Emerging Motivations for Global HRM Integration

Abstract

For many years, the field of international human resource management (IHRM) has struggled with the question of whether or not it is better for a multinational firm (MNC) to integrate its IHRM function across the various geographies in which it operates. By integration, I refer to the quest for consistency of HR philosophy, policies and practices across the MNC's operations worldwide. Looked at from one angle, the debate is rather a bizarre one. Does it really make any sense for a MNC to undertake 2 integration of HR policies? Surely, any VP or Director of IHRM must be considered slightly mad to take on such an endeavor. The obstacles this hapless VP faces would give anyone with his feet firmly planted in reality not just pause, but freeze him in his tracks. He is faced with a stupefying array of labor law regimes, enormous divergence in labor market characteristics, widely different institutional settings, vastly different cultures -who in their right mind would proceed to try to tie together their HR system into a global whole? No, much better to hire competent local HR specialists who can concoct a HR system for their local units that makes sense. It decreases the hair pulling over how to adapt and how much to adapt particular HR policies and yet retain an integrated system. It is simply easier, and less costly in both psychic and monetary costs, to not integrate.Evidently, the IHR profession must attract the slightly demented, because a fair number of firms actually seem intent on this lunacy. And, interestingly enough, we are likely to see more. And this is what I would like to explore with you today -why MNCs, and the IHRM VPs who work within them, are likely to become ever more intent on overcoming the many barriers that exist to integrating their HR management on a global basis. There are, I will argue, two emerging trends that cannot be ignored that are creating a strategic imperative for greater IHM integration, and that may dwarf other concerns. These two trends are the increasing need to focus on the creation of social capital within the global network, and the growing need to focus on sustainability as part of the company's global strategic imperative. And as I hope to show briefly, these harried VPs of IHR have gotten lucky, because achieving these two goals is a mutually reinforcing process. 3 I will first quickly review the major debates around HRM integration before turning to a description of these two trends in MNCs. I will then discuss how these trends are likely to increase the desire for integration of IHRM. I will finish with a short discussion of which aspects of HRM are most likely to be affected by each trend. My remarks are not meant as definitive but simply as food for thought, observations of the larger societal and strategic trends within which IHRM exists and with which it must deal.

Global Talent Management and Performance in Multinational Enterprises: A Multilevel Perspective

“…Future research should consider exogenous variables such as institutional distance, environmental complexity, and dynamism. Scholars have long established that MNEs cannot simply adopt HRM practices that fit the firm's strategy, but MNEs must also consider local environmental requirements (Lazarova et al, 2016;Taylor et al, 2006). We assume that strategies are path dependent and hard to change.…”

Integrating global mobility and global talent management: Exploring the challenges and strategic opportunities

“…In this regard, corporate integration is defined as "centralized control over key resources and operations that are strategic in the value chain" (Evans et al, 2002: 103). Two factors contribute to the increasing desire to integrate HRM policies in MNEs -the growing focus on creating social capital throughout the MNE's global internal network, and the increasing emphasis on ensuring the sustainability of MNE's global operations (Taylor, 2006). Global integration, in turn, facilitates the development of a common corporate culture and has the potential to enhance equity and procedural justice within the MNE through the transfer of organizational practices (Rosenzweig and Nohria, 1994).…”

Developing tomorrow's leaders—Evidence of global talent management in multinational enterprises

“…Second, we found the usage of a global HR policy formation committee to positively influence engagement in GTM. Although only a sparse literature discusses HR policy formation bodies, there is evidence to indicate greater utilization of such bodies (Taylor, 2006;Tregaskis, Glover & Ferner, 2005). It has been suggested that the presence of such global bodies may indicate a view within the MNE about the value managers from different country operations can bring to the table (Marginson et al, 1995).…”