When a US company expands from the domestic market by exporting, it faces various constraints. Firstly, recruitment is the key issue due to finding staff on a global basis. Difficulties are evident when selecting the right people for the job when desiring to expand in a new location (ADP, 2020). Recruiting people with the right vision and capability to expand their skills is not easy. Secondly, compliance with employment law and customs is common during the expansion. This element is a challenge due to the regulatory concerns in hiring, paying, and managing international staff without complexity. For example, it is not possible in European markets to hire and fire anyhow without a comprehensive plan for the same (ADP, 2020). In the US, a person can start working the following day after a job offer.
A company changing from an exporting firm to a multi-global entity must go through challenges. For an established organization, there is a likelihood that expanding as mergers will have to face cultural challenges. In most regions, there is a unique culture based on the mode of business and the background of operations (ADP, 2020). Having people from different countries work for a given company comes with diversity, and that is a key issue that brings ideological differences while working. For example, if a US-based company wants to expand in the Asian region, the mode of doing business can be highly unique from the Western style.
In countries like China and Japan, business clients usually prefer a formal way of engaging in business negotiations. It is possible to find a Chinese entrepreneur demanding to be addressed rightfully and given advanced services when negotiating a deal (ADP, 2020). That culture is not present in the US as people are obsessed with the potential outcome and not the first impression of the business paraphernalia. Therefore, these challenges pose a threat to the success of a business developed by a US company.
Becoming a Global Company
A company becomes a global company when people from two or more countries own the headquarter or the parent firm. It means that a company will have to get stakeholders in ownership from the areas of operations without basing ownership from one country (Chen et al., 2017). For example, Shell and Unilever are current companies that fit the multi-global operations level. (Chen et al., 2017). Practicing human resource management for multi-global companies is complex. For instance, in the Middle East, which comprises countries such as Saudi Arabia and the United Arab Emirates, the focus is gravitated towards manpower planning and staffing aspects because of the government style of operation.
The challenge could be significant since US human resource covers broad areas such as training, employee relations, recruitment, performance, and compensation handling. When expanding specifically to Saudi Arabia, acquiring a work visa may take a long due to the immigration rules that appear inappropriate for international companies (Cortes et al., 2021). Thus, expanding to such regions means a US-based company must be ready to company the existing human resource management challenges.
Elements of High-Performance Work Systems
High-performance work systems are determined by a raft of elements. The first is ensuring employee security which can guarantee workers a job after working for a company some time. For example, Lincoln Electric recently adopted a program to ensure that employees can sustain job matters after working for three years (Mehralian et al., 2021). Implementing employee job security issues ensures that a company can build trust with employees, creating room for advancing and expanding in different business areas. The second element is selective hiring, which involves a company identifying critical skills and attributes that are important for the available tasks. For example, Enterprise Rent-A-Car in the US has applied selective hiring to reveal people that make upper half feasible (Mehralian et al., 2021). The focus is to hire former athletes and sorority members with exemplary skills that can help the company grow its customer service reputation. Third, decentralized decision-making is also a key element in high-performance work systems (Cortes et al., 2021). It involves creating a team that can lead an initiative under the freedom of deciding. Other elements include high results-based compensation, training by the commitment, and sharing essential information.
Among the elements given in the above paragraph, selective hiring and high results-based compensation impact human resource management significantly. Developing a compensation formula that will reward employees at all working levels promotes the commitment to expansion, increasing a company’s profitability (Mehralian et al., 2021). This can involve group-based profit-sharing, which creates social accountability when working. Hiring is a key aspect due to the nature of work undertaken depending on the expertise and knowledge power that employees have in a given job. These two elements impact human resource management since they determine the level of expansion a company can have in terms of business operations.
Deception and High Performance
Human resource management has used deception to create success. deception can be a subject that questions the ethics in business, but it can easily win customers, employees, and other stakeholders. Deception has developed to be a fundamental part of the business through marketing and making ambiance and a work setting that communicates a linear stream of processes. Although ethics may limit the aspect of deception, it can lead to high-performance behavior in a company. Ethical behavior can be a determinant of the performance levels of organizations (Chen et al., 2017). For example, in any event, a person is promoted based on excellent work done by another person; high performance might come in because the person must work hard to ensure that they fit the expectations. In this case, the human resource decisions to promote the worker will be based on deceptive background.
The difference between human resource management at US companies and BP Australia focuses on meeting the demand for the two areas. The human resource in BP Australia is based on the advancement of resources that help meet the region’s demand for notably more energy with few emissions. On the other hand, a US-based company focuses on hiring the perfect employee for a particular position who can help others achieve a uniform result in the regions that can influence growth (ADP, 2020). Also, BP Australia offers lifetime employment, unlike in the US, where people can be free to engage in several enterprises at a time.
BP Australasia has diversity initiatives that can be helpful for US companies. The first is the broad talent pool that is evident for BP Australasia whereby, the firm draws talents from different people with skills that can be combined for the success of a business. This enables a collaborative base between people with different expertise and knowledge power (Mehralian et al., 2021). The other initiative is the employee retention program that gives workers a chance to be employed permanently after working and achieving intended results for a company. The two initiatives can be applicable for a US-based company in leveraging human resource issues hence, developing a productive working environment.
ADP. (2020). Growing pains: The HR challenges of international expansion [PDF] (1st ed., pp. 6-11). WEIU. Web.
Chen, Z., Lu, A., & Yang, Z. (2017). Growing pains: International instability and equity market returns. Financial Management, 46(1), 59-87. Web.
Cortes, P., Kasoolu, S., & Pan, C. (2021). Labor market nationalization policies and exporting firm outcomes: evidence from Saudi Arabia. SSRN Electronic Journal, 6(2), 7-11. Web.
Mehralian, G., Moradi, M., & Babapour, J. (2021). How do high-performance work systems affect innovation performance? The organizational learning perspective. Personnel Review, 3(8), 23-26. Web.