HUMAN RESOURCE

MANAGEMENT IN THE
CONTEXT OF GLOBALIZATION

A presentation by: SHRESTHA ASH (M.Sc Psychology, Ph.D Scholar)

 INTRODUCTION TO GLOBALIZATION:
International Business evolved from the age of World War I (1919) and World War II
(1939). The economies of several countries were down and exports and imports were
restricted due to unhealthy relations. The countries involved with the World War found the
need for international cooperation in global trade which led to the formation of IMF
(International Monetary Fund) and the World Bank. The attempts of these countries led to
the GATT (General Agreement of Trade & Tariffs) which was later replaced by the WTO
(World Trade Organization) in 1995. Hence the efforts of IMF, World Bank and WTO led
to the globalization of business during the1990s.

From initial years of export and import, the organizations began their promotion in the
countries where their products were in demand, thus starting international marketing. As
the demand of these products started increasing in the neighbouring countries, it became
difficult for the producers to export at a larger rate, thus they decided to manufacture their
products in the countries where there is high demand. Thus began international business.
GLOBALIZATION: It includes doing business in more than one country; operating and
expanding business throughout the world; establishing manufacturing and distribution facilities in
any part of the world; global organizational structures, organizational culture and strategies.

DISADVANTAGES OF
ADVANTAGES OF GLOBALIZATION: GLOBALIZATION:

• Cheaper products for consumers • Companies face much

• Wide variety of available products greater competition
• Leads to outsourcing • Economic depression in
• International barrier gets reduced between countries one country can trigger
which fosters relation among nations adverse reactions across
• Helps prevent market saturation in a specific market the globe
• Companies get access to wider markets • Widening of gap
• Standardization of products between rich and poor
• Increased flow of skilled and non-skilled jobs and countries
workers which enables better employment conditions • Exploitation of workers
across countries
 GLOBAL MINDSET:
The process of globalization forces companies and individuals to develop global mindset.
Mindset refers to the way we, as an individual or an organization observes, accepts and makes
sense of the world around us. It comprises of:

• Intellectual global mindset –

1. Understanding how to build and manage global alliances, partnerships and value networks
2. Ability to manage the tension between corporate requirements and local challenge
3. Ability to handle complex cross-culture issue
4. Understanding of global business and industry
5. Understanding cultural similarities
6. Understanding other cultures and histories

• Social global mindset –

1. Ability to connect with people from across the world
2. Collaborative environment
• Psychological global mindset –
1. Respect for cultural differences
2. Willingness to adapt, learn and cope with other cultures
3. Acknowledgment of validity of different views
4. Openness to cultural diversity
5. Positive attitude towards those from other cultures and regions
6. Ability to adjust behaviour in different cultures and regions
7. Willingness to work across time and distance
 HUMAN RESOURCE MANAGEMENT:

HRM is a management function that helps a manager to plan the required manpower, recruit,
select, train, motivate, engage and develop employees for the organization. It is an organizational
function related to the employee concerns such as recruitment, employee motivation and
development, training, wellness, compensation, benefits and administration.
Its functions include manpower planning, recruitment, selection, training and development,
performance management, employee engagement, compensation and benefits, employee exit.

IMPACT OF GLOBALIZATION ON HRM:

Globalization symbolizes free flow of technology and human resources across national boundaries
presenting an ever-changing and competitive business environment. This aspect of globalization
has also affected the HRM in the business world today. HR managers today do not need to rely on
a limited market to find the right employees needed to meet the global challenge, they can recruit
people from across the globe. The future success of any organization relies on the ability to
manage a diverse body of talent that can bring innovative ideas, perspectives and views to their
work. The HR professionals employ a “Think global, Act local” approach in most situations.
GLOBALIZATION HAS IMPACTED HRM IN THE FOLLOWING
WAYS:

• Managing cultural diversity

• Managing expatriates
• Difference in the employment laws
• Managing outsourcing of employees
• Managing virtual employees
• Corporate social responsibility
• Coping with flexible working hours
• Evolution of more part-time and temporary work (especially among women, the elderly
and students)
• Coping with emerging technologies and quality measures
• Changing perspectives from subordinates to business partners
INTERNATIONAL HUMAN RESOURCE MANAGEMENT:

It refers to the world wide management of human resources, including the process of sourcing,
allocating, and effectively utilizing their skill, knowledge, ideas, plan and perspective in training,
quality and management.

Purpose of IHRM: To enable the firm / multinational organization to be successful globally.

Dimensions of IHRM: According to PV Morgan, IHRM is the interplay among 3 dimensions – HR

Activities, Types of employees, Types of countries.

• HR Activities (It entails HR planning, employee hiring, training and development, remuneration,
performance management and industrial relations).

• Types of Employees of an international business are Parent Country Nationals (PCNs), Host
Country Nationals (HCNs) and Third Country Nationals (TCNs).

• Types of country categories in IHRM involves the Host Country where subsidiary maybe located;
the Home Country where the company has its headquarters and other countries that maybe sources
of labour and finance.
MAJOR CHALLENGES FOR HRM IN THE CONTEXT OF GLOBALIZATION:

• Attracting talent
• Retaining talent
• Conflict management
• Performance management
• Managing diverse workforce
• Global compensation and benefits
• Succession Planning
• Privacy and security
• Language barriers
• Legal compliance (labour laws and regulations)
• Global Mobility
• Crisis Management
• Cultural Sensitivity
THANK YOU