Human Resources Flashcards
Organizational Capability:
Organizational Capability: The power to combine and leverage a company’s resources, including human capital, to achieve specific business goals.
Example: Toyota’s ability to continuously improve manufacturing processes.
Human capital
Human Capital: The collective skills, knowledge, and abilities of a company’s employees that are used to create economic value.
Example: A lawyer passing the bar exam or a customer service representative helping customers.
Global HR Wheel
Global HR Wheel: A cyclical relationship where a company’s global strategy influences its human capital and HR practices, which in turn shape the company’s organizational capabilities and outcomes.
HR Practices
HR Practices: Policies and processes used by a company’s human resources department to manage its workforce, ensuring the alignment of employee skills with organizational goals.
Company-Specific Human Capital
Company-Specific Human Capital:
Knowledge specific to a company’s culture, systems, and routines that helps employees navigate and perform effectively within the organization. This knowledge is valuable within the company but less applicable outside of it.
Example: A manager who knows how to navigate internal systems and procedures at Toyota.
Location-Specific Human Capital
Location-Specific Human Capital:
Knowledge relevant to a particular market or geographic location, including cultural, economic, or political understanding.
Example: An executive familiar with the customs regulations in Vietnam, helping a company import products smoothly.
Performance management
Performance Management:
The process of aligning employees’ and teams’ goals with the organization’s objectives, evaluating performance, providing feedback, and linking performance to compensation. This process can be complicated by cultural differences.
Example: In collectivist cultures, singling out an individual for praise may isolate them instead of motivating them.
Cultural Sensitivity in HR
Cultural Sensitivity in HR:
Understanding and adapting HR practices to different cultural norms and expectations. For instance, in some countries, retention bonuses may be more effective than signing bonuses.
Two-Way Communication:
Two-Way Communication:
Essential for performance management, where healthy communication between superiors and subordinates is necessary for setting goals and providing feedback, but cultural differences may complicate this process.
strategic objectives:
strategic objectives: long-term organizational goals that help make a strategy successful
competitive advantage:
competitive advantage: a condition that puts a company in a superior business position
critical behaviors:
critical behaviors: the few key areas of activity in which meeting strategic objectives are absolutely necessary
KPI
key performance indicators (KPIs): clear-cut instruments to quantify whether individuals are on the right track to helping a company achieve its strategic objectives
Local Human Capital:
Local Human Capital:
The knowledge, skills, abilities, and attributes that employees develop based on their specific location or market. It includes understanding local customer needs, cultural traditions, institutional barriers, and political processes.
Example: Employees in China developing insights into local consumer preferences for home appliances.
Subsidiary Human Capital
Subsidiary Human Capital:
A combination of local and company-specific knowledge. It represents the ability of employees to adapt company knowledge to fit local market conditions, effectively aligning corporate goals with local needs.
Example: Haier employees in Indiana combining their knowledge of local U.S. tastes with the company’s Chinese efficiency to design products for the U.S. market.
Corporate Human Capital:
Corporate Human Capital:
Company-specific knowledge, skills, and abilities that transcend specific locations, applicable across a company’s global operations. It includes policies, procedures, and corporate goals that remain constant throughout the company.
Example: Knowledge about corporate procedures that are the same whether an employee works in China, the U.S., or Europe.
international human capital:
international human capital: knowledge of global best practices, global industry standards, international trade laws, modular systems and processes, cross-border industry networks, and other experience applicable across multiple companies and countries
Example: An employee with experience in international trade regulations and global supply chain management.
Human Capital Transferability:
Human Capital Transferability:
The ability of local human capital to be transferred to competitors within the same market. Local expertise may sometimes be too specialized to be transferable to other countries.
Example: Haier hiring designers familiar with U.S. consumer tastes from the local talent pool in Evansville, Indiana.
Multidomestic Strategy:
Multidomestic Strategy: A strategy focused on increasing profitability by customizing products, services, and operations for local markets. It emphasizes local and subsidiary human capital.
Example: A company with subsidiaries in multiple countries that act independently to meet local market needs.
Meganational Strategy
Meganational Strategy: A strategy focused on centralization, consistency, and global integration across business units. It relies heavily on corporate and international human capital.
Example: A company offering standardized products and services worldwide, leveraging economies of scale.
Transnational Strategy:
Transnational Strategy: A hybrid strategy that balances local responsiveness with global integration. It emphasizes all four types of human capital in varying proportions.
Example: Briggs & Stratton adapting engines for U.S. customers based on ideas generated by its Chinese subsidiary, while integrating these innovations across global units.
Economies of Scale
Economies of Scale: Cost advantages that arise when companies produce at a large scale, reducing the cost per unit. A key driver of meganational strategies.
Expatriates
Expatriates: Employees from a company’s headquarters who are relocated to work in a foreign market, typically to ensure standardization and consistency with corporate practices.
Example: Icon Health & Fitness sending a U.S. manager to oversee operations in Asia.
3 Global HR functions:
*Contributing to business decisions
*Providing HR expertise
*Delivering HR service
