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Global HRM

Notes Most multinational companies now do a good job of globalising the supply chains for all their
essential raw materials — except human resources. Players in global markets can no longer
afford this blind spot. Competition for talent is intensifying, and demand far outstrips supply.
To have the multi-cultural skills and vision they need to succeed, companies will have to put
into place programs that recruit, train and retain managers in all their markets.
If companies are to handle the challenges of globalisation and shift to a knowledge-based
economy, they must develop systems that “walk their talk” that people are their most valuable
resource. The purpose of a global HR program is to insure that a multinational company has the
right talent, managerial mobility and cultural mix to manage effectively all of its operating
units and growth opportunities and that its managers mesh into a knowledge-sharing network
with common values.

Self Assessment

Fill in the blanks:
13. The scarcity of …………… managers has become a major constraint on the speed with
which multinational companies can expand their international sales.

14. Ethnocentric companies tend to be …………, they put the most confidence in nationals of
their headquarters country.
15. The lifeline and role descriptions should be revisited at least annually to ensure they
express the business …………..

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Case Study Promoting Diversity: The American Express Way

n January 2006, the American Express Company (AmEx) was featured on Fortune’s 3
list of the ‘100 Best Companies to Work for’ in America. AmEx was ranked ninth
Iamong large companies, and 37th in the overall ranking of the list of the best employers
in the US. AmEx had been one of the regulars on this list in the early 2000s, and the
company stood ninth in the overall ranking the previous year as well.
Fortune said AmEx’s diversity initiatives, especially its policies related to women
employees and minorities, made the company one of the best places to work for in the US.
AmEx’s commitment to minorities was also saluted by Black Enterprise, a magazine
committed to the business and consumer issues of the African – American community, in
July 2005.

The magazine included AmEx in its ’30 Best Companies for Diversity’ list. The 30 best
companies were selected after the editors of the magazine conducted a detailed survey of
more than 1,000 publicly traded American companies and 50 global companies with
significant operations in the US.
AmEx was also appreciated by other mainstream magazines as well as those catering to
minority groups and special interests such as Hispanic Business and Working Mother, for
its diversity related policies (Refer Exhibit I for a list of the awards AmEx received in 2006
and 2005).
In the 1990s, diversity issues came to the fore in corporate America. Not only had a large
number of women and minorities entered the workforce, but markets had also rapidly
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