Standardized human resource practices prevent the company from adapting to the local features
Standardized human resource practices do not take into consideration the institutional differences of the various agencies of the multinational corporation
Standardized human resource practices do not take into consideration different labor market regulations, which would have to be followed and which could also impact organizational outcomes
Last, standardized human resource practices "may lead to a lack of fit between the characteristics of the focal subsidiary's operations and its HRM system. Hence, it may be more difficult to achieve a high degree of strategic HRM fit in the subsidiary" (Budhwar, 2004, p.254).
The Nike Inc. international organizations are primarily faced with the tasks of manufacturing, whereas the marketing, managerial and design operations are completed within the United States of America. In light of the similar functions they have to complete, it would be argued that several human resource practices could be standardized. Still, given the fact that the plants are located in different regions, it is also important to adapt to the local features. A relevant example in this sense is offered by the need to adjust to the minimum wage requirements in each different country.
In terms of the human resource practices which would be standardized, these include the following:
The recruitment and selection processes
The training of the personnel, including both the base line workers as well as the line manager
The compensation packages including the base salary (as legally required) and additional incentives
The organizational culture.
3.2. Different approaches
As it has been mentioned throughout the previous sections, Nike would have to pay increased attention to the operations which it would standardize and the ones it would localize. In terms of the strategic global management of the human resources, the practices would be similar in all plants the corporation has opened in the outsourcing regions. Differences would however exist when these are legally required and one example in this sense is represented by minimum wage requirements. Other labor force regulations which would force Nike to allow localization of its human resource practices include working conditions, working hours, paid vacation regulations or other stipulations in the local legislations.
While the company would integrate and standardize most of its human resource practices in its management of the international plants, different human resource practices would be implemented within the United States. The operations completed in the North American country are pegged to creation and administration, rather than actual execution. The employees in the U.S. are as such knowledge workers and they would be subjected to different HR practices. For instance:
They would be selected based on different criteria, with focus on expertise, education and intellectual capital
They would be rewarded using different wage scales and they would be offered different incentives. The people in the international plants would work in order to get the paycheck, but the employees in the United States would have to be more motivated and engaged in their professional responsibilities
They would be offered different and more comprehensive and stimulating rewards and incentives
They would be subjected to different training programs.
3.3. Global application of HR practices
As the organizational managers decide on the human resource practices to be implemented and the nature of the strategies, it is necessary to ensure that they would be integrated and implemented accordingly by each of the international subsidiaries. In attaining this objective, the following seven step plan is proposed:
1. The comprehensive understanding of the strategies and functions which can be integrated and standardized, as opposed to those which would be adapted to the local features (localized).
2. The understanding of the employees in the different global regions. Even if the decision has been made to standardize the human resource functions, the company managers could consider local differences as elements in the standardization process.
3. The training of managers in the United States to manage the integration processes in various global regions, in the Nike plants.
4. The training of local managers in the culture and business practices of Nike, coupled with the gradual transition from foreign management to local management.
5. The construction of internal documents to guide the processes and policies of Nike in its international locations.
6. The training of the line manager to ensure that he promotes the principles and practices as established by the executives in the U.S.
7. The promotion and strengthening of the corporate culture in all of the Nike plants.
3.4. Impact of strategic HRM decisions
The recommendations so far made for Nike Inc. center on three specific directions -- the standardization of human resource practices, the localization of human resource practices and the steps to be taken in the actual implementation processes. The actual business model for the application of human resource management practices varies across companies and is pegged to variances in resource availabilities, knowledge possessed, local features and so on. The current recommendations were formulated in light of the assessed literature review, coupled with the observed characteristics and needs of shoes and apparel manufacturer Nike.
The actual implementation of the strategies could generate both positive as well as negative outcomes, depending also on the critical success factors. These factors could include the adaptability of the firm or the strategic consistency. In the setting so far created, the implementation of the proposed strategies could create the following advantages:
Nike would be better able to centralize its control of the manufacturing operations due to standardization (Budhwar, 2004)
The Nike employees in the various international plants would be more motivated as they would appreciate the sense of equity from the implementation of the same human resource practices
Nike would register not only cost efficiencies from operating in these regions, but also operational efficiencies through the implementation of standardized human resource practices.
In terms of the negative outcomes, these could include the following:
Low levels of employee morale and as such, employee performance, as a result of the company's inadaptability to local features
The possibility of breaking the laws in the respective regions through failure of adaptation to the local features. This would also materialize in financial costs and the damaging of the corporate image.
The final results retrieved from the implementation of the proposed strategies would be observable at three different levels: the overall organizational revenues -- with the specification that a triumph in implementation would be followed by increasing revenues --, the assessment of employee productivity and the assessment of the levels of employee morale and commitment to the firm.
The modern day economic agents face mounting threats and challenges and the success in the dynamic society, industry and marketplace is no longer supported alone through the production and delivery of high quality services. Economic agents as such, supported by the research community, devise and implement a wide array of strategic efforts, all aimed to enhance their positions within the industry.
The practice of human resource management has as such evolved in time and it has given birth to more and more specific applications, such as strategic human resource management or strategic global / international human resource management. The scope of the adjacent strategies is that of creating competitive advantages and better supporting the firm in accomplishing its objectives.
The current project has reviewed the literature and has used it as a starting point in the creation on several suggestions for future HRM development at sports shoes and apparel manufacturer. The ultimate statement is that the firm -- Nike as well as any other firm -- has to implement the practices of human resource as best as it can, by meeting best practices standards, and by adapting these to the features of the company as well as to those of the industry, market and labor force.
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