Fluent Essays

Topic Choice 1: This discussion topic targets ELO 400-SMC-1015.301 (S301: Human Resources in the Workforce) Lt. Gen McConville said “the Armys most important weapon is its people. Where the other services may man equipment, what we do is equip the Soldiers, the women and men who are the Army. Thats where talent management comes into play”. Unfortunately, all Soldiers who enlist do not make the Army a career and choose to take their experiences back to the civilian sector. As a senior enlisted leader discuss why it is important to understand the “Soldier for Life- Transition Assistance Program” offers various programs to help transition Soldiers within your organization to include self to the new normal of the 21st Century Workforce. Assignment Instructions: Post a substantial initial response, with at least one (1) cited source from your required readings and a minimum of 300 words, to the topic below.  Identify references following the post using APA format. Additionally, respond to at least two (2) of your classmates initial posts, with at least one (1) cited source from your required readings. Each reply post must have a minimum of 150 words per for full participation credit SERGEANTS MAJOR ACADEMY Department of Professional Studies Lesson S301 Human Resource Management Processes and Systems Reading A Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Chapters 2, 8 and 9 Human Resources Management Issues, Challenges and Trends: “Now and Around the Corner”, pages 31–52. Copyright © 2019 by Information Age Publishing All rights of reproduction in any form reserved. 31 CHAPTER 2 GLOBALIZATION AND HUMAN RESOURCE MANAGEMENT Ronald R. Sims The environment in which today’s organizations find themselves continues to be more globalized as the world is becoming a “global village.” This globalization is driven in part by continued growth in multinational investment to include more and more companies entering into alliances with foreign companies, exporting their products overseas, and building plants in other countries. All of the human resource management (HRM) challenges, issues and opportunities discussed in previous chapters in this book are interrelated conceptually and operationally in the international context. This chapter discusses a number of the HRM challenges, issues and opportuni- ties HRM professionals and their organizations will need to address in today’s and tomorrow’s global world of work. The chapter first takes a look at today’s global organization and some HRM issues. Next, the discussion turns to the globaliza- tion of business and factors affecting HRM in global markets before focusing on an analysis of levels of global or international and HRM operations. Finally, the chapter discusses globalization and implications and impacts on HRM in the future. Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 32 • RONALD R. SIMS TODAY’S GLOBAL ORGANIZATION AND HUMAN RESOURCE MANAGEMENT ISSUES For the past decades, there have been profound changes in the international busi- ness scene. With geographic national borders being almost replaced by multi- national firms, and a heightened level of labor mobility around the globe, the implication of HRM to design and develop firms’ global business strategy, and to direct individuals (i.e. managers and professional staff alike) for working in different countries, is undoubtedly significant. Rosalie Tung (2016) has recently suggested that in the past three decades or so, globalization/regionalization, mi- gration and reverse migration (also referred to as “brain circulation”), the ascen- dancy of emerging markets, the demand for people with a global mindset, and the worldwide war for talent have brought about fundamental changes to the na- ture, magnitude, and raison d’etre for HRM in a global context. And, that these changes require HRM professionals and their organizations to adopt new lenses to fully understand the dynamics that impact global or international human resource management policies and practices. Organizations are attempting to gain competitive advantage, which can be pro- vided by international expansion as these countries are new markets with large numbers of potential customers. For example, organizations that are producing below their capacity can use expansion to possibly increase sales and profits. Still other organizations are building production facilities in other countries as a means of capitalizing on those countries’ lower labor costs for relatively unskilled jobs. Importing and exporting goods and services is the easiest way to “go global.” India has the world’s second-largest population (1.2 billion people) and a grow- ing middle class, so businesses are increasingly trying to expand their exports to that country (U.S. News & World Report, 2016). According to Snell and Morris (2019), Apple is one of those companies. Although the iPhone dominates the U.S. market, only 5 percent of smartphones in India are iPhone. Partnerships, mergers and takeovers are other ways companies are addressing globalization. The reality is that most organizations now function in the global economy. For example, U.S. businesses are entering international markets at the same time that foreign companies are entering the U.S. market. Consider the reality that many American and foreign firms have partnered with Chinese firms to expand in China, which is the world’s most populous country, with 1.3 billion people. In turn, cross-border mergers continue to increase (Noe, Hollenbeck, Gerhart & Wright, 2019; Shen, 2016) as Chinese and other foreign companies are merging with American firms (Sheng, 2016). Consider also that it has been suggested that globalization is the dominant driving force in the world economy, reshaping soci- eties and politics as it changes lives (Cascio, 2019). Globalization has also resulted in the blurring of national identities of prod- ucts. Many may think of Budweiser as an American beer, but its maker (Anheus- er-Busch) is owned by a Belgian company called InBev. Like many other compa- nies, Anheuser-Busch InBev has been purchasing or partnering with factories and Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 Globalization and Human Resource Management • 33 brands in other countries such as China and Mexico to expand its sales. Similarly, BMW is a German brand, but the automaker builds cars in the United States, Chi- na and elsewhere (Choi & Schreiner, 2014; Duprey, 2013; Snell & Morris, 2019). Giant multinational corporations such as Nestlé, Unilever, and AstraZeneca, began to lose their national identities as they integrated and coordinated product design, manufacturing, sales, and services on a worldwide basis. Further, many other U.S. firms, for example, generate a substantial portion of their sales and profits from other countries; companies such as Coca-Cola, Exxon/Mobil, and Microsoft derive a significant portion of total sales and profits from outside the United States (Dewhurst, Harris & Heywood, 2012). In 1982 GE, for example, generated 20 percent of its sales outside the United States and 70 percent in 2017 (Mann & Spegele, 2017). Many foreign organizations have taken advantage of growth opportunities in the United States. For example, Toyota, based in Japan, has grown its market share and increased its number of jobs in the United States and elsewhere in North America. Also, Toyota, Honda, Nissan, and other Japa- nese automobile manufacturers, electronic firms, and suppliers have maintained operations in the United States (Mathis, Jackson, Valentine, & Meglich, 2017). Higginbottom (2017) has recently argued that these are indeed “uncertain times” (i.e., for global (and local) organizations and HRM professionals). The last several years have played host to seismic political events such as Brexit and the election of Donald Trump as the U.S. president in 2016. The acronym VUCA which stands for volatility, uncertainty, complexity and ambiguity is a trendy management term that perfectly encapsulates the conditions that many multina- tionals are operating under. Brexit, for example, which stemmed from a slim majority of U.K. voters de- ciding in a June 23, 2016 referendum, that they no longer wanted to be governed largely from a bureaucracy located in Brussels, Belgium, continues to pose a seri- ous threat to the European Union. The EU and Britain are currently negotiating the terms of their separation which will have major implications for global busi- nesses and many observers predict that, at least in the short term, this exit will have a negative impact on the British economy (see, Amadeo, 2018a; Partington, 2018; Romei, 2018). Numerous free-trade agreements forged between nations over the past 60 years, like the General Agreement on Tariffs and Trade (GATT) in 1948 and the North American Free Trade Agreement (NAFTA) in 1994, helped quicken the pace of globalization. However, the election of Donald Trump as president of the U.S. in 2016 has created uncertainty for organizations making their location decisions in his efforts to renegotiate, for example, NAFTA which is the world’s largest free trade agreement. In an effort to keep companies from moving produc- tion outside the United States, Trump announced a 35 percent tariff on steel and a 10 percent tariff on aluminum on Canada, Mexico and the EU. President Trump campaigned on renegotiating NAFTA and frequently berated companies seeking Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 34 • RONALD R. SIMS to build plants in Mexico, for example, particularly when it entails closing plants in the United States (see Amadeo, 2018b; Stoll & Colias, 2016). While factors like Berxit and the election of Trump as the U.S. president are impacting globalization, perhaps none is more important that the rise of Inter- net technologies (Dreyfuss, 2017; Quora, 2017; Sato, 2014). The Internet, as it continues to develop, has certainly changed the ways that people live and work. Indeed, in some industries, such as music and e-commerce, it has completely revolutionized the rules of the game (Cascio, 2019). The Internet gives everyone in the organization, at any level and in every func- tional areas, the ability to access a mind-boggling array of information-instanta- neously from anywhere. Ideas can be zapped around the globe in the blink of an eye instead of seeping out over month or years. A global marketplace has been created by factors such as the following: • Global telecommunications enhanced by fiber optics, satellites, and com- puter technology. • E-commerce that makes organizations global from the moment their Web sites are up and running, as customers from around the world log on. • Financial markets are now open 24 hours a day around the world (Lioudis, 2018). • Cost pressures (that prod firms to move where labor and other resources are cheapest), coupled with a search for new markets (as firms and consumers around the world seek foreign goods and services). • The integration of cultures and values through international travel, as well as the spread of goods such as music, food, and clothing. In combination, these have led to common consumer demands around the world (Tarique, Briscoe, & Schuler, 2016). • The emergence of global standards and regulations for trade, commerce, finance, products, and services (Gunther, 2005). The rapid increase in telecommunications and information technology en- ables work to be done more rapidly, efficiently, and effectively all over the world. Friedman (2016 has suggested that an expanding high-tech, information-based economy increasingly defines globalization and shapes the business cycles within it. That is, much of the flow of capital, labor, services, and goods among Asia, America and Europe are technology based. Without chips, screens, and software help from Asia, the U.S. economy would grind to a halt. Clearly, open borders continue to allow new ideas and technology to flow freely around the globe, ac- celerating productivity growth and allowing businesses to be more competitive than they have been in past decades. Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 Globalization and Human Resource Management • 35 Globalization and HRM Due to globalization, companies have to balance a complicated set of issues related to different geographies, including different cultures, employment laws, and business practices, and the safety of employees and facilities abroad. HRM issues underlie each of these and other concerns. They include such things as dealing with employees today and tomorrow who, via the Internet and social me- dia, are better informed about global job opportunities and are willing to pursue them, even if it means working for competing companies or foreign companies. Determining the knowledge and skill base of workers worldwide and figuring out how best to hire and train them (sometimes with materials that must be translated into a number of different languages) is also an issue for companies in the global environment. There is every indication that the recent social and political changes have con- tributed to globalization and the movement toward international competition. De- spite the reasons an organization may have for expanding operations globally, HRM is critical to the success of any global initiative. If one adopts the basic prin- ciple that HRM strategy must be derived from corporate strategy and that people do determine an organization’s success or failure, then the HRM function needs to be a key strategic partner in any global operations. Still, in some instances HRM is often neglected in the planning and establishment of global endeavors. Despite such neglect, today’s and tomorrow’s HRM professionals must continue to develop their own and other organizational members competencies or skills in the ever-growing international context of the world of work. This means not only understanding the events and factors that continue to increase the global nature of business but also their role in helping to improve their organization’s competitive advantage in global environments. UNDERSTANDING THE GLOBAL ENVIRONMENT It is important for HRM professionals to continue to recognize that because politi- cal, economic, social and technological conditions are constantly shifting around the world, how employees are managed in those changing environments will need to shift as well. HRM professionals can better understand the global environment by regularly conducting a political, economic, sociocultural, and technological (PEST) analysis which can act as an audit of a company’s environmental influ- ences to assist in determining the corporate strategy and accompanying HRM response(s) (see, for example, Post, 2017; Snell & Morris, 2019). By conducting a PEST analysis HRM professionals and other organizational leaders are able to scan different contextual environments to understand the long- term trends and how they might impact a company. A PEST analysis can help HRM professionals to 1) spot business or human resource opportunities, and give them advanced warning of threats, 2) identify trends in the business environment so they can proactively adapt to these changes, 3) help to avoid implementing Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 36 • RONALD R. SIMS HRM practices in a particular country where they may fail, and 4) put an end to old habits and assumptions about how people should be managed to help bring about innovative ideas for the entire organization. Political Factors Government regulations and legal issues affect a company’s ability to be profit- able and successful, and this factor looks at how that can happen. Issues that must be considered include tax guidelines, copyright and property law enforcement, political stability, trade regulations, social and environmental policy, employment laws and safety regulations. Companies should also consider their local and fed- eral power structure and discuss how anticipated shifts in power could affect their business. HRM professionals can assess the political factors by examining a country’s labor laws, property rights, and patents. When Lincoln Electric, the Ohio-based welding company, for example, started operations in Brazil, they could not offer their yearly bonus program based on performance because any bonuses paid for two consecutive years became a legal entitlement (Siegel & Larson, 2009). Property rights in many countries are poorly protected by governments. Who- ever has the political power or authority can seize others’ property with few or no repercussions. Civil unrest can also lead to the poor enforcement of property rights. Businesses have less incentive to invest in countries or locate factories in countries experiencing strife. Another issue that has implications for global companies relates to the intellectual property rights—rights related to patents, trademarks, and so forth. Economic Factors This factor examines the outside economic issues that can play a role in a company’s success. Items for HRM professionals and other organizational mem- bers to consider include economic growth, exchange, inflation and interest rates, economic stability, anticipated shifts in commodity and resource costs, unemploy- ment policies, credit availability, unemployment policies, and the business cycle followed in the country. By looking at trends around market and trade cycles, specific industry changes, customer preferences, and country economic growth forecasts HRM profession- als and other organizational members can best understand the economic issues that are bound to have an impact on the company. For example, in 1995, the World Trade Organization (WTO) was formalized as a cooperative forum for country leaders to come together and increase free trade across the world. As of Decem- ber 2017, the WTO member countries represented over 164 member-nations and covered 97 percent of all international trade (Amadeo, 2018c). In addition, coun- tries are continually negotiating free trade agreements with each other in hopes of increasing their economic activity. Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 Globalization and Human Resource Management • 37 Since China joined the WTO in 2001, its economy has grown dramatically, drastically altering its political and trading relationship with many nations. In a strange twist of fate, Xi Jinping, the leader of the communist world and China’s president, has taken to defending free trade and globalization, whereas U.S. presi- dent Donald Trump, leader of the free world, has taken to attacking them as noted previously (Elliott & Wearden, 2017). Sociocultural Factors The sociocultural factor analyzes the demographic and cultural aspects of the company’s market. These factors help companies examine consumer needs and determine what pushes them to make purchases. Among the items that should be examined are communications, religion, values and ideologies, education, social structure, demographics, population growth rates, age distribution, cultural limi- tations, lifestyle attitude, attitudes towards work and job market trends. An understanding of sociocultural factors has important implications when it comes to a company’s decision about when and how to do business in a country. For example, because of low labor costs and language similarities, many U.S. businesses have found India an attractive place to locate their facilities, particu- larly call centers. By recognizing and accommodating different ideologies, religious beliefs, communication styles, education systems, and social structures, HRM profession- als and other organizational members stand a better chance of understanding the culture of a host country—a country in which an international business operates. Even in countries that have close language or cultural links, HRM practices can be dramatically different. For example, employers might be expected to provide employees with meals while at work and transportation between home and work. In most of the Islamic Middle East, it is completely acceptable to ask coworkers very personal questions about their children, especially their sons, but never about their wives (Tulshyan, 2010; Vollmer, 2015). Technological Factors Technology issues affect how an organization delivers its product or service to the marketplace. Specific items that need to be scrutinized include, but are not limited to, government spending on the maturity of manufacturing equipment, information systems, technological research, technological advancements, the life cycle of current technology, the role of the Internet and how any changes to it may play out, and the impact of potential information technology changes. Even in less-developed countries where manufacturing is typically stronger due to low cost of labor and high cost of capital-intensive equipment, labor-saving technolo- gy is becoming more affordable and accessible. Take, for instance, a textile factor in Vietnam. It is more cost effective for the factory to purchase high-tech thread- ing equipment to spin the cotton into thread than to hire hundreds of people to Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 38 • RONALD R. SIMS thread the cotton by hand, even when the average wage for such employees is less than $100 a month. Just like the other factors, companies should consider genera- tional shifts and their related technological expectation to figure out how they will affect who will use their product and how it’s delivered (Snell & Morris, 2019). While advances in technology have pushed for more service-based jobs, infor- mation systems and technology platforms have also increased the rate at which these services can be traded across countries. Along with the creation of the WTO, 1995 also signifies the beginning of the Internet era mentioned early which is a major driver of the increase in globalization. Table 2.1 provides an example of PEST analysis that can give HRM profession- als and other organizational members a clear understanding of how this works: Every country varies in terms of its political, economic, sociocultural and tech- nological systems. These variations directly influence the types of HRM systems that must be developed to accommodate the particular situation. The extent to which these differences affect a company depends on how involved the company is in global markets. Today, employees around the world continue to become empowered to com- pete without the need of a large company. For example, many websites such as guru.com have developed an online marketplace where individuals can offer vari- ous services and compete for business throughout the world. Consider the reality that one might be interested in developing a new website for their company. By going to the Internet one can select various individuals offering specific services. They may be from different parts of the world. In conclusion, these PEST factors shift the way companies are formed and how they and their HRM professionals go about managing their human resources in a global environment. ANALYZING A COMPANY’S LEVEL OF INTERNATIONAL AND HRM OPERATIONS Today’s international business operations can take several different forms. A large percentage of these operations carry on their international business with only lim- ited facilities and minimal representation in foreign countries. Others have exten- sive facilities and personnel in various countries of the world. Managing these TABLE 2.1. Sample Pest Analysis Political Economic Sociocultural Technical • New state tax policies for accounting • New employment laws for employee handbook maintenance • Political instability in a foreign partner country • International economic growth • Changes in interest rates • Shift in educational requirements and changing career attitudes • Population growth rate • Automated processes in the industry • Rate of innovation • Changes in technology incentives Co py ri gh t © 2 01 9. I nf or ma ti on A ge P ub li sh in g. A ll r ig ht s re se rv ed . Ma y no t be r ep ro du ce d in a ny f or m wi th ou t pe rm is si on f ro m th e pu bl is he r, e xc ep t fa ir u se s pe rm it te d un de r U. S. o r ap pl ic ab le c op yr ig ht l aw . EBSCO Publishing : eBook Collection (EBSCOhost) - printed on 2/21/2021 4:38 PM via US ARMY SGTS MAJOR ACADEMY AN: 2006258 ; Ronald R. Sims.; Human Resources Management Issues, Challenges and Trends: Now and Around the Corner Account: s4061880 Globalization and Human Resource Management • 39 resources effectively, and integrating their activities to achieve global advantage, is a challenge to a company’s leaders and HRM professionals. Often we hear companies referred to as “multinational” or “international.” However, it is important for HRM professionals to understand the different levels of participation in international markets. This is especially important because as a company becomes more involved in international trade, different types of HRM challenges, problems, and opportunities arise. Bartlett and Ghoshal (1991) identified the following four international organi- zational models: • Decentralized federation in which each national unit is managed as a sepa- rate entity that seeks to optimize its performance in the local environment. (This is the traditional multinational corporation). • Coordinated federation in which the center develops sophisticated man- agement systems enabling it to maintain overall control, although scope is given to local management to adopt practices that recognize local market conditions. • Centralized hub in which the focus is on the global market rather than on local markets. Such organizations are truly global rather than multinational. • Transnational in which the corporation develops multi-dimensional stra- tegic capacities directed towards competing globally but also allows local responsiveness to market requirements. Adler (2008) offers another categorization of the four various levels of inter- national participation from which a company may choose and includes the fol- lowing levels of involvement or participation: domestic, international, transna- tional, multinational. The four basic types of organizations differ in the in degree to which international activities are separated to respond to the local regions and integrated to achieve global efficiencies. Domestic. Most organizations begin by operating within a domestic market- place. For example, a business that starts in the …