The Globalization of HR
It's not easy going global, especially if you're in HR. There are all sorts of challenges to be met, from rounding up key leadership talent to figuring out how to implement a worldwide HR management system. Making things even harder, for years there's been a paucity of information on global HR. But a change is in the air, and various recent studies and articles are bringing global HR priorities, problems and sometimes even solutions into clearer focus these days.
For HR, today's major global concerns are leadership development, recruitment and retention, suggest two recent studies from HR consulting firms. A study from Development Dimensions International (DDI) found that leadership development was viewed as a top priority by 52% of surveyed international companies. Another study, this from Arthur Andersen, also found leadership development to be a top concern among companies conducting international business. This focus on leadership is, of course, strongly linked to the global war for talent. Fully 95% of global companies responding to the Arthur Andersen survey identified attracting and retaining talented employees as a critical HR goal. The DDI study found that "recruiting high-quality employees" ranked second only to leadership development among international companies.
"Beyond matching competencies with the technical or managerial requirement of employment opportunities, HR executives are challenged to hire employees with 'global' skills, who also possess the ability to be effective and develop relationships with people of diverse cultures," writes Arthur Andersen's Sarah Cuthill in Compensation & Benefits Management magazine. The competition for talent is extreme because companies are competing with firms headquartered all over the world.
At the same time it's trying to address these priorities, HR is working to develop a truly global HR system. It's an uphill battle for some. DDI's survey of its HR Benchmark Group found that many companies are still "lagging behind in developing the human resource policies, structures, and services that support globalization." One particularly common challenge is trying to ensure that structures and services are consistent across all locations. There are all sorts of global variations to cope with, such as differences in culture, employment laws, government regulations, and learning styles. What's more, local offices tend to have their own ways of doing things, and they don't always view HR itself in a consistent way. Some consider HR as mostly an administrative paper-pusher, while others consider it a vital strategic partner.
The fact that there are so many differences helps explain why, according to the Arthur Andersen study, "reinforcing corporate culture" is one of the most critical goals among firms developing global HR strategies. Such a culture is key to creating consistency. Yet, as the DDI study notes, building and reinforcing a common corporate culture is difficult because local cultures and customs have a "moderate to great influence on the way business is conducted." Businesses are attempting to forge a global corporate culture through a number of methods, such as increasing global communication, educating management, outlining the culture in a written statement, seeking input from all locations on global projects, and allowing local cultures to retain their identities within the context of the corporate culture.
In some cases, corporations also are trying to reinforce corporate culture through the establishment of common systems, such as global HR management systems (HRMSs). Yet, international variations can impede progress here, too. Technology needs can clash with culture, law, and even something as basic as people's names. For example, Asians tend to use their names in reverse order, Latin Americans may have four or five names or a hyphenated last name, and many Dutch names include a prefix. This makes the creation of name fields in an HRMS fairly tricky. The August 2000 issue of HR Magazine reports that it took Lucent Technologies Inc. two months to settle on a name format when it implemented an HRMS.
Of course, there is no quick and easy way of globalizing HR practices. Every organization will face some unique challenges. But as the globalization of HR becomes inevitable, there will almost certainly be more studies and articles about how to do it well. Over the next several years, HR managers should be on the lookout for more best practices in this area.
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An article about Arthur Andersen's "Globalization of Human Resources" is in the Fourth Quarter 1999 issue of International Mobility Management, which can be found at
http://www.shrm.org/shrmglobal/publications/andersen/index.htm
The summary of DDI's "The Globalization of Human Resource Practices" is at
http://www.ddiworld.com/research/R-n-R1.asp
For HR, today's major global concerns are leadership development, recruitment and retention, suggest two recent studies from HR consulting firms. A study from Development Dimensions International (DDI) found that leadership development was viewed as a top priority by 52% of surveyed international companies. Another study, this from Arthur Andersen, also found leadership development to be a top concern among companies conducting international business. This focus on leadership is, of course, strongly linked to the global war for talent. Fully 95% of global companies responding to the Arthur Andersen survey identified attracting and retaining talented employees as a critical HR goal. The DDI study found that "recruiting high-quality employees" ranked second only to leadership development among international companies.
"Beyond matching competencies with the technical or managerial requirement of employment opportunities, HR executives are challenged to hire employees with 'global' skills, who also possess the ability to be effective and develop relationships with people of diverse cultures," writes Arthur Andersen's Sarah Cuthill in Compensation & Benefits Management magazine. The competition for talent is extreme because companies are competing with firms headquartered all over the world.
At the same time it's trying to address these priorities, HR is working to develop a truly global HR system. It's an uphill battle for some. DDI's survey of its HR Benchmark Group found that many companies are still "lagging behind in developing the human resource policies, structures, and services that support globalization." One particularly common challenge is trying to ensure that structures and services are consistent across all locations. There are all sorts of global variations to cope with, such as differences in culture, employment laws, government regulations, and learning styles. What's more, local offices tend to have their own ways of doing things, and they don't always view HR itself in a consistent way. Some consider HR as mostly an administrative paper-pusher, while others consider it a vital strategic partner.
The fact that there are so many differences helps explain why, according to the Arthur Andersen study, "reinforcing corporate culture" is one of the most critical goals among firms developing global HR strategies. Such a culture is key to creating consistency. Yet, as the DDI study notes, building and reinforcing a common corporate culture is difficult because local cultures and customs have a "moderate to great influence on the way business is conducted." Businesses are attempting to forge a global corporate culture through a number of methods, such as increasing global communication, educating management, outlining the culture in a written statement, seeking input from all locations on global projects, and allowing local cultures to retain their identities within the context of the corporate culture.
In some cases, corporations also are trying to reinforce corporate culture through the establishment of common systems, such as global HR management systems (HRMSs). Yet, international variations can impede progress here, too. Technology needs can clash with culture, law, and even something as basic as people's names. For example, Asians tend to use their names in reverse order, Latin Americans may have four or five names or a hyphenated last name, and many Dutch names include a prefix. This makes the creation of name fields in an HRMS fairly tricky. The August 2000 issue of HR Magazine reports that it took Lucent Technologies Inc. two months to settle on a name format when it implemented an HRMS.
Of course, there is no quick and easy way of globalizing HR practices. Every organization will face some unique challenges. But as the globalization of HR becomes inevitable, there will almost certainly be more studies and articles about how to do it well. Over the next several years, HR managers should be on the lookout for more best practices in this area.
====================================================
An article about Arthur Andersen's "Globalization of Human Resources" is in the Fourth Quarter 1999 issue of International Mobility Management, which can be found at
http://www.shrm.org/shrmglobal/publications/andersen/index.htm
The summary of DDI's "The Globalization of Human Resource Practices" is at
http://www.ddiworld.com/research/R-n-R1.asp