- 1 Research Implications
Most of the literature focusing on international HRM has focused on managing
employees within a speciWc country or on expatriate management. Yet, managing
the portfolio of global sourcing options, including oVshoring, outsourcing, alli-
ances, and the like, on a global level is likely to be equally challenging. The picture is
further complicated when researchers consider the implications of global markets.
Much of the controversy about outsourcing and oVshoring manufacturing jobs, for
example, needs to be couched within the context of where the work is done relative
to where the products and services are sold. ManyWrms argue that their inter-
national employees are producing for international markets. Critics charge that the
international work is too often devised to exploit low-cost labor, and then the
goods/services are shipped back to the host country. These issues have political as
well as competitive implications and much more research is needed to understand
them fully.
Relatedly, while these diVerent arrangements are typically argued to facilitate
cost savings and companyXexibility, the question remains as to how these arrange-
ments relate to other facets of value creation. For example, faced with customer
concerns stemming from dealing with customer service representatives in India,
Dell reconsidered its sourcing strategy for its call centers. Though simplistic, this
example highlights the fact that organizations must balance tensions for cost
savings with achieving strategic objectives such as quality enhancements, oper-
ational performance, market access, innovation, customer service, and the like
(Aron and Singh 2005 ). Saving costs at the expense of other performance outcomes
is unlikely to prove a sustainable strategy over time. A related issue focuses directly
on which jobs or tasks and activities are most appropriate candidates for these
global sourcing options. If we shift our focus away from solely cost considerations,
the key question becomes which employee talent pools drive value creation within
organizations and how should those talent pools be employed to maximize value
creation while capitalizing on cost-saving options?
Viewing the HR architecture from a global perspective also requires greater
attention to environmental factors. Countries vary in the quality of their human
capital, the relative supply and demand of diVerent occupational skill sets, labor
costs as well as labor laws, unionization, and worker preferences. It may be the case
that the use of temporary employees, for example, reXects country regulatory and
environmental factors as much as consideration of strategic value and uniqueness.
Companies operating in countries with restrictive labor laws regarding employee
terminations may be more willing to choose externalized employment options,
rather than commit to long-term employment, even for critical or core employee
groups, compared to companies operating in environments that are more employer
friendly. Relatedly, the supply of labor in diVerent occupational groups may
inXuence which employment options are most beneWcial to pursue in diVerent
218 david lepak and scott a. snell