Table of Contents
2.0 International perspective.
3.0 China and Sweden cultural issues.
4.0 Intuitional and cultural context
Recruitment and selection.
Learning and Development
Performance and rewards.
Human Resource Management is a significant issue for gaining organisational goals, most importantly for the businesses that are operating in the global market. Thus, it is essential for organisations to integrate the human resource management strategies within the business operation effectively to ensure better performance and productivity of people. This report focuses on several issues related to internal and comparative human resource management focusing on the case study of IKEA, which is a leading furniture company operating in the global market. In the first section, the international perspective of HRM is outlined. Then, the cultural issues between China and Sweden are discussed. Next, the institutional and cultural context of human resource management is evaluated. Then, several issues including recruitment and selection, learning and development, diversity, performance and rewards are discussed. Finally, this report provides a recommendation for IKEA on how it can improve its HRM in the global market and provides an action plan to implement the recommendation provided.
2.0 International perspective
According to Torrington et al. (2013), international HRM focuses on taxation, host government relations, administrative services, language translation services, orientation and relocation, which are not essential in the domestic HRM. Most importantly, the taxation system differs from country to country (Britton and Gold, 2012). For example, the taxation system in the UK is quite different from developing country like Bangladesh. Gunnigle and Morley (2016) said international HRM focuses on visa and immigration issues, host-government relation, and public benefits that are less required in the domestic HRM. Weightman (2011) said the internal HRM needs to focus on the broader perspective of cultural diversity than the domestic HRM. Britton and Gold (2016) claim that international HRM should give more concentration on employee personal lifestyles and bigger compensation schemes such as housing and benefits, health and safety issues, transformation and communication, recreational programmes, children education and child benefits, spouse employment, health insurance, etc.
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Thomson (2012) said international HRM faces more complexity from its employees than the staffs worked in domestic organizations. In addition, the global HRM faces more political, cultural, legal and ethical, racial and economic challenges than the domestic HRM. Mullins and Laurie (2014) argued that international HRM includes three-time more direct costs in travelling, salaries and wages, training and relocations in compare to domestic HRM. In addition, the indirect costs related to reputation damages and loss of market are also higher in internal HRM than in domestic HRM. International HRM also faces a more dynamic business environment, unstable political situations, international terrorism than domestic HRM. Britton and Gold (2013) said international HRM is more affected by external forces like political instability than domestic HRM. Dowling et al. (2014) claim labour cost is higher in international HRM than domestic HRM. For example, in developing countries like China, India is less than developed countries like the US and UK. Dowling et al. (2014) also defined five variables that differ international HRM from domestic HRM, which are shown in the diagram below:
Diagram: Five variables that differ international HRM from domestic HRM Source: Dowling (2014)
According to the above model, five keys factors differ the international HRM from the domestic HRM. These factors are different cultural environment, industry types, the reliance of multinational corporation in the domestic market, attitudes of senior management, and complexity in the global market (Dowling, 2014).
In the case of the global market, human resource activities differ from domestic markets materially. The key reason is the domestic HRM faces employees come from a single nation, whereas the global HRM deals with staffs come from diverse culturally and educationally background (Boxall, et al., 2015). In addition, the activities of human resource management in the domestic and international market vary from country to country based on business culture and structure, HR roles and competencies. The administrative activities of human resource management vary from the international market to the domestic market…………….