Name: Argie G.

Catambacan Class Code: HRM 2232 (3-106) TTH

Learning Activity 5: Global Environment and HRM: Prospects and Challenges

1. Global Environment and HRM

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.
Further, 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. When a company decides
to enter a foreign market, whether to develop plants or other facilities in other
countries, it is no simple task and many human resource issues surface.
Doing business globally requires that adaptations be made to reflect
cultural and other factors that differ from each country. Human resource
regulations and laws vary among countries in character and detail. Equal
employment legislation exists to varying degrees. In some countries, laws
address issues such as employment discrimination and sexual harassment
(Human Resource Management in the Global Environment, 2021).
Additionally, according to the article, there are various approaches which
can be utilized when recruiting and managing employees from different
countries. These are;
A. Ethnocentric
- 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.
B. Polycentric
- 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.
C. Geocentric
- 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.
2. What is globalization?
- According to Alex Gray (2017), globalization is the process by which people
and goods move easily across borders. Principally, it's an economic concept
– the integration of markets, trade and investments with few barriers to slow
the flow of products and services between nations. There is also a cultural
element, as ideas and traditions are traded and assimilated. And one of the
effects of globalization is that it promotes and increases interactions between
different regions and populations around the globe .

3. What is international business?

According to Wikipedia.org, international business refers to the trade of
goods, services, technology, capital and/or knowledge across national
borders and at a global or transnational scale. It involves cross-border
transactions of goods and services between two or more countries.
Transactions of economic resources include capital, skills, and people for the
purpose of the international production of physical goods and services such
as finance, banking, insurance, and construction. International business is
also known as globalization.
Additionally, Hermant More (2019) stated that international business
also includes importing and exporting; the international movement of goods,
services, employees, technology, licensing, and franchising of intellectual
property (trademarks, patent, copyright, and so on).

4. Global Issues in international HRM: Legal-political and Socio-cultural

dimensions
- According to Jeremy Bradley (2018), operating human resources across
geographic and cultural boundaries can often prove difficult for small-
business owners and managers. That’s why, in his article, Bradley stated
some global issues relating to International HRM.

Compliance and International HRM Issues

As businesses begin to expand into the global marketplace or as they hire
employees from diverse geographic and cultural backgrounds, they may have
to adapt to new labor laws and tax liabilities. Doing business in Europe, for
example, will require the business to pay value added tax. Hiring employees
who are non-naturalized US citizens might require HR to apply for work visas
and report economic data to the federal government.
 Compliance with international law can be an issue for the under-educated
business owner or HR manager, because these laws tend to be complex and
sometimes difficult to implement. Keeping well-informed of the legal
requirements for the business's operations can help alleviate some of this
complexity and lessen the chances of landing in legal trouble.

Scope of Human Resource Management

With an increasing number of businesses operating on an international
scale, the impact of globalization on HR can be tricky to navigate.
Globalization means various laws, cultures and norms must be taken into
consideration when onboarding and crafting HR regulations. Some countries
are more forward thinking where gender is concerned than others, and this
distinction can lead to misunderstandings or worse, the loss of key personnel.
It really would not be that hard to have a male manager handle the day-to-day
operations in an area where female managers are frowned upon, just in case.
Understanding the mechanism that makes each culture tick and implementing
as little or as much needed so create balance is something to strive for.

Cultural Diversity and Global HR Issues

A salient issue in international HR is understanding and maintaining
cultural diversity. Working with people from different locations or from different
cultural backgrounds mean adapting the business's work style to new ideas,
new ways of communicating and unfamiliar social practices. If you hire an
employee from England, for example, the employee might have different
ideas about how to manage employees or on how to run technology
processes based on her experiences back home. Being open to new work
styles and cultural differences is the hallmark of cultural diversity in HR.

Benefits and Compensation

Benefits and compensation are the backbone of any HR strategy, but in
international HR, benefits and compensation are even more important in
focusing on the work-life balance of employees. The idea behind work-life
balance is to provide employees with programs and initiatives that improve
both their personal and professional lives. This is considered part of
international HR, because many multinational companies have already
implemented programs such as flexible working time, paternity leave,
extended holidays and on-site childcare. In fact, many nations around the
world, including much of Europe, mandate these programs by law.
Implementing them on the local scale is one of the challenges and, ultimately,
rewards of international HR.
 Training and Development
Related to the idea of benefits and compensation in international HR are
training and professional development programs. Training programs typically
encompass in-house seminars and meetings designed to give employees on-
the-job knowledge of skills that are important to doing business globally. HR
might offer language classes, for example. Professional development
encompasses the "extra" training that HR provides to its employees, such as
allowing them to attend networking events and conferences, global training
seminars and other specific competency-based programs. Professional
development helps employees to hone their skills in global marketing,
international business development and finance trends.

5. What is culture?

- Culture is the characteristics and knowledge of a particular group of people,

encompassing language, religion, cuisine, social habits, music, and arts (Kim
Ann Zimmerman, 2017).

6. Local/domestic issues in international HRM

According to Neil Kokemuller, human resources managers face several
common challenges, including legal requirements, diversity and employee
motivation. When you throw "international" into the mix, as is the case with a
global company, the issues escalate. Therefore, HR managers must
coordinate human resource strategy, systems, and processes consistently
and effectively across national borders.
In addition, Niel Kokemuller also stated four (4) Local issues in
International HRM.
 Distance
Distance is one of the greatest international human resources issues.
Building a cohesive company culture and providing consistent policies and
training around the world is difficult. You may have variable talent pools in
different countries for certain positions, which can lead to major talent
gaps in different office or business locations. Additionally, your company
often must provide infrastructure and technology tools for colleagues to
 communicate from global locations. In marketing, for instance, colleagues
around the world must collaborate on goals, strategies and tactics.

 Culture
Organizational culture is the intangible atmosphere that develops in a
business from shared norms and values. HR professionals often assume
primary responsibility for helping build an effective, positive and cohesive
culture. When you have employees in countries and from backgrounds
with different cultural perspectives and rituals, this is especially difficult.
You don't have the ability to bring employees together for company
retreats or events in a central location. Instead, you have to focus on core
values such as innovation or elite service and try to instill them in each
market.
 Expenses
Managing HR globally is more expensive than doing so locally. It takes
much more research and development to put together policies that are fair
and consistent across the board, addressing different laws and standards
in local markets. Travel costs to send employees to different locations or
for training are also typically higher. The technology, including computer
systems, virtual team software and other hardware and software programs
is expensive as well.
 Legal Parameters
Employee laws vary significantly around the world. The United States
is generally a pro-employee society. Several laws, including Title VII, the
Americans with Disabilities Act and the Age Discrimination Act protect
employees in hiring, promotion and management. Depending on where
you operate, HR professionals may deal with more protective laws or often
less employee-friendly laws. Wages are notoriously low in some Asian
markets. Maintaining a consistent standard company-wide but abiding by
each country's laws and regulations is a major undertaking.
7. Film Viewing: Belt and Road Initiative: Summary and Reaction: HRM
Opportunities and Threats.

Based on the video I watched in YouTube, the Belt and Road Initiative
(BRI) or called “yi dai yi lu” in Chinese was first announced by Chinese
President Xi Jinping in 2013. It’s a globe spanning plan with the purpose of
strengthening trade, infrastructure and investment links between China and an
estimated 65 other countries. The “Belt” refers to roadways and train lines
stretching through central Asia to Europe, while the “Road” refers to a maritime
network of shipping lanes running from China, through Southeast Asia, Africa
and all the way to Europe. This Belt and Road Initiative aims to become a
transnational network to facilitate trade and investment and promote common
development among all countries involved. At the same time, the Belt and Road
Initiative aims to ensure all parties gain real benefits.

OPPORTUNITIES

One opportunity of having this kind of initiative was that it helps improves
the people’s wellbeing in other B&R countries. According to Xinhua Silk Road
(2020), China has included the provision of aid in poverty reduction, agriculture,
education, health, environmental protection and other areas into the joint efforts
to build the Belt and Road. In fact, China has implemented the Program for
China-Africa Cooperation on Poverty Reduction and Public Welfare, and pilot
projects of the East Asia Cooperation Initiative on Poverty Reduction, wherein it
is actively helping countries in the basin of the Mekong River to tackle severe
droughts by releasing emergency water supplies. It is also providing
technological aid in flood control to Thailand and Myanmar.
In addition, China also signed an MoU with the WHO on health
cooperation as part of the Belt and Road Initiative. It has also implemented a
program for China-Africa public health cooperation and the China-ASEAN
training programs for 100 public health professionals. China has trained several
thousand professionals in public health management and disease prevention and
control in cooperation with other B&R countries and has offered free sight
rehabilitation surgery to more than 5,200 cataract patients in those countries.
Every year, China provides quality medical services to approximately 30,000
patients in neighboring countries. Chinese TCM teams have implemented plans
for the rapid eradication of malaria in countries including Cambodia, Comoros,
Togo, and Papua New Guinea.

Aside from that, the Belt and Road Initiative (BRI) also facilitate the
transfer of scientific and technological innovations to other B&R countries,
which is a big opportunity for those developing nations. Xinhua Silk Road (2020)
stated that China has signed 46 agreements on cooperation in science and
technology with other B&R countries and launched China-ASEAN and China-
South Asia science and technology partnership programs. It has built five
regional platforms for technological transfer with ASEAN, South Asia, Arab
States, Central Asia, and Central and Eastern Europe, and proposed and co-
established the Alliance of International Science Organizations in the Belt and
Road Region. A multi-level and diverse exchange mechanism in science and
technology and humanities has been formed through various means, such as
short terms of research in China by young scientists and the training of science
and management personnel from other B&R countries. In 2018, China hosted
500 young scientists from such countries to carry out research and trained more
than 1,200 science and management professionals. China actively conducts
cooperation with other B&R countries in space technology and makes its BeiDou
Navigation Satellite System, satellite communication systems and satellite
meteorological remote sensing technologies available to them.

THREATS
Although China emphasizes the economic aspects of the BRI, claiming
that it is a long-term win-win economic project for all participants involved, the
United States and its security allies and partners, such as Germany, Japan, and
India, have voiced concerns. This is because the commonly purported
consequences of BRI, such as debt trap diplomacy and the string of pearls.
According to Kazuki Nakamura, the financing required for BRI projects
may expand debt to unsustainable levels. For instance, the construction of the
Lao PDR section of the Kunming -Singapore Railway has an estimated cost of
US$ 6 billion – nearly 40 percent of GDP of Laos in 2016. The authorities are
attempting to contain the impact of the project over public finances by limiting
their participation to around US$ 0.7 billion, out of which US$ 0.5 billion financed
by a Chinese loan to the Government of Lao PDR. The Center for Global
 Development recently estimated that BRI projects will increase debt to GDP
ratios for several BRI countries, putting eight at high risk. Countries
participating in BRI projects will need to balance the need for these development
projects with the vulnerabilities created by increased debt levels.

Another is in Pakistan; the country is seen as the buckle in the belt. In

fact, it was reportedly promised more than $60 billion in Chinese investments.
But Pakistan may have gotten more than it was expecting when it took China’s
loans. The country’s prime minister and celebrity cricketer Imran Khan is fighting
to keep the economy afloat and some are worried that Pakistan’s debts to China
may ultimately hurt those efforts. But it’s not just Pakistan or even China which
got more than it bargained for. Thus, there’s a lot of talk now debt trap diplomacy,
which involves the Belt and Road.

REFLECTION
What I have learned from this activity was that because of globalization, HR
departments now face a bigger challenge as their tasks become more complex as
companies move departments overseas or redefine the business as operating in the
global economy. Since the world is becoming increasingly globalized, companies are
expanding to new international markets and hiring an increasingly diverse labor force
every day. This means that the impact of globalization on the management of the
human resource industry might just be the most challenging aspect of globalization, as
HR managers must learn to navigate a complex maze of local and global customs,
cultures and laws.
And from what I have understood , there are a lot of human resource
management issues that need to be resolved when it comes to globalization, including
complying with local and international laws and balancing local customs with company
policy and culture.
References:
Alex Gray (2017), What is globalization anyway?
https://www.weforum.org/agenda/2017/01/what-is-globalization-explainer/
Human Resource Management (HRM) in a Global Environment
https://www.mbaknol.com/international-business/human-resource-management-hrm-in-
a-global-environment/
Human Resource Management in the Global Environment (2021),
https://phdessay.com/human-resource-management-in-the-global-environment/
International business. https://en.wikipedia.org/wiki/International_business
Jenny Roper (2015) The HR challenges of a truly global world
https://www.hrmagazine.co.uk/content/features/the-hr-challenges-of-a-truly-global-world
Jeremy Bradley (2018), Global International HR Issues.
https://smallbusiness.chron.com/international-hr-issues-61937.html
Kazuki Nakamura “SIX YEARS LATER: THE REAL THREATS OF THE BELT AND
ROAD INITIATIVE” https://www.diplomaticourier.com/posts/six-years-later-the-real-
threats-of-belt-and-road-initiative
Kim Ann Zimmerman (2017), What Is Culture? https://www.livescience.com/21478-
what-is-culture-definition-of-culture.html
Neil Kokemuller. International HR Issues
https://yourbusiness.azcentral.com/disadvantages-globalization-diversity-14729.html
Xinhua Silk Road (2020). What are the benefits of Belt and Road Initiative?
https://en.imsilkroad.com/p/314276.html