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Global Business Strategies Need HR's Input

October 1, 1993
Related Topics: Managing International Operations, Featured Article
No matter what the corporate culture, for it to be advantageous to the company, the culture must be an outgrowth of a well-conceived global plan. "From a human resources point of view, it's critical that the company have a clearly articulated business strategy that spells out why it wants to become more international, what it's trying to achieve, and how it plans to harness senior-level commitment," says Dale E. Smith, an independent HR consultant located in Wilmington, North Carolina, who specializes in helping organizations develop global strategic plans.

First, you must have a clear mission and vision statement. Then, you need to understand the global environment or the specific region in which you're attempting to do business-its history, economies, political situations and cultures. Smith suggests that you accomplish this complex task by interviewing key managers and customers, trying to distinguish if it is indeed best for the company to become international. Identify specific product lines and specific countries in which the business will begin to venture out.

"Define what globalization means and how you're going to approach it," he says.

Next, HR professionals must identify the key human resources concerns that will support those strategies. Interview managers and customers, analyze data on the work force, relate external changes in the areas of the world into which you're planning to move specifically to the business plan.

For example, if the business strategy is growth, the company needs sufficient management talent to support international growth. If there are enough managers for this, the next question is, do they have a global perspective? Do they have the competencies required to perform on a global basis?

The same goes for compensation and recognition. The first question asks whether the compensation and recognition system supports the business strategy. Does the bonus system, for example, recognize the appropriate elements for increasing international market share? If so, then HR professionals move to the next level and ask how different reward-and-recognition programs abroad will send the message to employees that the company wants to grow its market share.

Based on a thorough analysis of the business strategy, which is confirmed with management, HR can then develop specific action plans. These plans form the foundation for all other HR supports, including communication strategies, compensation and professional development.

In Organizational Dynamics, David Lei, John Slocum Jr. and Robert Slater suggest that the best way for a company to instill its corporate culture is to ensure that its values are simple and clear, driven from the top, and consistent over time. A carefully defined strategic plan will facilitate these objectives.

Personnel Journal, October 1993, Vol. 72, No.10, pp. 84.

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