Globalization is the process of interaction and integration among people, companies, and

governments worldwide. Globalization has accelerated since the 18th century due to advances in
transportation and communication technology. This increase in global interactions has caused a
growth in international trade and the exchange of ideas and culture. However, disputes and
diplomacy are also large parts of the history of globalization, and of modern globalization.

Since its inception, the concept of globalization has inspired Many definitions and interpretations

These are some of the definitions:

Sociologists Martin Albrow and Elizabeth King define globalization as "all those processes by which
the people of the world are incorporated into a single world society."

In The Consequences of Modernity, Anthony Giddens writes: "Globalization can thus be defined as
the intensification of worldwide social relations which link distant localities in such a way that local
happenings are shaped by events occurring many miles away and vice versa."

In 1992, Roland Robertson, professor of sociology and an early writer in the field, described
globalization as "the compression of the world and the intensification of the consciousness of the
world as a whole."

BRIEF HISTORY OF HOW GLOBALIZATION STARTED

1. The first episode began around the mid-19th century and ended with the commencement of
World War I (WWI). International Business evolved from the age of World War I (1919) & World War
II(1939 ).

2. In both these episodes of globalization, rapid trade and output growth went together with major
shifts in the relative size of the economies involved.

3. In the 1990s, trade expanded again more rapidly, partly driven by innovations in the information
technology (IT) sector. The most dynamic traders in the 1950-73 period were the west European
countries and Japan.

Advantages & Disadvantages of Globalization

Advantages:

1. Cheaper Products for Consumer: Mass production leads to availability of products at low
price.
2. Consumers get the product they want at more competitive prices.
3. Consumers to get much wider variety of products to choose from.
4. Globalization leads to Outsourcing in some cases which can increase of job in other
countries. Eg: Moving call centers to India.
5. The international barrier gets reduced between counties which fosters the relation among
nations.
6. Better qualities of products are available due to standard norms set for production across
the globe.
7. Helps prevent market saturation in a specific market i.e it reduces too much competition in
one place. For e.g too much call centers were existing in UK market which moved to India
 8. Standardization of product: The same products can be seen in some many places – e.g coke
and McDonalds
9. Companies get access to much wider markets which give a scope of further development of
organisations
10. Increased Standard of living due to the availability of goods & services across the globe
11. Increased flow of skill and non skilled jobs and workers which enables better employment
conditions across the countries. Eg: Large numbers of Indian citizens work in the Middle East
country which helps both the countries.

Disadvantages of globalization:

1. Companies face much greater competition. This can put smaller companies, at a
disadvantage as they do not have resources to compete at global scale.
2. It can increase spread of communicable diseases.
3. Economic depression in one country can trigger adverse reaction across the globe.
4. Widening of Gap between rich and poor countries
5. Exploitation of workers: Paying the workers in less economic developed countries a fraction
of what would be paid to the parent citizen workers.

SLIDES – 7

HRM is a management function that helps a manager to plan the required Functions for the
Organisation.

In other words, organizational function that are related to the employee concerns such as
recruitment, employee motivation & development, training, wellness, compensation, benefits and
administration

SLIDE 8 –

Gone are the days when the job of the human resources department was to adhere to local labour
laws and manage local employees. Today, as the organizations cross geographical barriers and hire
diverse talent in terms of age, gender, ethnicity, skills, experiences and location, the responsibility of
human resources has increased multifold.
 
Today, human resource managers have to devise strategies that are ‘glocal’ – global yet local. So, if
the company is based in Los Angeles but hiring people in India, then it has to make sure that its
human resource strategy not only adheres to international standards but is also culturally
appropriate. 
SLIDE - 9

functions performed by International HR Managers

 Staffing & Recruitment: Understanding cultural differences in recruitment process, in the

selection of candidates and in what motivates employees is crucial in the staffing and
recruitment processes for any international operations.
Recruitment for international operations requires a thorough understanding of the business
processes involved in that part of the globe and the skills required to operate them. These
must then be matched to available local talents and skills; your recruitment policies have to
be amended to fit these criteria. Each area may require a separate evaluation as educational
levels may vary. Requirements for physical standards may also change, and this factor may
have to be considered while recruitment is being done.
 Salaries and Compensation Packages
While fixing up offer packages, care has to be taken to see that local standards are
maintained while at the same time overall organizational requirements are also met. Local
laws regarding minimum wages, bonuses and other benefits have also to be structured in to
the packages. Insurance, pension and such benefits should be reviewed as they relate to the
present policies of the company.
 Training and Development of Staff
People learn differently around the world. Global companies need to deliver the same
training program and consistent message on a worldwide basis which becomes a challenge
for the international HR Manager. Local facilities for training and development of staff need
to be kept in view. If these are not adequate, sending staff to other countries may need to
be looked at, and the additional cost and benefits of such training need to be carefully
studied. Possibilities of developing in-house training should be examined to reduce costs.
 Human Relations
When considering global human resource management, each area of international
operations may need to comply with certain religious and national festivals.
 Building Teams
Human resource professionals who support international business operations typically must
to ensure that diverse teams work well together. By conducting team-building workshops,
promoting acceptance of cultural diversity and motivating employees to achieve strategic
goals, they help their company build strong teams.
 Maintaining Gender Diversity
Maintaining and managing the gender diversity is an additional responsibility for an
International HR Manager. There are countries where the count of women are negligible,
whereas in some countries women are equally qualified & work with men. An international
HR should posses the cultural knowledge and should be aware of the sources to maintain
the diversity in the work place.
 Working with Diversified Managers
As companies become more global, human resource professionals act as business partners
to interview and orient new employees to the workplace. A complex business operation
typically requires specialized personnel, so human resource professionals must work
cooperatively with managers on the production lines from diversified culture
 Impact of Globalization on Wages & Benefits

 Recognizes differences in pay practices, taxation, benefits, market conditions, and

regulations across the globe
 Competitive Base pay
 Work / Life balance
 Pay raises linked to individual performances
 Reputation of Organization as a good employer
 Competitive retirement benefit
 Variety of work assignment
 High Level of autonomy

Impact of globalization on Trade Union:

 Global institutions like World Bank, International Monetary Fund, WTO, are putting
tremendous pressure on other nations to rationalize labour laws and weaken trade union
rights. This emerging global economic environment is very favorable to the growth of Multi
National Companies.
 To increase the competitiveness of their products in the global market, many countries have
adopted the so-called neo-liberal policy, with one of its key parts being legal restrictions on
 workers’ rights for the sake of higher economic efficiency. As a consequence, trade unions in
many countries have lost their rights that they had won through many years of struggle.
 Practice of informal employment and cheap forms of labour, such as part-time, casual and
domestic workers; have become prevalent over the past few years. Those informal workers
have not enjoyed adequate protection for their employment, wages, social security and
occupational health and safety. Changes in employment patterns have in turn made it very
difficult for trade unions to organize workers.
 Some developed countries have shifted their labour-intensive enterprises to other countries.
Trade unions in those developed countries have lost some of their traditional industrial
bases. In the meantime, the fast application of new and high technologies in traditional
industries such as steel, manufacturing and construction has caused a drop in labour
demand on a yearly basis. Furthermore, the traditional ways of trade union work have been
challenged in IT and other hi-tech industries. Against such backdrop, union density has
declined in many countries.

Participative Management: Participatory management is the practice of empowering employees to

participate in organizational decision making. Employees at all levels are encouraged to contribute
ideas towards identifying and setting organizational-goals, problem solving, and other decisions that
may directly affect them. Also called consultative management

Importance of Participative Management:

 Participative management holds employees responsible, accountable for their work.

 It allows them to determine the outcome of work related activities.
 Participative management affords employees a voice. Employees take their jobs seriously
and become loyal to the organisation.
 It delegates control to employees but the organisational goal must be achieved to.
 It fosters a team environment. It is management’s job to explain what’s expected and work
with the employees to achieve goals.

Impact of Globalization on Participative Management:

 Evolution of Participative Management: The concept of participative management is a result

of globalization.
 Global Challenges can be faced: For better production, better quality, global standards
 Serving global customers:
 Better Problem Solving:
 Enhanced team culture:
 Healthy IR conditions
Impact of Globalization on Employment

 Increase in employment growth: Due to globalization, employment opportunities have

increased in the developing countries like India. Emergence of Globalization has given a
boost to the employment to young youths.
 Diversified Employees: As the number of organisations is going global, the rates of
diversified employees are also increasing. Today’s MNC have citizens from all around the
world which is the result of globalization. Managing cultural diversity is one the challenges in
today’s employment scenario.
 Flexible Benefits: Competition among the MNC’s has arrived due to globalization. Every
organisation is ready to provide to flexible and customized benefit to the employees. Now
employee has the luxury to select the benefit which appeals to them.
 Economic Development: Overall the economy is developed due to the increase of
employment opportunities from the IT and ITES companies. Due to globalization, many
companies are switching to the developing economies like India where the workforce is
available at a lesser cost which enables overall development of the economy increasing the
disposable income of the employees.
 Higher Choices for Employees: Due to globalization, the employees have a higher choice to
select their employer of choice which gives the maximum benefit along with the
compensation.
 Increase in Quality of Employees: The quality of the employees have improved due the
number of prospective employees applying for the employment opportunities. This has been
made possible due globalization where the employment opportunities have increased
cutting their geographical boundaries.
 Higher Disposable Income: Due to the emergence of global MNC’s the competition have
increased in the market and as a result of this competition every MNC is proving lucrative
compensation packages to attract, retain and motivate employees with various facilities to
remain engaged with the organisation.

CHALLENGES

 Language: One of the first disadvantages of working in an international team can be the

impact of language. Multi-International teams have individuals who will not be able to
converse in their native tongue. Undoubtedly, this will lead to some form of
misunderstanding when working together for at least one member of the group. “When
people speak with their team in a language other than their native one, it often affects their
ability to interact with the group. It potentially affects spontaneity, clarity of expression
(vocabulary and pronunciation), and willingness to express ideas. Specific areas of
miscommunication can be found in the form of vocabulary, language style, non verbal
communication, and the unwillingness to express ideas.
 Vocabulary- The vocabulary that we and others use can sometimes be confusing to others
who do not speak the same native language, let alone to those who do. Many
miscommunications can arise if we are not aware of the speech and vocabulary we use and
how it is interpreted by the receiving party.
  Language Style– Varying nationalities communicate differently. When working in teams
some individuals may be very direct and blunt, while others may be indirect and vague in
their communication. Each person may interpret these language styles differently. It is
important to recognize the differing language styles and the common misunderstandings
that can come from it. Accents, pronunciation, slang and the use of idioms can also cause
fundamental misunderstandings.
 Non Verbal Communication- A majority of communication is done through non verbal
communication. Non verbal communication has an enormous impact on intercultural
communication because of the way in which it can be misinterpreted from one culture to
the next. Non verbal communication can give off mixed signals if you are not aware of the
communication style of the person with whom you are working.
 Unwillingness to express ideas- The inferiority complex where team members feel they
cannot express themselves in the language that is being used, so they do not express their
ideas.
 Attitudes toward time-The difficulty in dealing with international teams is that each culture
has a different attitude toward time. This can cause problems when prioritizing tasks and
completing tasks within certain deadlines.
 Different Value Systems: “Peoples’ values are expressed through what they say and what
they do. Therefore people working together from different cultural backgrounds may find
that they approach and execute tasks differently because of differences in their cultural
values. Understanding differences in value systems helps us to understand how and why
individuals may behave differently to ourselves. This can help us work more effectively
together and make the most of the benefits that those differences offer.”
 Preconceptions & Stereotypes: Stereotypes are the tendency we have to simplify the world
by putting people into a category, and then fitting the individual into the stereotype of that
category. If you interact with a team member from a particular country, you may have the
tendency to put another a future team member in the same category as the first team
member with whom you interacted.

Ways to Manage Diversify at Workforce:

 Embrace diversity: Promoting a culture that values employees for unique skills, experiences
and perspectives distinguishes an organization as all-inclusive, relevant and truly
understanding of what customers want and need. In essence, it is a treasure trove of
customer and business intelligence.

 Internally, the more leaders understand and respect their employees’ differences, the easier
it will be to make seemingly difficult conversations more comfortable.

 Make it part of company policy and a core value that discrimination is not tolerated in
your organization. Design a procedure for complaints regarding discrimination in the
workplace, in addition to disciplinary action. Make sure that you are consistent in
responding to complaints and executing discipline. Discrimination can occur in relation to
age, gender, ethnicity, sexuality and disabilities or illness.

 Create a visual of your team: Keep ethnicity and gender data on hand so that hiring
managers can create a visual picture of the individuals on each team. When numbers and
percentages fail, this mental image of who is on the team can help senior leadership see
where diverse populations are underrepresented or underutilized and especially compare
them to the customer population.
 Invite staff into the inner circle: Create an environment of inclusion where all staff members
feel valued, embrace the company’s mission, feel part of its vision and are fully tuned in with
the organization’s business strategy. Help them understand just how important diversity is
to serving customers best and that every individual is a big part of that. It’s easy to lose top
performers because they feel detached, especially in large organizations.

 Mentor and shadow: The best learning happens in the field, so develop a mentoring and
shadowing program that pairs hiring managers with employees of different cultural or ethnic
backgrounds or genders. This creates a trusted, educational environment where employees
can feel safe about asking questions regarding different backgrounds, and also lets them see
different cultural styles at work.

 Celebrate the cultural differences: Assign a person to be in charge of finding ways to

incorporate or celebrate the cultural differences within the company. Your employees can
offer their suggestions and even be involved in the actual planning of these events and
activities.

 Boost the existing diversity of staff within your company through corporate publications. If
you have a company magazine, website or annual report, highlight your company’s diversity
whenever possible. When your diverse readers and web traffic recognize the diversity within
your company, they may be more inclined to be a part of it.