2. Global Leadership and Strategic HRM

7/31/2019 2. Global Leadership and Strategic HRM

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2. Global Leadership and

Strategic HRM

Leadership and Management in

Transnational Companies Strategic HRM


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2. Global Leadership and Strategic

HRM Learning Objectives:

After studying this chapter students

should be able to:

Understand the nature of, and

relationships between, leadership and

management;


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Strategic HRM Learning Objectives:


should be able to:

Recognize the issues involved in

transnational leadership;


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should be able to:

Understand the need for, and basis of, a

strategic approach to HRM;


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should be able to:

Identify and evaluate strategies for

managing in culturally diverse

transnational organizations; and


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should be able to:

Identify the link between the transnational

companys value system and global

strategy, and its human resource strategy.


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Transnational Companies


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Leadership and management are two

distinct but related sets of behaviors and

activities.


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Management is primarily concerned withPOSDCORD: Planning Organizing Staffing Directing

Coordinating Reporting and Budgeting


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Management activities are:

closely integrated into the structure and

systems of the organization and

centered on its effective and efficient

operation.


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Leadership centers on the strategic

development and transformation of the

organization.


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Leadership:

looks toward the future,

creates a vision, and

seeks to move people and the organization

toward it.


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Leadership involves:

Developing a vision and strategic intentfor theorganization;

Creating shared values;

Developing people and the organization;

Creating change; and

Moving the organization toward the aspirations

encapsulated in the vision statement.


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Transnational Companies Definition of leadership

it is the ability of one person to influence the

behavior and actions of other people towardachieving the goals of an organization.


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Transnational Companies The nature of leadership:

1. Qualities or traits theories

2. Functional or group theories

3. Behavioral theories

4. Style theories

5. Situational approach and contingencymodels

6. Transitional or transformational theories.


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Transnational Companies Leaders in a learning organization must

be:

Designers

Teachers

Stewards


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be:

Designers designing the vision,

strategies,

policies, and structures of the organization;


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be:

Teachers facilitating learning so

people take a new view of reality; and


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be:

Stewards developing people and the

organization.


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Strategic HRM implications of a

core competence approach


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core competence approach1. Job Design

2. Staffing Issues

3. Training & Development

4. Rewards System


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core competence approach Job Design:

1. Greater technical knowledge will be

required for individual jobs;


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1. Greater technical knowledge will be required

for individual jobs.1. Project teams and rotation of jobs will be

used to foster the sharing of knowledge;

and


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1. Greater technical knowledge will be required

for individual jobs.2. Project teams and rotation of jobs will be used

to foster the sharing of knowledge.

1. Jobs will increasingly combine thinkingand doing.


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core competence approach Staffing Issues:

1. Most challenging positions will be filled by

internal transfers;


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internal transfers;1. Businesses will enter relationships with

educational institutions to obtain suitable

qualified employees; and


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internal transfers;2. Businesses will enter relationships with

educational institutions to obtain suitable

qualified employees; and

1. Personality and attitudinal tests will be

used to assess the potential of individuals.


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core competence approach T&D:

1. Investment in T&D programs will increase

to facilitate personal and organizationaldevelopment;


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1. Investment in T&D programs will increase to

facilitate personal and organizationaldevelopment;

1. T&D of personnel will increasingly be

decentralized to operating departments;


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1. Investment in T&D programs will increase to

facilitate personal and organizationaldevelopment;

2. T&D of personnel will increasingly be

decentralized to operating departments;

1. T&D will move away from traditional skills

building to development;and


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1. Investment in T&D programs will increase to facilitate personaland organizational development;

2. T&D of personnel will increasingly be decentralized tooperating departments;

3. T&D will move away from traditional skills building todevelopment; and

1. Performance review will be used to assess the

contribution of employees rather than to determinepay. This will be based on feedback from peers andcustomers rather than supervisors andsubordinates.


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core competence approach Rewards Systems:

1. A greater proportion of pay will be used on

group or organizational outcomes;


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group or organizational outcomes;1. Traditional hierarchical pay plans will be

replaced by broader banding of jobs. Job

evaluation will shift from a quantitative to

a qualitative focus.; and


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group or organizational outcomes;2. Traditional hierarchical pay plans will be

replaced by broader banding of jobs. Jobevaluation will shift from a quantitative to a

qualitative focus.; and1. Compensation systems will become flexible.


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HR Implications of Business Strategy

Business Strategy Questions HR Implications


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What industry and markets are we in?What people do we need?


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What industry and markets are we in? What people do we need?

Are organizational culture, structure,

and value systems appropriate orinappropriate?

How do we change them?


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Are organizational culture, structure and

value systems appropriate orinappropriate?


Strategic direction Who will we need in thefuture?


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Are organizational culture, structure and

value systems appropriate orinappropriate?


Strategic direction Who will we need in thefuture?

New businesses and new markets What systems andprocedures might bedeveloped?


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SWOT To what extent are theyrelated to existing use of HR?

Demand and supply in the

labor market?


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SWOT To what extent are they relatedto existing use of HR?

Demand and supply in the

labor market?

Critical Success factors To what extent do thesedepend on employees rather

than other factors?


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Examples of Organizational Strategies

and Associated HR Strategies


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and Associated HR StrategiesCorporate Strategy(strategic direction)

ExampleCompany

HR Strategies

Retrenchment(cost reduction)

Layoffs,

wage reduction,

productivity increases,

job redesign,re-negotiated laboragreements.


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ExampleCompany

HR Strategies

Growth Aggressive recruiting andhiring,

Rapidly rising wages,

Job creation,Expanding T&D


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and Associated HR StrategiesCorporateStrategy (strategicdirection)

ExampleCompany

HR Strategies

Renewal Managed turnover,

Selective lay-offs,

Organizational development,

Transfer/replacementproductivity increases,

Employee involvement.


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ExampleCompany

HR Strategies

Niche focus Specialized job creation,

Elimination of otherjobs,

Specialized T&D.


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ExampleCompany

HR Strategies

Acquisition Selective lay-offs,

Transfers/placement,

Job combinations,

Orientation andtraining,

Managing culturaltransitions.


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Case: GE the new leadership

paradigm

Q.1. What was the dilemma for

leadership that GE faced as atransnational co?

Q.2. What changes did Jack Welch bring

about in GE as its leader?


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End of Unit-2

Global Leadership and Strategic HRM

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2. Global Leadership and Strategic HRM

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