Human Resource Policies and Procedures in Multinational Firms - Coursework Example

Name: Professor: Institution: Course: Date: The role played by the Human Resource Managers has changed gradually as a result of the rise in competition and Corporate Company’s have established that Human Resource Management plays a key role in the Organization success. The role played by the HR function is strategic and Organizations that fail to maintain and retain their employees by enhancing their talent find that their employees move to the competing Companies which is detrimental to the overall human resource strategic employment. Both locally and globally competition has been on the rise and employees have a duty to become adaptable to the changing environment which is achieved by Organizations being customer focused, agile and resilient. Thus the HR function has emerged as a strategic key player in mentoring and changing the outlook of employees in the Organization. The only way to achieve and succeed in today’s environment is encouraging the environment to be business driven and setting key human resource policies and decisions. In a nutshell the Organizations are more focused in retaining their employees and developing their talents. A policy is described as a course of action which provides guidelines set in accordance to the objectives and business strategies. Thus it directly relates to the day to day activities of the Company and the vision set for the organization. With this in mind policies and procedures are visional as having a link which is strategic for the organizations daily operations and vision. This is very vital for the organizations success because well written policies and procedures ensure that the employees understand their responsibilities and roles more directly. As a result the management is relived the role of supervision and constant management. Policies provide a guideline to decision makers on decision making process and the general strategy on how to handle the day to day operations of the Company. The decision makers are set a limit within which they are bound to overcome problems but with the availability of alternatives to choose guidelines. The human resource procedures eliminate job misunderstandings and conflicts arising from job responsibilities and set boundaries employees. Thus the main goal is set in the provision of easily understood and clear action plans for policy implementation. Also clear procedures help Organizations to avoid mistakes which are costly to the organization. Hence procedures prevent employees from veering off, from the boundaries set within the organizations mandate. Organizations cannot operate on Human Resource Policies that are the same across borders because people are different in terms of country origin, culture, behavior versus personality, ethnic and religious background. ( Tom, 2005) Policies and procedures are different in that policies describe the person, whom it covers, they are general in nature, state when the rule applies how to enforce the rule, give an explanation on their existence, describe company rules in simple paragraphs and sentences and they also highlight the consequences. On the other hand procedures state exiting alternatives with cautions and warnings, state specific actions and when to take them, emergency procedures, identifies examples and in general how to complete forms. Consistency is a requirement in any organization and therefore policies and procedures are essential to achieve this objective. Accountability plays a strategic role in the running of organizations and policies and procedures help in maintaining the accountability issues such as guidelines on health and safety, regulatory requirements and discipline procedures. Every organization will at one time or the other review their policies and procedures as result of critical signs that reflect increase in costs, failure rates as well as the rise in number of accidents. Clues that the management should follow in determining the level of policies review may be identified in areas such as situations where the staff ask more questions during the normal operating hours or where the employees are inconsistence in their job performance as a result of increased stress. Customers may also report more cases on complaining about the services or goods offered. Employees in any organization represent different backgrounds and as a result of competition it has become a major rend for employees to move from border to border in search of better employment conditions and standards thereby maintain workplace diversity. This has attributed to the existence of cultural diversity in multinational companies inclusive of other aspects such as gender, ethnicity, age, educational background, religious beliefs and work experience. With the existence of different classes of people it has become quite difficult to manage employees in multinational firms with the aim of nurturing the diverse talents and improve their innovation ideas and processes. However, with clear guidelines and policies an organization can capitalize on this major challenge to reverse the problem and set it forth as an opportunity to identifying business opportunities using the diverse talents of employees whose cultural background, age, lifestyle and gender are different. ( Tom, 2005) In contrast where the Organization is not in support of diversity then the ultimate loser is the Company as employees divert to the competitor. Multinational Companies employ staff on a global scale and hence the environment within such an Organization consists of people who think globally but act local. Human Resource Managers in such Organizations have no other option but to ensure that their policies and procedures conform to the different cultural backgrounds and are relevant to the operations of the Company. (Dowling, 2003). Review of the policies and procedures is thus the order of the day and it’s carried out frequently to eliminate any conflicts in the boundaries set for job holders in terms of their code of conduct and roles and responsibilities. Thus training for the HR professionals is essential to the management of the company HR function. The balancing Act of the Human Resource Manager is important in ensuring effectiveness of managing a diverse workplace. Cox (1993) suggested that the most effective way of managing Organizations today is changing the perspective view of ethnocentric to a cultural view perspective through the HR scope of organizing, planning, controlling and leading organizational resources. The Asian countries have adopted the system of managing cultural diversity by making changes in breaking lifelong employment systems in Japan, replacing senior based HR systems to performance based Hr systems in Korea, increased flexibility of labour in Singapore and diffusion of American model of HR systems in Taiwan. (Wright, 2003) Policies and procedures are important to the employees because they provide room for decision making and set boundaries that define their role and code of conduct from a human perspective. Secondly employees are able to comprehend the constraints related to job performance without having to apply “trial and error” concept. Third the employees have a clear outline and understanding on team responsibilities and lastly the management have better control of the staff rather than ‘micro management’. The Company also benefits from the set policies and procedures because it sets the managers free to concentrate on strategic issues because supervision is minimal. The minimal supervision comes as a result of employees performing their jobs with dignity and respect due to the clear set policies and guidelines. It is quite difficult to establish and use a policy that is standard in all countries because of managing workplace diversity which results from composition of diverse employees in multinational Companies. HR managers act as mentors, counselors, succession planners and coaches in order to just motivate the employees and help them retain their loyalty to the Organization. They also help in fighting for beliefs, ethics, spirituality and values especially in multinational level Companies. The policies are set in such a way that they match or fit the different values, ethics and spirituality of the diverse workforce. For instance the training that an employee from Japan who has secured a job in Australia is quite different from the training that an Australian national is expected to go through. An employee from Japan working in Australia will require first to learn the language spoken in Australia, observe the culture practiced by the people, the food they eat, learn their management process, ethics, values and other beliefs within the Country. The same process repeats itself for an Australian who goes to work in Japan because they have to learn the Japanese language, adapt to their culture, eat the food available within the country and learn their management systems which entails recognition as an individual rises from the bottom to the top of the hierarchy. (Tayeb, 2005) Almost all Companies in the global arena allow their employees to be registered with unions and it is a law present which establishes that employees rights in terms of their working conditions and compensation is fair and standard. The recruitment and selection process is stated in the Human Resource Policies and if it was to be standard globally then it would be impossible for Multinational Companies to recruit employees who have the required skills and capabilities required for the Company to achieve their goals and objectives. The career development ladder differs from one Organization to the other in the global context because the Organisation structure is quite different even in terms of span of control. (Scullion, 2005) Multinational level Company’s Human Resource Policies put in place systems that motivate the employees to increase and improve their job performance to climb the corporate ladder. Promotion based on performance differs from one Company to the other and thus having a standard policy would not be possible to be maintained across the border because some firms apply other methods of promotion based on their policy. Performance appraisal which has been used as the benchmark for performance in majority Organizations also differs from one firm to another because the appraisals are based according to the Organizations objectives, goals, vision and mission. Pay and benefits package which is included in the Human Resource Policy is also another factor which is put into consideration in the argument of setting standard policies because employees in multinational level Companies pay packages differ quite a lot because of experience and professionalism. There are those employees who are targeted to work in a firm to initiate and implement Organization restructuring, to deal with research and innovation, others are hired to only work for a certain duration to turn around the performance and annual turnover of a Company and in consideration of all these factors their pay packages may range from exorbitant high amounts to exaggerated levels and Organizations find it hard to maintain and retain them since they are expensive. Globalization has resulted to policy regulation and setting strategy standards in the labor market as a formal or informal benchmark. Controversies arise in management styles in multinational Companies where employees come from different nations because culture is based on the geographical, historical and philosophical factors. It is essential for firms to acknowledge the existence of the different cultures in order to understand the behaviors and motives of each individual. (Debrah et. al, 2001) The HR function is the only one affected more by the cultural diversity aspect compared to the technical and financial matters existing within an Organization. The strategic role played by the HR function relates to developing global mindset executives who relate with international partners within global relations hence it is not practical to set policies that apply to all firms in the multinational level. Foreign companies like Japan are challenging major American companies by their production of low priced products which are affordable by the majority of low income earners and this entire decision making tactics trickle down to the management priorities set in Japan where they discourage collective bargaining and joining of trade unions. (Edward et. al, 2005) Thus organizations today major on uniform tailored policies and procedures which are acceptable by all the employees. Employees are allowed to participate in the formation or review of Organizations policies so that they feel part and parcel of the strategic objectives of the Company. International success of Multinational firms depend on the management of the firms employees and as result the percentage of expatriates working in such firms are the overall determinant of the level of innovation to be expected from the different employees. (Harris et.al,2009) In Multinational Level Organizations some employees have less tolerance to making decisions on their own and therefore the presence of policies and guidelines direct them to at least share their responsibilities with others. Consequently we find firms where managers make all decisions by themselves without consultation depending on their attitudes of authority and power sharing. This as a result is detrimental to the overall success of an Organization and in essence policies act as problem solvers and as a result decentralization of the firm structure helps to open a venue for problem solving. In some cultures the level of trust to other people is low while in other cultures its high which may be brought about by the existence of a country’s bureaucracies and corruption either in the public or private sector. People who have set high standards of moral management work ethics, values and possess the right skills and capabilities are more trusted in making decisions. This can only be observed in Organizations which have set their own Human Resource policies and they own them fully. (Ferner, 2004) Global resources in general determine the viability of Human Resource Policies internationally and in order to reach out to the global arena through impacting the employees to improve their performance, career development and expatriate skills are considered as a requirement. The top management positions are normally the focus because the leaders are expected to drive the globalization strategy by recruitment of international managers and expatriates through global sourcing. The employees should therefore have the ability to deal with international customers and handle international projects. With such global developments in mind the focus shifts to HR professional that have to consider developing policies which are optimum and standards so as to customize and maintain reliable professionals. The presence of International operations results in the increase of Human Resource Policy drivers in such issues as managing human resources and sourcing employees by considering the socio-cultural settings and environmental influence. Majority of multinational firms have developed effective policies which help select and manage Human Resource function. This is because multinationals value their workforce as the most important assets of the firm. ( Tayeb, 2008) In conclusion Human Resource Policies are derived and established to ensure that the overall performance of Corporate or blue print firms is above the competitors and act as drivers towards the achievement of Organisation objectives and goals. Without the existence of Human capital an Organisation is set for failure and the only reasonable way and measure to ensure that the day to day operations of a firm run effectively is by designing policies that are acceptable by the employees or staff. The participation of employees in strategy formulation of Human Resource Policy should be considered whenever there exists review of the Policies so that all the different cultural backgrounds are represented in one way or other for the general success and performance of the firm. In order to support the international business operations it is important to balance the HR policies by standardisation through customizing the HR function because of existence of different employees who are located across the world. The drivers of international Human Resource Management policies are the level of global capabilities and realignment of functions. References Brewster, Cox. (2003). ‘Developing a “European” model of human resource management’, International Journal of Human Resource Management, vol. 4, pp. 765–84. Budhwar, P. S. and Debrah, Y. (2001). ‘Rethinking comparative and cross-national human resource management’, International Journal of Human Resource Management, vol. 12, no. 3, pp. 497–515. Dowling, P. J. and De Cieri, H. (2003). ‘An integrative framework of strategic international human resource management’, Journal of Management, vol. 9, pp. 419–59. Edward Elgar. Negandhi, A. R., Eshgi, G. S., and Yuen, E. C. (2005). ‘The management practices of Japanese subsidiaries overseas’, California Management Review, vol. 27, pp. 93–105. Cambridge: Cambridge University Ferner, A. (1994). ‘Multinational companies and human resource management: an overview of research issues’, Human Resource Management Journal, vol. 4, no. 3, pp. 79–102. Harris, H. and Brewster, C. (ed.), (1999). International HRM: Contemporary Issues in Europe. London: Monir H. Tayeb (2005); International Human Resource Management- A Multinational Company Perspective. Great Clarendon Street, Oxford OX2 6DP Oxford University Press. UK Scullion H. (2005). ‘International human resource management’, in J. Storey (ed.), Human Resource Management. London: International Thompson Business Press Tayeb, M. H. (2008). ‘Transfer of HRM policies and practices across cultures: an American company in Scotland’, International Journal of Human Resource Management, vol. 9, no. 2, pp. 332–58. Tom Batridge,( 2005); Why are policies & procedures so important? AME Info FZ LLC / Emap Limited. Available at< http://www.ameinfo.com/55422-more2.html> [ Accessed on 22nd September 2011] Wright, P. and Brewster, C. (2003). ‘Editorial: learning from diversity: HRM is not Lycra’, International Journal of Human Resource Management, vol. 14, no. 8, pp. 1299–307 Read More