Global Village

Posted in Human Resource Terms, Total Reads: 515

Definition: Global Village

The rise of multinational corporations has multiplied the challenges of HR managers while successfully bridging the gap between nations. This state of business in the world is reflected by the term – Global Village. The rise of multinational corporations has increased the diversity between employees in an organization. Today, HR managers are entrusted with the task of not only looking for skills and knowledge, but cultural adaptability also. Global employee mobility has increased manifold in the last decade and today, therefore, employees need to be groomed for global assignments.

For a company to sell its product or offer services in a foreign country, it should first study the cultural scenario in the country. There have been cases where a wrong product was placed to the wrong group of people in the foreign country and the company had to move out even before it settled down in the foreign land. Workers who are entrusted with a global responsibility need to have a working knowledge about the foreign language. The company must ensure that the workers are provided adequate training.

Example - American Express has its main customer service centers based in India and Brazil. The Indian employees are imparted training on the English language – both American and British – so that they can cater to America, United Kingdom, Australia, and other English-speaking populations. The Brazilian employees cater to Latin America, Spain, and other Portuguese/Spanish-speaking populations.

One of the most important areas in Human Resource Management is cultural training and cultural integration. HR managers must ensure that workers going for global assignments understand the foreign country’s culture. Along with culture, training must be provided about legal regulations because what might be considered legal in one country might be banned in another.

Some of the other challenges put forward by the Global Village

Tax Regulations – A company’s operations in different countries would be taxed differently based on the tax regulations of each country. It becomes important for a company to have a department which works at a global level to ensure that the operations adhere to tax laws, customs, import restrictions, and similar regulations.

Government Regulations – Before setting up the business in the new country, it becomes important to have all the necessary permissions and adhere to the employment regulations and business regulations of the new country. For example, in some countries, it becomes necessary for a foreign company to enter into a Joint Venture with a local company if it wants to set up its business in that country.

Availability of Resources – A company would need access to raw materials, supplies, and equipment for setting up its business in the foreign country. Along with these resources, it is important that there is adequate availability of skilled-labour in the foreign country.


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