BMG935 CRN 13605- International HRM Assignment Sample 2023
1. Introduction
This section tends to analyze based on various recent scenarios that are currently been used by organizations all over the world to ensure better management of human resources. Organizations are constantly coming up with better modules almost every day to better face their problems.
The company of Larsen and Toubro is one of the multinational companies of conglomerate that focuses on the interests of business in the fields of engineering, manufacturing, construction as well as financial services. The company seems to operate in 50 other foreign countries on a worldwide basis and is popularly known as L&T.
The company of L&T tends to be engaged with the project concerning “EPC” and as well as services and manufacturing related to the field of Hi-Tech. The company seems to value its customers providing enough priority to them, by initiating a strong and customer focused approach.
The leading conglomerate company Larsen and Toubro is facing several HRM problems, for instance, the reward system, remuneration packages. In managing and maintaining Human Resource Policies, employment rewards and external and internal background of the organization, the company facing different issues. This further affects the organizational productivity, lack of workforce and severe economic crisis in this competitive market.
The company aims at delivering top class quality products which further has enabled the company to attain the leadership on the terms of sustainability. Although focusing on the current scenario and the emergence of the pandemic COVID-19 worldwide, the company of L&T is facing challenges on the issues related to the diversity that is present in the workplace.
The company is also facing issues related to the communication problems between the expats and the HR of the concerned field. The issues related to the gap between the gender ambitions are affecting the efficiency and the performance of the nature of work within the company of L&T.
Many Indian organizations have grown up to a huge extent these days to have created proper bases for themselves across various countries on different continents. This has thus currently created a requirement for the understanding of certain reasons that tend to guide these major decisions of organizations. Therefore, the study is going to focus on the challenges of international Human Resource management.
2. Literature Review
Strategically issues
Appropriate strategies assist an organization to complete a project within time with a proper result. Impropriate strategy of maintaining employees productivity level and work environment can be a reason of the downfall of an organization (Tahir, 2021). The world is said to be expanding fast after the advent of certain innovations in the field of technology.
Technology has created scenarios where products can quite easily reach various customers across the globe. According to the opinion of Kim et al. (2018), various companies are thus expanding themselves across various countries of the world to take benefit from this advantageous situation. But expansion for an organization does not simply mean an expansion of its processes and units.
In this scenario, there is also a requirement to give proper importance to the Human Resources department as well (Horak et al. 2019). It is acknowledged that the company of L&T is facing difficulties in the aspects of recruitment, culture within the corporate world. However, development in the aspect of leadership, motivation and retention of the employees within the organization is critical.
The international arena has got quite a diverse set of issues to make firms concerned about various facets of Human Resource Management. As per the opinion of Zardasht et al. (2020), the field of Human Resource Management needs to be tailor-made for various organizations. Larsen and Toubro thus also should frame its various policies as per the requirements.
Thus it can be said that the Human resource management of this organization needs to be a combination of these various matters (Andersson et al. 2019). Employees who work in an organization generally tend to follow a routine procedure through the years. But in those cases where a company suddenly decides to change some of its major operational decisions, then there tend to be numerous problems for these employees (Sposato, M. and Rumens, N., 2021).
3. Overview and History of the MNC
Larsen and Toubro started as a major organization associated with construction and other such activities from its headquartering in Mumbai. This organization mainly started its business from a constructional scenario and has extended itself to other areas like that of energy and power as well. Larsen and Toubro (L&T) has currently extended itself to include areas of metallurgical products as well as hydrocarbons.
As per the opinion of Farndale et al. (2017), this organization is a major contributor to the defence services of various countries. Thus, in short, it can be said that L&T specializes mainly in heavy engineering technologies to be thus associated with some of the major developmental tasks.
4. Outline of the International HRM issue
Issues regarding Human Resource policies
In the concept of entering new market and expanding business, Human Resource plays a crucial role. Human Resource policies assist to maintain a work environment. According to the opinion of Galanaki et al. (2019), international Human Resource management needs to integrate the various countywide requirements along with that of organizational and industry-specific requirements.
Companies that are looking forward to venturing into the international field like that of L&T need to ensure that there is a proper integration across various policies. As per the opinion of Bose and Biswas (2018), this can be done only with the implementation of a proper plan at the corporate level. The plan should be made in such a way that there remain no loopholes in the organizational procedure.
This organization has industries that are associated with construction, power, and various other sectors. As per the opinion of Chiang et al. (2017), the Human Resource policies can either integrate in a manner to include a similar format of a particular industry across different countries. Multinational Companies like Larsen and Toubro tend to integrate a diverse range of policies to better suit the needs of different people.
There are various challenges faced by Human resource management in order maintain the work environment and healthy relationship with employees. According to the opinion of Cooke (2018), but it is sometimes seen that all these methods are sometimes insufficient to satisfy various people. In the development of an organization, customers and employees play a significant role. Effective employment reward is essential to maintain employees’ retention.
The increasing scenario of Globalization has led to the emergence of numerous policies relating to International Human Resource Management. Organizations that are expanding across the globe are constantly seeing newer scenarios of a cross-cultural mixture in their Human Resources Mix.
According to the opinion of Suder et al. (2019), these days’ citizens of one country tend to be sent over by a parent company to a third country on its behalf. This creates a situation of a cultural jumble and sometimes tends to create a cultural shock for the expatriates. Different kinds of cultural situations tend to create different market conditions as well. Thus in this scenario, it becomes important to chalk out a proper plan to ensure a smooth running of the various Human Resource Management functions.
Figure 1: Changing Organizational culture
(Source: Reiche et al. 2019)
Different cultures tend to influence certain different kinds of career ambitions across different countries of the world. In some countries, it is more desirable to go for career options like that of sports and others. Whereas in some other countries there tend to be a focus on choosing certain career options that are related to the field of education.
Thus this cultural context needs to be kept in mind while framing some of the major Human Resource decisions. As per the opinion of Reiche et al. (2019), Human Resource policies should thus not be the same across different countries even for the same organization.
Thus there is an urgent requirement to frame a proper Human Resource policy as per the needs of a particular unit situated in that specific cultural context.
Larsen and Toubro thus need to thus understand specific market scenarios of countries where they decide to operate. The organizational scenario in a particular country is also a major influence in the formulation of Human Resource policies.
According to the opinion of Farndale et al. (2017), there can thus be a different approach for countries where L&T is a household name as compared to countries where it is going to start its venture. The talent pool of every country gets attracted to an established firm, while there remains some confusion regarding places where an organization has just started its venture.
Certain ethical areas do not remain clearly described across certain countries. According to the opinion of Mayrhofer et al. (2019), some codes of conduct remain ethical in some areas but are considered unethical in others. Thus there cannot be any straightforward policy that can be considered as applicable all over. Multinational Corporations across the world should thus properly frame their business policies keeping in mind the needs and regulations of the particular country..
Another challenging scenario that firms tend to face is to maintain a sense of brand identity and loyalty across different cultures. According to the opinion of Likhitkar and Verma (2017), Governmental control tends to vary across various countries thus making it a need to frame a Human Resource Policy that is conducive to such decisions.
A country that has a totalitarian or dictatorial form of government poses a different requirement than that of a democratic one. But despite these differences, there should remain some unity in terms of maintaining the brand identity of an organization. Thus L&T can maintain as well as expand itself if it takes proper care of these scenarios.
Reward system
The expatriates, who move on from one country to another in search of different jobs, sometimes tend to face problems regarding cultural adjustments. In most cases, it is seen that these people have difficulties even in doing their routine jobs. Appropriate rewards assist to motivate employees and develop the productivity level.
The human resource management needs to monitor the entire work in order to understand the capability of employees. Understanding the capability and experience of employees, the management can allocate their jobs effectively and increase the number of future opportunities. Reward systems are important in motivating the employees to increase organizational productivity and the employees are able to satisfy their needs (Keegan et al. (2018).
The leading brand Larsen and Toubro is introducing the reward system to motivate its employees through overcoming different risks and challenges. Therefore, it is imperative to note that the reward system is critical in increasing productivity and brand performance through satisfying the employees.
Larsen & Toubro is an Indian multinational organization, and there is a requirement of effective Human Resource Management in order to maintain an appropriate work environment and a healthy relationship with management and employees.
As per the opinion of Diaz‐Carrion et al. (2018), multinational companies tend to frequently transfer their employees across various countries of the world to maintain certain brand cohesion. Human Resource itself is quite an exhaustive field which has within itself numerous areas ranging from training of employees to mundane activities like that of record keeping.
5. Analysis of the International HRM issue or problem
Issues regarding remunerative packages
Appropriate remunerative packages can develop the productivity level of employees and can increase the number of future opportunities. Another important problem that tends to crop up from time to time is the question of proper remuneration channels for the employees.
According to the opinion of Keegan et al. (2018), some remuneration should be based upon home country currency while others opine that it should be based upon the current county of work. Thus employees may get confused as to what is going to be their remunerative packages after they relocate to another country. Employees generally tend to rely upon organizational guidance and training before relocating to another country.
Organizations like Larsen and Toubro have got to ensure an International Human Resource Policy that gives a proper understanding to its various employees. As per the opinion of Keegan et al. (2018), then comes the concept of feedback mechanism. Despite giving extensive training there are bound to be some cases of dissatisfaction among various employees across the organization.
Organizations that do not follow this procedure may lose some of their employees due to various pent-up grievances. There should be some freedom among the employees to be able to complain about any higher authority if they are facing problems. Thus Larsen and Toubro should also give specific stress upon the feedback mechanism to ensure proper integration of employee satisfaction along with organizational success.
Challenges regarding external and internal background of the organization
The human resource management needs to understand the opportunities and challenges of an organization. People of diverse ethnic, social, and cultural backgrounds tend to become a part of a multinational organization. As per the opinion of Bornay-Barrachina (2019), organizations that are planning to venture their operations across the international arena should first properly make their employees understand the various cultural scenarios.
There can be a multiple challenges on the matter of expanding market share of a company regarding internal and external background such as competitive challenges, environmental challenges and remunerative packages.
It may be extremely important to shift an employee to an office outside the country to give a better exposure. In this case, there should be an availability of at least two to three choices in front of the employees. According to the opinion of Cafferkey et al. (2019), this ensures satisfaction for both sides. This is very harmful for an organization as it tends to create a negative impact upon the employees.
There should thus be stress upon a gradual transformation method for an organization. Thus organizations like that of L&T should just focus upon those features that have to be essentially changed to survive in the global market. Then if there is a requirement gradual changes can be introduced in the basic structure through some period.
When an organization decides to expand its business into new areas, it first tends to focus upon various benefits that it is going to drive from such an expansion. According to the opinion of Donnelly and Johns (2021), sometimes it happens that there are numerous disadvantages like that of bad climate and other harsh weather conditions that are associated with that new location.
It falls upon the duty of the Human Resource department to ensure that employees are working in those conditions which are best suitable from their perspective. A lack of proper judgment in this allocation scenario may create huge dissatisfaction among the employees resulting in numerous resignations. The international human resource policies should be done in such a way to ensure that there is a central level human resource policy with country-specific distinctiveness. This is something that helps an organization to establish itself solidly for the long run.
6. Theoretical analysis
Motivational theory: The relevant motivational theories, for instance, Maslow’s hierarchy of needs and Hertzberg’s two factor theories assist in elaborating the employee motivational process. These theories are essential to understand the process through which the employees are influenced by the reward system to improve organizational operations and productivity.
Maslow’s hierarchy of needs
This motivational theory is important to understand the several steps that assist in influencing the employees about their basic needs. In the hierarchical order, this theory critically explains the needs of humans and how the things and different elements assist in motivating the employees.
As opined by Oved (2017), this further creates social differences in the people according to their needs and self-actualization to fulfil that demand. In this study, the application of the theory is significant and it focuses how the reward system assists in influencing the employees to fulfil the organizational goal.
Figure 2: Maslow’s hierarchy of needs
(Source: Oved, 2017)
Hertzberg’s two factor theory
This theory creates a positive impact on employee’s behaviour through motivating and hygienic factors and reflects a positive job attitude on the performance of the employees. The self-actualization assist in understanding the factors and the employees are able to perform accurately to fulfil their needs.
As opined by Alshmemri et al. (2017), the main motivating factors, include, recognition, achievement, responsibility, and advancement and in the study, the reward system assist in satisfying the employees. Application of this theory is critical for Larsen and Toubro to understand the employee motivating factors to increase productivity and performance.
Figure 3: Hertzberg’s two factor theory
(Source: Alshmemri et al. 2017)
7. Conclusion and recommendations
It can be concluded from the above discussion that a congenial and tailor-made approach is required for International Human Resource Management. Employee welfare is also a point to be hugely concerned about in this scenario. Gone are those days of Personnel management when employees were considered as simple machines to run the wheels of an organization.
In these days of Human Resource Management, it thus becomes extremely necessary to give employees an upper hand about the choices that they are comfortable with. In this study the issues of IHRM are also explored focussing on the aspect of the policies of HRM, rewards of the employers, challenges regarding external and internal background of the organization, issues regarding remunerative packages.
All these aspects tend to influence the level of performance for the company of L&T, thereby affecting their expansion and development within the market.
Recommendations
Numerous things need to be integrated to ensure that an organization that is functioning in the international sphere can carry its functions successfully.
Recurrent discussions with the employees
The employees of an organization should be there in the forefront to ensure that an organization is successful in its functioning. Before an organization like L&T decides to expand its businesses abroad, it becomes extremely important to frame HR policies that have been asserted by the employees.
According to the opinion of Al jafa Hasan, and Várallyai (2021), employees should be asked about their tastes, preferences, and choices before they are relocated or integrated into other newer organizational modules. Blind integration of policies should be best avoided by multinational organizations like Larsen and Toubro to ensure that it stays in the market for a long time.
Tailor-made Human Resource policies
The arena of International Human resources is quite a tricky one that has to be dealt with variety carefully. As per the opinion of Donnelly and Johns (2021), there should be a central Human Resource policy for an organization but these needs to be broken down into certain congenial formats as per the requirements of a particular country. Thus in this scenario, there should be a contingent approach to ensure that the brand policy remains the same without damaging country-specific requirements.
More reliance upon ensuring an intermix solution
The International Human Resource Management means that this is a Human Resource policy that operates across the globe. In this scenario thus it becomes important to take the best of both worlds. According to the opinion of Cafferkey et al. (2019), thus there is to be an integration of certain elements from the central perspective while some other from a selection of many of the different available choices. Thus employees are to be given a sort of free rein in selecting certain elements from a bouquet that is presented to them by the organization
Better Feedback Mechanism
Employees who leave their homes and move to other countries sometimes tend to feel stranded. New language and cultural scenario that is prevalent in another country tend to give people a sort of cultural shock. This thus leads to the creation of a situation that fosters innovation and certain such policies. In this kind of organizations thus problems, if any, tends to get sorted out quickly.
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