The concept of IHRM

Before we can offer a definition of international HRM, we should first define the general field of HRM. Typically, HRM refers to those activities undertaken by an organization to effectively utilize its human resources. These activities would include at least the following:

Main tasks involved in HRM

Human resource planning

Staffing(recruitment, selection, placement)

Performance management

Training and development

Compensation(recruitment) and benefits

Industrial relations

employee relations

(Table1)Main tasks involved in HRM

1.1.2 IHRM model

The question is of course which activities change when HRM goes international. A model (shown in figure 1) presents IHRM on three dimensions:

International human resource management (IHRM) is the process of procuring, allocating, and effectively utilising human resources in a multinational corporation.

These three broad activities can be easily expanded into the six HR activities listed above.(Morgan 1986)

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(Figure 1)A model of IHRM

National/country categories involved in HRM tasks:

the host country where a subsidiary may be located

the home country where the firm is headquartered

other countries that may be the source of labor, finance and other inputs

Categories of employees of an international firm:

host-country nationals(HCNs)

parent-country nationals(PCNs)

Third-country nationals(TCNs)

Morgan (1986) defines international HRM as the interplay among these three dimensions-human resource activities, types of employees, and countries of operation. We can see that in broad terms international HRM involves the same activities as domestic HRM: (e.g. procurement refers to HR planning and staffing). However, domestic HRM is involved with employees within only one national boundary.(Morgan 1986)

1.2 INTRODUCTION FEDEX CORPORATION

FedEx Corporation is leading global logistics solutions provider, among the list of 100 ‘best companies to work for’ in the US. FedEx Corp. provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $32 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world’s most admired and trusted employers, FedEx inspires its more than 275,000 employees and contractors to remain absolutely, positively focused on safety, the highest ethical and professional standards and the needs of their customers and communities.

1.2.1 The information of FedEx ¼ˆTable 2¼‰

Type

Public (NYSE: FDX)

S&P 500 Component

Industry

Courier

Founded

1971 (incorporated)

1973 (began operations)

Headquarters

Memphis, Tennessee, U.S.

Area served

Worldwide

Key people

Frederick W. Smith

(Chairman, President & CEO)

Alan Graf EVP and CFO

Robert Carter (CIO; EVP, FedEx Information Services)

Products

broad portfolio of transportation, e-commerce and business services

Revenue

US$ 34 billion (2010)

Operating income

US$ 2.075 billion (2008)

Net income

US$ 1.2 billion (2010)

Total assets

US$ 25.633 billion (2008)

Total equity

US$ 14.526 billion (2008)

Employees

280,000+ (2009)

Subsidiaries

FedEx Office, FedEx Express, FedEx Ground, FedEx Freight, FedEx Custom Critical, FedEx Supply Chain, FedEx Trade Networks, FedEx Services

website

FedEx.com

1.2.2 FedEx Corporation Mission strategy values (Table 3)

Mission strategy values

FedEx mission

FedEx Corporation will produce superior financial returns for its shareowners by providing high value-added logistics, transportation and related business services through focused operating companies. Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx will strive to develop mutually rewarding relationships with its employees, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards.

FedEx strategy

The unique FedEx operating strategy works seamlessly – and simultaneously – on three levels.

Compete collectively by standing as one brand worldwide and speaking with one voice.

Operate independently by focusing on our independent networks to meet distinct customer needs.

Manage collaboratively by working together to sustain loyal relationships with our workforce, customers and investors.

FedEx Values

People: We value our people and promote diversity in our workplace and in our thinking.

Service: Our absolutely, positively spirit puts our customers at the heart of everything we do.

Innovation: We invent and inspire the services and technologies that improve the way we work and live.

Integrity: We manage our operations, finances and services with honesty, efficiency and reliability.

Responsibility: We champion safe and healthy environments for the communities in which we live and work.

Loyalty: We earn the respect and confidence of our FedEx people, customers and investors every day, in everything we do.

FedEx boasts of its global reach and is one of the most reputed logistics companies and express delivery services today. FedEx offers exciting employment opportunities to those aspiring for a bright career in aviation. Being the leaders in this industry, FedEx offers job stability and growth opportunities to its employees. Employment at FedEx Kinko’s is truly rewarding, and employees are provided excellent compensation packages and incentive programs. Some of the major highlights of employment and career opportunities at FedEx Kinko’s include friendly work environment, growth prospects, open communications, and dynamic team spirit. FedEx’s employee-friendly policies resulted in very low turnover rate. In 2000, the turnover rate was estimated to be below 6%, while the industry average was 20%.

3.1 The concept of HR initiatives

Central to the successful management change are the HR initiatives which are put in place. Many organizations try to accomplish strategic change by merely changing the system and structure of their organization. This is a recipe for failure. HR initiatives will be incorporated within the organization’s overall HR strategy and will include education, management development programmes, and training and reward structures. Probably one of the greatest barriers to the management of change is the assumption that it simply happens or that people must simply change because it is necessary to do so. (Robert Galliers, Dorothy E. Leidner 2003)

The HR initiatives services (figure 2)

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3.2 How the programmes affect employee’s knowledge, skills and attitudes

Employee behaviour, also called organizational behaviour, is results of factors that influence the ways employees respond to their work, leadership and customers. Identifying the internal and external factors that affect their behaviour can help the company understand why employees are committed and motivated. Internal factors include leadership, organizational structure and the corporate culture. External factors include family life and other business relationships. ( Angus McIlwraith 2006)

3.2.1 Major Categories Affecting Behaviour

External forces

Outside the organization

Inside the work environment

Leadership

Coworkers

Outcomes of performance (such as praise)

Organizational Structure

Internal Forces

Within employee

Motivation

KSAs (knowledge, skill and ability)

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Model of Employee Behaviour (figure 3)

( Irene Nikandrou, Nancy Papalexandris, 2008)

3.2.2 How the programmes affect employee’s KSAs (knowledge, skill and ability)

(Table 4): The Programs of FedEx

Programs affect employees behavior

Function

Survey Feedback Action program

Encourage employees to give feedback on management policies.

Guaranteed Fair Treatment Procedure

ensured that all types of employee grievances were addressed

Job Change Application

Provide temporary employees the opportunity to gain regular employment at FedEx.

Leadership Evaluation and Awareness Process

gave FedEx’s non-managerial employees the opportunity to seek managerial positions at FedEx

internal employee training programs

how to accomplish job tasks correctly

Internal employee training programs affect employee behaviour by describing how to accomplish job tasks correctly. Improved employee performance reduces costs, reduces employee turnover, increases product or service quality and typically improves employee morale. Clearly defined roles and responsibilities and documented policies and procedures reduce grievances and conflicts. Training programs designed to affect employee behaviour typically feature role-playing activities and hands-on practice. For example, training programs designed to improve professional skills, such as negotiating, motivating, influencing, communicating and decision making require practice. (Russell C. Swansburg, Richard J. Swansburg 2002)

FedEx Company’s most successful communication tool is their renowned Guaranteed Fair Treatment Procedure (GFTP). This procedure which they believe is the cornerstone of their “people” philosophy, gives each Federal Express employee the right to have any eligible issue go through a systematic review by progressively higher levels of management. Their GFTP helps ensure that personnel have a right to discuss complaints with management without fear of retaliation. (FedEx Express, 2002)

Survey feedback program will be considered incomplete and meaningless if it does not contain the provision of developing an action plan to deal with the problems. The management should develop an action plan that is both straight forward and workable. Hence, participants are asked about their recommendations, about how to resolve the problems that are uncovered in the survey. The basic purpose of survey feedback is to assist the organization in diagnosing problems and developing action plans for problem solving. It also assists the group members to improve the relationships through discussion of common problems. It emphasizes and promotes two way communications in the organization. It can increase the influence of the lower level managers. It has a broad coverage and includes all the members of the organization. Information it provides often serves as the basic for concrete plans to enhance organizational effectiveness. It is flexible and can be applied to many organizations and to many problems.( Trunick, Perry A 1989)

For leadership development to become a process, not an event, line federal express has created a leadership institute which conducts week-long courses where attendance is required as manager move into the various levels. Courses are also run on improving leadership effectiveness with a special emphasis on developing the soft skills of leadership. A parallel process known as the leadership evaluation and awareness process (LEAP) is used to assess and prepare individuals for their roles as managers. The process allows employees who are interested in formal leadership roles to put themselves forward and receive self-development tools and personalized coaching. FedEx leaders and performers are directly involved in helping other people to develop. This has produced twin benefits by increasing the readiness of managers for leadership responsibilities as well as reducing the turnover of front-line management. (Linda Holbeche 2009)