Globalization and its Challenges
Globalization has become a normal part of contemporary society for many multinational organizations. Efficiency in information transmission is one of the key factors driving globalization, which attracts numerous organizations. Similar to this, businesses often take advantage of business prospects in emerging areas thanks to better management and coordination. Globalized organizations have also been successful in creating top-notch management teams with the needed exposure to other operating enterprises abroad. On a positive note, global expansion of the operations of an organisation contributes to increased profits, as well as enhanced market coverage. Nonetheless, such corporations have to deal with various challenges. The essay examines main social and technical challenges facing firms wishing to internationalise their staff selection and assessment approaches. Based on this question, the paper will evaluate the appropriate HRM strategies to overcome these challenges while assessing their effectiveness in IHRM.
Social & Technical Challenges
Cross-cultural Suitability
HRM studies have been able to emphasise the growing importance of the cultural environment in which expatriates execute their tasks and duties in the determination of the performance levels and profits at the end of each operational period. Other than technical and managerial skills, it is vital for the international workers to possess artistic abilities to facilitate effective and efficient operation in a new environment (Collings, Scullion, and Morley 2007: 204). For instance, firms seeking to internationalise their operations tend to focus on the cultural empathy, adaptability, positive attributes, emotional stability, language ability, and maturity. In spite of the growing need and importance of inter-cultural competence, firms tend to face challenges in defining components of this cultural attribute, let alone assessment of the suitability of the candidates in this context.
Technical Ability
From a subjective perspective, an individual's ability to execute the required duties proves to be an essential consideration. HRM researchers have been able to highlight the tendency of international corporations to depend heavily on the relevant technical skills, especially in the selection process (Thoo & Kaliannan, 2013: 148). In this aspect, management of such corporations experience challenges concerning the integration of the most effective selection criteria in the determination of the technical abilities of the potential workers in the international context.
Country/Cultural Requirements
In the midst of globalisation, cultural or national diversity issues continue to have enormous implications on the operations and activities of an institution. In the adoption and implementation of the recruitment, selection, and assessment practices, corporations seeking to internationalise their operations have an obligation to adhere to the national or cultural requirements of the host nation (Hurn 2014: 376). This is always challenging because of the need for adjustments by the firm to comply with the relevant needs and expectations in the new niche of operation.
Language
One of the critical attributes cross-cultural ability in an employee is the technicality or ability to speak the local language. Language is a critical aspect in the selection decision depending on the position of the international employee or expatriate. Diversities in language offer challenges to the realisation of effective and efficient cross-cultural communication. Based on this attribute, managers and corporations find it challenging to adopt and implement the most effective recruitment, selection, and assessment practices in the international context.
Family Requirements
HRM studies have been able to highlight, effectively, the growing importance and contribution of the family, especially the spouse, in the achievement of success of the workers in the global or international context. In spite of this importance, various corporations have been able to focus majorly on the potential employees. For the firm seeking to internationalise its selection and assessment practices, the performance of such workers in the host nation should be an important factor. Based on this, firms tend to experience challenges in determining the most effective HRM practices to deal with the family requirements at the selection and assessment stage.
MNE Requirements
These are situational issues or factors having enormous implications on the selection decisions. For instance, the firm might consider the proportion of the expatriates against the local staff in the course of making selection decisions as an output of the staffing approach or policy (Rees & Smith 2014: 83). Nonetheless, operations in specific nations tend to demand different criteria regarding a number of workers to operate as expatriates against practices to reduce unemployment among the local workers.
HRM Strategies to Overcome the Challenges
In the course of addressing these social and technical challenges, the firm seeking to internationalise its selection and assessment practices should consider three critical strategies regarding acquisition and management of the employees.
Ethnocentric Selection and Assessment Strategy
Adoption and implementation of this HRM strategy would facilitate prevailing of the home nation practices. For instance, the headquarters from the home nation will have the platform to engage in making critical decisions in the midst of this internationalisation process. Similarly, the home nation's practices will consider integrating employees with its origin on important jobs. Moreover, the firm will model its subsidiaries in agreement with the HRM practices of the home country. In this approach, the firm will have the opportunity to transform and transmit its operations easily from the local to the international level while addressing challenges of technical abilities (Sparrow 2007: 851). Furthermore, HRM practices of the home nation will cater for the family requirements based on substantive knowledge of the existing employees for further success in the global context.
Polycentric Recruitment and Selection Strategy
In the implementation or incorporation of this approach, the firm will focus on enabling each subsidiary to experience management on the local basis. For instance, the selection and assessment approach will focus on the utilisation of the local employee to head the relevant subsidiary. The notion behind this strategy relates to the lack of adequate knowledge and cultural suitability of the headquarters' managers for effectiveness and efficiency in running the subsidiary in the host nation (Treven 2001: 181). Notably, the strategy will aim at enabling subsidiaries to develop and adhere to the HRM practices of the host nation rather than the native or home nation in the process of internationalisation. In this aspect, the firm will have the ability and opportunity to engage in addressing MNE needs, cross-cultural suitability, and national or cultural requirements in the process of this expansion into the global niche (Dowling, Festing, and Engle, 2008: 163). To certain extent or degree, the firm will incorporate appropriate mechanisms in overcoming language barrier since local practitioners will have the opportunity to hold important jobs in the subsequent subsidiaries.
Geocentric/Global Selection and Assessment Strategy
Additionally, it is possible for a firm seeking to internationalise its selection and assessment practices to consider the integration of geocentric or global approach. The approach facilitates the integration of the global approach to the management of the employees. In this context, it is ideal to engage in the recruitment and development of employees from different nations to address diverse needs and demands of globalisation (Treven 2001: 181). The approach would be ideal in enabling the firm to use its selection and assessment practices to bridge the gap on the aforementioned challenges.
Effectiveness of the Strategies in the IHRM
Ethnocentric Approach
Firms implementing this approach to the HRM selection and assessment should assume the effectiveness of the home country approach, as well as the ability of employees from different parts of the world to follow. One of the most effective benefits of this approach in the selection and assessment of the workers is the ability for the firm to maintain cultural similarity with the parent institution. This will facilitate the effective and efficient transfer of the business, as well as management practices, thus, appropriate on the IHRM. Additionally, the firm in question will have the desired platform to exercise and experience closer control leading to valuable coordination of the international subsidiaries, thus, a platform for tackling technical suitability of the employees (Tatoglu, Glaister, & Demirbag 2016: 284). The approach will also offer valuable multinational orientation to the workers based on the experience at the parent institution in pursuit of quality products and services' delivery, as well as enhanced profit levels (Marie & Derous 2016: 57). Notably, integration of this approach would be sufficient in the IHRM because of its ability to establish the pool of experienced executives with the desired ability to make it on the international platform.
However, the approach might have its shortcomings. For instance, the strategy might generate issues of adaptability to the foreign culture and environment, thus, ineffectiveness in addressing the challenges mentioned above in the paper. Alternatively, there might be high transfer and remuneration costs while increasing 'foreignness' of the subsidiary leading to negative implications or lack of recognition among the audiences. The approach might also result in personal or family issues contributing to high failure rates. The success of the approach in the IHRM must depend on the local government restrictions (Scullion, Collings, & Gunnigle, 2007: 312). Integration of such approach might also exert negative influences on the morale and motivation of the local management.
Polycentric Approach
The approach proves to be effective in the IHRM based on its strengths, which outweigh the relevant weaknesses in the achievement of the desired goals and targets. For example, the approach facilitates efficiency in the selection and assessment process since the firm has a vast pool of workers to choose from in the local or host nation context. Eventually, this leads to reduction of the labour costs in the process of internationalisation (Harvey, Reiche, & Moeller, 2011: 159). Similarly, the approach enables the firm to address cross-cultural suitability, as well as national or cultural requirements' challenge through foster a reputation of legitimacy among the target audiences, the locals (Gooderham, Morley, Parry, & Stavrou 2015: 721). Notably, the approach will be able to function in the IHRM based on its effectiveness in representing the local considerations, as well as constraints in the decision-making processes (Mahmood 2015: 338).
Nonetheless, the process in the selection and assessment might have its shortcomings such as complexities in balancing local and global demands, as well as priorities and ineffectiveness in the acquisition of qualified personnel in the achievement of the goals and targets. Moreover, the approach might limit or reduce the desired level of control from the headquarters of the firm seeking to internationalise its HRM practices. In spite of these challenges or weaknesses, the approach would aim at tailoring the practices in accordance with the needs and expectations of the host nation, thus, efficiency in the interaction with the audiences in pursuit of an improved level of performance.
Geocentric Approach
The objective of this approach is to offer the desired balance between expatriate employees and local workers on the international subsidiaries. Being a bridge between hiring local workers and expatriates in the modern context, the approach proves to be valuable and effective in the IHRM. For instance, the geocentric approach will enable the firm to integrate transparency in the selection and assessment HRM practices while exploiting the vast pool of potential employees to address its internationalisation issues (Hamdani, Valcea, & Buckley 2016: 1158). Similarly, the effectiveness of the strategy is evident in its ability to address language barrier based on the approach by the firm to consider integrating English as its official language for the business transaction and practices. Moreover, the geocentric approach will address cultural-suitability issues because of the platform for the firm to recruit competent multicultural workers to oversee the growth and development of the firm in the global context (Ployhart & Weekley 2014: 157). In the implementation of this approach, the firm will aim at maximising outputs of diversity to achieve the desired profit levels while adhering to the national culture requirements.
Conclusion
Conclusively, in the growing cases of internationalisation, business entities, firms, and corporations have the tendency to face diverse challenges, especially in the recruitment, selection, and assessment of the potential workers. In this paper, the focus was on the assessment and exploration of such challenges regarding technical ability, language, cultural-suitability, national or cultural requirements, MNE requirements, and family issues. In addressing these issues, it is appropriate for the organisation to consider the most valuable strategy from ethnocentric, polycentric, and geocentric depending on its demands and expectations.
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