Human Resources Management in the Global Environment 1
Human Resources Management in the Global Environment
Today’s job market is rapidly becoming globalized and more companies are entering into international markets in a variety of ways. Some companies are building plants in other countries, some companies are exporting products overseas, and some are entering into alliances with foreign companies. No matter how the involvements begin, the reality is that in today’s world, managing global human resources is something that is growing.
Global competition is driving changes in organizations throughout the world. Companies are attempting to gain a competitive advantage and a way to accomplish this is to expand internationally.
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Three different approaches are (1) Ethnocentric, (2) Polycentric and (3) Geocentric. In the ethnocentric approach, the staffing and managing approach used is one consistent throughout the world. Companies which use this approach assume their home country approach is the best and that any employee around the world should follow it. The polycentric approach is applied when a company assumes each country is different than each other and employees in each country develop appropriate practices according to their surroundings. The last approach the geocentric approach tries to combine the best from headquarters and the subsidiaries to develop consistent worldwide practices. This practice shifts the power back to headquarters for hiring managers. (http://www.buzzle.com/articles/managing-global-human-resources.html) Some advantages of using local employees, but are not limited to are lower labor costs and familiarity with the political and legal environment and with business practices in the host country. Some disadvantages are aligned with the difficulty in recruiting qualified staff and communication difficulties in dealing with the parent company personnel. There are advantages to using transferred employees, as well. Some of the advantages are that the employee is familiar with the parent company’s policies and procedures and it permits closer control and coordination of international subsidiaries. A few disadvantages would be the difficulty in