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Implications for Human Resource Management: Transnational Organizations, Employees

engaging in Pirate Activity, and Intellectual Property

Alexander Shrestha

Westcliff University

BUS 632: International Human Resource Management

Professor: Dixita Silwal

July 25th, 2022

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Implications for Human Resource Management: Transnational Organizations, Employees

Engaging in Pirate Activity, and Intellectual Property

As a result of globalization, commercial practices all across the globe are undergoing

profound changes at an unprecedented rate. According to (Briscoe, Schuler, & Tarique, 2012),

the transformation of a local business into a global business has been facilitated in large part by

developments such as international trade agreements, new market and cost-saving opportunities,

advances in communication technology, technology transfer, improved education, migration,

knowledge sharing, and e-commerce, to name a few. The case which we shall be dealing with

today is about an organization named Capgemini and its headquarters is located in France, but

they have many firms in other nations and is also considered to be one of the biggest IT

companies there is with their mark on various nations such as the Netherlands, Sweden,

Germany, United Kingdom (UK), and India. In addition, to extend and develop their company,

they planned to combine with other companies and make acquisitions in the European continent.

Since Capgemini operates on a worldwide and multinational scale, the company has a

decentralized management structure. For the purpose of expanding their business, the firm

combined with another company called Sogeti and also formed partnerships with SAP and

Microsoft. Also, because the firm's operational approach is having an effect on other nations,

such as those in Europe and South Asia, the enterprise is gaining a lot of popularity.

Additionally, it is responsible for the employment of almost one million individuals from a

variety of countries. Diverse HRM challenges are being brought up as a result of the engagement

of many nations, each of which has its own set of cultural norms and employment legislation. As

a result, the size of the organization, its structure, and its culture are all undergoing changes. The

level of competition in the market is higher than it has ever been. As a direct result of these
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shifts, there have also been modifications made to the practices of human resource management

(HRM).

Organizations Operating on a Global Scale known as Transnational Organizational

Structure

Simply put, transnational refers to the organizational structure of multinational

corporations, also known as MNEs, which emphasizes the integration of functions while

maintaining a high level of local responsiveness. For the reason that it allows the flow of

information and resources among foreign subsidiaries and branches without the direct

involvement of head office, the transnational structure is considered to be a more complex

structure than other structures such as the international structure, the multi-domestic structure,

and the global structure. It creates solid linkages between the headquarters and the subsidiaries,

as well as relationships among the businesses themselves basically giving them the edge over

their competitors as they are integrated although independent, and have the ability and flexibility

to mold themselves to the requirements whilst achieving global integration at the same time.
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Figure 1: Organizational Structure for MNE (Briscoe, Schuler, & Tarique, 2012)

The primary objective of the transnational organizational structure is the integration and

interdependence of the worldwide network of their respective corporate units. In this context,

according to (Sprague & Ietto-Gillies, 2014), the term "transnational organization" refers to an

organization whose structure and networks for communication make it possible for the

organization to strategize, organize, control, and manage its activities in more than one country.

It does this by fostering interdependence across the various business divisions, while also

respecting the local flexibility of operations and preserving global integration.

According to (Gaffney, 2019), Coca-Cola, for instance, has operations in more than 200

countries, sells more than 400 different products under the same brand name, and allows for

local customization of both the product's packaging and labeling.

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Various requirements need to be taken into consideration when a multinational

organization decides to join the league of a transnational organization and within the framework

of Capgemini, there are about 91,000 employees located in 36 different countries. The main

office is separated from several branches and business divisions and a stronger link between the

parent firm and the subsidiary company, as well as an increased sensitivity to the needs of the

local community, is being addressed in the case. It allows for flexibility in reacting to the

demand in the local area. The practice of sharing information has also been used to facilitate the

diffusion of innovations developed in one nation or business unit to those developed in other

nations and business units (Festing & Eidems, 2011). Subsequently, additional locations of the

company should be set up in other nations that have a higher rate of productivity and a lower

overall cost of doing business to maximize the benefits of the company's expansion efforts. It

would seem that the various organizational communication channels link one business unit to

another as well as one professional. When taken along with the aforementioned characteristics of

a multinational corporation, these characteristics lead one to the conclusion that Capgemini is a

transnational organization.

Yes, Capgemini satisfies the requirements to be considered a transnational organization

because its headquarters are located in the country in which it was founded, France, and because

it has merged with a large number of other multinational companies and expanded its operations

into other countries, including United Kingdom, Netherlands, and others. They have an

incredibly decentralized approach to planning processes, and whenever one of their companies

surpasses 150 employees, they divide that particular section of the company into two. An

intelligence pooling system has been implemented in Capgemini, and as a result, the relationship

between the primary organization and the subsidiary firm is also greater. This system guarantees
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that creative solutions are disseminated throughout the many branches of the organization. In this

scenario, the subsidiaries or the community group is the one that makes decisions and provides

direct customer care, which means that the local group can deliver a better level of

responsiveness locally.

Implications of Human Resource Management for Multinational Organizations

The larger a company gets, the more likely it is to have a great number of business units that are

spread out over a variety of geographic areas, and all of them demand the participation of a huge

number of individuals. For the reason of all of these qualities, international HRM stresses the

integration of activities, which results in a greater degree of complexity in HRM processes. It

must function properly with individuals of varying ethnicities, cultural backgrounds, linguistic

abilities, and social circumstances even though a global or international firm’s operation

develops along with the company itself, which in turn leads to an increase in the number of

workers, responsibilities, goals, and resources must be clarified and coordinated on an

international level (Yu & Wu, 2009). This variability presents challenges for human resource

management. If we take the example of Capgemini, which initially grew its company throughout

Europe, then traveled to the United States, and most recently reached India, we can see that

Capgemini is forced to interact with individuals who come from a variety of diverse historical

and cultural backgrounds.

The political and legal systems, the working cultures, and the technology environments of

these nations are all distinct from one another. It is believed that the use of cross-border teams

and a wide cultural background makes the job of IHRM increasingly vital to maintaining the

effectiveness and integrity of global business networks (Briscoe, Schuler, & Tarique, 2012). This
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results in HRM being difficult for multinational companies, but at the same time, it has

broadened the scope and boosted the significance of worldwide HRM practices.

In multi-domestic firms, in contrast to transnational corporations, important areas and

positions at overseas subsidiaries are filled by individuals from the parent business, and there is

no link between the various subsidiaries. This is in contrast to the situation in multinational

corporations. The connection between the headquarters and the subsidiaries is not very strong.

The cultural differences that exist in these companies may also lead to HR problems, but the HR

problems they generate are not nearly as severe as the HR problems that arise in transnational

companies since transnational companies develop many networks among their business units and

their parents. According to (Dickmann, Müller-Camen, & Kelliher, 2009), for HRM to be

convenient and effective in transnational settings, it is recommended that HRM be

operationalized based on principles at the meta-level, and the basis of practices at the operational

level.

Acculturation is the primary strategy that can be utilized, and it can fully integrate diverse

cultures influenced by the cultural heritage that is most dominant in the transnational

organization. Since the diversification in the transnational organization could indeed cause a

variety of HRM issues, acculturation is the most important strategy that can be properly utilized

in this. The formation of multi-business project teams is possible via appropriate recruiting and

the provision of appropriate training in either a national or an international setting. Monitoring

and controlling the rules and regulations that are put into effect in an organization consistently is

required. This should be accomplished through the utilization of standardization and knowledge

networking processes. These HRM concepts and practices help to eliminate unnecessary

duplication of activities, foster the development of cohesive connections, and maximize the
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economic advantages of scale. Therefore, HRM methods for transnational organizations need to

be seen from a different viewpoint to deal with the particular HR difficulties that are connected

to it and to reap the maximum advantages possible from such a structure.

Freedom of Employee Transferability from One Employer to Another

We can detain a person, but we do not have the ability to jail their will. A person who

does not have a will be detrimental to the success of an organization. This only suggests that

businesses will not be able to get advantages from keeping an employee who has expressed an

intention to depart the firm. Therefore, it is not in the best interest of an employer to choose to

place comprehensive restrictions on the freedom of workers to move freely from one corporation

to another. It has been suggested that the employer should concentrate on organizational

procedures to ensure that personnel are satisfied in their existing positions and do not feel the

need to seek employment elsewhere. To do this, it might examine its pay scale, fringe benefits,

working environment, retirement plan, and incentive system in light of those offered by its rivals.

Every person has the aspiration to learn new things and advance in their career and personal

lives. The majority of the time, individuals find that switching jobs from one company to another

presents them with the chance to get closer to achieving their desired personal and professional

objectives. It is like human beings to dream large, to go for big, and to make big moves.

However, problems may occur when a business invests time and resources into training an

employee but then loses that individual before they can start contributing to the organization in a

meaningful way.

Human resources play a significant part in each one of the organizations that exist, and these

individuals must be properly used within the context of the organization to maximize the
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effectiveness of those resources. The management of human resources has a direct bearing on the

concerns of workers over their readiness to transfer jobs, the stability of their work rights, and

the opportunity to resign from their current careers. Before an employee begins working for an

organization, that organization's human resources department must, as part of the hiring process,

have the employee and employer sign a legally binding contract for the organization's best

interest. This contract ensures that the employed person is conscious of the company's policies as

well as the legal requirements that the business must meet. There are many different labor

regulations in place in an organization, and staff members and the employer alike are aware of

the rights that are afforded to them by those laws. This enables the company to better assist its

workforce. If any worker ever experiences harassment at their place of employment, whether it

be verbal or physical, they are free to resign at any time. This includes situations in which they

feel threatened. The agreement paper plays a very important part in the organization because the

employee is obligated to finish their stated job term if they do not have any issues or problems

with the organization. On the other hand, if the employee has to face some issue that is irrelevant

to the company's policies, then they may leave the job in the middle of the stated period. A

company may choose to engage in non-competitive agreements, non-solicitation agreements, or

non-disclosure agreements with its workers. These types of agreements do not prevent people

from leaving their existing jobs and also protect companies from financial damages. It is possible

to incorporate a cost-sharing clause in the employment contract. This provision binds workers to

pay the stated amount spent on their training and development if they leave their job before the

expiration of the set time. This may be done to manage job quit (Kessler, Bass, & Yeargain,

2007). It makes the disagreement that occurs after the person quits the position easier to manage.

The fact that each organization in the global setting has its own working culture and set of values
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means that the connection between both employee privacy and the business is influenced owing

to the technical and informational advantages. Employee piracy refers to the act of doing work

that is not authorized by an employer. This practice may lead to a shortage of professionals who

are both qualified and trained. These sorts of problems might lead to competitors or rival

organizations trying to persuade competent workers to work for them by offering a bigger salary

amount, pay, or bonus to draw them towards their company; this practice is known as employee

piracy.

Employee piracy may result in a higher influence on the process of the company, which

in turn results in enormous losses; as a consequence, employee piracy and similar activities are

forbidden in every organization. Non-competing, non-solicitation and non-disclosure agreements

are some of the actions and agreements that can help prevent employee piracy in an organization.

It is important to keep in mind that privacy must be protected within this type of agreement, and

employees are required to maintain confidentiality in their work.

Poaching the employees of one's competitors is one of the most effective methods available for

recruiting qualified workers. In the realm of business, this is a very standard procedure. The

building of the organization's very own channel is the only option for this predicament that can

be taken. This is the process of establishing its internal strength to keep the interest of its

personnel in the business. It has been proposed that a company is required to hold a meeting for

departing workers to discuss how they arrived at their decision to leave, and encourage them to

interact with target personnel as well as competitor firms to minimize the danger of talent

poaching in the foreseeable future (Gardner, 2002). Therefore, a company needs to have a

strategic goal to protect itself against staff poaching and to keep the competent individuals that it

now possesses.
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The World Economic Forum, International Labor Entities, the OECD, and the United

Nations are just a few of the institutions that are up to employment laws and continue to support

the workforce around the world today. The international labor law includes rights regarding

maternity benefits and leave, work schedule and reimbursement, and internal environment in the

workplace; therefore, employees can be chosen voluntarily. The progress of technology and the

variety of cultures, despite their similarities, do not restrict the independence of the workforce.

The Ownership of Intellectual Content (IP)

The term "intellectual property" refers to the intangible resources that are connected to

arts and literature. These properties include trademarks, patents, and proprietary information,

among other things. The formation of various skills undergoing development alongside the

nature of intellectual property as well as its availability has undergone tremendous

transformations as a result of advancement when it comes to technology. Sometimes it even

creates the situation where the question has been raised to trace out the real owner of intellectual

property, and often proving such ownership requires a more complex process or may go in vain.

However, when it does happen, it often creates the situation where the question has been raised

to trace out the real owner of intellectual property. In the context of a company, the topic of

property rights may come up if an employee's concept is used to generate a product or an asset

that is intangible and is developed entirely from scratch. As a result of the fact that intellectual

property (IP) is developed based on the cultural socialization and cultural principles of each

nation, the privacy of intellectual property varies from country to country. This is because many

countries have various conflicts based on IP. It is the responsibility of the legal department to

establish legal standards on the problem of safety associated with intellectual property, and the

multinational management of human resources must adhere to those rules.

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IHR is responsible for providing varied professional development for the competence

development of its employees to create more relevant statistics about the use of intellectual

property. HR is responsible for providing affirmation to employees after new hires have been

made and after non-competent agreements have been negotiated. IHR is moreover concentrated

on those countries which have very inadequate enforcement policy initiatives and consequences

regarding the protection of intellectual property as a result of the fact that they have their very

own range of constraints and legislation on intellectual property, and copyright rules also vary

from country to country. The increased usage of sophisticated technology in the workplace is one

of the cons associated with the proliferation of information technology (IT). On the surface, it

seems that the corporation owns the intellectual property, but we cannot guarantee that an

employee will not take it with them when they leave the organization. For instance, the staff may

simply take the list of clients with them when they leave the workplace and take it with them.

Therefore, businesses have a responsibility to be concerned about this issue to protect their

intellectual property rights. It has been found that self-regulated industry standards, common and

explicit intellectual property regulations, and an awareness campaign do the greatest job of

ensuring that all interested parties will profit from intellectual property (Saha, 2000).

Even while workers have the legal right to change jobs at any time, the possibility that

they may do so in a way that would reveal sensitive information about both the business and its

personnel to its competitors is a concern for the organization. Since the laws and practices

governing labor vary from country to country, workers often reveal confidential business

information and manufacturing processes to companies that compete with them. The most

difficult problem to solve is how to prevent workers from leaving the office for extended periods

since doing so increases the risk of confidential information being leaked. An organization has to
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regard innovation and technology management as the strategic step for producing wealth and

success for the business in the contemporary environment, and its culture needs to embrace this

approach (Guo & Li-Hua, 2008). Therefore, to reap the advantages that may be gained from

intellectual property, companies need to adapt to the growing trends in IP.

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Conclusion

The transnational structure emphasizes global integration by providing more leeway in

terms of how the business is implemented locally. In the context of global human resource

management, two of the most significant issues are cultural diversity and expanding business

networks. The presence of these elements makes HRM approaches more relevant for global

organizations. Because people quitting their jobs and companies recruiting away their workers

are both typical occurrences in the business world, an organization may protect itself from these

types of games by cultivating its internal strengths. The rise of information technology has made

organizations more vulnerable and sensitive, which is why they need more care and attention to

their intellectual property (IP).

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