Personnel Management To Hrm

Published Date: 02 Nov 2017

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Individual research concerned with the international students approach to the contextual issues of Human Resource Management.

MODULE TITLE: Managing Human Capital

JACKSON ANNOR

STUDENTS NUMBER: B0379SBSB0812

Maximum Word Count: 6000

Lecturers: David Hall and Rajendra Kumar

London School of Commerce

Table of Contents

1.Abstract ………………………………………..……………....................................3

2.Introduction……………………………….…………………………………………4

3.1.The Review of Collins And its Relevance to the International Manager……….…6

3.1. a What is HRM?……………………………………………………...…………...8

3.1.b The Evolution HRM: From Personnel Management to HRM….....…………...10

3.1.c Models of Strategic HRM…..………………………………………………….11

3.2 Best Practice Model SHRM ……………………………………12

3.3 Best Fit Approach …………………………………………….

3.4 Discussion……………………………………………………

4.1 Summary and Conclusion………………………………………

5.1 References

6.1Bibliography

1. Abstract

This discussion paper serves as the basis of advice to be given to the management of XYZ cooperation, a multinational company operating in Ghana and other developing countries. The advice given pertains to how restructure its Human Resources Department. The discussion commences with a descriptive outline and structure of the work and then proceeds to chart the evolution of the human resources management through an extensive the literature review. The discussion is done from a historical point of view, while at the same time examining the contesting voices and the sources of their differing approaches to the management of people. From there the paper focuses on the best fit versus best practice debate and concludes with an advise at the end.

With regards to the Methodology used, this work has drawn on the work of other academics and practitioners. In so doing, the author commenced the work by looking at the work of Collins, range of literature, text books, and journals.

The paper concludes by showing, that debate over the concepts of Best Practice (Webber et al) and Best Fit (Guest (87) and others) are at best a misunderstanding of how an organization is to be structured. Because the key is to identify the right fit having regard for the context or the immediate and wider environment in which the business is operating. Thus in accordance with that XYZ is advised to adopt the best fit model be flexible as a market penetration strategy before trying to build its own best practice model in the Ghanaian context.

2. Introduction

The objective of this research is to produce a discussion paper which will form the basis of advice to be given to the Human Resources Director of XYZ Corporation (a failing multinational manufacturer) who is trying to penetrate the Ghanaian market. The advice concerns the why and how XYZ is to restructure its Human Resource Department (HRD) in a developing country like Ghana. Presently this is not only necessary but also of immense strategic importance. In so doing, a number of the prevalent Human Resource Management (HRM) perspectives and models are looked at and deliberated upon in the light of the work of Audrey Collins and other researchers to see how they can be applied in the management of people in international context. This is necessary for Multinational National Corporations’ (MNC) like XYZ operating an emerging economy such as Ghana. Ghana is used because of its dynamism at present seen as one of the few economies who are emerging on the third world.

I will show that the arena of Human Resources Management (HRM) is cluttered with quite a number of theories of which include the configurational, contingency, the universal theories. In Collins’ view this is because our view of HRM is coloured by several factors. It is these theories and perspective or differing and divergent views or ways of seeing HRM and how its impact the organization and management that this discussion paper explores.

In so doing I will first define what HRM is and proceed to show that what constitutes HRM is not easy to grasp and for that matter its very nature is quite protean: constantly changing hence the evolution or change of name first from Personnel Management first to Human Resource Management (HRM) and now Strategic Human Resources Management (SHRM) (Mullins 2005). This gradual change has been well documented. Reviewing Collins’ work I will proceed to show that the change in HRM still continues and this changing nature has given birth to so many contesting voices and debates. In the light of Collins’ work and other researchers including Debrah(2001), the sources of the contesting voices about how people are to be managed and its relevance to the international manager will be examined. Despite the numerous literature about the concept of Human Resource Management (HRM) and how it affects the organization, most of the literature is centred on HRM as taught and practiced in the western world particularly the United States (US) and United Kingdom(UK) as opposed to Asia and much less of Africa. This is because not much has been written on the practice of HRM in the developing world. As result how the issues and theories explored can be utilized in a MNC operating in a developing country like Ghana is explored. This will be done by examining the work of Debrah (2001). Debrah’s work gives a broad perspective of key HRM duties such as recruitment, training of staff and how performance appraisal and reward and how they are carried out in Ghana and a number of developing countries.

As Collins’ tapestry suggests, the picture of HRM is a bit marred resulting in a lot of debates diverse views and perspectives. However, recently the debate is centred on the best practice and best fit model. I will show that this debate is unhelpful and constitutes a misunderstanding. In accordance with that, the next part of the essay will focus on the Best Practice model of SHRM, which is essentially the concept that there is a single best way of organizing and treating people. I will then proceed to discuss the Best Fit model of SHRM which on the other hand suggest that Management have the right to manage suggests that ‘if it is successful then follow them’. The two models will be compared and contrasted and after having delineated their merits and demerits, suggestions as to how an MNC such as XYZ who is struggling in a developing country like Ghana should design its HRD will be offered. I will then summarize the work and relate my conclusion to my initial objectives and make the relevant recommendations.

3.1 The Review of Collins and its Relevance to the International Manager

According to Collins, ‘The tapestry of which HRM forms a part is continually being woven, but we can now become aware of the sources of their differing approaches to the organization and management and the contesting voices about the management of people’ ( Beardwell 2007)

Collins’ quote above, cited by Beardwell (2007) in their book ‘Human Resource Management: A Contemporary Approach’ could not be more descriptive of the nature of Human Resources Management (HRM). From my perspective, the statement encapsulates the essence or true nature of Human Resources Management (HRM). The statement suggests that HRM has not always been what it is today. In Collins’ view the discipline of HRM has evolved and continues to do so or metamorphose. He captures the evolving nature of HRM by likening it to a tapestry whose development is still in progress. More so employing the tapestry metaphor the authors posits that our view of HRM is coloured by the warps of ideologies, assumptions, and the wefts of events, people, and transient issues.

Again the authors show that HRM is not only interwoven and interrelated but it is also multilayered. They do so by demonstrating that HRM is akin to a multilayered onion. Collins employs this elaborate metaphor to demonstrate to HR practitioners and academics how interwoven and inter-related the seemingly disparate elements of HRM fit together when put in context. For Collins how to manage people is a function of context.

Collins work is very timely for the international Human Resource Management practitioner, in that if he or she fails to appreciate what Collins broadly calls ‘the immediate and wider issues’ which affects the organisation then, his work will be very frustrating. This is because it is in the understanding and appreciation of those issues that he will know or can make meaning of how to develop and make the best use of his or her organisation’s Human Capital and thus function well as international HRM manager.

Like Beardwell, Debrah (2001) sees the effect of national traditions and culture as colouring and shaping the practice of HRM in Ghana and most developing countries. So do the legal, political and economic issues affect and shape hrm. For instance, the Ghanaian constitution shapes HRM practices and policies of all businesses operating in the country. This creates a situation where national interest determines or must be taken into account when designing HR policies. Again for Debrah, in the organisational context of most emerging countries, there is an entrenched conception that senior managers knows everything or have all answers pertaining to management issues. Therefore there is a lot of looking up to, which may be traced back to the culture of autocratic leadership which most of the nationals had known until recently. Again in his view, recruitment and promotion tends to be more nepotistic or devolves to people with social capital. Therefore the international managers working in a developing country like Ghana must be aware of such issues and not be oblivious to them because it will invariably affect his work and performance. To depart from these nepotistic tendencies he or she will have design a system which brings in diversity of personnel regardless of ethnicity, race, religion and gender. He describes this unfolding picture of HRM by employing the tapestry metaphor. From his perspective, metaphorically speaking the warps and wefts of the HRM tapestry are diverse and has affected the different stages through which the discipline has been and how it is has been seen.

3.1. a What is HRM?

Human Resource management has been defined in several way by different authors, for instance Armstrong (1999:4) defines it

"as a strategic and coherent approach to the management of an organization most valued assets which is its people working there who individually and collectively contribute to the achievement of its goals".

In the view of Storey (1995:5 cited in Beardwell 2007) it is a unique perspective of

‘employment management which seeks to obtain competitive advantage through the strategic development of a highly committed and skilled work force, using on array of culture, structure and personnel technique.’

On the other hand the Chartered Institute of Personnel Development which is professional body who deals with the management and development of people defines Human Resources Management as

‘the design, implementation and maintenance of strategies to manage people for optimum business performance including the development of policies and processes to support these strategies.’ (Mullins 2005).

All the definitions above differ markedly; in Collins view these definitions exist because the authors are looking at the discipline from different perspectives and in different epochs. Some of them attempt to find a distinction between Personnel management and Human resources management. In the view of Beardwell the discipline is simply the management of the employer employee relationship. (Julie Beardwell 2007)

3.1.b The Evolution HRM: From Personnel Management to HRM

Collins’ in Beardwell (2007) shows that Human resource management has been called a dozen of names in the course of its development due to changes in social, economic and political order of the day. In 17th century for instance it was called industrial welfare inspired mainly by act of parliament. When the 1st world war broke, it took on the form of was more of personnel development driven largely by government initiatives aimed at maximizing its war efforts through best use of its people. This continued through to the Second World War but this time it was expanded to include other personnel activities which focused more on recruitment, training, discipline, motivation, remuneration, health and safety.

In the view of Beardwell, Frederick Taylor’s work was central to birth of human resources management in the early part of the twentieth century. This is because of his work which advocated the use of the scientific method in the recruitment of employees as well as incentivizing them when they meet deadlines or exceed performance targets. For the authors, Taylor's work served as the launch pad for future HRM development. Around the same time others researchers developed industrial psychology and it was employed in recruitment related testing for the army. This was done by the use of psychometric tests to match soldiers to specific tasks. The Hawthorne studies coupled with increase in collective bargaining compelled the personnel function of organizations to adopt the labour and human relations philosophy.

Besides the aforementioned, torrents of legislation has revolutionized the discipline by bringing changes in the demographics of the labour force. Moreover, Technological change coupled with globalization has since the nineteen-eighties changed the practice of HRM. Thus the present conception of HRM is a product whose development dates back to times immemorial and at present takes in to account inter alia globalization, technological advancement, the business or organization itself as well as the socio-economic and political order of the present day. Thus one will expect these changes to be reflected in the in the definition of the discipline and its resultant change of name from Personnel Management to Human Resources Management, but as Mullins (2005) and Beardwell (2007) points out Despite the acceptance of the term, some has derided the change in name as merely cosmetic: nothing more than ‘an old wine in a new bottle,’. For instance (Mullins 2005) draws the reader’s attention to the fact that besides the change of in title Torrington et al still stand by the extensive definition of hrm they gave in 1995. At that time they defined HRM as being synonomymous to Personnel Management.In 2002, wrote ‘with the exception of a shift in the title Personnel Management to Human Resources Management’ their 1995 definition which makes two things one and the same remains their philosophy. (Mullins 2005) For Collins, whichever way it is looked at the discipline has evolved to become what it is today. This implies that the acceptance of the use of the term Human Resources Management to describe the field is a very recent development which only gained currency within the last two decades.

More importantly, the distinction is irrelevant. However for him, all the diverse ways of seeing HRM is coloured by the context. They dwell more on context and how it affects what several ways of seeing HRM. Today the notion that HRM is of strategic importance in achieving the organisations objectives have taken hold and has given birth to a relatively new field called strategic human resources. This offspring of HRM is essentially an amalgam of strategy and human resource management. Consequently, the strategic management concept of ‘fit’ has become central to the way academics think about the practice of strategic HRM. Thus concerning the nature or what constitutes HRM the debate has moved on. The term HRM and SHRM are now more or less used interchangeably. In fact, Beardwell(2007) indicates that academics do not bother to distinguish them anymore. That attests to the evolving nature of the discipline.

The nature of the debate now does not concern the distinction between HRM and personnel management but on its value and strategic role in the organisation and more importantly the quest for the best model or if you like the preeminent model of HRM or the one best way of managing people.

3.1.c Models of Strategic HRM

With regards to the concept of fit they fall broadly into ‘Internal and external fits’. the former is enjoins the organisation in question is develop a HRM practices and policies which are interconnected and mutually reinforcing in order to achieve improvement in its performance. The assumption underlying the theory is that there are a set of best human resources practices (hence the name best practice) that can be put together so that one practice complements the other perfectly and the set working together synergistically. Thus the claim is that this synergy could be effected if the total output of a set of human resources practices and policies out perform their individual output. The external fit, on the contrary requires the organisation to develop a set of HRM practices and policies which matches the organisational strategies to its HRM policy. Unlike the internal fit, the assumption here is that performance will improve if the business strategy matches the HRM policies and practices. Here, detailed practices and policies need to be developed to buttress the broad organisational strategy such as innovation, or Porter’s cost leadership, (Fombrum et al., 1984).

As intimated earlier, since the advent of Strategic HRM, a number of competing models have emerged. All these models of which include, the configurational, the resource-based view and the best-practice, the best-fit approaches to SHRM attempts to capture the ways in which organisations can align HRM functions with their business strategy.(Loosemore 2003) (Armstrong 2002, p. 66). It is these models of SHRM that will be discussed next focusing more on the best practice and the best fit approaches.

3.2 Best Practice Model SHRM

The best practice model is also called high-commitment. It has its origin in the United States schools conception of HRM. This school of thought advocates the view that following or adopting some established human resource practices will help the organisation to improve its performance which will reflect in among other things

‘improved employee attitudes and behaviours, lower levels of absenteeism and turnover, higher levels of skills and therefore higher productivity, enhanced quality and efficiency’ (Beardwell, 2007).

As a result of this proposition it has been dubbed universalistic. The key theme in here is universalism. Thus any organisation irrespective of the business they are in can improve their organisational performance provided they are able to identify, and persuade management to adopt and implement a set of best human resources management practices. A lot of work has been done in this area in an attempt to identify or define the sets of human resource practices will help realise this objective, since it was pioneered by Guest (1987) and Beer et al. (1984) (see Beardwell, 2007; Budhwar and Aryee 2013). It has since been found that there are several views on the best practice model itself. For instance, some focuses on high-commitment and others on high-involvement practices. Formulating a conclusive decision about it remains difficult, despite the availability of a large amount of studies supporting the best practice approach. This stems from conflicting views on what the ideal set of Human Resources best practices are .

The seven practices for ‘building profits by putting people first’ (Pfeffer’,1994) throws more light on how the changes in the outside business environment have rendered the conventional means of achieving competitive advantage ineffective, and heightened the necessity of identifying alternative means of staying ahead of the competition. In his view, the new way is a human resources management approach which makes it possible for an organisation to adapt and innovate. The relevance or the applicability of this is key to success in the global economy. With regards to Guest’s (1997) universal approach, it is thought that the closer the business entity matches the ideal set of best human resources practices, the better its service, productivity and eventually profitability will be. Thus according to this model it is the Human Resources Manager’s responsibility to come up with strategies and persuade top management or the board to commit to those set of established best practices, and ensure its proper implementation.

This approach has its own demerits. To start with determining what constitutes a best-practice is not clear. Several lists of best practices, with a lot of variation in their composition as well as how they affect organisational performance abound.

Advocates of the best practice model, maintains that the alignment of human resources practices’ helps boost an organisation’s performance. At present most Human Resource practices that were thought to be distinct have now being bundled into this model (Higgs et al. 2000; Huselid 1995; Pfeffer 1998)

Giving that the internal fit concept is pertinent to the understanding of the universal/ best practice model, the key question to ask is how to create a coherent human resource system that produces better organisational performance. The way to do this is by the ‘additive relationship’ and ‘interaction relationship’ (Budhwar and Aryee 2013). More importantly, it is worthy of note that several combinations of practices could produce the similar outcomes. That is also referred to as ‘equifinality’, which refers to achievement of identical outcomes can via different systems of Human Resources practices.

There is a mixed support for the best practice model. This stems from the ostensible differences pertaining to how to identify a best human resource practice. From the work of Boxall and Purcell (2003) and others three means by which the best practice approach can impact organisational performance have emerged. The first is the ‘human capital base’ which draws on skills, knowledge, and potential of the organisations personnel. Here the way organisation select or recruit and train, it people directly impact the organisations performance. The second hinges on ‘motivation’. Here, how the organisation recognises and rewards its personnel is key to its success. The third means is by giving employees the ‘opportunity to contribute’, by encouraging involvement and empowering them through job design. Thus the universal model or best practice if implemented properly can achieve competitive advantage through the building of a valuable and a unique team of personnel. (Budhwar and Aryee, 2013).

3.3 Best Fit Approach

According to Armstrong (2006), the best fit approach which is also called the contingency approach states that human resources strategies should be contingent on the context, and circumstances of the organisation and its type.’ This model essentially challenges best-practice view and its assumptions. Instead, it advocates a fit between the organizations stage of development and its human resources practices. Thus according to this model, an organisation which is pursuing a cost-leadership strategy for instance should create narrow jobs and provide less or little job security. In the same vein an organisation or business who is trying to develop a differentiation strategy must focus on the training and development of its employees. This approach compliments the "one strategy fits all" advocated by Pfeiffer in his seven best practices (Budhwar and Aryee, 2013).

However, the ‘best-fit' approach has been criticised for inter alia being incongruent with the present social norms and may go contrary to some legal requirements as it can be insensitive to employee interests. It’s view of organisational strategy described as being myopic it focuses on cost reduction, flexible employment contracts and the like. It has also being criticised for being reactive by focusing too much on existing competitive strategy as opposed to being proactive by focusing on the changes occurring in the external environment.

This ‘contingency’ or best fit model which advocates strategic integration of HRM avers that a company’s set of human resources practices and policies will produce results if it is in line with other organisational strategies. Here the emphasis is on ‘external fit’ (Fombrum et al., 1984 in Budhwar and Aryee 2013). Therefore how effective the individual human resources practices is dependent on the firm’s strategy. That is organisations which adopts human resources practices that fit or suit their strategy will see better performance. (Budhwar and Aryee 2013)

3.4 Discussion

A critical look at both models shows that they both have their merits and demerits. Therefore the issue is not whether one is better than the other but when, how and under what circumstances a certain model should be pursued. That is why in my perspective the best practice versus best fit debate is null and void. For instance, it is evident that both SHRM models advocates the strategic linking of people with the business or organisation. Therefore both models require the integration of HRM functions into corporate strategies. The object is to synchronize the organisation’s corporate strategy with its human resources policies, programmes and practices. If this is well synchronized it will result in the development of a peculiar human resource system difficult to imitate by competitor and thereby give the organisation a competitive advantage. To achieve this objective both schools of thought suggests that, HR manager should design strategies that is not only congruent but a part and parcel of the business plan. These HRM strategies need to be plans and programmes which is developed to deal strategically with the personnel aspect of the organisation. This makes both models proactive as opposed to being responsive.

Again at the heart of both models is the centrality of the thoughtful devolvement of human resources management to line managers as opposed personnel specialists. Devolvement here is akin to delegation or the integration of hr duties into line managers work, here the human resources policies are thought out and formulated as part of the business plan and not as an after-thought or an appendage’.

Since the debate is null, unhelpful and constitutes a misunderstanding of human resources, another model which combines both ‘fits’ has being developed namely: ‘HRM as bundles’ model also called Configurational model. This view has it that specific combinations or configurations of both best fit and best Human Resource practices can be made depending on the organisational contexts and its strategy. The challenge here is to establish which combination of the ‘fits’ and in what context will produce greater organisational performance. (Budhwar and Aryee 2013)

Thus in the organisations quest for competitive advantage, it does not necessarily have to choose between the best fit or best practice but rather it has a number of combinations to choose from depending on the company’s situation and goal as seen in the strategic typology developed by Miles and Snow(1984) which proposed the four strategy ideals namely the reactor, prospector, defender and analyser.

Following this line of thinking the configuration theory has produced, a few theoretical ‘employment systems’ of which include the ‘ideal type’ developed by Delery and Doty. These include the ‘market type system’ which advocates that in terms of recruitment new personnel should be brought in from outside the organisation, while ‘internal system’, advocates the contrary.

Therefore depending on the strategy and the goal of the business, for instance if it is defending its market share with efficient products, then it should look internally for new personnel. On the other hand, if the organisation is prospector then new people should be brought in from the outside.

This shows that the issue is not the superiority of one model over the other but when and under what circumstances should a certain model be adopted. Nowadays technological innovations and fierce competition is fast shaping the environment in which corporations and organisations operate around the world and the Ghanaian business environment is no exception to this international development. In the face of this fierce competition one way to stay ahead of the curve is through human resource management. Ghana, a country which in the recent past was troubled by political and economic instability has recently emerged as one of the fastest growing economies in Sub Sahara Africa. It was therefore a step in the in right direction for an organisation such as XYZ to move into Ghana to establish its presence. However, since Ghana is still developing there are a number of factors which the organization has to bear in mind in its recruitment process and the management of people in Ghana. This is because the context is key and explains the need to change and adopt new HRM practices. This is because as Audrey Collins tells us HRM practices are not only rooted in the history of organization but also is affected by its environment. Again, moving away from the norm and pursuing the best fit model will avoid the tendency to fall a victim of "institutional isomorphism" (Kabst 2005)

This is the idea that management practices in similar environment tend to become the same. As a result of this view the proponents of the convergence theory posits that was relevant in the past but presently contextual issues such as culture are now irrelevant due to the increasing effects of globalisation, better communication technology and the entrenchment of capitalism internationally. For them those factors are doing away the differences between organisations and management practices. Accordingly they maintain that HRM practices irrespective of cultural and geographic context will in due course become standardised and universal (Ralston et al. 1993; 1995). This view can be criticised for not only being too optimistic but also very simplistic (Leung et al. 2005).

4. Summary and Conclusions

This paper which is to serve as the basis of restructuring advice to be given to the Human Resources Director of XYZ Corporation (a failing multinational manufacturer who is trying to penetrate the Ghanaian market) has examined the Audrey Collins quote cited in Beardwell (200) and shown that context is important in terms of developing a human resource strategy. The work has also considered the best practice versus best fit debate and, highlighted how they can help an organisation in gaining the competitive edge over its competitions. From the analysis of both models it has been seen that there is a link between Human Resources practices and an organisations performance and in theory several factors such as inimitability, rareness and non-substitutability, are necessary if the organisation is to achieve a competitive edge through human resources management. When these factors are examined in the light of the light of best practice model it is not clear if it can deliver sustained competitive advantage. From my perspective of the theory the configurational approach provides a much sounder basis for human resources strategy development. However, in agreement with Collins who avers that context is important and key in this endeavour, I will suggest that in most developing countries like Ghana the HR manager should not underestimate how culture affects HRM.

Following the divergence perspective which is akin to the best fit view, I aver that for now the human resources practices should be culturally determined as HRM doesn’t operate in a vacuum. Consequently XYZ’s strategies and policies must reflect the need to create a fit between their HRM and organizational strategy (Armstrong 2001). The strategy must have cognisance of the effect of culture, Ghanaian national attitudes, technology, market competition and the like in creating a distinctive human resources management which will set them apart and give them the competitive edge.

While the institutional and convergence theory suggest that national and institutional effects will lead to common HRM practices between organisations operating in the same geographical location like Ghana, the international manager who is aware of the effects of context can employ the Contingency theory or best fit to create a differentiation. In analyzing the various HRM practices in Ghana,. This coupled with the rapid economic growth the country is caught between shedding deepening old economic practices and embracing modern practices, Debrah (2001) points out that Ghana is at a critical stage in its attempts to modernisation and so are other developing countries Consequently socio economic conditions seriously impacts the employer- employee relationship and human resource management in the country.

One thing worthy of note is that Ghana and the stable third world countries are quickly attracting MNCs therefore the competition is becoming more keen therefore it is essential that xyz creates a competitive advantage by choosing a unique model which will set him apart. And this will mean developing its own best practice model however it will have to start with the best fit or contingency approach and as the organisation becomes more established it can move to the best practice.

In summary, on the balance of the evidence so far it is not clear which model to favour because any conclusive preference for one or the other would be premature giving that they both have their merits and demerits but, more crucially, because the debate itself constitutes a misunderstanding of HRM as it looks at the discipline out its context. Since context is important xyz is advised to align its HR strategy with its business Strategy by using the best fit approach which fits the present Ghanaian context. The HR should be represented at the board level and the employees interests aligned with that of the organisation to avoid conflict. The HR strategy should encourage the devolution of daily HR functions to line managers and charge them with them overseeing them. Advantages of devolving HRM duties to line managers have been well documented. The devolution of the HR function to line managers will help bring to the fore problems requiring specialist attention which senior management may need help with. These may embrace how to control and motivate employees. It will also enable local managers to respond much quicker to problems within their area of responsibilities. By doing so, most recurrent problems will not only be dealt with quickly but effectively by the local personnel. Furthermore the devolution of HRM to line managers will free up HRM personnel specialists to handle issues of strategic importance. Again devolving HRM function in the view of Storey, will help personnel specialist to monitor the management styles of line managers and help in training future managers as they are allowed take decision. Overall this will have the effect of bringing down operational cost.

Here it is important for the international manager, to determine the extent to which integration and devolvement are carried out. As Stephen Covey suggests, personnel can be made to write their own personal mission statement from that of the organisation to guide their actions. He believes that is a sure way of getting employees to feel as part of the business.

When those functions are devolved to line managers they should then be evaluated on the basis of their responsibility for making low key decisions regarding pay, recruitment, training and development, industrial relations, health and safety, and workforce expansion and reduction.