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(BMP6026) International HRM assignment on application of International HRM Practices in HSBC Holdings Plc


Task: In the international HRM assignment you will examine a topical HR issue for a real-life organisation. Choose an organisation (either multinational or transnational) and critically appraise the impact of national culture on their managerial decisions in relation to human resource management (discuss how IHRM decisions and operations are affected by cultural practices– Use examples from different national cultures wherever your chosen organisation is operating). Evaluate the chosen companies’ international strategies with regards to management of people as a business resource.


IHRM refers to the management of various human resource activities in global organizations located across various countries(Brewster, et al., 2016). It involves the processes of procurement, allocation and efficient utilization of various human resources in the international business. As per the findings of the international HRM assignment some of the basic human resource processes involved in the global context of IHRM are planning, controlling, training and development, procurement, compensation and performance management, induction, industrial relations and other(Brewster, et al., 2016). These activities are largely influenced by the types of global employees and countries of operation in IHRM. This IHRM is essential for companies operating in the global market for resolving any HR issues, catering to employee needs and enhance their productivity and performance in the organization (Björkman, et al., 2015). It helps in emphasizing on core competencies of global workforce, thereby empowering them to improve themselves. The purpose of the international HRM assignmentis to analyse the impact of culture on HRM decisions of HSBC Holdings and consequently, discuss its international organizational strategies for IHRM. HSBC offers a wide variety of international banking and financial services such as corporate banking, retail banking, capital markets, custody, trade, trusteeship, investment banking, securities, treasury, private banking and insurance (Bloomberg, 2022).Here, the bank serves millions of customers across the world. International HRM assignmentdiscussing the impact of Culture on HRM decisions

Recruitment and Selection
Recruitment and selection are the core functions of HR department of an organization. This is because these functions help in identifying the right people with the right skills for the particular tasks in the firm. It is also commonly referred to in theinternational HRM assignmentas the staffing function consisting of three phases, namely, job analysis, manpower planning and recruitment and selection (Chungyalpa,et al., 2016).

Pros and Cons:
National culture as per the international HRM assignmenthas significant impact on recruitment and selection strategies of firms. It has been observed that cultures having high scores in performance orientation generally have more formal staffing practices. Internal recruitment is also more predominant is highly collectivistic cultures. Uncertainty avoidance and power distance as per the international HRM assignment also determine whether interviews, ability tests, panel discussions, technical tests or psychometric tests are going to be involved in the selection strategy (Prince, et al., 2019).This is because national culture influences the way managers think and act, thereby identifying selection or recruitment strategies that they are going to implement in their organizations.However, national culture as per the international HRM assignmentalso discourages people having other shared values, beliefs and attitudes different from the company is they are unable to relate with them(Chungyalpa,et al., 2016). This might result in loss of potential candidates for the organization that would have been the right fit.

In this international HRM assignment, the selection and recruitment procedures of HSBC are different when undertaken in the UK and Bangladesh. Both these countries have strikingly different national cultures, which further have an impact on their recruitment practices.According to Hofstede’s model, UK is an individualistic society (Nabi, 2018). Here in the international HRM assignment, recruitment and selection procedures focus on enhancing individual capabilities of the applicants. Managers also select these employees based on their personal motivation, skills and self-confidence. Individuals here are task-oriented and have low power distance (Hofstede, 2022a). HSBC bank faces low trade unionism and consists of a culture with mutual respect. For this, some of the common methods followed in the bank are interviews, psychometric tests, work samples and evaluation methods. These focus on determining individual capabilities of the candidates. On the other hand, Bangladesh has a collectivistic culture(Nabi, 2018). Employers as per the international HRM assignment do not generally compare or rank individuals during selection procedures. It has a people-centred culture, thus, the employee fit with the rest of the organization is more important in recruitment process. With high power distance, managers of HSBC in this culture focus more on fairness or needs of applicants during selection process(Hofstede, 2022a). Thus, ability tests, interviews and employee referrals are common methods of recruitment here.

Employee Retention/ Engagement
Employee retention and engagement as per the international HRM assignmenthave become essential for companies to ensure their long-term survival in the global business environment. It is importance for organizations to understand in this competitive environment why some employees leave while others stay(Armstrong, et al., 2020). This not only helps in positively influencing the bottom line of the firms but also retain talented employees. In this regard, employee retention can be referred to as an organizational strategy for reducing and preventing employee turnover(John, et al., 2007). Thus, as per the international HRM assignmentthis involves decreasing the number of individuals leaving the organization.

Pros and Cons:
National culture as per the international HRM assignmentconsists of various beliefs, attitudes, norms or customs that individuals possess in a particular society or nation. These beliefs or values are bound to influence individual behaviour, thoughts and perceptions. It further affects the organizational culture in a firm, thereby determining employee engagement towards job and their intention to leave or stay (Lee, et al., 2016). For example, cultures having high collectivism tend to foster an integrated and team-oriented culture in the organization. This emphasizes on involving employees in major decisions, thereby making them valued and appreciated. Thus, it enhances their engagement with the job and organization, which helps the managers to retain these employees.However, as per the international HRM assignmentthis national culture becomes difficult for expatriates working in foreign organizations (Takeuchi, et al., 2013). Lack of cultural knowledge might make them feel frustrated and troublesome in getting engaged in the organization’s work. Thus, this can increase their desire of leaving the organizations.

HSBC undertakes different engagement and retention strategies across Hong Kong and UK. Hong Kong is a collectivistic society with more emphasis on welfare of the entire group unlike the individualistic culture of the UK. Here in the international HRM assignment, HSBC has given its Hong Kong employees provision of working 4 days a week from home along with a $322 allowance for home office setup (INC91, 2020). They are also offered an extra off day for showing their perseverance during the pandemic. This has helped in engaging with the employees on an emotional basis. On the other hand, UK is a more masculine society as compared to that of Hong Kong. For this purpose, more achievement-oriented benefits are provided to the HSBC UK employees. This is evident from the fact where the company agreed to pay for some 1500 UK staff for helping them to deal with their high cost of living crisis (White, 2022). The company considered in the international HRM assignmentundertook this strategy for sharing its better-than-expected profits incurred in the first quarter of 2022. Thus, different employee engagement strategies are undertaken based on cultural differences.

Training and Development for the international HRM assignment
Training and development as per the international HRM assignmenthave become vital for ensuring long-term success of the organizations. Training can be referred to as the acquisition of various skills, knowledge and competencies with specific goals of improving productivity, performance and capabilities. Effective training and development programmes are important in the organizations for maximum utilization of human resources in the firm (Gomez-Mejia, et al., 2012).As per the international HRM assignment these are helping for increasing efficiency, enhancing employee morale, better relationships, decrease in supervision and increased organizational flexibility.

Pros and Cons:
As per the findings in the international HRM assignment there exists a significant impact of national culture on the urge and intention of conducting effective training programmes on part of the managers. On the other hand, cultural values, beliefs and attitudes of the employees also determine their tendency and enthusiasm towards participating in training and development programmes of the organization. This is because national culture directly impacts the organizational culture, which further determines fairness, equal opportunities and non-discrimination in getting involved in such training programmes despite the cultural differences (Winkler, 2014). In addition, national culture also signifies the type of training investments, strategies and techniques being adopted in the firms.However, cultural differences amongst diverse employees often deteriorate the quality of training programmes. Here in theinternational HRM assignment, diverse employees might find it difficult in grasping knowledge in different language or participate in group work (Dominique, 2020). Thus, this can result in decreased effectiveness of employee productivity in organizations.

China and Hong Kong possess collectivistic cultures as opposed to the individualistic culture of the UK. Along with this, UK is also a more masculine society as per the international HRM assignment. Here, people give more emphasis on achievements, gains, success and task driven. China also scores high in long-term orientation, which shows that people here adapt more easily to changing conditions and have perseverance for achieving results (Hofstede, 2022b). For this purpose, HSBC in the Asian market has focused on developing skills of employees for working in digital and hybrid workplaces (Ahmed, 2021). The coaching is also provided virtually to the employees with the ongoing pandemic. Besides, digital learning modules and resources are being introduced in these Asian cultures for employee development in HSBC. The masculinity culture of China shows why HSBC started the development of a global training centre in the country for providing training to around 14,000 employees and senior managers (Kang, 2021). On the other part of this international HRM assignment, people in UK are success driven, which has encouraged HSBC UK to provide fintech training to thousands of staff. This has been undertaken for training employees outside their digital and technology jobs (Flinders, 2021). Thus, different training and development strategies have been undertaken across different cultures.

Compensation and Rewards Management in international HRM assignment
Rewards and compensation management as per the international HRM assignmentis another important part of HRM comprising the implementation and formulation of various policies and strategies for rewarding employees in a fair and equitable manner. These rewards are provided in terms of compensation of extra benefits after achieving the desired organizational goals (Armstrong, 2006). These are considered as essential factors for motivating the employees; thus, firms focus on improving their compensation and rewards management.

Pros and Cons:
Cultural differences across different nations as per the international HRM assignment influence values, attitudes and beliefs of people. This makes it essential for the firms to align their rewards system and compensation policies with their national culture and values. It has been observed that high power distance cultures tend to provide more importance to monetary rewards and want to gain promotion, authority, job title and status (Noor, et al., 2018). Feminine cultures emphasize more on quality of life and non-monetary rewards like recognition, respect, work flexibility and others. In addition, individualistic cultures make strong use of external rewards like financial status for recognising employee success. However, these cultural differences across various nations generate an impact on the expatriates working in foreign companies. For example, expatriates coming from masculine society to work in feminine cultures might get frustrated on not receiving the types of rewards and compensation that they expect. Thus as per the international HRM assignment, this can hamper their morale and productivity in the firm.

Cultural differences are evident across UK, Singapore or Hong Kong. These nations mainly possess masculine culture with a strong emphasis on success and achievements (Hofstede, 2022c). As per the international HRM assignment this encourages HSBC to implement rewards and compensation packages based on reasonable performance expectations from the employees. It introduced the Continuous Performance tool for supporting its Everyday Performance & Development Conversation (EPD)in Singapore to collect valuable feedback and recognize achievements of employees (Ahmed, 2020). Despite cultural differences, HSBC’s pay strategy is based on total compensation linked to pay and performance along with ascertaining how goals are being achieved based on company values. The reward package of HSBC as per the international HRM assignmentis same across all cultures, consisting of five elements, namely, fixed pay, benefits, annual incentives, long-term incentive awards and shareholding requirement (HSBC, 2019). Thus, this shows apart from some specific strategies undertaken in different countries, HSBC follows a standard rewards and compensation management system.

International Organizational Strategies for IHRM
International human resource management involves various activities catering to the specific needs of the organizations that have expanded internationally. This further includes designing of policies and procedures into the area of HRM by taking into consideration the specifics of the local areas (or evi, 2016).

Managing Global Workforce:IHRM further displays the way how MNCs manage their workforce located across various geographical regions for gaining competitive advantage in local and global levels with the help of their human resources. It helps in attracting, developing and retaining human resources in the companies through various strategies. In this international HRM assignment, emphasizing on cultural differences across geographical boundaries from where these employees belong is of utmost importance. Here, national culture helps in better understanding human nature, relationships, human activities, time orientation and understanding space. Thus, managers need to understand these differences for better managing the workforce.

IHRM Practices as per the international HRM assignment:Some aspects of IHRM practices in a global context include talent management, diversity and international migration (Al ArissandSidani, 2016). Talent management according to the international HRM assignmentinvolves recruiting highest calibre of individuals and identification of qualities that make a successful manager. HRM practices of selection, attraction, retention, recruitment and others vary across cultures of international migrants. Lastly, diversity is another important aspect of IHRM focusing on embracing cultural differences of the workforce.

Recruitment:HSBC undertakes a geocentric approach for recruitment as it is a multinational organization. It focuses on recruiting the most suitable employees that will be right for the specific job irrespective of their nationalities.HSBC has been focusing on transforming its global HR systems since 2017 by introducing cloud computing technologies in the same through SAP’s Success factors. It has been trying to attract various digitally savvy employees in the recent years (Carey, 2017). As per the data in international HRM assignment the bank engaged in app development and testing in the cloud with the help of AWS and using Google Cloud for analytics and other training of machine learning algorithms.This has been beneficial for the recruitment process of the company.

Empowering Global Workforce:Furthermore, digital HR solutions are being adopted through SAP, MuleSoft and ServiceNow to revamp employee experiences (Accenture, 2022). These have replaced traditional compensation and performance systems, manual processes of talent management, succession management, knowledge management and payroll. AS per the international HRM assignment it has been beneficial in empowering the global workforce along with driving value for both customers and shareholders(Accenture, 2022).This digital transformation undertaken in the HR department has been enabling managers to managing talented bank employees and allowing them to undertake better decisions about both teams and people.

Managing Senior Executives:HSBC has also focussed on revamping its senior management structure in 2021 for reducing the hierarchical culture in the company. This is because of its complicated current management system alongside inconsistency in seniority roles. The bank as per the details in international HRM assignmentfurther focuses extensively on enhancing its recruitment strategies, continuous improvement and talent investment, performance management and reward management (HSBC, 2022a). These are fundamental areas of focus in the HR department that improves the quality of workforce in the organization.

Managing Diverse Employees:Besides, HSBC emphasizes on diversity and inclusion because of its global workforce (HSBC, 2022b). It ensures fair and inclusive recruiting, progression of under-represented talent, fostering an inclusive culture and supporting an inclusive society. The bank as per the research in international HRM assignmentalso provides disability support, making banking accessible, mental health initiative, ethnicity at work, improving representation and racial equity standards. Thus, these are international organizational strategies that have been undertaken for IHRM in HSBC.

The international HRM assignmentaimed at analysing the international human resource strategies of HSBC Holdings Plc. For this purpose, the international HRM assignmentpointed out how IHRM activities have become important for MNCs like HSBC to ensure their long-term survival and success in the competitive business environment. The international HRM assignmentfurther analysed the impact of culture of various HRM decisions of HSBC. In this regard, cultural elements of Hofstede’s model were considered for understanding their impact on HRM decisions. It was observed in the international HRM assignmentthat these elements determine the cultural orientation of nations or societies, thereby generating a direct impact on HRM practices. The international HRM assignmentrepresented how national culture generates a significant impact on recruitment and selection strategies, training and development, employee engagement and retention strategies and rewards and compensation management. These implications were also evident in the case of HSBC, where the bank determined its strategies based on cultural differences across nations.

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