Managing Globally Competent People

Adler, N. J., & Bartholomew, S. (1992). Managing globally competent people.

The need and importance for transnational firms to have corresponding transnational human resources management systems - managing HR effectively in a global forum will bring a lagging organization up to speed.

This article stresses the need and importance for transnational firms to have corresponding transnational human resources management systems.  Recently, many top lever managers of large companies have lost much of their control and this is due to business strategies internationalizing faster than their implementation and those who need to implement them, the managers and executives of these companies. The solution to this problem is to manage HR effectively in a global forum in order to bring these lagging elements up to speed.  

The authors make recommendations for changes in global HR management at the individual level and also at a systemic level.  Individually, they recommend "skills required by individual managers to be globally competent" and systemically, they recommend "a framework for assessing globally competent human resource systems".  Both of these suggestions are illustrated in the article by showing how much improvement is needed in these areas by the majority of North American firms.
In beginning to address the main concern of the article which is "how to create human systems capable of implementing transnational business strategies", the authors begin by explaining five essential skills that are needed by transnational managers as part of their necessary broad range of skills that must surpass those of an international manager.  These include taking a global perspective, learning about foreign cultures, working well with people from different cultures, adapting to living in other cultures and interacting on an equal level with foreign colleagues.

The article next discusses the four stages that a firm progresses through in reaching the transnational phase.  These include beginning domestically, going international, becoming multinational, and finally, competing at a global level by transforming into a transnational firm.  In discussing each of these phases it is important to note that that with each progressive title, managers and executives of such companies need more skills. 

The development of such competent managers who are able to be effective in transnational firms is dependent on the firm's "capability to design and manage transnational human resource systems".    Such a system is defined as one that "recruits, develops, retains and utilizes managers and executives who are competent transnationally".  

However, in order to be effective in this definition, such a HR system needs to demonstrate three characteristics. The first of these is transnational scope, which is "the geographical context within all major decisions are made".  The next is transnational representation, which refers to the "multinational composition of the firm's managers and executives".  The last of these necessary characteristics is transnational process which illustrates the "firm's ability to effectively include representatives and ideas from many cultures in its planning and decision making processes".

Ideally then, transnational HR systems must involve each of these three dimensions just discussed in each of the four components that define an effective transnational HR system (recruiting, developing, retaining and utilizing globally competent people).  The article goes on to discuss how the three dimensions apply individually to each of the four necessary components and use examples of results from their survey of 50 North American firms to illustrate their points.  The essential conclusion of this survey was that "North American firms' human resource systems are not nearly as global as their business operations on any of the three fundamental human resource dimensions". 

 But why is this?  The authors suggest that there seems to be some illusions that contribute to why such firms are not acting in a global matter.  They recognize seven specifically and give brief reasons why such illusions are wrong and misleading.  The article concludes by encouraging openness and experimentation in an effort to reach global and transnational goals of the human resource system of a transnational firm.

This article is helpful in understanding the process in becoming transnational and how important the role of human resources is in this process. Human resource systems are not up to date with firm's business strategies, but they need to be in order to enable companies to compete at their highest potential.

Back to Aslan News