Globalization of business operations and industries has created a new challenge for organization penetrating in international markets. Several factors require management when firms focus on diversifying its product/service offering in international markets. Especially limiting the viewpoint to human resource requires managing the workplace diversity, employee selection mechanism, cultural differences, and managing the intercultural communication requires assessing the capabilities of organization to address these issues.
International market business operations present the companies with acquiring new set of skills and transformation in human resource policy in order to perform the services with flexibility that doest not hinder in goals achievement. Workplace diversity management is the essential and important issue that needs to be address by an organization entering in international markets. Since diverse workforce consist of people belonging to different culture, races, having different ethnic background, a different way of learning; thus providing different ideas merging in organization.
This enables organization to utilize and focus on enlarge business challenges in different business markets. Strategic HRM policy structure gives flexibility to organization for changing its focused principle in consideration of market needs; such as cultural dimensional factors identified by Hofstede on various dimensions helps identify the factors to be addressed by organization based on the market needs. Cultural differences have strong implications for organization expanding in international markets.
Therefore, organization needs to give autonomy and flexibility to employees that will serve organizational purposes in international markets by leveraging the HRM policies. This can be done by regulating the rewards and compensation package structure for employees who will need to be relocating in different workplace locations due to their skills required to penetrate and serve in international markets. In relation to managing cultural differences, organization must define a comprehensive and decentralized decision making structure through defining the hierarchy management channel in its policy for international markets.
Since few activities of firm remain limited in centralized location, so in order to comprehend the objective proper decision making style will enable accuracy and timeliness of activities. Decentralization of decision making structure will reduce the possible delay in decision making due to multi-level hierarchy structure of an organization and will also result in better assessment of any situation due to diverse workforce. Communication between departments and stakeholders is highly significant when concerning the international operations of an organization.
Effectiveness of organizational culture for performing international operations is based on the communication style related to information processing, decision convey ability, surpassing the imperative information related to business decision making, and matters related to managing intercultural communication barrier. Ambiguous and unstructured problems require managing the barriers to improve the interdepartmental sharing of information for goals accomplishment.
This issue can be addressed by initiating equal employment opportunity program for international business which would limit the selective culture growth of organization and encourage workplace diverse. Frame of reference affects the cross-cultural communication due to selective visionary capabilities of employees to foresee the potential growth possibilities. Therefore organization must initiate a formalized recruitment program focusing on viewing various individual dimensions in its SHRM policy structure to normalize the responses towards reducing frame of reference.
Stereotypical response by employees increases the biasness that affects the communication at international level increasing the chances of intergroup conflict affecting the effective goals accomplishment of organization. In association to this, chances of misunderstanding increases when firm do not address discrimination issue in its HRM policy to manage international operations functionality. Impartiality of decisions thus contributes towards progressive growth pertaining to employee contribution.
At international level, cognitive dissonance is also a big challenge for firms to manage as ambiguity in information sharing leads towards strong misunderstanding among departments which may be depicted in actions leading towards wrong objectives setting. Company must address the corporate culture issue and coordination mechanism in its HRM policy to reduce the impact of cognitive dissonance on organizational goals accomplishment.
Sony Corporation has developed a communication structure identified in its HRM policy to increase the effectiveness of communication among its employees in regional offices and production sites located in China. Employees are given combined training sessions, and encouraged to participate in workshops which increases the communication among employees belonging to different cultures and understand their potential issues that may arise due to operations in international markets.
Human resource ethical issue also has implication for firms either they operate locally or in international markets. Employee privacy, job safety, health standard, workplace environment and condition, legislation for employees’ rights protection are essential duties for senior management to address in strategic HR policy. This although may create certain challenges to address by management but provide job satisfaction to employees; policies amendment concerning addressing the ethical issues differ of country basis due to differing working demand and obligations by country law.
However, an organization can standardize the procedure and policies giving protection to employees as its ethical responsibility. SHRM policy can emphasize on employee welfare concept that aimed at addressing the factors leading to increased employee living standard; consequently, employee involvement in work increases and firm’s penetration power in international markets also strengthen due to direct participation of employees in organizational objectives achievement.