Example Answer On Multinational Corporations And Complexity

Example Answer On Multinational Corporations And ComplexityMultinational corporations (MNCs), in their effort of globalisation norm every last(predicate)y face complexity that caused by multi heathenism and geographic dispersion. There argon ternion characteristics of complexity in globalisation. 1) Multiplicity reflects the film of MNCs to be responsive to disparate viewpoints, public opinion concern and government rules and regulations. 2) Interdependence pull up stakes office all operation and ancestry activities are interrelated that discount non be treated al one. 3) Ambiguity means the lack of information lucidness that forget lead to difficulty in interpreting events and sight. Complexity in the international operating(a) environment will then lead to versatile global take exceptions.It is difficult for MNCs to achieve organisational effectiveness and sustainable emulous usefulness locally as substantially as globally if it is operating without an efficient an d arrangingatic HRM practices that align with the business dodging. Paine Co. which is building its international figurehead is liner some HR issues and challenges that typically will happen in MNCs. From the case study, the following main HR issues had been identified.TABLE 1 chief(prenominal) HUMAN RESOURCE ISSUES FACED BY PAINE CO.A. CommunicationDo non bear a clear view of the corporate mission parameter and mental imagery set within the group.Lack of conference channel mingled with the vigilance and the employees.Do not ache get-together among staff for idea sup deviset and employees feedback sessions.B. Recruitment, alternative and becomingtyDecentralised recruitment policies.Do not have good image flawing and caller-out reputation.C. capital punishment precaution and give back systemDo not have well designed process critical review and appraisal system.D. Training and developmentDo not give staff intensive preparation for all saucily employees.Do not have further on- cable or off- traffic training for repairment of skills and knowledge.Do not have interchanging of staff in the midst of subsidiaries.Communication cosmos one of the near in-chief(postnominal) components in human life is in addition the divulge of achiever for HR management. Effective communication is essential without an organization to watch transpire of all information and knowledge sharing commode be achieved. Communication is withal vital for the organizational objectives background knowledge. Effective communication mingled with the employer and employees house lead to a greater understanding in achieving organizations goal. employment by Lindholm, N. (2000) found that it is master(prenominal) to communicate the company goal and job objective clearly to the host-country employees in MNCs to increase their job expiation.Jack Welch, the chief executive officer of worldwide Electric Co. (GE) had portrayd the informal culture across the company. The Informal by Jack Welch means violating the conventional chain of command, creating communication across all layers of the organization and everyone fuck talk to the boss. During his tenure as GEs CEO, Jack Welch organized a lot of corporate events that fork up opportunities to all the employees to get-together and at the equal time the management can communicate the company values and vision effectively to the employees. Besides that, Jack Welch similarly made un anticipate visits to plants and offices abroad as well as scheduled luncheons with his managers to achieve good leading, guidance, and work the behaviour of complex organization.The weakness in communication within Paine Co. can be shown in a few contexts. The communication problems started from their international intricacy with some of the subsidiaries running on decentralised basis. There are no common strategies and objectives been set and communicate across all subsidiaries in the general busine ss operation. There is to a fault no interchange of people among subsidiaries which can help to promote knowledge sharing and team spirit. stash away workplace feedbacks from employees can facilitate in creating two-way communication which is important in an organization. Annual staff opinion survey is one of the methods that can be introduced to collect feedbacks from employees. In Paine Co., the occasion that consultants from France made direct complaints to their MD bypassing their local manager had shown the lack in suitable channel of communication within the organization. Besides that, Ferguson as the MD of Paine Co. did not emphasize on knowledge sharing and team work just unless see personal results and consummation as the key factors of find the business winner. Therefore, overall synergy can not be achieved for a greater sustainable hawkish advantage.Human assets are important for service exertion as their people are core part of the source of services that hav e direct visibility from a customer point of view. Stringent recruitment and infusion processes must be implemented to ensure the indemnify people are to be engaged. Employers reputation and corporate branding are different all important(p) factors that will affect the recruitment and selection process. Highly dexterous people are always looking for their employer of choice in seek their job for better flight advancement. Singapore Airlines (SIA) for example had been the employer of choice for umteen educated young people due to their reputation as a service leader in the airline industry. On the other hand, SIA adopts a highly rigorous and smashed selection process which the applicants are postulate to meet various criteria from outlook appearance, age ranges, academic qualifications as well as physical attributes. The stringent selection process is to ensure the decline people bee selected for the estimable job and at the resembling time change the service tonus of the organization.In this case, Paine Co. failed to carry out the best-practice in the recruitment and selection strategies. The company has had problems in developing a brand with a good company image in Germany, both for clients and staff. eyepatch facing the problem in recruiting good staffs, at the same time it also fails to retain the talented young employees. These have affected the power and suavity of the project and business operation and at the same time will incur higher cost for recruitment purpose. As recruitment and retention of employee is some other challenging task in IHRM. Employers ingest to select the skilful people and put them to the right jobs, as well as managing their executing effectively and at the same time retain the quality employees from departure the organizations. Only the right people will take the organization where they need to go. Hadhiphanis (2010) highlighted three issues that need to be considered by management when recruiting employees Value of engender and skills for the proposed position behavioural and technical competencies based in making hiring conclusion and pre-screen candidates before interview. While for retention of staff, Hadhiphanis (2010) again suggested that three strategies need to be carefully implemented in order to ensure the company provide better value to their employees as compare to their competitors.Options of remuneration, fringe benefits and rewards system to employees. sort out in communicating expectations and ability to gauge the performance against expectations.Rotational assignments, rush development and homework as well as financial obtain (job-related and non-job related) to employees.The implementation of good staff recruitment and retaining strategies will not tho build good employees capability for today but also for the future. Paine Co. should rank the ask of their employees and should not assume employees in every country having the same call for. Most of the time, the employees needs are reflected in the well-disposed-economy and culture of the country. Besides that, employees needs will not be the same all the time and review should be carried out periodically to ensure the HR practices are being implemented correctly to fit out the current conditions.As for the performance management and reward system (PMRS) in Paine and Co. Although employees pension and rewards are performance based, the final exam decision still subject to the senior management discretions without going through a proper appraisal and performance review system. Therefore their bonus system is not well-regarded. Performance management (PM) was defined as a HRM process involving constant evaluation of individual and corporate rectifyment get on against the predetermined objectives which are correlated to the company business schema (Dowling et al., 1999 cited by Lindholm, N., 2000). The extrinsic and intrinsic motivations, understanding of job task and job rejoicing of the employees are mainly influenced by PM practices of a company (Lindholm, N., 2000). PM that is properly planned and implemented will also help in the objectives setting, reducing job errors as well as maximizing employees satisfaction and motivation in achieving not unless individual job objectives but also align with the companys business strategy in achieving organizational goals. march from research had shown that cultural differences among countries will affect the elements in implementing PM. PM practices will not be successful if MNCs implement and standardize their PM policies at both home country office and the overseas subsidiaries without shape the cultural differences among the countries. Hofstedes cultural dimensions theory had been applied by researchers in their studies in descent between the cultural differences and the transferability of PM as well as job satisfaction in MNCs. Lindholm, N. (2000) suggested that PM system should be modified to correspond to the culture of host-country. Modular type PM system that can suit to different cultures in different countries can be developed to improve the job satisfaction and performance of host-country employees. Besides that, the design and implementation of a elegant performance evaluation system by taking host-country employees feedback into consideration is crucial to create job satisfaction of employees in MNCs.IHRM issue is one of the greatest challenges for all MNCs. Even world class companies like General Electric Co. and Black Decker Corp. will face some challenges in managing HRM issues when it set-back going global. Mendenhall, M.E et al, (2003) had identified the following Big Five global HR challenges for MNCs.Enhancing global business strategyAligning HR issues with business strategyDesigning and leading changeBuilding global corporate cultures develop global leadersThe implementation of good IHRM practices has hold up very crucial in the success of all organization regardl ess their sizes and industry (Ulrich, 1997, cited by Nicolaou, N. and Costea, E.S). The fit of this type of culture HR system shall be wedded more attention in order to create an effective organization. In todays highly agonistical globalization business environment, human resource become the main assets of an organization and therefore the implementation of IHRM strategy is the key to the success of the organization and its continuous competiveness in the global market.ANSWER FOR QUESTION 2Barlett and Ghoshal (2000, cited by Harzing, A.W and Ruysseveldt, J.V., 2004) highlighted the three types of strategic objectives for MNCs are meeting the challenges of global efficiency multinational flexibility, and worldwide learning. Porter (1990, cited by Truong, et al, 2010) pointed out that the most strong source of emulous advantage for an economy is a skilled, flexible and well-read workforce. While Heneman et al. (2000, cited by Truong, et al, 2010) stated that HR is important for all types of organizational sustainability. umteen companies had realised the importance of strategic HR practices but only a few can implement it strategically in meeting of minds with the business strategy to gain free-enterprise(a) advantage (Schuler R.S MacMillan I.C, 1984).The following put off shows the core components of HR practices that had been identified and the proposed HRM strategies in order to help Paine Co. in building their corporate business strategy to gain long-run competitive advantage.TABLE 2 CORE HRM COMPONENTS, CURRENT STATUS AND PROPOSED STRATEGIES FOR PAINE CO.HRM Core Components up-to-date StatusStrategiesRecruitment and SelectionRecruitment and selection procedures not modulate or standardisedDo not have clear and stringent criteria in selectionTo use value-based hiring methodTo carry out proper job analysis and descriptionSpecification of minimum criteria in selectionStandardisation of recruitment and selection procedures (i.e. interview, psycho metric test and social test) salary and BenefitsRemuneration system not standardised or according to industry standardTo carry out industry remuneration reviewTo introduce cyberspace sharing schemePerformance charge and Reward brassDo not have proper appraisal review systemRewards do not reflected on the individual performanceNo relationship between reward policy and corporate business development strategyTo carry out KPI as PMRSTo create link between goal-setting and performance achievementTraining and DevelopmentDo not have proper training and development programTo have intensive training for new staffTo provide continuous training throughout employment holding of TalentsLack of support from management to staffLack of communication between employer and employeesLack of motivationDo not have succession planTo create multiple channels for information sharingTo rewards the staff with groundbreaking waysTo carry out employees satisfaction surveyTo develop career advancement plan fo r employeesSchuler R.S and MacMillan I.C (1984) suggested two ways for HRM practices to help in gaining organizational competitive advantage by helping themselves and by helping others. They also clarified that good HRM practices should be first be targeted within the company before implement to the external parties (i.e. customers, suppliers, distributors). Strategic HRM practices should be ideally integrate with the business strategy of an organization in building long-tern competitive advantage.Wirtz, J., et al, 2007 believed that The ill-timed people are liability. Recruitment and selection is an important process in HRM that will decide whether the right person will be doing the right job at the right place. Value-based hiring method can be use by Paine Co. in their recruitment and selection process. A detail job analysis and job functions description should be carried out before determining the selection criteria in their recruitment exercise. Other than qualifications and experiences, criteria like physical attributes, social and emotional competency should also be considered when selecting their consultants who are the front-line staff that practise their clients. Therefore, other than structured interviews, psychometric tests and social competency tests should also be included in the screening process to ensure high quality consultants are recruited. By having stringent selection criteria, the uncertainty of hiring the right applicants with the expected qualities will be reduced. In long run, the cost for recruitment and selection process can be reduced due to the increased in efficiency of recruitment and selection process.Besides the selection and recruitment process, Paine Co. also facing problems in managing their compensation and benefits as well as PMRS. It is suggested that profit sharing scheme to be introduced to the consultant advisers and senior consultants. This will embolden employees to be part of the business partners and increas e their commitment towards the company performance. While for PMRS, Paine Co. should implement the Key Performance forefinger (KPI) system to ensure lovely evaluation of performance review and structured appraisal throughout the livelong group. Implement of KPI system will not only guarantee fair treatment to all staff but also make the objectives setting and performance management process more effective.Training is one of the key components of success for service industry like Paine Co. For organizations that are seeking competitive advantage through HR, Khandekar, A., and Shama, A. (2005) suggested that they should design their HR systems so that human resources can be utilised efficiently and enabling knowledge been used by employees to maximize their organizational competitive. In this situation, Paine Co. is suggested to plan and provide an intensive training program to all its new employees before they carry out their duties. intensive training programs are effective HRM tools because it can help the newcomers to master their jobs which likely causing fewer anxieties among them. Besides that, company values, objectives and the expectations from the employer can also be clearly communicated across to the new staff through intensive training. succeeding off-job and on-job trainings should be planned and provided regularly throughout the employment period to improve knowledge and skills of employees. The training and development program is part of the strategic HR management that is essential for Paine Co. to obtain sustainable service excellence and long-term competitive advantage in the industry.Last but not least, the talents retention is another area that needs to be strategically implemented. Tobia, P.M (1999) mentioned that lowering turnover rate of staff will increase profits of a company. Besides that, only employees who are motivated and satisfied with their working conditions are able to spend a penny good services and products for bet ter competitive advantage in the industry. Many young consultants in Paine Co. left the company by joining the competitors make that its employees are not satisfied with their working conditions as compare to the competitors. Paine Co. need to improve the provision of resources to the employees in carrying out their duties. Implementation of some long-term retention programs such as innovative and fair PMRS people neighborly policies and carry out employees feedback survey will definitely help in reducing staff turnover rate. Opportunity for career advancement is another determinant of retention success. Succession plan and career path planning is important to retain talented employees and increase productivity.By implementing all the supra proposed HRM strategies will not guarantee the ultimate success of the company in achieving the long-term business competitive advantage if there are no continuous reviews and improvement plans on its strategies. Besides a good HRM systems, p roducts and brand differentiation focus orientation global thinking a slender radar system perpetual spirit of innovations social and environmental responsibilities are some of the other criteria for MSCs to become a real World club Company and achieve long-term business competitive advantage. All the preceding(prenominal) mentioned criteria will need to link people with the strategic needs of the business as people is the most valuable asset of an organization. If the business needs of an organization can be clearly identified and be merged effectively with the HRM practices, long-term sustainable competitive advantage will not be far from achievable.REFLECTIONPlanning and formulating the HRM practices with business strategy for competitive advantage will be meaningless if the management do not understand the basic needs of their employees. Therefore, communications play an important fictitious character in the analysing and understanding the employees behaviour so that the ri ght HRM practices can be strategized. All employers know what the company goals are, but not everyone is able to excogitate their products or services with the market-place effectively to determine the types of employees needed. The needs-matching process to get the right person to do the right job is another great challenge in HRM.Another concern will be the consistency in the implementation of the best HRM practices in an organization. Only long-term consistency in the practices can bring great results and achieve sustainable competitive advantage instead of just short-term success. Commitment from the top management is an important factor that will determine the success. Total organizational commitment can not be achieved without starting from the top and working down. If the top management started to demonstrate good practices, concern and commitment to their job and products, the employees will also begin to follow the same practices and further synergizing their contributions to perform for sustainable competitive advantage. END ABBREVIATIONSGE General Electric Co.HRM Human Resource ManagementIHRM International Human Resource ManagementKPI Key Performance IndicatorMD Managing DirectorMNCs Multinational CorporationsPM Performance ManagementPMRS Performance Management and Reward SystemSIA Singapore Airlines