Global or International Human Resource Management (IHRM) is a set of organized activities whose aim and objective is to improve the hiring, pricing, and general human resource of an organization at the international level (Bornay-Barrachina, 2019). IHRM strives to meet the objectives and develop a structure that will improve the organization's overall competitiveness over other related competitors in the global market. In the modern business sphere, there are seven distinct but inter-related HRM activities as stipulated in the Wolfgang's Balancing Act. However, the seven events are condensed or combined to form three major international HRM activities: allocate, utilize, and procure (Bornay-Barrachina, 2019). Therefore, this essay seeks to evaluate the three major HRM activities concerning the analysis of Wolfgang’s Balancing Act.
Procurement is one of the three major activities in the IHRM as stipulated in the Wolfgang’s Balancing Act. Procurement is involved in human resource induction and planning. For instance, in a multinational corporation whose headquarters is situated in one country, the planning process is undertaken in the mother country (Werker & Hopp, 2020). Strategic human resource planning, the method of recruitment, and the credentials of the recruits are done in the mother country. Other countries, such as the second and the third countries, adopt the planning strategies through the induction process. The induction process in IHRM is defined as the activities through which the HRM procurement department applies the objectives, goals, and vision of the enterprise. For instance, the Coca-Cola Company, one of the global international corporations, has employed the induction process in its production, distribution, and hiring of employees. In 2012, it was recorded that the majority of the employees that operated in the US-based company were non-Americans but rather employees from other countries induced by the company to the American franchises (King, 2020)
Nonetheless, procurement does not provide full operations of the HRM in a global company. Sonnichsen and Clement (2020) argue that procurement deals with evaluating, balancing, and developing strategic plans with the available budget for future endeavors. This structure of HRM does not consider other non-recruitment challenges such as inflation, rates of employment, and a change in the global human resource development mechanism such as new virtual teams.
Utilization is the process through which another person applies one activity for the corporation (Werker & Hopp, 2020). For instance, according to Wolfgang’s Balancing Act, allocation in HRM is the process through which skilled, semi-skilled, and informally experienced personnel is used or applied in an enterprise (Werker & Hopp, 2020). The global chain of business demand skills and labor from all spheres of human capability (Werker & Hopp, 2020). For instance, in quarrying activities, the majority of the laborers required are those that are semi-skilled or informally skilled while in a pharmacy, those hired are skilled laborers. Utilization of the HRM is the most crucial aspect of HRM as it involves productive employment and maximization of skills and knowledge in the enterprise's production sector. Lin (2020) asserts that most global organizations are geared to hiring the most appropriate employees for a specific task to save the cost that could be incurred in training non-skilled employees. For instance, a study conducted by Lin (2020) showed that more than 40% of US companies prefer to hire trained employees rather than new ones. The essence of this form of HRM recruitment is to maximize the utilization of the already achieved skills and knowledge to enhance productivity.
Allocation is the last phase of IHRM in which it involves the plan to use the human resources across the subsidiaries of the corporation and in the specific projects (Werker & Hopp, 2020). In this category, placement, orientation, and performance evaluation are critical to evaluating the employees' remuneration regarding the skills and services provided. For instance, in the concept of HRM, the countries that have the headquarters and the strategic planning of the operations of the corporation decide on the allocation formula and method to the subsidiary countries. According to Bombiak and Marciniuk-Kluska (2019), the allocation is the distribution of the enterprise's scarce resource to its human resource. Human resources refer to the chain of activities that are distributed and offered by human beings in terms of skills, labor, knowledge, and production of the business. However, in most cases, it has been argued that countries with higher GDPs have relatively high remuneration of their employees compared to the rest despite having similar or equal credentials and productivity in the organization. Wolfgang’s Balancing Act showed that this is one of the most significant challenges that face global human resource management and skills development (Bombiak and Marciniuk-Kluska, 2019).
In summary, HRM is the art of recruiting, training, planning, placement, and managing human resources in an enterprise. HRM is divided into three segments to enhance operations that are procurement, which is tasked with planning, hiring, and induction of employees. Utilization is tasked with maximizing the skills, talents, and knowledge provided by the employees and allocation, which is the cognitive distribution of qualifications held by laborers in the company.
Bombiak, E., & Marciniuk-Kluska, A. (2019). Socially responsible human resource management as a concept of fostering sustainable organization-building: Experiences of young polish companies. Sustainability, 11(4), 1044.
Bornay-Barrachina, M. (2019). International human resource management. Managerial Competencies for Multinational Businesses, 174-194. https://doi.org/10.4018/978-1-5225-5781-4.ch009King, L. A. (2020). Power and marginalization in popular culture: The oppressed in six television and literature media franchises. McFarland.
Lin, P. (2020). Strategic Decision-Making Business Functional Outsourcing Model: A Multiple-Case Study on Human Resource Management Outsourcing of a Chinese Car Dealer.
Sönnichsen, S. D., & Clement, J. (2020). Review of green and sustainable public procurement: Towards circular public procurement. Journal of Cleaner Production, 245, 118901. https://doi.org/10.1016/j.jclepro.2019.118901Werker, C., & Hopp, C. (2020). Balancing act between research and application: How research orientation and networks affect scholars’ academic and commercial output. Journal of Business Economics. https://doi.org/10.1007/s11573-020-00979-x
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