Human Resources South Africa

Expanding the Scope of SHRM and HR in South Africa

Expanding the Scope of SHRM and HR in South Africa

Expanding the Scope of SHRM and HR in South Africa
May 21
12:25 2011

The process model of strategic HR change (SHRC) in multinational enterprises identifies key factors that lead to successful change outcomes. The three major stages in the SHRC process include, habitualization (conception of the need for change and new programs), objectification (transition) and sedimentation (emergence of new strategic direction and discourse)

A study was conducted to view the influence of knowledge transfer and subsidiary absorptive capacity (employees’ ability and knowledge) in multinational corporations (MNCs). It found that the greater the absorptive capacity of an employee, the higher the level of knowledge transfer.

The transfer of HR practices to MNC units are influenced by, implementation, internalisation and integration. Because HR practices is a social process the outcomes are influenced by governance mechanisms used by the MNC, characteristics of the subsidiary HR system, the social relationship between the subsidiary and the MNC headquarters and the transfer approach taken by managers at headquarters.

A few factors have been identified, that can lead to a more likeliness of firms adoption SHRM in emerging economies, which include firms that are more market oriented, have competent HRM professionals and top management that put a higher priority on HRM. Other possible factors include the national environment (extent of unionization and sector characteristics, technological sophistication), legitimizing driver (use of international consultants), organisational culture, humanistic goal priorities.

It is important to look at all the factors that determine a multinational corporate strategy because it can have an influence on the approach and competitive advantage. The determents include level of abstraction (level at which HR strategy is focused example recommendations, policies, operational-level procedures), scope (Extent of HRM practices dealt within the HR strategy example focus of 2/3 key areas versus a comprehensive list of practices), business model, impact of national culture on the business model and the role of an MNE’s on organisation culture in directing and controlling affiliates.

Certain SHRM practices can influence product/service, performance and financial, the rest of the paragraph shows which HR practices influence what. Training, participation, reoriented appraisals and internal career opportunities affects both product/service performance and financial performance. Employment security and job descriptions contribute uniquely to product/service performance and profit sharing contribute uniquely to financial performance.

The context for designing SHRM systems and assessing SHRM performance becomes more varied and more complicated as the scope of SHRM broaden. Therefore in order to design effective SHRM policies and practices organisational differences as well as culture and economic systems differences needs to be taken into account.

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