UNIVERSITY PARK, Pa. — As organizations become more interconnected on a global scale, the study of international human resource management (HRM) becomes crucial in guiding enterprises on how to manage a diverse workforce effectively, according to researchers in the Center for International Human Resources Studies (CIHRS) in the School of Labor and Employment Relations at Penn State. Modern organizations rely on diverse teams, making effective management of individuals from various cultures essential for being a competitive employer. Research at CIHRS focuses on how people are managed in the workforce and the convergence and divergence of HRM practices around the world. CIHRS, which coordinates the human resource management-focused CRANET Research Network, recently produced the “Cranet Executive Report on International Human Resource Management: Summary and Analysis of 2021-2022 Survey Data." The report serves as a benchmarking analysis of HRM practices worldwide.
“Recent years have changed the world of work on a global scale more quickly than ever before and in ways that we might never have imagined, upending the daily work of HR professionals worldwide,” said Elaine Farndale, director of CIHRS and professor of human resource management at Penn State.
The report is a collaborative effort coordinated and led by CIHRS involving HRM scholars from across 38 countries. According to Farndale, the completion of this research project reflects a “remarkable success,” as scholars and universities worldwide collaborated to develop the uniquely extensive international dataset. The report summarizes data from 5,899 human resource professionals from organizations with over 100 employees across 38 countries, representing the ninth round of data collection since the establishment of the CRANET Research Network in 1989.
Despite the challenges posed by the COVID-19 pandemic, the CRANET Research Network managed to gather valuable insights into HRM trends worldwide, Farndale said. The dataset comprises responses from countries at various stages of the pandemic, including full lockdowns, remote operations and when restrictions eased. The findings of the report highlight the global trends in key HRM practices and the role of human resources in organizations, including how COVID-19 impacted the management of the global workforce.
The executive report summarizes how countries in the European Union have more chief human resource officers holding seats on organizations’ executive boards, with North America lagging slightly with around seven in 10 holding such a position. While human resources gain power inside organizations, there is a global downward trajectory in union density and collective bargaining. This has been particularly evident in the U.S., with almost three-quarters of organizations surveyed reporting no union role.
External vendors are also becoming key strategic tools, according to the report. Two-thirds of organizations globally outsource their training and development activities, irrespective of organizational size. This figure has changed little over multiple rounds of survey data collection. Meanwhile, training budgets had a sharp increase on average from 4% to 9% of total salary budgets in 2021-22 compared to the last survey round in 2014-15.
For recruiting, social media use is increasing, especially for managerial positions in North American and European Union countries. In Southeastern Europe, Asia and Latin America, organizations generally still rely more on informal, face-to-face recruitment strategies. Algorithmic HRM — using computer programming to inform human resource management — is still very much in its infancy, Farndale said, but it was reported most frequently in use in organizations in the Asia-Pacific region, closely followed by use in North America.
Globally, addressing diversity issues is another area that is seeing a rapidly changing landscape, particularly in North America. North America has the highest rate of adoption among organizations surveyed of programs for traditionally underrepresented populations in the workforce globally. The continent is also the most likely to have organizations adopt recruitment programs to attract members of the LGBTQ+ community.
The ongoing work of the CRANET Research Network and the 2021-22 survey round reflects the continued commitment to advancing understanding of HRM practices in an ever-changing global context. To explore and learn more about the CRANET Research Network, please visit https://cranet.la.psu.edu/.