Towards modeling human resource management of internationalizing SMEs
Alppi, Annileea (2014)
Kuvaus
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Tiivistelmä
The aim of this study is to increase the understanding of international human resource management of SMEs, and to formulate a model of IHRM of SMEs. In the study, it is found out how internationalization reflects to the IHRM, which factors affect the IHRM and how they affect, and how HRM has internationalized in relation to the internationalization process of the overall business.
The study consists of theoretical and empirical parts. The first theoretical part deals with the HRM of SMEs in order to increase the understanding how HR issues are managed in SMEs in general. The second part of the theoretical framework deals with the internationalization process and the international human resource management of SMEs. In the end of the theoretical part, a model of IHRM of SMEs is formulated which is used as the base for the empirical study. This study was conducted as a qualitative case study, and eight different Finnish SMEs were chosen to the interviews. In conclusion, a final model of IHRM of SMEs is presented which is modified according to the empirical data.
The research results indicate that internationalization is reflected in different ways in human resource management of SMEs. HR issues need to be considered already at the early phase of internationalization. Internationalization of the companies complicates HRM of SMEs because there is a need to take different legislations and cultures into account. SMEs also do not have any common way to manage HR issues, thus they use IHRM practices very differently with varying levels of informality and formality. Different internal (e.g. management, corporate culture and values) and external factors (e.g. legislation and cultures of countries) influence international human resource management of SMEs. It is important to recognize the factors, and try to turn the effect from negative into positive. Constant discussion with business department of the company is needed in IHRM of SMEs in order for HR to be aware of the changes in business and to be able to support the business in the most effective way.
The study consists of theoretical and empirical parts. The first theoretical part deals with the HRM of SMEs in order to increase the understanding how HR issues are managed in SMEs in general. The second part of the theoretical framework deals with the internationalization process and the international human resource management of SMEs. In the end of the theoretical part, a model of IHRM of SMEs is formulated which is used as the base for the empirical study. This study was conducted as a qualitative case study, and eight different Finnish SMEs were chosen to the interviews. In conclusion, a final model of IHRM of SMEs is presented which is modified according to the empirical data.
The research results indicate that internationalization is reflected in different ways in human resource management of SMEs. HR issues need to be considered already at the early phase of internationalization. Internationalization of the companies complicates HRM of SMEs because there is a need to take different legislations and cultures into account. SMEs also do not have any common way to manage HR issues, thus they use IHRM practices very differently with varying levels of informality and formality. Different internal (e.g. management, corporate culture and values) and external factors (e.g. legislation and cultures of countries) influence international human resource management of SMEs. It is important to recognize the factors, and try to turn the effect from negative into positive. Constant discussion with business department of the company is needed in IHRM of SMEs in order for HR to be aware of the changes in business and to be able to support the business in the most effective way.