Human Resource Management in the Multinational Context Research Paper

Human Resource Management in the Multinational Context - Research Paper Example Alignment of HRM strategy in MNCs is of importance when it comes to strategic implementation (Chew & Horwitz 2004, p. 33). This is the alignment of HHRM systems and policies with the organizational goals and policies in order to achieve the established operational goal and competitive strategy of the firm. HRM system must be deemed as a source of the firm’s competitive advantage in any multination for it to be successful (Sparrow et al 1994, p. 268). IHR function constitutes of corporate HRM group managing the various roles and practices of personnel management. This HRM group has about 500 level managers who carry out the global service program. In line with the company’s philosophy, the HRM group manages the various subsidiaries in line with the markets they operate in, for instance, the company applies varying HR standards in different market operations. Salary standards are applied differently in a different market and the aim is to ensure that their salary scale re mains competitive in the markets. Multinationals like Coca Cola staffs its operations from the local personnel and only engages expatriates where the system demands. According to Caligiuri et al (2010, p. 3), successful MNC companies manage their global staff in ways that match their strategic needs as well as the demands of their markets. Global market offers different external environments and varying skills and capabilities in the global labor market HR plays a critically important role in managing the companies’ global operations and enhancing their competitiveness. IHRM policies and practices play an important role in strengthening interunit linkages in various ways including staffing policies, comprehensive planning of human resource, compensation policies, performance appraisals, and development and training of staff. As the report stresses business today is no longer limited to the countries’ national boundaries. Large multinationals do a significant percentage of their business activities outside their home market and country; this has resulted from continued establishment and strengthening of business in the overseas by multinationals. Competitiveness in these corporations has largely been determined by their effectiveness in the international market, this is in turn determined by the effectiveness of global managers particularly the international human resource managers who can function effectively in the international business activities. IHR practices are critically important in determining the effectiveness of multinationals.