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Macro Environment Of Tesco

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Report - 3000 words



Chapter Particulars Page #

1.0 Introduction 1

2.0 Defining policy 2

3.0 Defining human resource policy 2

4.0 Defining International Human Resource Policy 2

5.0 Human Resource Polices

6.0 Hewlett Packard HR Policies

7.0 Culture of Southern India

8.0 How India's Culture Impact on HP HRM Policies

9.0 International Human Resource Approach

10.0 Recommendations For Managing Diversity

11.0 Conclusion


Today, the increase in economic activity at the global level encourages business organizations to seek a competitive advantage by accessing new markets and expanding their operations. According to Porter (1990), the term competitive advantage refers to the strategies that allow successful companies to create profits in their sector of economic activity. By expanding operations, multinationals corporations (MNCs) are often able to benefit from maximized profits. However, these MNCs often face challenges while preparing to invest in foreign countries. Some obstacles to a smooth entry in the market include: adapting to cultural changes and government laws. As such, management needs to understand the new business environment and be willing to implement strategies to deal with the issues that may arise.

With this in mind, this report aims to review the international human resource management policies that would influence the decision of a multinational corporation, namely Hewlett Packard (HP), to set up a subsidiary in Southern India, the challenges faced in attempting this, and ways in which those policies could be adjusted to accommodate operations in the new environment. Southern India was chosen because, according to an article entitled "India Country Profile" written by The Economist Intelligence Unit Ltd (2006), Economic growth and progress in human development indicators have been much faster in Southern and Western States rather than the north. Therefore, MNCs tend to view the south as an ideal geographic location given its minimal cost to set up operations, large skilled population, and low wage rates. Before delving further into this study, it is necessary to define the term Multinational Corporation. Wall and Rees (2004) claim, this is a company that has headquarters in one country together with operations in other countries. The current multinational under study, HP, specializes in the production of hand held calculators, computers, laptops and other electronic gadgets.


Armstrong (2003) defined "policy as a provision of generalized guidance on the approach adopted by the organization and therefore its employees, concerning various aspects of employment". In other words, employers and employees are guided by the rules and regulations that govern the organization and strive to maintain its values.


Armstrong (2003) noted, "Human resource policies are guidelines on the approach the organization intends to adopt in managing its people." As a result, management must ensure that the policies they choose complement the cultural characteristics of the employees. It must also reinforce organizational values and this will in turn promote the maintenance of high standards.


According to Boxhall (1992), as cited in Rees & Wall (2004) "this is concerned with human resource problems of multinational firms in foreign subsidiaries or broadly, human resource management issues associated with various stages of internationalization." This implies that the internationalization process is fraught with problems, especially in the management of people. Hewlett Packard's success would be determined on the process used to adjust its policies to the cultural differences of Southern India.


5.1 Equal Opportunity (EO)

This is concerned with eliminating gender biases regarding employment, training, promotion and other employment related issues. Beardwell et al (2004) explained that EO was designed to address the issue of disadvantages in a systemic and consistent way and to assist managers in decision-making. Thus, the EO policy is focused on eliminating unfair treatment against any employee regardless of race, nationality, age, religion and the like. This should be applied to HR polices such as R & S, training and promotion.

5.2 Managing Diversity

Armstrong (2003) also pointed out that cultural differences exist among employees and organizations need to pay attention to individual differences and talents and use them for the benefit of achieving organizational goals. To ensure the multinational's success, it is important for the company



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