How can IHRM assist for technological globalisation?

 

Source: usemultiplier

In today's fast evolving world, technological globalisation has become a significant driving force behind economic growth and development. It has facilitated international trade, helped connect people and businesses across the globe, and enabled companies to expand their operations to new markets. However, as Stahl et al. (2012) summaris, for organisations in navigating the challenges of technological globalisation, this comes the need for International Human Resource Management (IHRM) to assist to make it through.

Facebook, Instagram, Skype, and YouTube are all examples of technology platforms that have played a significant role in technological globalization. These platforms have helped connect people and businesses across the globe, facilitated international communication and collaboration, and enabled companies to expand their operations to new markets.

Source: Modern technology

IHRM can help companies leverage technological globalization by adopting a strategic approach that aligns with their organisational goals and objectives. One theoretical model that can be used to guide this approach is the Resource-Based View (RBV) of the firm. According to RBV (Armstrong, 2012), a company's resources and capabilities can be a source of sustained competitive advantage. IHRM can assist in identifying the resources and capabilities required to effectively operate in a global context and help develop strategies to acquire, develop, and retain these resources as per Barney(1991).

Another theoretical model that can be applied to IHRM's role in technological globalization is the Institutional Theory. Institutional Theory (Cheng et al, 2016) suggests that organisations are shaped by social and cultural institutions, which influence the way they operate and are perceived by stakeholders. IHRM can help organisations navigate institutional pressures and cultural differences that arise when operating globally by ensuring that their HR policies and practices are culturally sensitive and aligned with local regulations and customs.

According to Institutional Theory, organizations can face three types of institutional pressures: coercive, mimetic, and normative. Coercive pressures refer to the pressures imposed on organizations through laws, regulations, and other formal rules. Mimetic pressures refer to the pressures organizations face to imitate the practices and strategies of other successful organizations in their field. Normative pressures refer to the pressures organizations face to conform to social and cultural norms and values.

In practice, IHRM can assist organisations in leveraging technological globalization by implementing the following practices (Dowling, 2017):

1. Talent Acquisition: To take advantage of global opportunities, organisations need to recruit and retain top talent. IHRM can assist in identifying the talent requirements for global operations and develop recruitment and retention strategies that are aligned with the organisation's objectives.

2. Cross-Cultural Training: IHRM can help employees navigate the challenges of working in a global context by providing cross-cultural training that helps them understand cultural differences and work effectively with people from diverse backgrounds.

3. Global Compensation and Benefits: IHRM can help ensure that employees are compensated fairly and equitably across borders by developing global compensation and benefits packages that take into account local laws, regulations, and market conditions.

4. Global Performance Management: IHRM can help organisations establish a global performance management system that aligns individual goals with organisational objectives and provides a framework for measuring performance across borders.

In overall, technological globalisation is reshaping the global economy, and companies that want to remain competitive must adapt to this changing landscape. IHRM can play a critical role in helping organisations leverage technological globalisation by adopting a strategic approach that aligns with their goals and objectives. By applying theoretical models such as the RBV and Institutional Theory and implementing best practices such as talent acquisition, cross-cultural training, global compensation and benefits, and global performance management, IHRM can help organisations navigate the challenges and seize the opportunities of technological globalisation.

References

1. Armstrong, M. (2012) Human Resource Management Practice, 12th edition, Kogan Page, London, and Philadelphia.

2. Barney, J. (1991) Firm resources and sustained competitive advantage. Journal of management, 17(1), 99-120.

3. Scott, W. R. (2008) Institutions and organizations: Ideas, interests, and identities. Sage Publications.

4. Dowling, P. J., Festing, M., and Engle, A. D. (2017) International human resource management. Cengage Learning.

5. Stahl, G. K., Björkman, I., Farndale, E., Morris, S. S., Paauwe, J., Stiles, P., and Wright, P. M. (2012) Six principles of effective global talent management. MIT Sloan Management Review, 53(2), 25-32.

6. Cheng, J. L. C., and Brown, A. D. (2016) Institutional theory: A meta-theoretical review. Journal of management, 42(1), 58-93.