Global HR Functions
Much like domestic companies, the roles for the HR department working for a global company consist of five main functions. Here we will look at each one and explain how they differ when they're being conducted on a global scale.
1. Recruiting and Hiring
The goal of recruiting is finding a qualified candidate that can fulfill the duties of the position. It involves understanding the job description and interviewing, after which comes hiring the candidate that is the best match. When completing this function on a global level, there are some important considerations. First, the HR department needs to understand the tasks for the position in that part of the world and the skills needed to be successful. Education levels and differences are also a consideration since they may not be the same from country to country.
2. Training
Once the employee has been selected, they need to be trained. Most employees need some training in order to learn the ways a company does things. When the company is global, it's crucial that processes and policies are similar from one global area to the next in order to clearly communicate and to be able to use resources and materials in a variety of different places. Using the same processes and policies avoids miscommunication among offices and staff, and it cuts costs when the resources can be passed around to all of the different locations.
3. Developing and Administering
Most companies, global or not, offer opportunities for additional training in order to develop the skill sets of their employees. When this happens on a global level, employees may have an opportunity to visit another country to receive valuable training. This increases the value of the employee because they can now become successful in a variety of locations. As for administration, companies also need to make sure that they oversee their employees in a professional manner. This may mean training, compensation, or adhering to laws and regulations. On a global level, this is especially important because working hours may vary from location to location. Following the local laws is a priority for global HR departments.
4. Salary and Benefits
Whether the company is local or global, they have to compensate their employees. And most offer some sort of benefits package, which includes things like insurance, vacation, and sick days. However, companies need to pay close attention to how laws differ in all parts of the world. For example, the minimum wage might be different, and some countries might offer paternity leave for new fathers as a benefit. While the common goal is to pay employees for their work, knowing the standards, laws, and rules for each global area is an important goal for a global HR department.
5. Legal and Personnel Relations
Like mentioned earlier, following the laws of each country is a crucial aspect of a global human resource department. This means knowing and following labor laws, tax laws, holidays, and any religious needs. By following the policies of each country, a company is able to keep out of legal trouble where these areas are concerned.
Global HRM Challenges
All companies face challenges, but a global company may face some that are unique because of cultural and legal differences. Let's take a look at some of those challenges now.
1. Cultural Diversity
Different cultures have different ideas, needs, and practices. This means that what may be the norm in one area of the world might be completely abnormal in another part. If employees have to travel to a variety of global locations, they may not be fully prepared for these cultural differences, which may cause a challenge.
2. Training
Additional training may be needed in order for employees to do business on a global level. This might include learning how to network with people from a different culture, learning a different language, and learning a variety of other technology skills in order to work with employees from a variety of locations. Because you may not be able to always meet face-to-face for a meeting, employees need to have the skills to adequately meet and communicate with all employees regardless of location.
3. Laws
Laws are different in all areas of the world. Countries have different labor laws, tax laws, etc. It can be very challenging for a global HR company staying on top of all these laws. Failing to comply could land the company in legal trouble. Also, a global company has to comply with traveling rules and regulations, such as visas and passports, again adding to the complexity of the differences when conducting business globally.
Lesson Summary
Let's take a couple of moments to review what we've learned about global-scale human resource management, its functions, and its challenges. The human resource department oversees the staffing and employee needs of a company. While there are already a plethora of responsibilities to fulfill, that number increases drastically when the company expands globally. Cultural and country differences force a global HR department to be knowledgeable and prepared so that business goes smoothly.
Some important functions of a global human resource management team include:
- Recruiting and hiring: finding a qualified candidate that can fulfill the duties of the position
- Training: done in order to learn the ways a company does things
- Developing: offering opportunities for additional training in order to develop the skill sets of their employees
- Compensating: paying
- Following laws: knowing and following labor laws, tax laws, holidays, and any religious needs
While fulfilling those functions, there are also some challenges that a global HR department has to overcome. They include things like culture diversity, training, and legal compliance.
