Major HR Issues for International Managers - Essay Example

?Major HR issues and ‘international managers’ Introduction Globalisation and opening up markets by the countries has optimized the job opportunities for the employees. Many Multinational Companies (MNCs) are entering new countries and providing job opportunities to the local people, and on the other hand, employees from many countries are entering prospective countries to tap the enticing job opportunities in those countries. Thus, globalisation by making the various countries open up their markets has initiated a two way traffic providing opportunities as well as challenges. Globalisation is a process in which interaction, mixing and assimilation among people, organisations and governments of different countries takes place, mainly on the structure of industrial and financial business. Thus, “globalization is mainly process driven by international trade and investment for the benefit of the investor as well as the host country, with particularly emphasis on the employees as well as employees on both sides” (Rothenberg 2002, p.1). While employing local employees in the host country as well as employees from the foreign countries or expatriate employees, organizations have to implement certain International Human Resource Management (IHRM) aspects to manage those employees optimally and effectively. This is where the role of international managers assumes importance. That is, the international managers by using IHRM concepts have to play a prominent role in the management of human resources or employees particularly foreign or expatriate employees. Human Resource Management (HRM) is concerned with the way in which organizations manage their people (Redman and Wilkinson 2001). So, this paper will discuss how the employee centric HRM aspects like appraisal and assessment techniques, rewarding system and importantly training has to be managed effectively by the International managers to enhance the manageability of the local employees working in an MNC under foreign management as well as the expatriate employees working in an MNC under foreign management, in total employees who are working under foreign or international management. Role of International Human Resources Management (IHRM) Organizations particularly MNCs, will not remain “static”. They will or have to break ‘boundaries’ both from geographical perspective as well as economical perspective to utilize the opportunities in the new markets or countries and emerge successful. Thus, internationalisation is a happening concept which is being used by many firms to expand their reach globally. “As the global economy expands, as more products and services compete on a global basis and as more and more firms operate outside their countries of origin, the impact on various business functions becomes more pronounced” (Briscoe and Schuler 2004, p. 20). When the organizations enter new countries as part of their global expansion plans, they will recruit employees from the local population. They will do that as a feasible as well as a responsible thing. That is, feasible thing in the sense, as the MNC will be stationed in those host countries, recruiting from local places will be an easy process than bringing employees from their home country or other Third countries. (Scullion and Collings 2006). In addition, as they will be manufacturing and marketing product or service for the local population, local employees will be the best choice. Importantly, it is a responsible thing because through recruitment of local employees, MNCs will try to give a share of their benefits. Although it is an unwritten rule, organizations are duty bound to recruit the local employees. Apart from fulfilling their responsibility, this recruitment of local employees importantly will provide the MNCs with cheap and surplus labour. Thus, with the recruitment of local employees being a key component of MNC’s operations, the recruited employees have to be managed optimally by the International managers on the basis of effective HR policies or IHRM policies. After the firm enters a new global market, the role of IHRM comes into the picture for the management of the expatriate employees as well. “IHRM is about understanding, researching, applying and revising all human resource activities in their internal and external contexts as they impact the process of managing human resources in enterprises throughout the global environment” (Briscoe and Schuler 2004, p. 20). Expatriation will normally take many forms. The term expatriations can be used when working employees are sent by their organisation to new foreign countries, on a short term or a long term business mission. Also, the term expatriates are given to prospective employees who on their own personal choice enter new countries and thereby new organizations. Like organisations, sizeable percentage of humans will also not remain ‘static’ in one geographical location; rather they will or have to keep on moving to new places as part of job necessities and also for job opportunities. That is, as part of organisational commitment and to enhance their prospects of better life, they could or will keep on moving to uncharted territories to achieve advancement. When these expatriate employees from different countries with their distinct cultures, traditions, way of life, etc, enter some other country and thereby organisations, the organisations particularly International managers should incorporate apt IHRM principles to optimally handle them and make them highly productive. (Casico 2005). That is after recruiting them into the organization based on apt IHRM incorporated recruitment process, organizations should provide the employees apt working environment understanding their distinctness. IHRM and International managers are the key because as mentioned above, both the local employees as well as expatriate employees, will normally work under International managers. Although, local employees in MNCs could have local managers, sizable times, they will be managed by international mangers. Thus, as part of apt working environment, international managers should implement effective appraisal and assessment techniques, rewarding system and training process as part of IHRM policies to effectively manage both categories of employees. Appraisal and Assessment process from international perspective Employees are the crucial components who can determine the functioning, success and even the survival of the organization. So, these crucial employees have to be recruited correctly, then appraised validly and optimally, and finally trained aptly. This is also applicable to the employees, who work under international management, including local employees and expatriate employees. The performance appraisal or employee assessment method is a key process, without which the other aspects of recruiting, training and even rewarding cannot be carried out effectively, particularly the training process. (Bain 1997) As part of the performance appraisal and assessment techniques, the performance of an employee has to be evaluated by the management particularly HRM managers. Performance appraisal includes evaluating the employees’ productivity, quality of the work, the time factor in productivity, employees’ response to critical situations, personal choices, etc, etc. Based on these appraisal results only, HR managers will recommend or organisations will give the employees salary increases, promotions, incentives, etc - in case of positive results. An in case of negative results, HR managers will recommend training, mentoring, etc, etc, and in extreme negative results salary cuts, and even termination of their jobs. “Appraisals are used for determining pay increases, who gets let go, who gets promoted. Often they are used to focus on what people have done wrong.” (Bacal 2004). Thus, the role of HR managers as an appraiser in association with the employees supervisors will be two dimensional. They have to judge whether the local and expatriate employees are functioning in line with the organisational goals, leading to rewards, promotions, etc, but also to find out whether the employees are underperforming, deviating from the organisational goals, committing detrimental acts, thereby leading to disciplining and other tough measures. (Jackson and Schuler 2005). Many neo-human relations writers such as Douglas McGregor focussed on this conflicting role of the appraiser as a helpful counsellor and reward-giver on one hand and as a disciplinarian on other hand. According to McGregor, this conflicting role makes the leader and manager particularly HR manager including International manager to be always judgemental about their employees’ works, instead of being a supporter and motivator for them. “The modern emphasis upon the manager as a leader who strives to help his subordinates achieve both their own and the company's objectives is hardly consistent with the judicial role demanded by most appraisal plans.” (McGregor 1957, p. 90). This is particularly relevant for the local employees as well as the expatriate workers because there will always be stereotypical scepticism about whether a local or a expatriate worker can successfully function and perform in a new cultural and work environment. If the leaders and the managers, who should support them and give them confidence to perform in the new environment, instead becomes judgemental as part of the job appraisal process, it will be difficult for the expatriate employees to perform. Although, many employees could take it has a challenge and prove their worth to the appraisers as well as their worth in the organization, it could lead to negative results in other cases. The role of discipline in the job appraisal process can sometimes provide positive results. That is, the disciplinary approach of the appraiser can bring the best out of the employees instead of making him/her less confident. As Coates (1999) points out how appraisal at a Midlands trust hospital, CareCo made women calculable, describable and comparable because of the “disciplining practices of paid external image consultants, castigation and expectation, thus opening them to an evaluating eye and to its disciplinary power.” Thus, with appraisal and the power incorporated disciplinary approach resulting in benefits, it is clear that power is not “simply repressive and negative, but is positive and productive through the constitution of the self in discourse.” (Findlay and Newton 1998, p. 216). Appraisal process’ connection with the organisational goals The other advantage or purpose of job appraisal is that it makes the employees focus and align their performance on the organisational goals. This purpose is viewed by experts as ‘subordination’ of the employee to the organisational goals. Townley (1993) called this behaviour as the acquisition of ‘implicit expectation’ in the performance of employees, with the “employees becoming drawn into ‘the subjective realm’ of their managers’ aspirations for output and performance.” This perspective is a key one because during the job appraisal in the initial stages, the local and expatriate employees may not have or reveal about his/her personal goals, so the local international HR managers can utilize the appraisal to make them align with the organisational or the subsidiary unit’s goals. Thus, the role of international managers has to be charted a middle path, without being too judgemental and also without being too lenient. They need to point out the mistakes and at the same time, they need to recommend rewards and other incentives, when the employees perform Development of International managers as global leaders The role of international managers has become very crucial for the companies to develop globally. Not only it enables the companies to accomplish their worldwide tasks and targets, but also enables it to develop global leaders. “An increase in international assignments has become an important way to develop future global leaders who can navigate their firms effectively through the complex waters of international competition.” (Gregersen, Hite and Black 1996). In that direction, the international managers also have to develop future leaders from the group of local employees as well as expatriate employees. (Harzing and Ruysseveldt 2004). As a first step for that future expected scenario, the performance appraisal and assessment of both the set of employees have to be carried out with perfection by the international managers, so they can be managed optimally to contribute to the organizational growth. International Managers’ role in Questionnaire formulation The initial exercise of that performance appraisal is the formulation of correct and relevant performance appraisal forms or questionnaire, which need to be given to the local or expatriate employees. Relevance is the key word because the expatriate employees and the local employees should not be given the common domestic forms and instead specific and exclusive forms. “In the expatriate setting, however, the performance context does change, and sometimes it changes dramatically. Given a global context, previous testing and established baselines grounded in domestic situations can become meaningless.” (Gregersen, Hite and Black 1996). Specific and exclusive forms in the sense, all the local factors from culture, fellow employees’ attitude, nature of competition, government’s influence, their mental and physical evolution in the new environment etc, etc should be incorporated in the performance appraisal forms. This way, the local and also expatriate employees will be able to provide accurate details regarding their experiences, exposures, difficulties, etc., all from the local perspective. Apart from work environment centric information, they will be able to provide details about their personal challenges as well as motivations like how their physical body and thereby their mental part is responding in the new environment, their equations with the local people, their social environment, etc. “The employer has a duty to maintain a healthy and safe workplace. The health and safety function is directly related to the elements of the HRM cycle- selection, appraisal, rewards and training” (Bratton, and Gold 2007). All these details as part of the appraisal will give the International manager as well as the organisation a clear and detailed picture about the expatriate employees’ work environment including the challenges they face as well as well as the factors that are motivating them. With that clear picture, the international manager in association with the organisation’s management can modify the work environment from the organisation’s culture perspective, by providing them with apt rewards, non financial recognition, implementing their suggestions, etc. International Managers’ role in the interpretation of the collected data To correctly interpret and respond to all these responses of the local or expatriate employees, managers have to function optimally. As a first step, managers with correct and relevant credentials should be selected. For example, HR managers, who have not worked abroad, should not be allowed to evaluate an expatriate's performance, because it would not give apt results. That is, they would be unfamiliar with the typical problems of the local and expatriate employees, which will affect their job performance. (Oddou). This being the case, many companies use multiple persons from both the main office as well as the local office including international HR managers, supervisors, etc., to play the role of an appraiser. For example, as stated by Dowling, Festing and Engle (2008, p. 284) immediate superior (in either the home or host country), the expatriate as self-rater, and the HR manager (either home or host-country based) were commonly used as multiple evaluators of US expatriate performance. Although, using multiple evaluators is a good option, more weight should probably be given to international HR managers because of their multinational experience. Correct appraisement by International managers could heighten the Motivation of both the employees and can also initiate training regimes With correct job appraisal, the motivation of the expatriate employees can be accentuated optimally, thereby improving their productivity as well as organizational growth. Adonis (2008) writes that performance appraisal has to be carried out because it motivates employees, it creates consistency, it is a legal protection and finally it is a prompt for managers to review and recognise good performance. Although, managers some times think performance appraisal as a time and money consuming process and employees for their part could become defensive and avoid giving correct feedbacks during the appraisal, it has good merits resulting in better manageability of the expatriate employees. Among those merits, how the announcement of an appraisal process itself can motivate the employees and also make them give consistent performance is a crucial one. Having an optimal rewards system can heighten the motivation of the employees, pushing them to exhibit more productivity, and with the performance appraisal being used as the main criteria for such rewards system, it validates the perspective that apt appraisal done by the managers particularly international managers can enhance the manageability of the local and expatriate employees. Apart from motivating the local and expatriate employees in the current situations, job appraisal will provide opportunities for the employees to equip themselves for future tasks and challenges. As Bacal (2004) puts forward the “most important purpose or goal of the appraisal is to improve performance of the employees in the future, when they underperformed in the current scenario.” After the performance appraisal process in a foreign managed work environment, the managers instead of critically and negatively viewing the employees’ underperformance, has to guide as well as work with those employees to find out the factors that is causing underperformance. Then as an extension of that appraisal process and acting as a counsellor, the managers come up with the avenues that can remove those impeding factors. In essence, “people management theory argues that if manager implements a specified set of employment as well as work practices, it is going to lead to better performance” (Boxall and Purcell 2008). This process of finding out the impeding factors and managing it will mostly lead to the training regimes. That is, the next logical step of performance appraisal can be the training process or practices initiated and overseen by the international HR manager, which can be given to the local and expatriate employees to correct the problems in their functioning. Impact Factory discusses this aspect of training by listing out the different training programs – face to face training, on-line training, in-house training courses, 'out' house training, etc. Also, as part of training, coaching and mentoring, whether on an executive level or for overall staff, can be used for employee development, thus leading to higher productivity on the part of the employees and importantly actualization of the organisational goals. Conclusion From the above analysis of international manager’s role in the management of local and expatriate employees, it is clear that apt performance appraisal will surely lead to enhanced management of the expatriate employees, improving the organisational performance as well. Employees’ career and even to some extent their survival in the job market particularly as a local and expatriate employee depends on the results of the performance appraisals. Because of this crucial nature of job appraisal, International managers following all the key tenets of IHRM has to carry out this appraisal or assessment aptly, logically, taking into all factors, without any favouritism, undue influences, without missing any key criteria, etc. Local and expatriate employees’ performance and productivity can be optimized if the appraisal is done effectively by the managers. This is because, it can bring out a clear picture about employees’ performance and needs, thus giving the organisation and leaders including HR Managers good ideas on how to effectively manage the employees for the organization’s growth. References Adonis, J. 2006, MANAGERS dread them. 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