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International and comparative HRM Assignment Sample

Introduction

Human resources management (HRM) practices differ significantly across countries with national characteristics influencing its various facets. Diverse practices are employed in various countries across the globe and multinational organizations are required to carefully consider the local environment while designing HRM. According to Beardwell and Claydon (2010) the distinctive cultural contexts that exist in different countries and regions influence organizational approach to managing people. This paper will therefore carry out a comparative analysis of the HRM practices adopted across nations. Through use of precise examples key focus will be laid on practices such as recruitment, training, compensation, legislation, and industrial relations.

Comparative analysis of HRM practices

Cultural and societal differences of various countries coupled with organisational factors influence recruitment and selection process by dictating the requirements, sources and systems of recruitment. For instance, in the USA recruitment is usually conducted through the free employment systems with greater emphasis on individual abilities, innovativeness and experience in the field of practice. This recruitment practice is deeply influenced by the national culture of innovativeness, individualism and highly functional labour markets (Daspro 2009).

On the other hand, recruitment in the Japanese labour market mostly follows internal recruitment and referrals whilst candidates are considered based on their learning capacities and desire for lifetime employment in the organisation (Tungli & Peiperl 2009). Similarly, this employment criteria employed in Japan is influenced by the local culture that’s greatly focuses on long term relationships and collectivism. As such most organisations in Japan will depend on internal recruitment as the national culture tends to avoid uncertainties that may be brought from the external environment. Moreover recruits from the wider labour market are perceived to possess professional skills but lack understanding of the organisational culture and communication skills. However USA, a capitalist country, depends greatly on the market economy thus resource allocation follows similar patterns. As such organisations largely depend on the external labour markets to provide qualified employees.

Training practices also differ significantly across nations based on the content, forms, and features of the package as influenced by the local culture. According to Hutchings et al. (2009) training in China is limited to professional skills that enable employees to effectively carry out the immediate organisational functions. Chinese enterprises seek to reap maximum value from their training investment for employees. Moreover high employee turnover recorded in the country discourages organisations from making huge investments in employee training since they incur losses when such employees leave the organisations (Eriksson et al. 2014). However the case is quite different in Japan since as aforementioned, Japanese organisations invest in long-term plans and prefer recruitment of employees with lifetime employment desires. Therefore Japanese organisations invest in training of employees that features professional skills, personal development, spiritual, and enterprise culture since employees are expected to stay in the organisation for long. In this case training is viewed as important not only for the employee but also for the organisation as a whole.

Compensation practices also differ widely across nations based on the extant rewards standards, performance management, promotion and punishment as well as the combination of tangible and intangible benefits. USA organisations are renowned for placing greater emphasis on compensation systems that are influenced by their individualistic culture whilst it is used as a mechanism for employee motivation. According to Beardwell and Claydon (2010) USA enterprises use compensation packages to reinforce positive behaviours among employees through rewards and promotion while punishment is used to discourage negative behaviours. However these systems have been criticised for being unscientific and subjective.

On the other hand, Chinese enterprises do not follow formal performance appraisal systems but rather compensation depends on human relationship factor. Tsai and Wang (2013) observe that there is a general lack of effective performance evaluation in Chinese organisations thus organisations employ subjective measures in salary adjustments and promotions. Moreover, Chinese enterprises follow the national culture of respecting elders that is embedded in the Confucian doctrine. Therefore some practices such as promotion follow specific pecking order rather than performance evaluation. Tsai and Wang (2013) observe that this is important to maintain employee enthusiasm and maintain working relationships throughout the organisation.

It is also notable that there are huge gaps between executive compensation and other employees’ compensation in the USA. According to Shin (2014) USA executives continually earn multiple times in salaries and annual bonuses in comparison to nonexecutive employees. However in other countries like China, the pay disparities are relatively smaller as executives earn proportionate amounts of their compatriots in the USA. Other factors such as gender have also been found to influence compensation in multiple countries. Kulich et al. (2011) established that female workers receive relatively lesser compensation in comparison to their male counterparts. Unlike other compensation elements, this factor however does not differ significantly across countries with female employee compensation being lower than males in similar positions internationally.

Labour legislation and industrial relations also differ across nations with formalisation of the labour market, economic development and workers’ rights being the core differentiating factors. Most advanced economies like UK have established formal labour laws that are highly protective of its nation’s workforce. UK labour laws are concerned with workers’ rights in terms of minimum wages, working conditions, discrimination, and employee dismissal among others (Marinescu 2011). In addition the country’s employees are organised in labour unions through which they collectively bargain for fair terms of employment. The labour unions are also used as channels for ensuring labour laws are effectively enforced in the country.

However labour laws in countries such as India are quite relaxed. According to Van Der Meulen Rodgers & Menon (2013) this is due to low proportion of workers in formal employment and the government laxity to install strict measures. Similarly to the UK, India has labour unions that advocate workers’ rights. These unions play a significant role in drafting of laws and ensuring their enforcement. These labour unions also play crucial part in maintaining healthy industrial relations. However they are strained due to the weaknesses of the legal system and poor implementation of labour laws in India.

Conclusions

From the above discussions, it is evident that HRM practices differ significantly across nations due to the influence of national cultures. Organisations should properly analyse the prevailing national culture before developing their recruitment, training, and compensation practices. On the other hand it is also evident that the labour legal framework substantially differs across nations. Thus multinational enterprises must consider existing laws and their enforcement while developing their HRM practices. Similarly it is important to evaluate the industrial relations and how labour unions may affect business operations in the international market due to their diverse nature.

Reference list

Beardwell, J and Claydon, T 2010, Human Resource Management: a Contemporary Approach, Harlow: Pearson Education Limited.

Daspro, E 2009, ‘A Cross-Cultural Comparison of Multinational Firms’ Recruitment Practices in Mexico and the United States’, Latin American Business Review, vol. 10, no. 1, pp. 1-19.

Eriksson, T, Qin, Z & Wang, W 2014, ‘Firm-level innovation activity, employee turnover and HRM practices — Evidence from Chinese firms’, China Economic Review, vol. 30, pp. 583-597.

Hutchings, K, Zhu, C, Cooper, B, Zhang, Y & Shao, S 2009, ‘Perceptions of the effectiveness of training and development of ‘grey-collar’ workers in the People’s Republic of China’, Human Resource Development International, vol. 12, no. 3, pp. 279-296.

Kulich, C, Trojanowski, G, Ryan, M, Alexander Haslam, S & Renneboog, L 2011, ‘Who gets the carrot and who gets the stick? Evidence of gender disparities in executive remuneration’, Strategic Management Journal, vol. 32, no. 3, pp. 301-321.

Marinescu, I 2011, ‘Are judges sensitive to economic conditions? Evidence from uk employment tribunals’, Industrial & Labor Relations Review, vol. 64, no. 4, pp. 673-698.

Shin, T 2014, ‘Explaining Pay Disparities between Top Executives and Nonexecutive Employees: A Relative Bargaining Power Approach’, Social Forces, vol. 92, no. 4, pp. 1339-1372.

Tsai, C & Wang, W 2013, ‘Exploring the factors associated with employees’ perceived appraisal accuracy: a study of Chinese state-owned enterprises’, International Journal Of Human Resource Management, vol. 24, no. 11, pp. 2197-2220.

Tungli, Z & Peiperl, M 2009, ‘Expatriate practices in German, Japanese, U.K., and U.S. multinational companies: A comparative survey of changes’, Human Resource Management, vol. 48, no. 1, pp. 153-171.

Van Der Meulen Rodgers, Y & Menon, N 2013, ‘Labor regulations and job quality: evidence from India’, Industrial & Labor Relations Review, vol. 66, no. 4, pp. 933-957.

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