Human Resource Strategies For Global Market Expansion: A Case Study Of Microsoft

1.Identify and explore purpose and scope of international human resource management, evaluate different types of multinational companies, their structures and strategies, and its influence to the people management practices.

2.Assess the impact of cultural differences in the management of people in multinational organisations and demonstrate knowledge of global issues that influence the international HRM practices.

3.Analyse international staffing  approaches,  compensation  strategies  and management of virtual team.

Microsoft Corporation is one of the leading giant among the software development industry throughout the world. The company creates, manufacturers, supports and licenses various range of services and products, which is predominantly linked to computing. Bill Gates and Paul Allen are the main founders of Microsoft and it’s headquarter is situated in USA. AT Microsoft, the values and mission are to serve the customers and business all over the world realizing its full potential.

 In the given report Microsoft is selected due to the skills, knowledge and capabilities of the human resources of its company. Proper human resource management has led the organization effectively achieves its objectives. Hence, from the perspective of the company, highly managed human resource function is crucial for the success of the company.

The report acknowledges Microsoft’s human resource practices. There are generally no universal sets of practices of human resources to be followed by every organization. Each company tailors the most effective model for human resources management to achieve the growth of their organization.

In the recent era of globalization, business needs to adapt and evolve itself to attain maximum profit and success in the long-term. As the organization expands itself its needs are also greatly dependent on the international operational capabilities. Microsoft needs to adequately understand the business complexities while entering into a global market to retain its competitive edge. The most common challenges facing Microsoft’s is managing the cultural and diverse work force in its target country. Diverse culture, customs and languages hinder the alignment of human resource policies in the target company.  One of the major problems that is faced by the HR are the disconnection among them as they fail to implement the same procedures and policies related to benefits, hiring and compensation in all of its subsidiary branches (Ones, Viswesvaran and Schmidt 2015).  

Furthermore, political and economic environment also lead to tremendous affect on the global operations. Each and every company has its own legal compliances and labor laws. The HR department for every foreign subsidiary needs to fully assign with the organizational policies. It is vital to abide by the regulations, laws and rules of the country in which the business is to be expanded. The country’s logistic and tax laws, culture and import duties are very crucial. It is very crucial for the company to implement effective human resource strategies (Chelladurai and Kerwin 2017). 

The Importance of Human Resource Management for Microsoft's Success

Microsoft should develop proper staffing strategies so that the reporting structure can be delivered appropriately. In the countries, like China and India, which are the new emerging markets in the IT sectors, effective human resource practices would contribute towards success (Brewster et al. 2016).

Recruitment and Selection strategies:

Recruitment is generating a pool of candidates required for the company’s and selection is the crucial process to select the best talent for the organization. Selection is usually known to be a two-way process and any wrong decision may impact the organization’s success in a negative manner (Björkman, Fey and Park 2007). Microsoft should maintain strong screening process while selecting the candidates so that it can make correct decisions at the very first time (Storey 2014). Both the countries, India and China are highly abundant with great skilled work forces. To establish the company in such emerging markets it is important to efficiently recruit and select the best employees. Microsoft should advertize in the local papers and websites. Application should be made online to and should be screened to ascertain the best candidates. Tests, Interview and CV evaluations should be made in the selection process (Armstrong and Taylor 2014). The individual to be selected should be first evaluated through their resume so that it should match with the requirement of their job.

In the next stage Microsoft should evaluate the individual’s logical thinking, technical knowledge and background knowledge. People in the country’s like India and China are unaware about the various updated techniques used by Microsoft in any other organization. After the interview process, the individuals should go through various kinds of assessments and psychometric testing so that their personality and aptitude level can be known.

Since the Earlier times, Microsoft has firmly believed in recruiting the most intelligent staff. The corporation lays major emphasis on intelligence rather than experiences. Microsoft always attracts the brightest and best for their company (Cascio 2018). There are various benefits availed by Microsoft after implementing efficient staffing strategies in its target country. Employee productivity level increases, which leads to the growth of the organization and further reduces costs (Reiche et al. 2016). The corporate strategies get aligned with HR and talent strategies. It makes the process of recruitment as more of competitive advantages. Through efficient recruitment employees are hired with efficient skills to deliver the organizational strategy. It raises and improves the level of employee’s satisfaction among its organization. Proper staffing strategies lead to increase opportunities, achieving organizational long-terms objectives and plans and gain competitive advantages (Sparrow, Brewster and Chung 2016). There are few limitations to the staffing strategies that involves recruitment and training are it is very time consuming and complex process. In countries like India and China, Microsoft needs to adopt proper skillful planning to avoid any kind of pitfalls. It is significant to monitor and develop business contingency plans for addressing the possible changes within the external environment (Stone et al. 2015).

Challenges in Managing a Culturally Diverse Workforce

The implementation programs require active participation and a clear communicated plan. Staffing strategy is worthless, if proper implementation of the strategy is not made within the organization. In India, it is a common practice for the organizations to provide legal documents to every new hire, which is the contract of employment to sign. The effective utilization of a country’s human resources leads to greater bases for competitive advantages. Moreover, this leads to achieving the organizational goals. Microsoft interviewing process limits the analytic and creative abilities of the individual instead of just reviewing their familiarity with computer programming language.

Employee motivation: at Microsoft, recruitment and selection process is done to employ individuals, who are properly motivated by the working environment they provide. Microsoft’s ensures that the organizational work culture leads to provide favorable opportunities to motivate it employees. The motivation of the employees can be related to the need hierarchy theory of Maslow’s (Bratton and Gold 2017). The theory’s top-level need theory is self-actualization need that fulfils the individual’s need to be self-fulfilled. Similarly, Microsoft’s provides the staff greater opportunity as per their expectations (Pinto 2015).

Employee satisfaction and loyalty: employees in Microsoft are encouraged for horizontal transfers and also encouraged to develop themselves by switching their jobs. Since the organization inception, employee’s empowerment is the intrinsic part (Lee et al. 2017).

a. Hofstede’s Model For Singapore:

Singapore culture is analyzed using Hofstede’s model of culture dimension to ascertain their future expatriates. The country is a multi-ethnic society that comprises Chinese around 77%, Malay around 15% and expatriates around 2%. The major six dimensions are stated below:

Power Distance: This Hofstede’s dimension deals with the major fact that all the persons in the societies are unequal and expresses the cultural attitudes for the present inequalities amongst them. Singapore usually scores highs core in this power distance dimension. As power is centralized so managers usually depends on their head and company’s rules and policies. Attitude towards manager and control is accepted.

Individualism: the main issue to be addressed is the degree of interdependence among its member. Singapore is a collective society and the people belongs to ‘in-groups’ like families and organization. the individualism rate is very low with a score of 20. People believe in harmony for the group and conflicts are avoided. As a manager maintaining respectability and calmness is important within an organization.

Masculinity: Singapore mostly scores 48 and is mostly on the feminine side. This showcases that country’s softer aspects like consensus, leveling with others and sympathy. This shows that the country values more to the softer aspects of corporate culture. This includes consensus, sympathy, and leveling with others. Both in the work and private life conflicts are avoided to a great extent, moreover, consensus is very important at the end. Feminism in the government shows respect and support for the individuals.

Recruitment and Selection Strategies for Emerging Markets

Uncertainty avoidance: The extent to which the individual’s in a nation feels threatened by unknown or ambiguous situations and also develops beliefs to avoid these is reflected through the uncertainty avoidance scores. The score rate is 8 in these dimensions as people abide to every rule due to high level of PDI.

Long-term orientation: this dimensions demonstrates the methods of the society to maintain link with the community past besides dealing with the present and future challenges. The country with high scores shows more pragmatic approach while encouraging efforts and thrifts in the modern education while preparing for the future. Singapore scores 72 that show the country’s cultural qualities through long-term investment. The investment includes sustained efforts and perseverance.

Indulgence: this dimension showcases the extent to which the people in the society try to control their impulses and desires according to their culture and living standards. Weak control is known as Indulgence, whereas strong control is known to be as ‘Restraint’. It is quiet difficult to determine the preference for this dimension but the indulgence score of Singapore is 46.

Life of an expatriate will be critical in Singapore as the cost of living is very high and will unable to live in this strict budget.

while relocating to another part of the world, the expatriates may get cultural shocks. He should be prepared beforehand to for the expected cultural shock because of the cross-cultural transition. The selected candidate for an overseas assignment should be motivated and posses the following characteristic like Managerial competencies. This includes leadership and technical skills as well as the knowledge that is specific for the company’s operation. the expatriate should be encouraged to get adequate training according to culture and languages of the host country. The expatriate should be adaptable enough to deal with the unfamiliar scenarios and also the ability to adjust itself according to the culture of the organization. various schemes relating to rewards and compensation would also motivate an expatriate for a new overseas assignment. Compensations issues also vary to a great extent in other countries like in the form of:

• cost of benefits: in country like Singapore, the expatriate is provided from the Government with a catastrophic policy. Various organization also offer healthcare to the expatriates that are relocating to other country (Albrecht et al. 2015).
• Culturally accepted or legally mandated amount of vacation day is also provided.  

Government highly controls the various profit sharing plans.

• Pay systems are provided according to the seniority. The pay system should be efficient and made according to the seniority.
• Annual lump sum payments and bonus structure highly creates a positive impact.

Compensations and rewards issues are a great consideration for motivating the overseas employees, the systematic system of the country (Singapore) ensures fairness regarding compensation for all of its expatriates.

Conclusion

Effective HR practices are not only a vital part of the organization but also are useful in shaping the firm’s business strategy. Microsoft is one of the leading MNC and it can be ascertained from its success that how effectively the HR practices have been efficiently aligned with its business practices. Microsoft’s employee referral program also plays a major role in the company’s recruitment and staffing process. It is recommended that the organization like Microsoft should continue to recruit graduate students to make sure that the knowledge will be directly flown in the organization in a continuous manner.

Human resources practice for MNC’s should be adequately made so that the organization should be able to retain the best employees and achieve long-term success in the future. effective recruitment, selection, performance evaluation, training and development and reward management t is necessary to attain maximum success. It can be concluded that HR functional strategies plays a major role in achieving the organizational objectives. Moreover, proper reward and compensation strategies should be made for all the expatriates.

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