The Impact of Globalization on Hr Practice

Topics: Human resources, Human resource management, Globalization Pages: 20 (6167 words) Published: August 20, 2012
Impact of Globalization on Human Resource Practice
Nwadei Lucky, Department of Business Administration, University of Education, Winneba Ghana ABSTRACT
Globalization is bridging barriers of communication, culture and commerce and one major area its impact is felt is how the world is becoming one marketplace. Multinational enterprises are the actors in this process and a major emphasis in many such organizations is the practice of Human resource which has been shaped tremendously by the impact of globalization. HR practice is changing and is been changed to reflect the changing face of people management.

* Abstract


* Globalization defined

* Globalization – A historical perspective

* Drivers of Globalization

* Effects of Globalization

* Ethical Globalization


* The Rise Of Free Trade

* Multinational Enterprises as Actors of Globalization


* Human Resource Practice in Multinational Enterprises

* Direct Effect of Globalization on HR Practice


There are many different definitions of globalization, but most acknowledge the greater movement of people, goods, capital and ideas due to increased economic integration which in turn is propelled by increased trade and investment. It is like moving towards living in a borderless world1. Globalization (or globalization) refers to the worldwide phenomenon of technological, economic, political and cultural exchanges, brought about by modern communication, transportation and legal infrastructure as well as the political choice to consciously open cross-border links in international trade and finance2. It is a term used to describe how human beings are becoming more intertwined with each other around the world economically, politically, and culturally.

1 “Globalization”, 04 January 2011, www.globaleducation.edna, 2 “Globalization”, 02 January 2012,

The International Monetary Fund (IMF) defines globalization as “the growing economic interdependence of countries worldwide through increasing volume and variety of cross-border transactions in goods and services, freer international capital flows, and more rapid and widespread diffusion of technology”. Meanwhile, The International Forum on Globalization defines it as “the present worldwide drive toward a globalized economic system dominated by supranational corporate trade and banking institutions that are not accountable to democratic processes or national governments 3.” Overall, globalization requires a combination of linguistic, engineering and marketing knowledge that is not easily available. Globalization is linked to four major aspects4: * Trade: Developing countries as a whole have increased their share of world trade from 19 percent in 1971 to 29 percent in 1999. The composition of what countries export is important. The strongest rise has been in the export of manufactured goods. The share of primary commodities (such as food and raw materials) that are often produced by the poorest countries, has declined5. * Capital movements: Private capital flows to developing countries increased during the 1990s and their composition has changed. Thus, direct foreign investment has become the most important category. * Movement of people: Workers move from one country to another partly to find better employment opportunities. Thus there is a transfer of high-skilled workforce towards industrialized economies.

* Spread of knowledge (and technology): Information exchange is an integral aspect of globalization. For instance, direct foreign investment brings not only an expansion of the

3 “Globalization”, 02 January 2012,...

References: 1. “Globalisation and the historic course”,13/02/2002,
2. “Globalization, Growth and Poverty: Building an Inclusive World Economy”, 22/04/2002,
3. “Globalization: Threat or Opportunity?”, January 2002, 13/05/2002,,
4. “Investment Winners and Losers”, Money, October 1992, p. 133
5. “Services: Multinational/Globalization Issues”, M&A Mercer, 7/05/2002,
6. “The Impact of Globalization on Developing Countries: Risks and Opportunities”, 29/01/2002,
7. GARETH R.J & GEORGE J. M, “Managing the Global Environment” in Contemporary Management, 3rd edition. McGraw Hill (2003) pp184 - 195
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