Human Resource Management Challenges in a Global Era

Introduction: The Evolving Role of HRM

Almost every day, company owners, managers, administrators, and experts are confronted with challenging employee-related issues. Human resource management challenges cost organizations time, capital, resources, lost opportunities, and decreased productivity. The role of the HR manager is expanding alongside changes in the competitive market environment, and there is growing recognition that HRM must play a more strategic role in the success of a business. Companies that do not prioritize attracting and retaining workers may find themselves in precarious positions, as their competitors may be outmaneuvering them in the strategic management of human resources (Chan, 2009).

With increasing competition, both locally and globally, companies must become more flexible, agile, and customer-oriented in order to succeed. Within this changing environment, the HR manager must evolve into a strategic partner, an employee advocate, and a change counselor within the organization. To be effective, HR must function as a company-supported division with a clear understanding of the organization's overall direction, and must be capable of influencing important decisions and strategies. Today, the focus of the HR manager centers on strategic personnel retention and employee development. HR professionals must act as coaches, counselors, advisers, and succession planners in order to motivate employees and build their commitment. The HR manager must also champion values, ethics, and a positive workplace culture, particularly in the management of workplace diversity (Chan, 2009).

Managing Workplace Diversity

The future success of any organization depends on its ability to manage a diverse workforce that can contribute innovative ideas, perspectives, and approaches. The challenges posed by workplace diversity can be transformed into a strategic organizational advantage when a company is able to leverage its pool of varied employees. With a workforce drawn from diverse cultural backgrounds, genders, age groups, and lifestyles, an organization can respond to business opportunities more quickly and creatively — particularly in the international arena — which must be among the most important managerial objectives (Chan, 2009).

This is especially true for multinational corporations (MNCs) that operate on a global scale and employ workers from different nations, ethnicities, and cultural backgrounds. An HR manager must therefore remain alert and apply differentiated approaches in most situations. Many HR managers must undergo culturally grounded HRM training in order to develop the skills needed to motivate a group of highly skilled but culturally diverse professionals. In addition, the HR professional must reassure local employees that foreign workers do not pose a threat to their career advancement. In many respects, the effectiveness of workplace diversity management depends on the skilled balancing act of the HR manager (Chan, 2009).

One of the chief causes of ineffective workplace diversity management is the tendency to categorize employees — placing them in separate silos based on their diversity profile. In reality, diversity cannot be so easily classified, and organizations that respond to human complexity by drawing on the full range of skills within a large workforce will be most effective in growing their business and expanding their client base. In order to manage workplace diversity productively, it has been recommended that HR managers shift from an ethnocentric perspective to a culturally relative one. This shift in mindset must be embedded in the HR manager's approach to planning, organizing, leading, and controlling organizational resources (Chan, 2009).

Employee Retention and Downsizing

In today's environment, where cost-cutting is a dominant concern, human resource management may appear to focus solely on reducing headcount. Layoff announcements from organizations are issued on a near-daily basis. During periods of downsizing, HR management may be tempted to deprioritize employee retention — but this is precisely the wrong moment to do so. Retaining critical skill sets and top performers is among the most important tasks during an economic downturn. When the economy recovers, organizations that have shed key talent will face significant difficulty rehiring those workers. Rather than conducting blanket downsizing, HR management policies must protect essential functions and high-performing employees. Downsizing should be paired with employee retention strategies. One approach is for HR to use online employment screening assessments to identify leadership capabilities, job-specific skills, and employee alignment with organizational values and culture (HR Challenges in 2009, 2010).

Cost-cutting can deflate workforce morale. HR management must monitor the pulse of the organization and take strategic steps to sustain productivity. Employee surveys are a practical tool for gauging workforce morale or measuring reactions to new policies. Online employee surveys are easy to administer and provide quantifiable data to support HR management planning (HR Challenges in 2009, 2010).

Conclusion

HR professionals must consequently be familiar with and appreciate other cultural standards in order to encourage organizational diversity. A company that recognizes and promotes cultural diversity will benefit by better serving the markets it operates in. With mounting globalization and competition within the marketplace, a diverse workforce is advantageous in attracting and retaining a strong client base. When competing in a global market, employees from varied national backgrounds supply language skills and an understanding of other cultures. HR professionals will also be accountable for providing cultural awareness education for the organization's employees and managers throughout the company (Challenges faced by Human Resource Managers in the Era of Globalization, 2009).

Ultimately, the challenges facing HR managers — from managing diversity and navigating globalization to balancing cost-cutting with retention and adapting to virtual workplaces — reflect the growing complexity and strategic importance of the HR function. Organizations that invest in developing capable, culturally competent, and strategically oriented HR professionals will be best positioned to compete in an increasingly dynamic global business environment.