Global Challenges

With hiring forecasted to be strongest in emerging markets overseas, HR leaders may want to refocus to a global mind-set until the recovery hits the American or European markets. Adapting to different geographic demands and creating specific current and future performance expectations are necessary for multinational organizations to succeed.

By Chandler Harris

As the worldwide economy slowly gains its footing toward recovery, developing countries are leading the employment outlook.

The emerging markets of China, Taiwan, India and Brazil are forecasted to have the strongest fourth-quarter hiring, according to a new Manpower Employment Outlook Survey. China has a projected 40-percent employment increase from 2009 to 2010; while Taiwan had a 23-percent increase; India, an 8-percent increase; and Brazil, a 16-percent increase.

For HR leaders of multinational corporations, this means they may want to focus on hiring strategies for overseas employment until the United States and Europe find surer economic footing.

"CHROs need to be able to adjust their strategy by region," says Chris Michalak, Aon Hewitt's chief operating officer. "High-growth regions will require strong sourcing and selection processes and a growth orientation, while other regions may require outplacement and retrenchment strategies.

"The global HR exec needs to be able to adapt to different geographic demands and have region-specific strategies to ensure they are supporting the needs of the business in various economic environments," he says.

The Manpower survey, which included nearly 62,000 human resource directors and senior hiring managers from public and private organizations worldwide, found that, overall, employers in 28 of 36 countries and territories expect positive hiring for Q4, 2010.

This is a marked improvement from 2009 -- the lowest employment year for the 17 countries and territories that have participated in the survey since 2005.

Five countries overall reported negative hiring expectations for Q4, which is an improvement from 12 countries last year with negative hiring projections.

The weakest hiring plans for the upcoming quarter were projected in Greece, Italy, the Czech Republic, Spain and Ireland.

"Continued strong domestic growth is fueling stronger job prospects in all industry sectors in China and Taiwan from three months ago," says Jeffrey A. Joerres, chairman and CEO of Milwaukee-based Manpower Inc. "As a result, the talent wars are raging again as companies struggle to retain the talent they need."

In the United States, unemployment actually rose marginally from 9.5 percent to 9.6 percent in August, according to the U.S. Labor Department. However, the drop was less than expected and the private sector added 67,000 jobs in August.

Seven in 10 (71 percent) U.S. employers say they have no plans to either increase or decrease hiring, according to the survey.

Global Mind-Set

As more emerging-market-based multinationals make stronger gains in the worldwide economy and more talent is utilized overseas, HR leaders of multinational organizations are increasingly needing to facilitate overseas hiring and other sensitive HR management issues.

Success is largely dependent on the HR department's global mind-set, or knowledge of different regions, including cultural context, laws, business culture, etiquette and a host of other cultural issues.

The top four competencies for senior HR leaders operating in global organizations, according to What Senior HR Leaders Need to Know: Perspectives From the United States, Canada, India, the Middle East and North Africa, a 2010 report by the Society for Human Resource Management, based in Alexandria, Va., are global intelligence/global mind-set, cross-cultural intelligence, effective communication and strategic thinking.

The report also found that "leading change" -- or being able to make it easier for stakeholders to navigate shifts in business processes, priorities, roles and expectations -- is very important in the current economic climate.

The economic growth overseas is also driving the use of expats for overseas positions for periods ranging from months to years, says Ed Hannibal, partner for U.S. mobility at New York-based Mercer.

Such relocations offer additional challenges for HR professionals, including moving entire families overseas and making sure they "have an understanding of the culture through cross-cultural orientation." He notes that many multinational organizations are sending talent to and increasing hiring in the "BRIC" countries of Brazil, Russia, India and China.

Whether expats or native workers, it's important for global HR leaders to "maximize employee investment," by creating an effective plan that establishes current and future performance expectations, Hannibal says.

HR plans should also include development of a robust employee-training program for security awareness. HR leaders should have "a structure in place where security, travel and HR are all in sync with HR -- they need to know where people are and how long they will be there," Hannibal says. "It's not just compliance but management and security risk that are important."

To be successful in this global climate, HR leaders of multinational corporations should act "divergently," or have strategies oriented for specific regions and countries, based on economic growth, says Michalak.

This can be challenging, since different strategies need to be consistently updated to reflect the changing business environment. And, as acquisitions and joint ventures increase with countries overseas, the HR leaders should have effective strategies for incorporating new companies or working through joint ventures.

Other challenges include knowing the "employment rigidity," or restrictions on hiring and firing based on a country's employment laws. They should also understand the awards perspective of benefits cost and compensations levels for each country, Michalak says.

Yet, even as organizations continue to become more global than ever, Aon Hewitt is seeing fewer companies utilizing local talent to send overseas. Instead, multinationals are finding key overseas advisers that HR departments can rely on, either through acquisitions or direct hire.

"Being able to effectively source talent is very critical," Michalak says.