For this assigment you will need to use the 1st assignment which is the essay outline, you will be able to find this on the additional materials section.
The first Assignment was a 800 word essay outline (Which i have included in the additional materials for you to use)
The second is the full 1,500 word (+/- 10%) essay based on the essay outline provided in assignment 1 (This is the one you will be doing)
I have also attached the instructions for you to better understand the assignment
Please do look at the assignment 1 file as this essay should be done based on the essay outline which was done in assignment 1.
Also please APPLY THEORY, harvard referencing and follow all guidelines in the module handbook file.
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GLOBALISATION AND INTERNATIONAL CW2
Many companies in modern times have expanded their operations to the global market. Business growth depends on numerous factors, such as capital, human resource, and a feasible market for their products or services. Therefore, to achieve business objectives and productivity, companies should have these factors in abundance. Although all the factors are critical, Bamber, Lansbury, Wailes, and Wright (2016) suggest that human capital is the most critical asset to facilitate the growth of companies locally and internationally. Therefore, human resource managers should focus on improving and developing their human capital to play a critical role, such as in manufacturing and operation. Multinational corporations depend on a diverse workforce but should consider the role of integration in ensuring the success of their operations. They should also provide competitive Pay and Rewards to maintain an edge in the international marketplace. Consequently, although multinational corporations could quickly adapt their ‘Pay and Rewards’ HR strategies to local conditions, it is more beneficial for them to integrate them globally and maintain competitive rates in the global arena.
Human resource management remains pivotal for the success of multinational companies because they ensure that they are equipped with the most talented workforce in the market. They improve the development and growth of their organizations through the human capital (Torrington & Atkinson 2017). They also support the growth of revenue and profits (Harzing & Pinnington 2015). However, Beardwell (2017) reveals that human resource does not just provide positive results for their companies. The author suggests the importance of motivation to encourage employees, including managers, to put more effort into them through payments and rewards. Motivations theories reveal the importance of extrinsic motivation to improve organizational performance (Huang, Chiu, & Lu 2013). Proper motivation will help managers to provide direction and channel employees towards achieving organizational mission and vision (Brewster 2011). Thus, motivating employees through adequate compensation and rewards will encourage them to contribute to growth in profits, active capital management, and market growth and expansion. However, they should ensure the use of an effective system to retain their employees, especially in the face of global competition.
When operating in a global arena, the diffusion of ‘best practice’ is necessary and beneficial for companies. Siebers, Kamoche, and Li (2015) introduce the theory of the internationalization of human resource management. In their case study of China, the authors reveal that multinationals cannot divorce their human resource management from other internalization processes and expect success in the global arena. As a result, they are expected to integrate human resource management approaches, including payment and rewards strategies, and manage them more globally. After all, the forces that affect multinationals are not localized in nature (Crawley & Walsh 2013). For example, since they attract a global talent base, they should manage according to global standards. Therefore, since their operations are global, they should subject their human resource management practices to international rules and best practices in employee compensation and rewards.
Multinational Corporations focus on broadening and improving their production and operations to meet the demand of a global client base. The demand implies that they attract a global and diverse workforce to manage their operations from around the world. Therefore, they cannot manage, such as workforce from a localized perspective, which would create biases and inequality in the management of employees located in different regions around the world (Tarique & Schuler 2016). Besides, managers would disagree on how well to run each branch of the company in different countries or locations, which would cause low production levels (Iles & Zhang 2013). Since they are managing the same company, they should have a global, integrated, and competitive compensation system that motivates employees to remain in the organization. Using global standards will promote equity and equality among managers and employees and benefit the company in the long-term.
Multinational companies operate in a highly competitive environment, and one of the most effective ways of gaining an edge in the competition is the ability to retain qualified and talented employees. A practical payment and reward system are the most critical factor in achieving the objective of attracting the best talent in the market and avoiding losing employees to competitors. Retention limits the time and resources necessary for a firm to train and develop employees, including new managers (Edwards & Rees 2011). Besides, rewarding employees within the company, such as promoting them into managers from within support company’s growth because they understand the mission and vision, as well as organizational goals. As a result, they can support continual development and growth (Martinez Lucio 2014). Furthermore, such policies could encourage competition among the employees as they target the integrated rewards, such as promotion (Harzing & Pinnington 2015). Such effectiveness is possible where the company has a globally integrated HR system. For example, a manager working in China stands a chance of being promoted and transferred to a company’s head office in another country, such as the UK. Such competition can improve performance and achieve organizational commitment.
Besides, payment and global reward strategies provide both financial as well we non-financial benefits for multinational corporations. Employees are motivated to improve their performance when they expect globally competitive benefits (Bamber & Wright 2016). For example, a multinational company could provide non-financial benefits, such as housing allowance, holidays, health insurance covers, and transport allowance to motivate their global workforce (Wilkinson & Dundon 2017). To be meaningful to the company and employees, such benefits should be equally managed throughout the firm’s operations around the world. For instance, the packages that employees in the US receive should be equitable to those for workers in China. Failure to use the competitive approach could cause the company to lose employees to competitors who have integrated pay and rewards strategies. The allowances encourage managers to work more efficiently and productively (Bratton & Gold 2017). However, it will be more motivating when they know that the rewards are equitable and that they have an equal playing ground with other employees around the world.
Multinational companies with a globally integrated payment and reward HR strategies can reduce the costs they incur in paying and rewarding their workforce. Uniformity plays an essential role in harmonizing the HR management activities on a global scale (Shields et al. 2017). Popaitoon and Siengthai (2014) use international human resource management theory to prove how integrated international mechanisms reduce the cost of motivating employees. An integrated system prevents the replication of efforts, which is a cost-reduction benefit. Also, the uniformity makes it possible for corporations operating in a global market to pay and reward their employees without concerns regarding the quality of the currency of a particular country, the economies of scale, or the standards of living. It could be a lot of work and a high cost for multinationals to have a payment and reward system for each country where it operates (Rees & Smith 2017). Using a uniform mechanism makes them reduce the cost of motivating their employees, including managers who are drawn from the local context. They also manage others who are expatriates who come from different parts of the world (Armstrong 2007). The perception of equality can also motivate them to work more for the benefit of the company.
In conclusion, human resources are essential for the performance and productivity of companies operating in a global market. They support the development and growth of multinationals, especially if they are highly motivated. Hence, a payment and reward system that benefits managers would motivate them to increase productivity and maximize the sales and profits of the firms. Although a localized payment and reward system could still work, multinationals benefit more by using integrated human resource strategies on payment and reward to match their global operations. Such as system is highly motivating and creates equality in the compensating and rewarding employees, including managers. The strategy also lowers the cost of paying and rewarding the human resource team because of the uniformity and prevention of replication of efforts. A global payment and reward human resource system are the most competitive for companies to maintain a motivated workforce and ensure retention in the highly competitive global marketplace. Therefore, multinational companies should avoid replicating efforts and bearing a high cost of human resource management by integrating their systems, including the payment and reward strategy.
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