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More HR activities: HRP, Employee hiring, T& D, Compensation, Performance management, Industrial relations. The need for broader perspective: More involvement in employees personal lives Change in emphasis of workforce of expatriates & local varies Risk exposure Broader external influence.

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Rapid increase in global competition. Rapidly developing economies having huge markets. Reduce cost reduction. Changing demographics. Regional trading blocks are adding pace to globalization. Declining trade & investment based have vastly contributed to globalization. One of the most powerful instrument Technology.


Matching model: highlights the resource aspects & emphasis on the efficient utilization of HR to meet organizational objectives . Also emphasis on right fit between organizational strategy, structure & HRM Systems. Harvard model: Stress on human, soft aspect of HRM more concerned with the employer employee relationship. Highlights the importance of stakeholders community, shareholders, management, government, unions etc.



Contextual model: based on premises that organizations may follow different pathway in order to achieve the same results. This is because of the influence of external influence like culture, leadership, technology etc.

4. 5P model: melds five HR activities (philosophies, policies, programs, practice, process). This model shows the interrelatedness of activities & significance in achieving organizational needs.
5. European model: based on the argument that european organization are constrained as both international & national level by national culture & legislation.

SHRM (Strategic Human resource management) in Multinational companies:

SHRM refers to the process of developing practices, programs and policies that help achieve organizational objectives. The foundation of sound SHRM practices can be summarized as follows.

A clear & concise understanding of the nature & scope of the business that the MNC is engaged in. A good understanding of global challenges what the particular business or industry is facing. What needs drive the organization to go global? Which country did it choose to set up its operation & why? what are the host country HR challenges?

Knowledge about the sources of competitive advantage that the MNC have over its competitors. Strategic HR activities can be globalised or localized to perfectly match with MNCs Strategies. Strategies of an organization comprises: 1. Defenders (Low cost producers) 2. Prospectors (product innovators & differentiators) 3. Analyzers (imitators of successful prospectors) 4. Reactors (companies with dysfunctional strategies)

Low cost producer (Defenders): Focus is on cost control. With the cost control as primary focus, predictability & short term focus are valued. They provide G & S at low cost maintain quality & provide customer service. Globally, the HR activities that are relevant to this context are T&D as employees are hired in entry level, high level position are filled through promotions. Employees are expected to stay with the organization for long period.

2. Companies pursuing prospectors strategy look for

innovation. They design & produce new products & Deploy resources from discontinued products to development of new ones. Innovation being the key approach, organist ions that foster risk taking, cooperation, creativity, & long term perspective are valued. Globally talented individuals are hired & training is mainly on the job.

3. Analyzers is another strategy that organization

often seek to pursue. These companies are of hybrid type, they are innovators as well as competitors in long run. Such countries are constantly looking to countries that provide constant global growth. The HR policies of these organizations fall between the defenders & prospectors. Organizations spend heavily on trg but talents are brought to fill higher level positions. These companies both promote (make) as well as hire(buy) HR.

4. Reactors strategy are highly competitive markets & are the slaves of their envt. Decisions to globalize is driven by the market conditions.

Reactors Retrenchment Passive recruitment Retention of core talent Frequent layoffs Defenders * employees hired at entry level Lot of emphasis on T&D Making & not buying to fill vacancies. Prospectors * hire talent & then spend on training High turnover Result based PA

Sources of labour


Analysers Heavy investment on trg but talents are also brought Low turnover Dismissal for poor performance

Group contribution

Assignment of promotion criteria

Individual contribution

Internatiomalisation of HRM : Socio-cultural context