Impact of Globalization on Human Resource Management

 


Human Resources Management is transforming as the modern business environment faces various complex challenges and opportunities. This transformation happens due to the factors such as globalization. As a result of that many firms have begun to compete on a worldwide basis. This situation has led Human Resources Management to gain more importance in the global arena and international Human Resource Management field. The increasing globalization of business has required organizations to manage their workforce effectively. Managing a foreign workforce can differ drastically from managing a domestic one. Human Resource Management in the international context requires managing diverse workforce originating from different nationalities with various cultures. Therefore, workforce diversity has become increasingly important for organizations that plan to expand into global markets and target different consumer groups.

The main reason for the growth of the globalization with respect to employment is the cultural differences in terms of national values and attitudes. Thus, a lot of care must be taken to adopt, improve and standardize culturally suitable human resource management plan, policy and performance (Faugoo, 2009).

According to the Kapoor (2015), below main factors are driving the globalization

Shortage of talent employees - Despite the current economic downturns almost every developed and developing countries are facing long term talented employee shortages mainly due to ageing and the retirement of baby boomers. Since demand for the talented employees are very high in global markets.

Availability of low cost labor and growing consumers in developing countries - The opportunity has never been more prominent for multinational companies to hire the best talents from developing counties or to outsource work to these developing counties.

Technological progress – Due to the globalization, cost effective powerful technologies, including the Internet, enterprise resource planning system, data warehouse, data mart, and data analytics are available to use for the development of human resource management.

There are many challengers of globalization including gap between the supply and demand of highly skilled workers. Talented individuals have been growing mainly because of increased educational opportunities in world wide however due to their lack of language skills, low quality of educational system, and lack of cultural fit may widen the gap further.

Therefore, this is a very challenging front in HRM. Entities are held together by global HRM, different entities can operate coherently only when it is enabled by efficient structures and controls. It is very important that the businesses not only familiarize with local ways of doing business, and understand the needs of local consumers, but also develop a global mindset among the employees.

Reference:

Akanbi, P. (2013). Impact of Globalization on Human Resource Practices. European Journal of Business and Management.

Faugoo,D.(2009). Globalization and Its Influence on Strategic Human Resource Management, Competitive Advantage and Organizational Success. International Review of Business Research Papers

Kapoor, B. (2015). Impact of Globalization on Human Resource Management. Decision Sciences.

Comments

  1. Venushka BandaranayakeApril 28, 2022 at 6:50 AM

    Globalization in to HRM is very important topic to discussed. However the polices and procedures should be implemented depending on the location and the workforce. Good Job..

    ReplyDelete
  2. Dilini MBAApril 28, 2022 at 7:41 AM

    As explained, organisations and the HR function faces many challenges due to globalisation. Changes in employee expectations, higher employee turnover and new technology are some of the challenges. HR managers should ensure that these challenges are well addressed in order to have continued performance from employees. Good article.

    ReplyDelete
  3. Nishantha RathnayakeApril 28, 2022 at 10:28 AM

    You have shown in this article Globalisation has far-reaching implications for human resource management. Globalization puts pressure on some people to do their best, to develop a transferrable set of HRM practices that can be used all over the world. Well done...

    ReplyDelete
  4. ChathuraDApril 28, 2022 at 7:30 PM

    This blog clearly explained Globalization and how it affects the functions of HRM. Because of the increasing internationalization of business, companies must properly manage their personnel. Managing a foreign workforce is very different from managing a home workforce. Human Resource Management in an international setting necessitates managing a varied workforce of many ethnicities and cultures. Well written article.

    ReplyDelete
  5. Asela ThennakoonMay 1, 2022 at 7:42 AM

    Globalization is a vast area and if any organization expect to expand their activities globally, HRM function should be inline with global standard. This article discuss about the fundamentals driving the globalization on HRM. Good Initiative towards the future HRM.

    ReplyDelete
  6. Amjad AboobakarMay 2, 2022 at 10:38 AM

    Globalization is vast area and cannot be evaded, its a good briefing about the challenges that are faced by HR on this context. Great

    ReplyDelete
  7. Anuradha Wickramasiri.May 3, 2022 at 4:13 AM

    Globalization in HR is becoming significantly important in the global arena Because of the increasing internationalization of business, HR officials of relevant companies should properly manage their employees for the betterment of both employer and employee.
    Well explained article, Good job Amila

    ReplyDelete
  8. Achala BandaraMay 6, 2022 at 9:04 AM

    Globalization is a big topic that cannot be avoided; this article provides a solid overview of the issues that HR faces in this environment. Great Globalization is a big topic that cannot be avoided; this article provides a solid overview of the issues that HR faces in this environment. Superb

    ReplyDelete
  9. Amila PereraMay 6, 2022 at 10:32 AM

    Globalization can be identified as an emerging challenge to Human Resource management function in the present context. Dealing with greater diversity through local and global customers will emphasize the need of well skilled human resource managers to the market. As you explained given factors are pushing the HR function towards globalization and it important to adopt to new changes to gain maximum outcome from the people. Nice article. Well done

    ReplyDelete
  10. Suranga Senarathne - MBA May 7, 2022 at 3:00 AM

    Globalization and how it impacts HRM functions were effectively addressed in this blog.
    Companies must effectively manage their staff as the company becomes more internationalized.
    Managing a foreign workforce is not the same as managing an American staff.
    In an international setting, human resource management entails managing a diverse workforce of different races and cultures.
    Excellent article.

    ReplyDelete

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