The rise of global corporations working in several states increased the importance of human resource management in the international context. The increased number of cross-cultural relations and employees from various countries mean that CEOs faced the necessity to create an effective management model helping to integrate workers with different cultural contexts and ensure they do not face barriers to demonstrate better performance. It means that international human resource management (IHRM) became the most effective tool to address the growing number of problems and resolve them by employing the strategies and methods available at the moment. The following case study revolves around the IRHM issue and helps to understand the issue better.
Alistair Mackay is a Director of Personnel Development, European Division, for Trianon, an avionics firm. It is an Anglo-French company focusing on aligning cooperation between French and British aerospace contractors. Alistair is responsible for planning new expansions, and he is informed that a new quality compliance manager is needed for a three-year assignment in Hungary. The demands are also specific as a candidate should possess outstanding technical skills and competencies vital for supporting the project and guaranteeing its success. Under these conditions, Alistair becomes responsible for making the right choice and selecting a specialist who will promote their Hungarian department. The case offers several IHRM issues that can be summarized for a better understanding.
International Human Resource Management
The first relevant issue of the case is IHRM and its employment to attain the best possible outcomes. Thus, the term can be defined as managing human resources at the international level using specific activities to create the basis for enhanced cooperation (Noe et al., 2020). The case revolves around an Anglo-French company, focusing on further expansion and opening a ten-year joint venture with a Hungarian government-backed firm. It means that the company faces the increased complexity of HR activities because of a need for a broader perspective and increased risk exposure (Dowling et al., 2017). The necessity to align the work of various companies placed in different countries introduces the demand for effective management models and involvement in all aspects, including employees’ personal lives to ensure positive outcomes.
Furthermore, the case can be analyzed regarding the countries where IHRM occurs. It implies the host country, or place where the subsidiary is located, parent country, or the place where headquarters are found, and other countries serving as the labor source (Dowling et al., 2017). For this case, Hungary is a host country as the planned expansion implies opening a department there, while France is the parent country. The choice of the new quality compliance officer can be viewed regarding his/her cultural background, origin, and competencies (Dessler, 2016). It means that the case offers a dilemma that can be analyzed regarding the significant assumptions of the IHRM. The recruitment of a new specialist will have a critical influence on the company and its success.
The primary concern of the case is the search for a specialist who will be ready to accept responsibility for the development of the first firm’s joint venture outside Germany, the UK, or France. It means that recruitment issues and strategies acquire the top priority. The major problem is that term is limited, and Alistair has to find a new specialist in five or six weeks. From the IHRM perspective, it is a sophisticated task as a candidate should meet the job description and possess all competencies needed to promote the further evolution of the firm (Banks et al., 2019). Thus, regarding the applied paradigm, searching and obtaining potential job candidates implies analyzing not only their skills but cultural backgrounds as it is a vital component of success in global corporations.
Another critical demand to the potential candidate is the knowledge of technologies used by the company and the ability to use this information for decision-making. It means that the applications should be considered in terms of knowledge and experience. Regarding the IHRM perspective, looking for a new candidate demands considering ethical and business issues. Thus, a specialist should observe the existing code to remain effective and respected by subordinates. Moreover, he/she should be competent and experienced enough to ensure the stable evolution of the firm. In such a way, the case introduces the critical importance of the recruitment process and its influence on outcomes.
International Performance Management
One more problem of the case can be linked to the ideas of international performance management. The concept implies the evaluation and assessment of an individual working in a foreign subsidiary temporarily with the primary goal to transfer knowledge and create the basis for improving global leadership skills (Cummings & Worley, 2018). Thus, expatriates usually perform several tasks vital for the company at the moment. These include the role of CEO, structure reproducer, troubleshooter, or employee performing functional tasks (Dowling et al., 2017). For Trianon, the issue of international performance management acquires the top priority as the firm looks for a top manager responsible for the subsidiary’s work in Hungary.
In such a way, for the corporation, it is vital to establish international assignments and ensure a new specialist will follow them. The case implies developmental and strategic goals vital for future success (Dowling et al., 2017). First, a new manager should acquire an enhanced understanding of the in-country performance and local performance. Second, the global perspective should be developed by establishing the practical work of the subsidiary and aligning the cooperation with the firm (Gundling & Williams, 2021). For this reason, choosing a new manager, Alistair should consider the current tasks and the basics of international performance management to ensure a hired worker will be able to promote the further evolution of the company and align better ties with the local business.
Finally, the case introduces the critical importance of the cultural context. The rise of global corporations and the increased scope of international relations means the increased number of cross-cultural interactions. People from different states acquire the chance to work together within a single global corporation. It increases the importance of the cultural context of IHRM and the necessity to consider it (Carnall & Todnem, 2014; Harzing & Pinnington, 2017). Thus, culture influences communication, feeling, behavior, and the way of thinking of an individual (Gundling & Williams, 2021). It means that representatives of different countries might have various views on a particular event, it is critical to establish a basis for their improved cooperation. Alistair has to consider various cultural dimensions and peculiarities when resolving the current task.
From the cultural context, Hofstede’s dimensions also become critically important. Thus, the five domains, such as power distance, uncertainty avoidance, femininity vs. masculinity, individualism vs. collectivism, and short term vs. long term orientation, are used to determine the mentality and the cultural code of a person and create a comfortable environment (Abramson, & Moran, 2017; Luthans & Doh, 2020). It means that launching a new venture and looking for a new specialist, it is critical to consider the cultural context and diversity peculiar to the modern global business.
Altogether, the case introduces several significant issues that can be considered regarding relevant theories. These include international human resource management, international performance management, recruitment, and cultural contexts. These aspects are vital for understanding the case and making the correct decision about the following steps that should be made by Alistair to guarantee the effective work of a new subsidiary and hire a specialist who can help to lead the firm and manage it at the first most complex states of its evolution.
- Among the existing list of candidates, Marie Erten-Loiseau should be viewed as the best option. Several reasons to justify the given choice can be offered. First of all, the specialist has outstanding experience and technical knowledge of the issues vital for the company’s work. She is an aeronautical engineer who has the needed skills and understanding of all processes. Another critical factor is that she worked in France, Germany, Poland, the Czech Republic, and Slovakia. It means that she is used to traveling and working with cross-cultural teams in different working environments. For this reason, working in Hungary will not be a critical challenge for her.
Moreover, the candidate has the experience of successful leadership as her two projects demonstrated critical success. It proves her management skills and characterizes her as a good worker. At the same time, IHRM implies analyzing personal issues that might impact performance (Mahadevan, 2020; Zheng, 2017). Marie has a semi-retired husband and a child in the university. It means that she is less dependent on family and can plan her activities in other cities. Under these conditions, the candidate becomes a perfect choice as she has the needed skills, experience and is ready to work in various countries. Her knowledge of different cultures will help her to integrate and cooperate with different teams.
- Recruitment is one of the critical processes regarding IHRM as possible candidates should meet requirements and help the company to evolve. Under these conditions, it is vital to establish an effective selection process helping to find the best possible specialist. For the case, Trianon should consider the three leading criteria when making the final decision, such as technical quality, cross-cultural competence, and family life. The given aspects are vital for specialists working in international corporations. First, Henri Genadry, General Director of Joint Ventures, Mergers, and Acquisitions, Display Division, says that it is vital to focus on the technical quality. It means that the selection process should consider skills and experiences in the field of interest.
Second, the company plans to launch a new project in Hungary, meaning that the questions of inclusiveness, diversity and cross-cultural cooperation acquire the top priority. A specialist should be ready to work with representatives of different cultures and help them by creating a positive climate within an organization and promoting the necessary chance (Noethen & Alcazar, 2020). For this reason, this criterion becomes vital for the recruitment process. Finally, a specialist should be ready to devote much time to a new project, meaning the family issues should not be a barrier. A combination of all these three aspects will help to find the best possible candidate and make a conclusion.
- Strategic planning is one of the critical processes vital for the functioning of any company as it creates the basis for future growth. At the same time, it implies using all available resources to achieve specific goals and move forward. Under these conditions, it is vital to engage HR staff in strategic decision-making. First of all, IHRM is focused on resolving expatriates’ issues and improving their effectiveness. Considering the idea that people are the most valuable asset of any organization, increased attention to specialists will lead to higher performance levels and better outcomes (Deresky, 2016). Thus, finalizing a joint venture agreement, the HR department might offer solutions regarding central posts or top management. Additionally, HR specialists can recommend actions linked to aligning cross-cultural communication and establishing the climate within a new organization to ensure it will evolve (Thomas & Peterson, 2017). Furthermore, the success of international business operations depends on the level of the HR department’s perspective (Plummer, 2018). It means the ability to correctly realize the current situation is vital for strategic decision-making.
Furthermore, the growth of international corporations increased the importance of cross-cultural cooperation and diversity management. The inability to align cooperation between representatives of various cultures is one of the major causes of big projects’ failures (Stewart & Brown, 2019; Valentine et al., 2019). For this reason, the role of HR staff becomes critical. These specialists are responsible for analyzing the existing employees’ peculiarities and characteristics to create an environment beneficial for cooperation and collective effort (Strohmeier, 2020). It means that the HR department has the tools needed to create high-performance teams consisting of representatives of different cultures (Tarique et al., 2022). It becomes especially important regarding international projects and new joint ventures. Under these conditions, it is critical to engage the HR department and specialists in the strategic planning and decision-making process (Noe et al., 2020). First of all, it will help to avoid failures in selecting candidates for the potential expansion and assigning them to specific vacancies. Second, using IHRM tools, it is possible to plan the creation of cross-cultural groups and establish a positive climate for achieving existing goals.
Altogether, the case demonstrates the critical importance of IHRM and possible issues associated with the work of global corporations. The summary reveals that such aspects as recruitment, international performance management, and culture become especially significant for companies such as Trianon. Every company planning to launch a joint venture with a partner from another country should consider all aspects of IHRM. It implies increased attention to recruitment and hiring specialists who possess skills and competencies vital for the company’s growth. At the same time, cultural issues are central for IHRM as people from various states engage in direct cooperation. It might serve as the basis for numerous conflicts, and that is why it is necessary to use available HR tools to create the basis for international collaboration and minimize the risk of conflicts or failures. The case also shows that strategic planning is impossible without HR staff engagement; otherwise, there is a high risk of poor outcomes stipulated by the lack of understanding of existing employees’ issues.
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