International human resource management The WritePass Journal

International human resource management Introduction International human resource management IntroductionAdvantages of ExpatriatesExpertise and SkillsCompany Culture and Practices Passed Down EasilyDisadvantages of expatriatesHigh CostsDiscontent among LocalsAdapting to the New EnvironmentBibliographyRelated Introduction Nowadays, most companies have been expanding internationally, many positions have to be filled which range from entry level positions to those of senior management. As more companies go global, the need for the transfer of skills and knowledge becomes essential if the company is to succeed internationally. To ensure that the subsidiary’s goals, practices and strategies are in line with the parent company, it is necessary to have senior management filled by qualified individuals capable of leading the new, inexperienced team and steering it in the right direction. In addition, to ensure that the subsidiary inherits the culture and practices from the parent company, managers from the parent company might be deployed to fill senior management positions at the subsidiary. However, other positions at the subsidiary might be filled by personnel from local countries rather than the parent or host country. Personnel who do not hail from the host country are defined as expatriates. Whi le recruiting the expertise of the expatriates might be advantageous, they bring a unique set of problems which need to be dealt with to ensure their efficiency. Although there are disadvantages associated with employing expatriates, there are measures that companies can adopt to ensure that the impact of these problems would be decreased. Advantages of Expatriates Expertise and Skills Employing the expertise of expatriates can help a company accelerate the development of its subsidiary or return it to profitability. The skills that they already possess will enable the expatriates to pass on their knowledge and skills to their subordinates and train them in the relevant skills and knowledge. When expatriates are selected for foreign assignments, they have to be chosen based on their skill levels and their ability to adapt. Therefore, when they pass their knowledge and skills to the employees at the subsidiary, the company is able to expand successfully. Despite having a successful 20 year run in Japan, a subsidiary company’s business volumes had decreased, causing its profit levels to dip. HTM Corporation concluded that this situation required the use of expatriates with high levels of technical and communication skills to return the business to its profitable level (HTM Corporation, 2009). As seen in this case, the expertise of expatriates is able to help c ompanies, previously profitable without expatriates, return to those levels as they have sufficient skills. Expatriates are able to bring lot of experience to the subsidiary company because the unique experiences may enable them to help the company succeed through innovation and creativity (Radio New Zealand International, 2009). Expatriates are also able to fill vacancies when the host country nationals do not have the relevant skills or expertise (Pacific Bridge Inc, 2009). This is an alternative to providing on-the job training for the locals. Company Culture and Practices Passed Down Easily The parent company culture and relevant practices and procedures can be passed down quickly if training of the local employees is conducted by expatriates from the parent company. The ideals, vision and mission of the parent company can be demonstrated through the expatriate. If the expatriate embodies these principles of the company, the culture and practices of the parent company can be transferred to the subsidiary quickly and effectively. Disadvantages of expatriates High Costs Although Employing expatriates are beneficial to a company, it is an expensive process. Relocating an expatriate with a family which can be time consuming and costly to the company. For instance, hiring an expatriate to work in China can cost as much as five times of hiring a local. This is due to the package that the expatriate is to receive as compensation. This compensation and benefits package usually consists of a hardship allowance, housing, insurance, tax and home leave, amongst other benefits. The compensation and benefits package is usually attractive to expatriates as a form of financial advancement. This makes the move to the subsidiary company and country attractive. To ensure that it is attractive enough to entice the highly skilled and experienced personnel, the compensation and benefits package has to result in a higher standard of living or the promise of career advancement. The company has to support its high costs, while the expatriate benefits from this package. Other than the compensation and benefits that the expatriate receives, the parent company also has to invest time, money and effort into pre-departure training and incur other costs such as sending the potential expatriate on a trip to assess the location. Hence, there will be a loss of man-hours. As a result of the high costs involved, it is substantial that the expatriate is well prepared for the move. This will reduce the likelihood of expatriate failure which will incur more costs. Discontent among Locals Due to highly trained, educated and skilled expatriates joining the new subsidiary, locals might be discontented when they feel that their opportunities are being taken away. Local mid-level managers might feel that they do not have the opportunity to advance in their careers. This would encourage the talent to leave the company in order to get promote. Consequently, staff turnover might rise because of expatriates holding all the senior positions in the company. This discontent among the locals could be damaging to the subsidiary company. If the company acquires a reputation for poor career advancement opportunities, talented locals are unlikely to pursue a career in that company. Therefore, the company should utilise expatriates while it is in its initial phase but train local managers to succeed the expatriate. Adapting to the New Environment Utilising expatriates to fill key positions is a risky task because of moving an expatriate and the family requires time and effort. An expatriate with children and a working spouse might be concerned about whether the spouse and children will be able to integrate into the local environment easily. To ensure ease of integration, the expatriate must be flexible and open-minded. The company also has to prepare the expatriate for the move to the new country. Expatriates, unfamiliar with the local environment and location, require more time to adapt to their new life. As a result of this unfamiliarity, the expatriate is likely to be less efficient and productive for an initial period. With low productivity, the profits of the company might decrease. Therefore, to reduce the impact of low productivity as a result of adjusting to their new life, expatriates should receive well-structured pre-departure training, preparing them on what they are to expect in the subsidiary company and country. Also, expatriates should be hired on the basis of their ability and willingness to adapt to new environments. Alternatively, they should be allowed a period of time to settle into the new country before starting work. Bibliography HTM Corporation, (2009). Expatriates in Tokyo, Japan Outsourcing by HTM. Retrieved on 11th March 2011 from htm.co.jp/Astrategicallyusingexpacts.htm Pacific Bridge Inc., (2009). Asia – Compensation, Hiring and Retaining Employees in South East Asia. Retrieved on 11th March 2011 from pacificbridge.com/publication.asp?id=58 Pacific Bridge Inc., (2002). Asian HR eNewsletter, Retrieved on 11th March 2011 from pacificbridge.com/newslettervol.asp?vol=2no=7 Radio New Zealand International, (2009). Samoa’s Prime Minister Defends Hiring Expatriates for SamoaTel. Retrieved on 12th March 2011 from rnzi.com/pages/news.php?op=readid=46480 Tripod, (n.d.). Use of Expatriates, Retrieved on 12th May 2011 from http://members.tripod.com/cometonada/HRM.htm International Human Resource Management INTRODUCTION International Human Resource Management INTRODUCTIONTHEORY OF GLOBALIZATIONCROSS CULTURAL MANAGEMENT AND CASTELLS THEORYWHAT IS CROSS CULTURAL MANAGEMENT?CROSS CULTURAL MANAGEMENTCONCLUSION AND RECOMMENDATIONSLIST OF REFERENCESRelated INTRODUCTION The essay will be focused on discussing the Network Society as a new type of Social Structure or Organization of the Information Age. I will be using Castell’s theory on The Information Age to explain how the Network Society affects culture, individuals, institutions and various societies around the world.I will also touch on the Power of Identity, what it entails and its connection to various individuals in the global business environment After this I will talk about cross cultural management, its challenges and how it is implied in the business environment, analyzing the impact the theory of the Information Age has on this type of management and its challenges. I will also discuss the critiques of other theorists to this Castell’s theory and conclude with the negative impact of globalization and the need for cross cultural management in organizations. First and foremost I will touch on a relevant theory of globalization that relates to the Information Age and Cross Cultural Management. THEORY OF GLOBALIZATION There are various theorists, who have given their opinions and views on the theory of globalisation. I am going to phrase a few of them and focus on only one of these theories for the purpose of this essay.   Ã¢â‚¬Å"Anthony Giddens (1990: 64) the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa.  Ã¢â‚¬Å" â€Å"Globalization  refers to the compression of the world and the intensification of consciousness of the world as a whole (R. Robertson, Globalization, 1992: 8).† Robertson sees the globalisation theory as the coming together of the world as a single entity through a set of global ideas and putting aside the distinctiveness of cultural, societal and ethnic differences to be used in the home environments and during academic discussions â€Å"From the social theory perspective, globalization involves the flows of commodities, capital, technology, ideas, forms of culture and people across national boundaries via a global networked society â€Å"(Castell’s, 1996, 1997, 1998). â€Å"The transmutations of technology and capital, work together to create a new globalized and interconnected world.   Ã¢â‚¬Å"(Castell’s, 1998) Manuel Castell is the theorist that I will be focusing on in this essay. He talks about the theory of the network society, which is an information based society where everyone and everything is connected through digital networks.   The networks are the people who control or rule the network society; they are the elites of the society who have the upper hand, are more knowledgeable and have power over the excluded individuals. â€Å"A network society is a society whose social structure is made of networks powered by microelectronics-based information and communication technologies.† (Castell’s, 1996) â€Å"The Net stands for the new organizational formations based on the pervasive use of networked communication media. Network patterns are characteristic for the most advanced economic sectors, highly competitive corporations as well as for communities and social movements. â€Å"(Castell’s, 1996) The Network Society is an emerging social society or structure whose communications rely on digital networks.   A digital network being global means that a society running on them would be a global society i.e. The Network Society is a Global Society. The Network Society came about as a result of the ever changing society which occurred due to the dramatic changes in technology which are controlled by the networks. Castell explains that although everyone is affected by this society, it doesn’t mean that everyone is included in it. People who aren’t part of it try to defend themselves from it. He cites the reason for everyone being affected by these networks as the fact that all central activities that manipulate and form human life around the world are being organised by global networks. The Network Society works on an Inclusion/Exclusion basis; this is a feature of it and while it searches for important add-ons that will benefit the network, it will also bypass any activity, territory or person that will not contribute to the goals or tasks assigned to the network. Part of Castell’s assumptions is the fact that under the network society, there is no class among individuals in our society and that the powers now lie in the hands of the networks. With the network society, there becomes a need for individuals to affirm their identity; this is known as the power of identity. People tend to search for their identities in order to give their lives a source of social meaning. This is a reaction got mostly from the individuals who have been excluded from the network society. Castell realised two types of reactions from these people. They either make up their own networks or exclude the networks from their lives. This power of identity is also known as the Self. â€Å"The Self symbolizes the activities through which people try to reaffirm their identities under the conditions of structural change and instability that go along with the organization of core social and economic activities into dynamic networks.† (Castell’s, 1996) CROSS CULTURAL MANAGEMENT AND CASTELLS THEORY WHAT IS CROSS CULTURAL MANAGEMENT? CROSS CULTURAL MANAGEMENT â€Å"is a system designed to train people in the global business about the variations of cultures, practices and preferences of consumers around the globe. It poses as a challenge for companies who participate in the global market. As time passes by, the diversity in culture, practices and preferences significantly increases, and so is the need for cross-cultural management, to be able to bridge the communication gaps for every culture.â€Å"Error! Hyperlink reference not valid. Cross Cultural Management is the examination or assessment of the human behaviour from an international perspective. With cross cultural management, managers are aware of the different cultures that exist in different industries in different parts of the world.   It realises and tries to manage these different human behaviours, culture and communication issues so as to bring people together without any disputes or problems. This information age has brought about the rise of technology and the use of the internet. This network society has changed the way businesses operate; whereby almost every part of an organisation is controlled by some sort of technology. Most jobs are now done through the internet by some e-commerce organisation, which in turn reduces the number of physical labour needed. With the rise of the global society, cross cultural management is becoming more essential for global companies to be successful with their employees as well as their consumers. It is needed to tackle the challenges that any global business might face in relation to culture and human behaviour. In order to tackle some of challenges brought about by these changes in regard to culture and human behaviour cross cultural management is essential. Some Cross Cultural Challenges that could occur are:- Mixed cultures and languages brought about by globalisation The recent growth and need of the internet as a part of management and easy processing The increasing need for a knowledge worker in knowledge driven organisations The increasing need for flexible workers and jobs There are many more challenges but the network society being a global society has helped to deal with some of these problems. Due to the compression of time and space, companies find it easier to employ the people that will be relevant for the required jobs. Also with the individualisation of labour and the growing flexibility of workers, they are able to adapt and adjust to the growing temporality of jobs. Companies now have the option to choose either part time workers and pay them for the hours worked rather than employing full time workers who are expensive and are not required most of the time. Castell talks about the network society sourcing valuable add-ons that can contribute to the goals and objectives of the network to integrate into its system and excluding those it has no need for who he says make up the ‘irrelevant planet’, this feature of the network society has contribute to some modern business challenges where there is the need for knowledgeable workers. He says that the work process is a globally integrated but labour has become individualised and therefore has no class again as ultimate power goes to those that are in charge of the networks and determine what happens in it. But his theory also says that labour is divided into two; the self programmable and generic labour. The former is skilled and flexible with the ability to learn new things, processes, tasks are able to adapt to change and are knowledgeable while the latter is unskilled and can be easily exchanged or disposed of. There are many critiques towards Castell’s theoretical assumptions.   Many theorists believe that our society is still divided into classes and are against the faceless capitalism which Castell talked about. Theorists like Webster and Garnham believe that the network society is not a new type of social structure or system, and that it has been in existence over time. They argue that this network society is a gradual development of the former industrial society and is not completely a new one. They also argue that the society is still in the hands of the capitalists, as they are still the elites who have access to technology and education, and the members of this capitalist group are heading companies in the top managerial positions. The people in this positions are who Castell says are in charge of the networks so therefore the capitalists still matter in the society. It is also difficult to accept his grouping of labour, as the people in the groups do not share the same values or interests. CONCLUSION AND RECOMMENDATIONS However globalisation can sometimes lead to the exploitation of workers in some third world countries that offer cheap labour. Many of these workers are paid less than the normal UK or US standard of payment, making the big international companies exploit them, and some of them do not offer job security or workers rights. With this network society business do not consider the interests of their workers and are more interested in the opportunities and goals of the networks and look for people that they can integrate that will contribute to their goals. They pay less attention to cross cultural management. This is not advisable to do because in order to be successful as a global company, they need to understand the cultures and practices of the countries they move into. They need to work on integrating the local workers, consumers and culture with their own organisational culture in order to be successful in that country LIST OF REFERENCES Castells, M. (2000).The Rise of the Network Society, Second Edition. U.S.: Blackwell Publishing Castells, M. (1996, second edition, 2000).  The Rise of the  Network Society, The Information Age: Economy, Society and Culture Vol. I. Cambridge, MA; Oxford, UK: Blackwell. Castells, M. (1997, second edition, 2004).  The Power of Identity, The Information Age: Economy, Society and Culture Vol. II. Cambridge, MA; Oxford, UK: Blackwell. Castells, M. (1998, second edition, 2000).  End of Millennium, The Information Age: Economy, Society and Culture Vol. III. Cambridge, MA; Oxford, UK: Blackwell. Webster, F. (2002). Theories of the Information Society. U.S.: Routledge Garnham, N. (2001). Contribution to a Political Economy of Mass-Communication. In M.G. Durnham D.M. Kellner (Eds.), Media and Cultural Studies (pp. 225-252). U.S.: Blackwell Publishing. Manuel Castells , ‘An Introduction to the Information age’ City 2: 7, 6-16 Castells, M. (2000). Materials for an exploratory theory of the network society.   British Journal of Sociology Vol. No. 51 Issue No. 1 (January /March 2000) pp. 5–24 Giddens, A. (1990).   The Consequences of Modernity, Cambridge and Oxford: Polity and Blackwell. Kiely, Ray, 1964–The clash of globalisations: neo-liberalism, the third way, and anti-globalisation/by Ray Kiely. p. cm. -(Historical materialism book series, ISSN 1570–1522; v. 8) R. Robertson,  Globalization  (London: Sage, 1992) The network society: a cross-cultural perspective / edited by Manuel Castells. p. cm. Castells, M. 1983. The City and the Grassroots: A Cross-cultural Theory of Urban Social Movements. Berkeley: University of California Press. http://cross-cultural-management.bestmanagementarticles.com/