Global Considerations and Company Management Strategies


The success of some global businesses and the failure of some make one wonder as to the reasons behind it. Analysts have suggested strategy to be the key reason. The right game plans, the appropriate corporate structure and technological innovations are other reasons attributed (Stroh et al, 2005). Stroh et al believe that global leaders are behind the successful enterprises. Empirical research supports this viewpoint. Carpenter and colleagues have observed that Chief Executive Officers who have had international experience led the successful ventures (2000). Those who did not possess the international experience have caused the downfall of their institution. A significant indication is that an organisations’ competitive advantage depends on the quality of human resources. Global experience has contributed to the runaway success of many companies as evidenced by recent international appointments. Charles Perrin who was the backbone of Duracell recently was absorbed into Avon as the CEO (Stroh et al, 2005). Global leaders are being sculpted by international experience. SmithKline Beecham, a pharmaceuticals company, has a Danish-born executive, Mr. Jan Leschly, in its US office and the French-born Mr. J.P. Garnier in its UK office. International assignments provide the best practices, broad thinking and latest information in research for producing effective global leaders (Stroh et al, 2005).

Assigning international employees

A company’s future strategy depends entirely on the quality of people in the organization. Another point of concern is that implementation of a strategy must always consider the global business environment (Stroh et al, 2005). It goes to show that companies need globally capable employees as their HR strategy. Raj Tatta from the Price Waterhouse Cooper’s has commented that international assignments are essential for changing the quality of service that one offers into a high quality one. Wielding the company in an international perspective is a tireless effort which begins with keeping the newly hired staff interested in their work and committed to the company. Identifying and mentoring young employees early helps them thrive in the environment (Stroh et al, 2005). Close working relationships are involved with personal contact.

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Global economic interdependence is achieved through marketing, research, production and service strategies which allow one to think globally and act locally (Kline, 2005). Shared values provide the impetus for collective interactions. Economic, social and cultural patterns are influenced by the global business. Ethical considerations need to be used for the assessment and selection of values which guide the daily life of the potential employees. The different judgements and decisions of the international employees are influenced by the way they identify, understand and choose among the values.

Hiuman rights concepts must be suitably applied. The UN has set the rules for evaluating the actions and the conduct of international business enterprises as two covenants (Kline, 2005). Many nations ratified the covenants but modified to their political situation. Human rights and the governance of corporate behaviour are governed by the UN General Assembly which attempted to provide legal bearings for the rights. UN Declaration’s preamble states: “recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the world”. International companies also cater to the local national concepts of human rights.

Failure in a global assignment expressed as early return to own nation or poor performance is due to an inability to adjust by the employee and his family. On the other hand, a successful completion of an assignment is inferred to be due to cross-cultural adjustment. Cultural illiteracy must be overcome (Black and Gregersen, 1999). It is wise to remember that it is not poor technical or professional ability that causes an employee to return early.

Selection processes must be careful and not depend solely on the job-related competence or technical qualification (Miller, 1973). Potential candidates must be selected from the domestic and international divisions of the company after ascertaining their range of skills. The recruitment can be from the host country, parent country or a third country (Briscoe and Schuler, 2004). Believing strongly in a nationality mix, local candidates may be recruited for the posts of managers and technical staff (Briscoe and Schuler, 2004).

Finding ways to measure the improvement of performance is another significant method of gauging potential candidates in their assignments. Research helps in this process. Seeking references from fellow managers, reading the personnel files and requesting help from the human resources manager also contribute to the selection process. US firms are known to search throughout the different wings of the corporation looking for candidates with high cross-cultural adaptation and communication skills. However they do not complete the list; when they get a sufficient number, the rest are not screened and they may miss really good potential candidates (Stroh et al, 2005).

Tung’s study indicates the similarity of the selection processes in Japan, Western Europe and the United States (1988). Managerial talent is the criterion in these places. However Scandinavia also based their selection on qualifications (Bjorkman and Gertsen, 1992). Partner’s ability to adjust is not considered a criterion in Japan and Scandinavia. The success of international assignments relies on the communication abilities but most companies do not bother to test these skills of their potential employees (Ones and Visweswaran, 1997).

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Adopting a strategy for selection of candidates for international assignments becomes a necessity when the aim of the company is to acquire and maintain a competitive position in the global market. However companies refrain from aggressive recruitment campaigns. They prefer traditional methods of selection.

Translating corporate goals and strategies into IHRM practices

The skills that qualify a successful HR manager are varied. He would have a multidimensional perspective whereby he would have had experience with multiple products, worked in a multi industry, or a multifunctional company with a multi environment experience according to Mr.Ed Dunn, Corporate Vice-President of Whirlpool (Briscoe and Schuler, 2004). The track record of having worked in multiple assignments overseas would be topped with success in operating strategic business units and proficiency in line management (Howard, 1992). Prudent decision-making skills would have taken him to a successful completion of his assignment. His resourcefulness would have carved a name for himself in the host country’s political circles. Cultural adaptability would have been demonstrated by his easy mixing with the local people. His sensitivity to cultural diversity would be effective in coordinating the various genders, cultures, nationalities, races and religions (Howard, 1992). Team leadership qualities would help him bring culturally diverse groups of people together under his wing and lead them into becoming more committed (Howard, 1992). He would be able to practice interpersonal contact with the employees and be adept at leading the working group into accomplishing the strategic goals of the organization. The stressful demands of an overseas manager would be fulfilled by his physical ability and mental maturity. Computer literacy would be a plus point for comfortably exchanging electronic information (Howard, 1992). His skill in negotiating strategic business deals in a multicultural environment would be evident in his track record. Successful organisational changes may be possible with his competence as a change agent. Visionary skills would help him handle business opportunities or deals based on the host country’s economic situation. He practices participative management with the skill to delegate work to his employees (Howard, 1992).

Successful expatriation of an employee indicates his completion of the foreign assignment, his skill in adjusting cross-culturally and his exemplary performance in his job. Overseas assignments allow individuals to develop the skills necessary for managerial roles (Harzing, 2001). They then become indispensable to their company.

Expatriate personal change and role innovation is enabled with the international assignment. Two groups of researches were done for studying the expatriate posting.

Understanding the level of psychological comfort constituted the first group. The second group was based on the work role transition theory (Nicholson, 1984). Nicholson said that a change in employment status and change in job content had a great effect on the development of the employee in the future and the organization. He claimed that work role transition affected both the personal development and role development. The change in the personal frame of reference and values is termed personal change. Role innovation means that a person changes his role requirements so that his identity in the organization is safe. He would change his task objectives, methods, materials, scheduling and interpersonal relationships (Nicholson, 1984). Shay and Baack (2004) do not agree totally with Nicholson. They feel that the work role transition theory would work only at the lower levels of the hierarchy. The expatriate managers need to have further methods of adjustment. Subordinate personal change is an added work role for the expatriate managers (Shay and Baack, 2004). The manager is also aiming for subordinate role innovation.

Supervisory evaluations are another point of concern in international assignments of employees. Managers depend on the supervisors for the evaluations.

Subjectivity and bias are found in such evaluations. The supervisor would have seen the employee working on only few occasions. The manager depends on these evaluations for the promotions, training and rewards apart from other considerations

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(Shay and Baack, 2004). This further influences the evaluation of the expatriate manager by the HR manager sitting in the home headquarters (Gregerson et al, 1996).

Evaluations must be practically effective. The raters must understand the objectives of the job. The individual being evaluated must be frequently observed. The individual’s value to the organization must be also assessed. Research has shown that managers believe that these supervisory evaluations are useful to their personal development too (McEvoy, 1988). Expatriate managers can have a self-evaluation or self-reported effectiveness ratings but leniency error (Meyer, 1980), restriction of range (Thornton, 1980 and halo error (Holzbach, 1978) will have to be considered. Researches need to use longitudinal study methods to assess any change in the expatriate’s perception of reason for assignment and whether the change affected adjustment or effectiveness.

Performance appraisal of an expatriate employee depends on his cross-cultural adjustment and newly acquired skills and abilities. Two kinds of criteria are considered in researches: hard and soft (Gregersen et al, 1996). Performance-based or outcome- based criteria are the hard criteria. They are easy to collect and easy to interpret. Legal defence is easier based on hard criteria. Intentional discrimination is impossible. The performance would be therefore accurately portrayed. Soft criteria are suggested as important by the US researchers (Schuler and Huber, 1993). Personal traits or interpersonal factors are considered under the soft criteria. Rater variation or bias is also possible in expatriate employee performance. Multiple performance raters and careful selection of raters could help the performance appraisal to be more correct and reliable (Kingstrom and Mainstone, 1985)

Global economy sees international assignments as important. The modes of adjustment and expatriate effectiveness are a significant subject in the global perspective. Continued research is needed to further elaborate expatriate assignments, adjustments and effectiveness.

Dealing with Corporate culture

Revelations of dishonesty and manipulations have shocked the entire world of corporate culture (Johnson and Phillips, 2003). Silent complicity is another feature which has worsened the crime. The US Economy suffered to the tune of trillions of dollars and the world lost its faith in the US corporate empire. This has brought forth opinions in favour of honesty and why it does pay to be honest. The passivity with which lies have corrupted the personal and organizational levels and allowed the occurrence of enormous disasters must be conquered (Johnson and Phillips, 2003).

Honesty pays in the long run. Straight talk and integrity also keeps abay wild accusations and attempts to malign. Customers, shareholders and employees must be able to trust the organization. The catastrophes of Enron, Worldcom and AOL Time Warner should never be repeated.

Corporate culture is the social and political environment in which people work (Johnson and Phillips, 2003). The business of the company is taking place in this corporate culture. This culture influences the various aspects of the behaviours of the involved people in whatever they do, starting from the way they greet others including the supervisors, how they behave in meetings or seminars and their decision making.

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If this culture is disrupted by the entry of an unwanted presence who topples the culture, everybody’s spirit is disturbed and the corporate culture suffers. Instilling absolute honesty into a corporate organisation needs committed and efficient leadership. A picture is first formed of the patterns of common behaviours, values and beliefs within the organization and attitudes of the staff (Johnson and Phillips, 2003).

A culture of absolute honesty must be encouraged among the employees as in Intel Corporation (Johnson and Phillips, 2003). The staff must be able to frankly view their opinions or suggestions in their meetings or discussions. The staff in Intel had been taught how to confront others with their views even if not accepted or unpopular. This is the kind of behaviour which proves most to ensure a successful corporation. Creating trust by taking the right decision is actually easy. Lying is more difficult as more lies are needed to cover that first one and it goes onto be a vicious cycle till there is a point of no return. The person who is lying undergoes many sleepless nights for the simple reason that he did not tell the truth at the beginning (Johnson and Phillips, 2003). By then the amount of dishonesty created would have revealed his deficits to others and they lose their trust and confidence in him. Damaging relationships and one’s integrity are the outcomes of that single lie which started it off. Telling the truth is the essential moral. This is especially useful for the leadership. Some believe that the truth is painful sometimes but it is usually not so (Johnson and Phillips, 2003).

Tackling the problem is the next step that is useful to prevent another person from starting a trail of dishonesty and malice. Constructive confrontation is the art of attacking problems and not people (Johnson and Phillips, 2003). One might need it to convince another, especially a senior personality, about the better methods that can be adopted to suit customers. If the method adopted is convincing, the confronting parties actually feel better about each other and team up to function. This outcome helps the organization. Implementing this process may not always work with the staff. One needs to do the homework, make efforts to open the debate, listen carefully and then speak one’s mind. It must not appear to be a personal attack and then the confronted person becomes amenable to your suggestion (Johnson and Phillips, 2003).

Disagreement on some issues is expected but the staff must commit it. Each has to voice his opinion even if it goes against the common trend (Johnson and Phillips, 2003). Concerns about an issue must be expressed otherwise how is the leadership going to know that there are such issues. Avoiding the expression of the different opinion may put one in a better light in the views of others but a significant issue which may affect the organization later is not put up for discussion (Johnson and Phillips, 2003).. It is equivalent to telling lies. The reasons for not voicing an opinion may be due to the fear of retribution, hurting another, being disliked or losing support, paying the price, losing competitive advantage and losing face. The person who has the different opinion may be more down-to-earth than others in the room. Even if the opinion appears uncalled for, it must be thought about seriously in discussion.

Welcoming the truth is as important as telling it (Johnson and Phillips, 2003). Some people on the staff may be used to getting accolades for most of their opinions and work performance. This kind of person is the one who has a tendency to be occasionally dishonest so that his face is saved; he cannot bear losing it. Some managers also cannot see the level of emotional distress in someone who worked hard for the organization. However emotions should not cause the discomfited person to cause “symbolic spear sticking” (Johnson and Phillips, 2003). Defensiveness is also not a technique to be encouraged. It is usually used for protecting self-worth. This attitude should be replaced by simply telling the truth. The manager should ensure that the employee is not put into a situation where his self-worth is in question.

The management must provide the support to employees who come forward with truthful messages (Johnson and Phillips, 2003). The employee who comes forward with the message must be rewarded if possible. The staff must never feel that he has been punished for telling the truth. It might discourage him later and affect others in the organization who know this has happened.

Building a platform of integrity is essential for any organisation and its management (Johnson and Phillips, 2003). The picture that goes out about the organization begins from the employees who carry the story about the organization. If anyone in the organization tricks another, the picture of dishonesty gets spoken about. This tends to lead to the other employees becoming dishonest and the organization failing in its ventures due to the staff losing their commitment (Johnson and Phillips, 2003).

Change is another factor that affects corporate culture. A change instituted must continue to be a part and parcel of the organization. Further changes must continue from there. A standstill should not occur and innovations must be a continuous process.

Ethics must be a part of the behaviour of every employee. The ethical behaviour must be established by having a steering committee. A stronger ethical infrastructure must have leadership with the topmost leaders, lawyers, middle managers and a few employees. They meet frequently to oversee the design, implementation and operation of this ethics programme. A corporate ethics officer post may be created. This ethics programme “regulates standards of business conduct, provides education on ethical decision making and ensures adherence to laws, company policies and guidelines” (Johnson and Phillips, 2003). Every employee is given training and expected to have model ethical behaviour. The code of ethics must be revised every three years.

Safety, anti-trust, conflict of interest, environmental responsibility and international business conduct are some of the topics covered (Johnson and Phillips, 2003).

Conclusion

The International HRM certainly has different aspects to it. Selection of candidates for international assignments needs to take other criteria into consideration than those for HRM. The cross-cultural adjustment ability and the spouse’s ability to adjust form the two main considerations for an expatriate assignment. The distance of the international employee from his home ground may create problems of satisfaction occasionally.

References

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Bjorkman, I., & Gersten, M. (1992). Selecting and training Scandinavian expatriates: Determinants of corporate practice. Scandinavian Journal of Management, 9, 145–164.

Briscoe, D.R. and Schuler, R.S. (2004). International Human Resource Management:. Policies & Practices for the Global Enterprise. Routledge: New York

Carpenter, M., Sanders, W., & Gregersen, H. (2001). Bundling human capital with organizational context: The impact of international assignment experience on multinational firm performance and CEO pay. Academy of Management Journal, 44, 493–511.

Gregersen, H.B., Hite, J.M. and Black, J.S. (1996). Expatriate Performance Appraisal in U.S. Multinational Firms. : Journal of International Business Studies. Volume: 27. Issue: 4 Academy of International Business;

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Johnson, L. and Phillips, B. (2003). Absolute honesty: Building a corporate culture that values straight talk and rewards integrity AMACOM: New York.

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Kline, J.M. (2005). Ethics for International Business: Decision Making in a Global Political Economy, Routledge: London

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Ones, D. S., & Viswesvaran, C. (1997). Personality determinants in the prediction of aspects of expatriate job success. In A. Zeynep (Ed.), Expatriate management: Theory and research (Vol. 4, pp. 63–92). London: JAI.

Schuler, Randall S. & Vandra L. Huber. 1993. Personnel and human resource management. St. Paul, Minn.: West

Shay, J.P. and Baack, S. (2004). Expatriate Assignment, Adjustment and Effectiveness: An Empirical Examination of the Big Picture Journal of International Business Studies. Volume: 35. Issue: 3. Academy of International Business

Stroh, L.K., Black, S., Mendenhall, M.E. and Gregersen, H.B., (2005). An Integration of Strategy, Research, and Practice Lawrence Erlbaum Associates. Place of Publication: Mahwah, NJ.

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