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Human Resource Management Issues In International Market

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Question:

Identify and Discuss the Human Resource Management Issues that a HR Manager in Melbourne would have to Consider when Relocating a Manager from Australia to Manage a Subsidiary branch of an Australian Multinational Organisation that is Located in London in the United Kingdom.
 
 

Answer:

Introduction

In present time, the organizations are becoming globalized. It is very critical now for the organizations to use expatriates for the business operations in the international market. The multinational companies are using expatriates not only for expansion of the business but also to develop international management competences in the international market. It is observed that human resource management faces many problems in the international market as the international environment is more complex (Caligiuri&Tarique, 2012). There are many evidences which suggest that international human resource management is the important part to determine the success or failure of the companies in the international market. There can be many reasons for failure such as incapability of communicating and coordinating the activities in the international business by the companies.  The aim of this essay is to identify the human resource issues in London   which can be faced by an Australian company while expanding its business in London   market. There can be many issues for the managers while locating in new country for business perspective (Briscoe, Schuler & Claus, 2011).

 

International human resource management

There are various literatures focusing on the international human resource issues for the HR managers. At the micro level of HRM, HR managers are concerned with the global coordination of HR policies and procedures to achieve the business goals.  In the time of globalization, companies are focused on the expansion of the business in the international market. Companies are expanding their business in the various countries to achieve growth and success. The company which is going to enter in the London   market must take into consideration the challenges and issues to avoid the chances of failure (John, Lynette & Tony, 2004). The human resource management is not limited to planning, recruiting, staffing, labor relation, performance management and compensation within the organization. The concept of human resource management has now turned into international human resource management. Because of the development international human resource management in the organizations, the work actions of the HR managers are becoming more complex having many functions such as managerial services, global relocation, education and apprising the employees in the global environment, international taxation, and inter-government relations etc (Hutchings, Fenwick & Cieri, 2007). So, global human resource management is different from the domestic HRM due to many complications. The manager from the Australian company may face many issues and challenges related to the culture and other factors while working in the London branch. The culture and environment in the London is differing from the Australia and it may create various challenges for the manager in London market (Khalid & Rehman, 2010).

 

Challenges in London 

It is observed that human resource management is the main base of competitive advantage for each company. In other words, human resource management affects the presentation of the managers with the strategic management. Basically, International human resource management is the mixture of different processes, procedures, and roles which are accepted to attract, maintain and develop the customers in the companies. It is easy to locate the company in the international market but it is not simple to operate the business in the global marketplace. The manager, who goes in the international market for operating business, can face many issues related to the environment and culture (Stankiewicz, 2015). Some of the main challenges and issues are as follows:

Cultural diversity-

No any prior information of local culture of target country can be a big challenge for the manager. Common business practices in the London   are not proper while managing the staff. Manager can suffer from the loss of morale in the new country.  This is the silent issue in the international market which can impact the performance of the manager. The culture of Australia is quite differing from the culture of London. It will not be easier for a person to adjust in the London without prior training. Although there are some similarities in both of the cultures but the livings of the Australians and English people are different (Taylor, 2015). The business and work culture of both the countries are also different. In Australia, punctuality is must in the business meetings and people in the meeting keeps short and to the point. On the other and, the work culture of London is different from the Australian culture. In the business meetings, people are more reserved in the meetings as compared to Australians. This can be the challenge for the manager of Australian country (Katie, 2016).

Currency issue-

To operate business across the local boundaries is not an easy task. Managers have to deal with the foreign currencies while operating the business in the intentional market. Managers need to understand the conversion rates and the currency exchange rates of London to complete the money transactions effectively. Incorrect calculation and any kind of mistake in the can increase legal complications in the business and can affect the bottom line of the business. HR Manager in the London market needs to develop company-wide policy to instruct that manager about accounting practices in London market (Okpara &  Pamela 2008).

 

Law and regulations-

The business of Australian country will not get success and growth if the manager ignores legalities and the regulations of London. Tax laws, government controls, and health and safety standards are different in London from Australia. It can create the issue for that manager who is going to relocate in the branch of London. So, there is the need to provide information about the laws of London by the HR managers which can impact the business and the life of that manager (Darby & Williamson, 2012).  It is the job of HR manager to research and communicate about rules and regulations of London. Manager should remember that things can be changed quickly in certain areas due to the change of economy and political power. To avoid the pitfalls, manager should be aware of laws and regulations in London market (Tessema & Soeters, 2006).

Human resource management and employment relations issues affecting work life

Proper HRM practices and employment relations are the most important functions for the success of organization in the international market. There are some HRM and employees relation issues that can impact the performance of manage in London. Those issues are as follows:

Lack of training and education-

Manager has to face many issues while handling the business in London. Without proper training and education of international market, it is very critical for manage to adjust in the London market. Training and development are perceived as the important activities to get good business results. HR managers have to provide proper training of cross-cultural market so that the manager in London branch can be able to handle the business effectively. Without proper training, the performance of the manger can decrease (Gurbuz, 2009).

Lack of succession planning-

Without any succession plan, manager in the foreign country will be demotivated. No any prior succession planning, it will impact the motivation of that manager. Manager will not be able to perform and produce desired result as he will know that there will be no any reward accordingly. The lack of succession planning will be the cause of unhealthy office politics (Hansson, 2007).

 

Ambiguous job description-

Imperfect job description can also affect the performance of manager in London   market. This will lead the manager who does not know about his job role and responsibility. It will also create many complications in achieving the organizational goals (Abbott, 2006). This will create dissatisfaction and tension in his job and decrease the performance of the manager. Manager will be unhappy as he will be unable to utilize his skills abilities and knowledge based on his specialization. Due to ambiguous job description and specification, manager will feel demotivated in his job role.  The human resource manager is responsible for providing right job role to the right person n the organization (Green et al, 2006).

So, these are some human resource management and employees relation issues which can affect the performance of the manager in the London branch.

Conclusion

 This essay discusses about the international HRM and the issues faced by the manager of an Australian company who is relocated in the branch of London. From the above analysis, it is observed that entering in the global market is not an easy job. The HR managers have to experience various issues and challenges such as HR rules and actions, and actions and attitude of the customers. It is also observed that international human resource management is a complex process. So, it is clear that manager of the Australian company has to face many challenges in the London market while operating business there. Further, there are some issues such as different business culture, Currency issue, and different Law and regulations which can be faced by the manager in London market. The business and work culture of both the countries are also different. Apart from this, HRM practices and employment relations can also impact the performance of manage in London. Due to Lack of training and educationthe performance of the manger can decrease. Lack of succession planning and Ambiguous job description can create dissatisfaction and tension in his job and decrease the performance of the manager. So it is important for the HR manager to look after these issues for the success of the company in London market.

 

References

Abbott, K., (2006). A Review of Employment Relations Theories and Their Application: Problems and Perspectives in Management. 1

Briscoe, D.R., Schuler, R.S., & Claus, L., (2011). (3rd). IHRM: Policies and Practices for Multinational Enterprises, Routledge Chapman & Hall

Caligiuri, P., &Tarique, I., (2012). Dynamic cross-cultural competencies and global leadership effectiveness: Journal of world business. 47. 612-622

Darby, R., & Williamson, C., (2012). CHALLENGES           TO INTERNATIONA HUMAN RESOURCE            MANAGEMENT: The management    of employee     risk      in         the       humanitarian   aid       and            security sectors: Int.    J. Human        Resources        Development   and      Management. 12 (3)

Green, W. K., Wu, C., Whitten, D., and Medlin, B. (2006).The Impact of Strategic Human Resource Management on Firm  Performance  and  HR professionals’ Work Attitude and Work Performance: International Journal of human resource Management. 8(3).263-276

Gurbuz, S., (2009).The effect of high performance HR practices on employees’ job satisfaction: Istanbul University Journal of The School Of Business Administration. 38. 110-123

Hansson, B., (2007).Company?based determinants of training and the impact of training on company performance: Personnel Review.36 (2). 311–331

Hutchings, K., Fenwick, M., & Cieri, D. H., (2007). The challenge of international human resource management: balancing the duality of strategy and practice: The International Journal of Human Resource Management. 16(4). 584-598

John, L., Lynette, H., & Tony, W., (2004).The Strategic Managing of Human Resource.New Jersey

Katie, (2016).Key Differences Between Australian, American and British Work Culture. Retrieved on 31st March 2017 from https://www.languagetrainers.co.London  /blog/2016/09/19/key-differences-between-australian-american-and-british-work-culture/

Khalid, G., &Rehman, M. Z., (2010).Impact of HRM Practices on Orginizational Performance: NUML Journal Management and Technology. 16-27

Okpara,    J.    O., &  Pamela W., (2008). HRM    Practices    in    a    Transition    Economy: Challenges and Prospects. Management Research News. 31 (1): 57 –76

Stankiewicz, K., (2015). Contemporary Issues and Challenges in Human Resource Management. Retrieved on 31st March 2017 from https://zie.pg.edu.pl/documents/10693/38995566/Contemporary%20Issues%20and%20Challenges.pdf

Taylor, B., (2015). Key challenges facing international market researchers, Retrieved on 31st March 2017 from https://www.languageconnect.net/blog/market-research/key-challenges-facing-international-market-researchers/

Tessema, M. T., &Soeters, J. L., (2006).Challenges and Prospects of HRM in Developing Countries: Testing the HRP-Performance  Link  in  Eritrea  Civil  Service: International  Journal  of  Human  Resource  Management. 17(1): 86-105

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