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Global HRM

Notes The global journey has not been very easy. As the company moves from being just an
India-focused group, one of the challenges it constantly faces is to establish its credibility
as a global multinational. Consider: A new acquisition in Canada in 2005. Its pulp and
fibre business inked an agreement with the province of New Brunswick in Canada,
establishing a new company, AV Nackawic Pulp Plant. As part of the acquisition process,
the team needed to make presentations to groups of the local community of the mill
township of Nackawic, whose livelihood depended, to a large extent, on restarting the
pulp plant. There were searching questions from local unions, the provincial government
and employees, but the team was able to effectively allay their concerns. Starting from a
position of scepticism, by the end of the process, the employees of Nackawic were convinced
that they would rather work for an Indian multinational with credibility, than for a local
company that presided over its shutdown last year. Finally, the Indian acquisition team
was taken to the provincial Parliament, where it received a standing ovation.
Indeed, this acquisition was important for the Aditya Birla group. The strategy was to use
this as a captive source of high quality pulp for its fibre units in India, Thailand and
Indonesia. With a capacity of 180,000 tonnes per annum, this acquisition is expected to
enhance its global competitiveness in the fibre business.

For the future, the group wants to be in the Fortune 500 list by 2010. It needs to grow at an
average 15 per cent in dollar terms over the next seven years. It has set itself tall global
plans. In rayon fibre, it wants to be the number one global player with a market share in
excess of 30 per cent. In non-ferrous metals, it plans to be the largest integrated aluminium
player in Asia with significant presence in downstream customer-interactive business. In
cement, it targets to remain as one of the largest players in India and look selectively at
other attractive markets to diversify its global reach. And in carbon black, its target is to
be one of the top commanding presence in all significant world markets.
Questions

1. How did Aditya Birla Company move from India-focused group to global MNC?
2. What factors can contribute Aditya Birla Company to enter into Fortune 500 group?
3. Can Kumar Mangalam Birla make the higher global mark?

Source: Indian Management, December 2006

1.5 Summary

 Globalisation is the process of international integration arising from the interchange
of world views, products, ideas, and other aspects of culture.
 Advances in transportation and telecommunications infrastructure, including the rise of
the Internet, are major factors in globalisation, generating further interdependence of
economic and cultural activities.
 HRM refers to those activities undertaken by an organisation to utilise its human resources
effectively.
 Even those organisations who consider themselves immune to transactions across
geographical boundaries are connected to the wider network globally.

 Globalisation is the process of international integration arising from the interchange
of world views, products, ideas, and other aspects of culture.

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