Human resource management can be defined as an activity which help in managing human resource in organization at international level in order to attain competitive advantage. Mainly it includes HRM functions such as recruitment, selection, training and development, performance appraisal at international level. IHRM is concerned with management issues relating to workforce on international level (Almond, 2011). In this context, the main purpose of IHRM is to capture competitive advantage by hiring as well as improving skills and productivity of the workers With which company can easily enhance their performance level at international market. Current report is based on Lundin Petroleum, is the famous and largest oil company in Sweden. Mainly, they operate in Norway and presently they provide employment above 500 person in seven various countries. This report discussed about national culture of Canada and cultural differences. Along with this, reward system are also mentioned in this report which would be appropriate for a Canadian workforce in context of employment. At last, Perlmutter's EPRG taxonomy is also
1 National culture of Canada
Canada is a diverse and large country in North America and it is also a second largest country over the world. Along with this, country also consists of 10 provinces and 3 territories. The culture of Canada substantiate the humour, musical, political and social elements which are representative of Canadians and Canada as well. As per country history, its society is highly influences by European culture. In addition of this, the population also influenced by the American culture this is because of shared language, migration between two countries. Federal government of Canada is defines as instigator of multicultural ideology because the public give social importance of immigration. In addition of this, government of Canada also influenced various culture with programs, institutions to make better culture. In context of this, Canada culture and customs are very unique and distinctive (Delbridge, Hauptmeier and Sengupta, 2011). It is a country with dual nationality like French Canada and English Canada.
Management of Canadians Workforce
Canadians people are considered as one of the most hard-working individuals in terms of performing their task in a systematic manner. As Canadian people are having good knowledge and education in which they easily perform their duties within the organization. The egalitarianism and diversity are required to be emphasized by the managers of Lundin Petroleum if they wish to manager workforce in the ideal manner (Scullion and Collings, 2011). Hierarchy in business is not really emphasized and employees are nurtured with undertaking of participative approach and are persuaded to share their views and concerns relating to business. Short term planning by a business is not encouraged and change is mostly accepted by the capable Canadian workforce.
National policies of Canada is combined three core elements such as infrastructure, tariffs and population growth. It has been observed that every organisation possess their own legal and regulatory framework in all the major grounds inclusive of human resources. The framework has been developed in close consideration to the business practices, religion, culture and geographic environment. The employment protection law which has been formed by the U.S. Government is applicable. The recruiters are required to provide a notice of termination along with a valid reason for employee exiting. The one thing that stands crucial is diversity which has been emphasized in the country more than ever. Therefore it is crucial for employers to make sure that biasses on any grounds is not acceptable on this soil. HR can be considered as one of the regulated professions in the country, therefore need to conform with the government policies and practices. Collaboration and time-bound activities are cherished and failure to implement both these aspect is loss of management.
Culture stands vital for an organisation as it influences various sector in a business environment such as practices and approaches to a task. The multiculturalism in the Canadian market is strongly emphasized and respected. The culture in country is mainly influenced by the Roman Catholics as they comprise of determining 38.9%. The culture theory undertaken helps in understanding dynamics and periphery in the upcoming market. It is essential for a business to consider these factors so that workforce in the organisation could be rightfully communicated along with maintaining respect to their culture and ethnicity (Paik, Chow and Vance, 2011).
The official languages spoken in Canada is English, French. Mainly, many more people are speak English more than French. In addition of this, English takes priority in all type of language. In Median age (46.92 years), Canada ranked 79th which is 4% more than Sweden and population aged 0-14, country ranked 112th. Along with this, Canada is ranks in top 5 of world's best place to grow old (Country vs country: Canada and Sweden compared: People stats, 2018). In this, Canadians should feel lucky in their golden years because as per United Nations- backed study. In this, Canada provide pension program to old age people to secure their life in upcoming time frame.
Religion, ethnicity, behaviour
Religion: Religion is the important factor which help HR manager of organisation in formulation of working practices as per their needs. Around, 67.3% Population in Canada was Christians. 23.9% individuals are following no religion of the total population. 3.2% individuals are Muslims in Canada. So, it is important to consider their religious needs while framing any working policies.
Ethnicity: It is referred as group of people having similarities in each other on the basis of language, religion and culture. It was observed that Canadian is the largest ethnic group required to consider by HR manager of Lund-in Petroleum.
Behaviour: It is referred as the way which is used by some one to act towards others. It is important for HR manager to frame common ethical conducts which are followed by employees within the organisation.
Difference between Canada and Swedish
- Business culture of Swedish is characterised on the basis of business communication, etiquette, work-life balance and cost of living. Therefore, for conducting business in this country, a person needs to formulate a proper plan first. As due to different culture, it will impact negatively on outcomes of business as well.
- Ventures of Swedish used to give much employment to citizens only so that level of standardisation of them can be enhanced.
- While culture of Canada is relatively much different. It has much different culture depend upon region. Business tycoons are needed to understand legislation of this country so that they can conduct activities in profitable manner.
- As compared to Swedish, ventures of Canada doing their business in competitive manner. For this process, they used to hire employees of different culture so that innovative ideas of them can be gained (Janssens and Steyaert, 2012).
2 Reward system
Workers are the important assets for every business organization as they contribute in enhancing the profitability level of the company. For this firm also provide reward system to its employees to motivate and encourage employee to fulfil the tasks with their full potential. . The undertaking of suitable rewards system assures employees perform their task effectively and also tries to attain set goals and objectives in appropriate time frame. In this context various theories and rewards system are used by the company to provide suitable working environment to Canadian workforce. This will may contribute in motivating their workforce so that they can easily attain success in the latest identified market place (Gomes and et. al., 2015). One of the main advantage of using rewards system company can easily make their workforce strong and capable as well. Mainly, reward system is an effective collection of brain structure which is responsible for including associative learning, incentives salience. There are two types of reward system, such as – intrinsic and extrinsic reward system. In which, satisfaction once get from their job is known as intrinsic reward system, such as – pride in one's work, feeling of achievements and being a part of team. Although, techniques like – job enrichment, job rotation, shorter week works helps in giving intrinsic rewards to employees and allow them to perform in well being manner. Apart from this, extrinsic rewards comprises with promotions, money, transfer, fringe benefits and so on. It comes from outside source specially management.
In context of Canadian workforce, intrinsic reward system is one of the best approach that helps it to improve performance level and productivity. The approach refer that if an employee get experiences feelings of achievement or personal growth from a job. It helps in motivating employees in internally thus they towards to do their job in more efficient and imperative manner. In addition of this, employees reward and recognition program are important method for motivating employees and at the same time also change their work habits in order to attain set targets. One of the main advantage of this is to increased the productivity level by measuring workers overall performance of the company by monitoring their activities at the time of performing their duties. In this context, Maslow's Hierarchy of needs, Herzberg theory are important which help in increasing motivating workers at workplace. Both are beneficial for Canadian workforce but one of the most effective theory is Maslow's Hierarchy of needs. This will help in improving overall performance of Canadian workforce. This can be understood by Malsow's Hierarchy of needs which consider various level that are important for workers to fulfil to motivate towards the job responsibilities:
- Physiological needs: It is important and prime needs of the human for survive in the world. If these type of requirement are not met then human can not able to function properly and ultimately fail in surviving in the world (Francis, Parkes and Reddington, 2014). These are first and basic needs of the people who can motivated by fulfilling their basic needs. Mainly, it includes water, food, clothing, shelter and many more. In context of Canadians workforce, it is also important for them to fulfilling their basic needs. Through which they easily get motivated and survive in the world.
- Safety needs: It is also important which comes after physiological needs. Ones a person's physiological needs are satisfied safety needs are take place. Mainly, it includes emotional safety, environmental protection and many more (Festing and et. al., 2013). Every individual want safety within their life to feel safe. If a person does not feel safe then they find safe environment to motivate them selves. Mainly, these are important for people as it relate with job security, financial security, family security and many more. When people fulfil these type of needs then they wants to fulfil social needs. Therefore it is suggested to undertaken permanent employment practices so that employees are able to reap benefits of policies and procedures which is being established by the government. This factor will definitely encourage employee to perform in an optimum manner.
- Love and belonging needs: These are also play vital for people to feel fresh. As these are relate with love, belonging, relationship with another person. This needs is beneficial for people to share views and ideas with their family and friends, with the help of this, they feel stress free and fresh as well. For satisfying this needs, people have to satisfy their basic and safety needs. Every individual live in society in which they having their friend and groups to make relation with them. By this people feel motivated and stress free as well.
- Self- esteem needs: This need is relate with the person ego, status, self respects and many more. As every people have a need to feel respected. Self esteem are relate with human desire which is accepted to another people. In this context, individual with low self esteem needs respect from another person to feel respected and glory. Mainly it is includes internal esteem which cover self respect, confidence, freedom, achievement and many more. On the other side, external esteem needs like power, status, admiration, attention and so on. Both are important for individual to feel reputed (Kahrilas and et. al., 2015). With the help of this workers are motivated.
- Self actualisation needs: It is higher level of this theory as it refer to the level of desire through which people wants to attain luxury needs and wants. As people may have the strong desire to attain self contentment. With the help of this people keep to attaining continue growing in their life.
Thus, Maslow's Hierarchy of needs theory is one of the effective approach which help workers to encourage their morale and motivation as well. By applying this, Lundin Petroleum can easily motivate Canadians workforce and also attaining their satisfaction towards the work activities. As this one is right to motivate workers towards their job responsibilities (Huselid, 2011). With the help of this, they can easily perform their job activities and attain predetermined goals and objectives in appropriate time frame. As Canadians workforce are capable and smart in their work so that they can easily perform their work. Along with this, for attaining their commitment towards the company workers needs motivation to effectively perform their task. By this, company can easily retain their workers for longer period of time and at the same time also increase productivity level of the company at market place.
Herzberg's two factor theory was given by Frederick Herzberg, and according to him there are some of the factors that provides satisfaction from job whereas some can give dissatisfaction. This theory is basically divided into two factors i.e. hygiene and motivators factor moreover it is explained below for better understanding:
This is considered as an effective element that is required by company in order to maintain motivation at workplace but it doesn't provide long term benefits and satisfaction as well. Factors that are included in this are considered as extrinsic factors which dissatisfies job that are performed by employees. Thus, hygiene factors are symbolised as physiological needs which an individual need while performing their different activities. Some of the factors that are included in this are explained below:
Job security: This is the prime factor for which most of the person works thus, it must be prime duty of Lundin Petroleum, to provide job security so that they can sustain loyalty of employees for a longer period of time.
Pay: It is consider as one of the factor, because some of the employees before opting for the job look at pay scale and structure whether it is appropriate or not. Therefore, Lundin Petroleum, should give equal and competitive wages to employees according to their roles and responsibilities (Lazarova, Morley and Tyson, 2014).
This factor provides positive satisfaction to employees, thus, it is incorporated by companies in order to get superior performance. Most of the employees find this factor intrinsically rewarding and mainly symbolises psychological need which is moreover determine as beneficial for business operations. Motivational factor includes certain factor that are given below:
Sense of achievement: In terms of employees they must have a sense of achievement so that they can perform their task in speculated period of time and in a better manner as well. Thus, it depends upon type of job which an individual is doing so, it is important that a person choose job which best suits as per their work.
Responsibilities: Taking responsibility is the major concern that an individual should have because it will provide them sense of doing work in a better manner with great enthusiasm.
3 Perlmutter EPRG
EPRG is an effective framework which help in describing the way business and staff members as an international management. In this context, perlmutter is evaluate as well as describe an effective way of determining the alternative management orientations. As it states that the business and its workers are tend to operate in four aspects are as follows:
- Ethnocentric: Under this, these type of people and companies are believe the home country is superior. In this context, when the people and organization look into new market then they evaluate the similarities with their home country. If there are any offices in the international market then they are less effective then the head offices in the home country. These firms are making few changes in the products and they are making few efforts towards to carry out research in international market. Along with this, opportunities of outside the home country are ignored by the companies. Mainly, Ethnocentric companies do the business outside of the home country which is known by international companies.
- Polycentric: These type of companies or managers are see each and every country as an unique and also evaluate that business are effectively run locally (Hurn, 2014). Mainly, management of Polycentric refer to head office places are little control on entire activities of market. Along with this, also tries to use new and innovative ideas form another markets to attain success.
- Regiocentric: These type of companies are sees difference and similarities in region and strategies as well. For example, Norway and Spain both are different in culture, transport and climate as well (Wilson, 2014).
- Geocentric: These type of companies are global player in which they see the world as a potential market. In this they recognise the difference and similarities between home country and international market. As it combines ethnocentric and polycentric views. This will help in creating a global strategies to responsive to local needs and wants.
From assessment of Perlmutter For different approaches are identified which named as Ethnocentric, Poly-centric, regiocentric and geocentric. The two approaches which are selected by the HR manager of Lund-in Petroleum to use in their organisation is Ethnocentric and Geocentric.
Ethnocentric: It is the approach which includes the act related to judgement of others culture on the basis of predetermined conceptions which are basically found in their values and standards. This will helps the organisation to determine the behaviour and attitude of employees and make better policies to gain their support in organisational activities.
- The basic advantage which was attained by Lund-in Petroleum is related to complies with overall corporate objectives and policies
- This will help in achievement of required level of competence
- This will restricts the promotional activities of organisation and impacts the turnover of organisation
- Application of this approach increase the cost of operations
Geocentric approach: It is most important approach in perspective of international organisation. This approach is adopted by Lund-in Petroleum which allows HR manager of organisation to recruit best employees irrespective of their nationality. This will help to hire best candidates.
- This will helps the organisation to develop effective international executive team.
- Support cooperation and resource sharing activities within the organisation
- Government of nation may use immigration controls to improve employment which negatively impact the organisation in application of this approach
- High cost is involved in use of this approach because of training and relocation costs.
From the above mentioned report, it can be concluded that IHRM is one of the important aspect which help in managing workforce at international level. In this context, the Maslow's Hierarchy of needs is more beneficial for the firm to make their workforce motivated. By using this theory Lundin Petroleum can enhance their productivity level. This will contribute in establishing positive brand image of the company at market place by encouraging workers towards its job responsibilities at workplace.
As per given report, it has been recommended that HRM is important activity for every business organization to improve overall performance of the company. Thus, company needs to effectively provide motivation to its workers so that they can easily perform their duties and attain better results. Along with this, Lundin Petroleum should use effective reward system for encouraging Canadian workers towards the company goals and objectives. This will contribute in making positive brand image of the company at market place. Maslow's Hierarchy of needs is also effective that should be used by the company to motivate their workers to enhance their performance level.
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