus more on the development their HRM effectiveness by developing their individual employees by providing them with employee training and development, employee health care and pension provision, good remuneration, and providing good working conditions. Apple Inc. Can achieve this HRM effectiveness for its employees by selecting the most talented employees to work them, motivating and rewarding them well, and training and developing them for future performance and appraisals so as to justify their rewards. This practice will be achieved by the company is they follow the four human resources cycle which includes; selection, performance appraisal, rewards management as well as the human resources development. This practice will allow employees to perform better and reduce employee turnover. References Hartel,C. E. J., & Fujimoto, Y.(2010). Human Resource Management (2nd ed). Frenchs Forest, Australia:Pearson. Schuler, R. S., & Jackson, S. E. (2007).Strategic Human Resource Management (2nd ed). Victoria, Australia: Blackwell Publishing. Shen, J., & Edwards, V. (2006).International Human Resource Management in Chinese Multinationals. Abingdon, Oxon: Routledge. Brewstera, C., and Bennett, C. V. (2010). Perceptions of business cultures in eastern Europe and their implications for international HRM. The International Journal of Human Resource Management, 21(14), pp. 2569-2588. Taylor, S., Levy, O., Boyacigiller, N. K., Beecher, S. (2008). Employee commitment in MNCs: Impacts of organization culture, HRM, and top management orientations. The International Journal of Human Resources Mangement, 19(4), pp. 501-527. Howe-Walsh, L. & Schyns, B. (2010). Self-initiated expatriation: implications for HRM, The International Journal of Human Resources Mangement, 21(2), pp. 260-273. Miah, M. K., & Bird, A. (2007). The impact of culture on HRM styles and firm performance: evidence from Japanese parents, Japanese subsidiaries/joint ventures, and South Asian local companies. The International Journal of Human Resources Mangement, 18(5), pp. 908-923. Greenberg, G. (2015). Apple’s Corporate Culture Motivates Employees, Boosts its Stock Price. In TheStreet. Retrieved from http://www.thestreet.com/story/13314263/1/apple-s-corporate-culture-motivates-employees-boosts-its-stock-price.html Panmor Institute, (2015). Apple Inc. Organizational Culture: Features & Implications. Retrieved from http://panmore.com/apple-inc-organizational-culture-features-implications Read More