Global Human Resource Management

What is a business and what is HRM from a business point of view?

o   A business is a value-creation system where firms assemble and coordinate resources – physical, financial, human, and intangible – to produce outputs that satisfy customer needs at a price that exceeds the cost of inputs, thereby generating profit and ensuring long-term survival in competitive markets.

o   Human Resource Management is the function within a business that is responsible for attracting, developing, motivating, and retaining the workforce – the human capital – that enables the organization to execute its strategy, achieve operational excellence, and sustain competitive advantage.

What are the five core contributions of HRM and its business impact?

o   1. Talent acquisition and deployment = ensure the right people are in the right roles at the right time, directly impacting productivity and innovation

o   2. Performance and productivity = designs systems that align individual effort with organizational goals, driving efficiency and output

o   3. Organizational culture and engagement = shapes the behaviors, norms, and psychological climate that determine employee discretionary effort

o   4. Strategic agility = develops workforce capabilities that enable rapid adaption to market shifts, disruption, and crisis

o   5. Risk management and compliance = mitigates legal, reputational, and operational risks related to employment practices, ethics, and labor relations

Define the VRIN framework as proposed by Barney (1991) and explain how it transformed HRM from “personnel management” to “human capital”

o   According to Barney, the VRIN framework means that human resources are a source of sustained competitive advantage if they are valuable, rare, inimitable, and non-substitutable (=VRIN).

o   Valuable here means that resources enable efficiency or effectiveness, therefore it has to be identified which skills and behaviors drive performance.

o   Rare means that resources are not widely possessed by competitors, thus unique talent must be recruited and developed.  

o   Inimitable means resources cannot be easily copied by competitors, thus firm-specific knowledge and culture must be built

o   Non-substitutable means that technology or automation cannot replace human contribution

o   It transformed HRM from personnel management to human capital since valuation and there what people are considered to be worth changed since people were now considered as strategic assets

According to Ulrich (2023), what are the three key components of “human capability” and how it contributes to business?

o   The three key components of human capability are talent (=individual skills), leadership (=ability to mobilize and inspire), and organization (systems and culture)

o   This contributes to business since the collective ability of an organization is used to turn knowledge into action and to then create value.

o   The priorities in this are agility, adaptability, ecosystem thinking and value co-creation.

Is employee centric theory (e.g. Kaufman, 2020; Pfeffer, 2024) in conflict with the human capability model (Ulrich, 2023)? Why?

o   The employee-centric theories do not replace or conflict the human capability model, rather they rebalance it.

o   The insights from the employee centric theories are an integration and not trade-offs

o   Since toxic work cultures undermine both well-being and performance of employee, human capability cannot be sustained without employee-centric foundations

Identify 3 pillars of ethical HRM proposed by Kramar (2022) and briefly explain each.

o   According to Kramar, ethical HRM is a fuction that must balance economic, social, and environmental outcomes, moving beyond profit-centric metrics to stakeholder capitalism.

o   The economic pillar focuses on the organizational performance, productivity, and profitability, requiring strategic workforce planning, talent optimization, and efficiency metrics

o   The social pillar revolves around employee well-being and equity and therefore includes fair wages, work-life balance, diversity and inclusion

o   The environmental pillar describes green practices and climate response, for example remote work and sustainable and paperless HR

Trade Policy —> explain the key differences on globalization vs. deglobalization and its impact on HR

o   Globalization means open borders for trade. Countries actively reduced tariffs (taxes on imports) and signed free trade agreements like NAFTA (US-Mexico-Canada) and expanded the European Union. The World Trade Organization (WTO) created common rules for global commerce.

o   Deglobalization means protectionism is rising. Countries are imposing tariffs (taxes on imports), restricting exports of critical goods (e.g. semiconductors), and prioritizing trade with politically aligned nations (“friends-shoring”). Supply chains are being shortened (“near-shoring”) to nearby countries.

o   HR implications of this are that when supply chains move closer to home, HR must recruit and manage workforces in new geographic locations. For example, a company shifting manufacturing from China to Mexico needs HR to build talent pipelines, understand local labor laws, and manage cultural integration in the new location

Capital Flows —> explain the key differences on globalization vs. deglobalization and its impact on HR

o   Globalization means money moved freely across borders. Companies could invest in factories anywhere in the world without significant restrictions. Foreign Direct Investment (FDI) grew rapidly as multinational corporations expanded globally.

o   Deglobalization means in this context that investment is now restricted. Governments are screening foreign investments more strictly. For example, the US Committee on Foreign Investments reviews and block investments from certain countries (especially China). Capital is flowing along geopolitical lines rather than purely economic ones.

o   HR implications are that when foreign investment is blocked or restricted, planned expansions are delayed or cancelled. HR must be agile and ready to pause hiring, redeploy talent, or shift recruitment to alternative markets where investment is approved.

Supply Chains —> explain the key differences on globalization vs. deglobalization and its impact on HR

o   Globalization means efficiency was everything. Companies built global supply chains focused on lowest cost. “Just-in-time” inventory meant parts arrived exactly when needed, reducing warehousing costs. China became the dominant manufacturing hub (“the world’s factory”)

o   Deglobalization means resilience now matters more than efficiency. After COVID-19 disruptions and geopolitical tensions, companies now prioritize “just-in-case” inventory, holding extra stock to withstand shocks. Supply chains are being diversified across multiple countries to reduce dependence on any single nation.

o   HR implications are that as supply chains regionalize, HR must manage workforce transitions. For example, a company closing a factory in one country (due gto decoupling) and opening in another requires HR to handle layoffs, severance, redundancy agreements, and simultaneously recruit, train, and integrate new workforces in the destination country.

Geopolitical —> explain the key differences on globalization vs. deglobalization and its impact on HR

o   Globalization means a single global leader. The United States was the dominant economic and political power after the Cold War. There was a broad consensus around free markets, democracy, and global cooperation. International institutions (WTO, IMF, World Bank) coordinated global rules.

o   Deglobalization means no single leader and fragmentation. The world is now multipolar (multiple power centers: US, China, EU, etc.) or bipolar (US vs. China). There is no country willing or able to lead global governance, a situation called the “G-Zero”. Nations pursue their own interests, often conflicting.

o   HR implications are that Global HR can no longer assume that a single home-county approach works everywhere. HR must develop “geopolitical intelligence”, the ability to monitor political risks in each country of operation and adjust talent strategy accordingly. For example, a US company operating in China must plan for scenarios where talent movement between the two countries becomes impossible.

Ideology -.> explain the key differences on globalization vs. deglobalization and its impact on HR

o   Globalization means that the world was seen as converging. The dominant belief was that globalization would make the world more similar – cultures would blend, economies would integrate, and prosperity would spread. Thomas Friedman’s “flat world” metaphor captured this optimism.

o   Deglobalization means that national interests now come first. The prevailing mindset is economic nationalism and sovereignty. Countries prioritize self-reliance, strategic autonomy, and protecting domestic industries. Trust in global cooperation has eroded.  

o   HR implications of this are that HR must navigate a world where local nationalism may conflict with corporate values. For example, a global economy promoting gender equality and LGBTQ+ inclusion may face resistance in countries where such values are culturally or legally contested. HR must develop nuanced strategies that uphold global ethical standards while respecting local legal and cultural contexts.

When expanding globally, talent mobility is limited. Explain it on multiple levels.

o   Talent mobility is limited when expanding globally since there are talent mobility restrictions. Increased nationalism has led to tighter visa regimes, making traditional expatriate assignments more difficult. MNEs (multinational companies) must develop “flexible global working arrangements” (FGWAs) including international business travelers, flexpartriates, short-term international commuter and rotational assignees.

o   This also means that severe global supply chain changes may occur as domestic firms aim at engaging in international trade instead of operating locally abroad. This requires HR to manage workforce transitions, relocations, and potential redundancies.

o   Also, anti-globalization policies with the rise of populism can have negative effects on MNEs as the ability to transfer technological knowledge across political borders will be hampered.

Further, MNEs must now incorporate political risk assessment into HR strategy, including avoiding risky countries and supporting national interests if they plan to operate there to reinforce the subsidiaries’ foreign legitimacy.

Describe Sathe’s three levels of culture

• Top layer is the manifest culture: the easily observable elements such as behaviors, language, music, food, etc., it represents the first contact with a new culture e.g. peoples speech, dress, interactions with each other, but it provides only a partial understanding of a particular culture and observing the manifest culture does not necessarily reveal the meaning of a culture, but it could provide some important insights

• The layer above the water in between the top and bottom are the expressed values and here the deeper meaning of a culture develops, since this level represents how people in the culture explain the manifest level

• The bottom part of the iceberg underneath the water are the basic assumptions, which are the foundation of culture, encompassing the shared ideas and beliefs about the world and society as a whole that guide people’s thoughts and actions

Kluckhohn and Strodtbeck identified five value orientations. Name any three of these orientations and provide your insight into its impact on business and HR

• Relations to nature means the variation between nature domination (subjugate), harmony between both and human domination (mastery)

  • It impacts Business and HR because for nature variation you need control bs. Adaptability, for harmony variation you need sustainable practices and reactive strategy, and for human

• Time orientation means the variation between past, present and future oriented

  • It shapes whether HR emphasizes tradition and seniority for the past orientation, immediate results for the present orientation or strategic workforce planning for the future orientation as well as short-term vs. long-term incentives

• Human nature means the variation between evil, mixed and good

  • It impacts business and HR because for evil orientation it means strict rules and surveillance, for mixed it means a balance of oversight and trust and for good orientation it means minimal rules with high autonomy, and additionally, it drives whether HR invests in training or focuses on selection

• Preferred personality means the variation between being, growing and doing

  • The impact on business and HR herein is that for being the focus is put on work-life balance and wellbeing, for growing it is put on personal growth and development and for doing it is put on achievement and productivity and KPIs

• Relationships among people have variations of collectivist, group, and individualistic

  • The business and HR impact here is that it shapes compensation, so individual vs. team, performance management, so competition vs. cooperation, and decision-making processes, so collective vs. absolute power from leader

How do differences in cultural dimensions such as power distance and individualism influence HR practices in communication and reward systems

• Differences in power distance influence HR practices especially in communication because in low power distance countries there will be flat structures, consultative decisions and egalitarian treatment of all and therefore more equal and egalitarian communication and for example there can be 360 degree feedback used that include upward feedback from subordinates. On the other hand, in high-score power distance countries, there will be more formal communication, hierarchy, and respect for authorities and for example, feedback only flows top-down and subordinates do not evaluate managers

• Differences in individualism influence HR practices especially in reward systems since low score countries will focus more on team rewards, group interviews and referrals and for example the team bonus will be distributed equally among all team members whereas high score countries will focus more on individual bonuses and skills and for example the highest commission would be paid to top individual salesperson

How do organizational elements such as rituals, stories, symbols, power structures, and control systems shape organizational culture and influence employee behavior?

• These organizational elements are part of the corporate culture and thus the set of values, behaviors, and practices that define how things are done in a company. It is therefore the operating system of the organization and shapes decisions, interactions, and performance

• Rituals and routines as daily behaviors and how work is done could for example be found in HR in weekly team meetings or performance reviews

• Stories as the narratives about past events could be used to explain certain events in the company’s history and how employees feel and think about it

• Symbols such as logos, office layout, or dress codes could mean whether there is a open-plan office, casual dress or corner offices for example

• Power structures mean who holds authority and how decisions are made so for ample if they are centralized or decentralized and if formal titles are used

• The organizational structure defines reporting lines and authority so for example if they are flat or tall and if there is a matrix vs. functional

• Control systems encompass the metrics, rewards, and punishments so for exmpale the KPIs used, bonus structures and disciplinary structures

According to Schein, how do national culture and corporate culture interact with each other?

• According to Schein, national culture and corporate culture interact with each other in a complex way where corporate culture does not replace national culture but overlays it. That means employees bring their national cultural programming to work and the corporate culture either reinforces, challenges or ignores the programming

• Reinforcement interaction type means that the corporate culture aligns with the national culture so in HR for example policies are accepted easily and no adaptation is needed, so for example when German corporate culture with high uncertainty avoidance operates in a German national context.

• For the challenge interaction type the corporate culture contradicts the national culture, meaning for HR for example that there is resistance, confusion, or withdrawal, so training is required as well as adaptation or selection and this can happen for example when US corporate culture with low power distance is in a Malaysian national context with high power distance

• For the neutral interaction type it means that the corporate culture operates independently of national culture so there is no cultural conflict and it can be standardized globally for example through technical procedures or safety protocols

Why might employees from high uncertainty avoidance countries experience anxiety toward principle-based HR policies that depend on manager discretion rather than clear rules and procedures?

Employees from high uncertainty avoidance cultures prefer predictability. That means HR policies based on manager discretion can create uncertainty and anxiety because outcomes may vary between managers, whereas clear rules provide consistency and security