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HRM Problems in Offshoring Organizations

What are typical HRM problems in offshoring organizations? How can companies, for example in India and China, design their human resource management systems to avoid these problems?

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Goyal (2012) identified these human resource management problems in offshoring:
- Political stability of the country to be outsourced
- Cultural differences which can make an impact on the employee
- Policies, communication styles and more importantly time zones
- Language

On the other hand, Schramm (2004) said that key HRM issues in offshoring are language proficiency, political stability, legal framework, and data security.

Language Proficiency:
English language skills and offshoring is dominated by English-speaking companies. Countries with large speaking countries are sure offshoring winners.

Political stability:
Political stability is one issue but economic conditions are perhaps the most critical. The establishment of foreign operations is a major investment and even contracted outsourcing relationships tend to last over several years.

Legal framework:
The legal framework of the destination country is also a consideration. More rigorous internal processes and safeguards may need to be put in place in offshored operations because of security reasons as some countries have few laws or legal precedents for dealing with issues such as identity and data theft.

Data Security:
Protection of sensitive and confidential employee data is already a key concern for HR professionals who may be called upon to develop data protection measures that are tailored to specific regional needs and take into account a complex network of relationships with foreign contractors. Security issues are one ...

Solution Summary

The solution identifies various human resource management problems in off shoring organizations.