In today’s competitive business environment, Organizational
Innovation is an essential aspect that requires attention. HR practices have
always played an important role in corporate strategy, but with changing times,
well-organized HR practices is needed now, more than ever. HRM plays a major
role in churning out new strategies that are better suited to the dynamic
setting of the business environment. Sometimes, HRM is not a mere part of the
strategy but the very factor that defines the strategy itself. To remain
competitive in today’s markets, Indian and Foreign Multi-National Companies are
required to revamp and upgrade their HR practices. This paper discusses about
the innovative strategies of Indian and Foreign Multi-National Companies and
the HR practices implemented by them.

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While the basics of any HR practice are similar,
companies differ in their HR practices only in their implementation and
operations of the same. Companies change their HR practices according to the
cultural, political, economic and technological environment of the countries in
which they are operating. One of the more recent driving factors for the
standards of HR policies is Globalization. No longer are HR practices a matter
of trend, but a matter of survival for companies. Moreover, competitive
pressures have forced companies to be proactive and diagnose HR problems and
overcome them through new HR strategies. A key difference between Indian and
Foreign Multi-National Companies is the emphasis on alignments between parent
and subsidiary companies; something that Indian Multi-National Companies are
not as concerned about.

As of the present time, the Indian Multi-National
Companies put a greater emphasis on managing performance from within and thus,
focus on getting their culture building practices right. In contrast, Foreign Multi-National
Companies are more focused on ensuring a greater synergy between the parent and
subsidiary companies and having standardized practices in place. Foreign Multi-National
Companies are also conscious of the cost involved and the performance expected
from the implementation of a strategy, unlike their Indian counterparts.

A discussion of the findings, limitations, and
implications are provided.



Strategic human resource management is the process of
linking the human resource function with the strategic objectives of the
organization to improve performance. Strategic human resource management
focuses on the overall HR strategies adopted by business units and companies,
according to John Bratton; it is a thought that integrates traditional human
resource management activities within a firm’s overall strategic planning and
implementation, thus called strategic human resource management. Strategic
human resource management is concerned with all those activities that affect
the behaviour of individuals in their efforts to formulate and implement the
strategic needs of the business. The pattern of planned human resource deployments
and activities intended to enable the firm to attain its goals. There is an
explicit linkage between HR policy and practices and overall organizational
strategic aims and the organizational environment.

Support the Management with strategic
policies and implementation of new policies, the company requires.

As a company has many competitors,
creating and maintaining competitive advantage to the company is essential to
have the position required.

Innovation and upgradation of the
responsiveness is subject to improvised potential of the company.

Increase in number of feasible strategic
options available is the added advantage to the company in various scenarios of

Participating in strategic planning is the
essential factor towards the Contribution
of goal accomplishment and survival of the company.

 strategic directions of the company as an
equally entitled member of top management influences majority of the company’s

Improve the cordial relationship between
HR managers and line managers to maintain the ethicality and smooth functioning
of the organization.

 Companies should have a constant and regular
process of hiring, transferring and promotions in the organisation.

?        Expansion in market and enter into new market,
there should be changes in skills and employee perspective.

 Structured compensation as an incentive to
achieve goals of the organization and it’s members.

 Improving Training based on the requirement of
the company suitable for growth of business.




To analyse the HR strategies implemented
by the Indian and Foreign Multi-National Companies which have made them the
biggest companies.

To focus on HR practices that relate to
performance and growth in Indian and Foreign Multi-National Companies


of literature:

This research throws light on the review of the
previous literature on human resource management practices; innovative HR
practices; impact of the HR practices on employee or organizational performance
and HRM in Indian and Foreign MNCs context

The concept of human resource was introduced by prof. L.
Nadler (1969) in American society for training and development. In India,
Larson and Tubro ltd, a private sector company introduce this concept in 1975
in their organization with an objective of facilitating growth of employees,
especially people at lower levels, therefore Human Resource management plays a
major role because of the importance of the Human resource themselves and the
intricacies of their management. Human resource and organization related
challenges are the most critical issues. Due to economic liberalization in
India the logical strategic initiatives and competitive opportunity building
environment that opened the scope of human resource management subject to the
competitive advantage. The manager of Lufthansa: “HRM is a big concern in
India” as it is facing the challenges related to HR practices comparatively
growing faster.in, three major challenges in HRM are named: personal
recruitment, personnel development and personnel retention poses a challenge
that is not only to get the people in but to keep them active and maintain
their interest and make sure they are in.

Although most HRM provide no clear focus for any test
of the HRM performance link, the models tend to assume that an alignment
between business strategy and HR strategy will improve organizational
performance and competitiveness.

Indian and foreign MNCs have developed by the share o
HR department. Performance appraisal, competency mapping, job rotation, team
work, excellent team work strategies and games, training online and offline,
entertainment programmers, open management policies, compensation system with
incentives fairs gratuity, appreciation awards certificates internal display
and promotion schemes had been undertaken to lead to employee satisfaction in
both Indian and foreign Multi-National Companies 



This paper is undergone through secondary data
research for 3 Indian and 3foreign Multi-National Companies referring number of
articles, research papers, online journals, magazines, books and company
websites. The comparative study on the working conditions and the competition
with the foreign Multi-National Companies focus on criteria like optimum
utilization of available resources maximum human satisfaction which leads to
achievement of organizational goals with regards to cost effectiveness. HRM
strategies should be adopted to maintain the working environment to meet the
goals and objectives of the organization, for this they need to take some strategic
initiatives by satisfying employees. Face the competitive pressure as the
foreign Multi-National Companies focus on strategic initiatives and innovative
HRM practices.

Table 1 provides a summary of the strategic
initiatives and innovative HRM practices of Indian Multi-National Companies and
Table 2 summarizes for foreign Multi-National Companies

1: Innovative HR strategic practices adopted by Indian Multi-National Companies



Strategic Initiatives

HR practices



Information Technology

Accept the challenges of globalization
Powered by intellect and driven by values
Culture of ethics, performance, meritocracy
Creation and sharing of wealth


Employee-driven campus programs like “Infosys
Toastmasters Club” to provide support to the employees
Construction of a leadership institute to foster the
qualities of leadership within the employees
through INSTEP where three to six-month internships are given to students
from across the globe




Global coordination and control
Building capabilities for customer centricity
workforce diversity and embracing inclusion

Manager Assimilation Program
initiatives available for employees (Gyan Jyoti)
Employee Induction Programs like HELLO (Helping
employees launch and learn in the organization) and NEST (Nurturing
engagement with satisfaction and trust) 


Unilever Ltd.


penetration level as well as per capita consumption
productivity and quality
Reduce attrition

360-degree performance appraisal for performance
Talent identification and Talent development
Engagement assessment



Table 2: Innovative HR strategic practices adopted by
Foreign Multi-National Companies



Strategic Initiatives

HR practices



People orientation
Improve quality
 Launch new
models for diverse markets
 Reduce costs
and increase operating efficiencies
employee attitude with corporate culture

Phased retirement program
Productivity campaigns 
Management development program to enhance the
capacity of managers to think strategically, manage their time effectively
and improve work methods and quality 
Implementing healthy communication through the
removal of emotion and reliance on data




Support system with data
Crowdsourcing-product strategy
usage of data and testing to support ideas
Attract best talent, develop happier and more
productive employees

Hiring through People operation
Relaxation area with entertainment
technology tools that enable all aspects of the HR function
 Learning and
leadership development program
allowed to bring dogs to work 
Utilize people with distinctive capabilities to
create unsurpassed Competence in an area



Demonstrate and sustain respect
Commitment to workforce diversity
To be known for the greatest respect for the
 Commitment to
the advancement of women in the workplace

Minority recruiting/people with disabilities IBM’s
Project Able
programs like Basic Blue, One Voice and Coaching Simulator were introduced to
guide employees for a variety of challenging management
Flexibility/telecommunicating/leave of absence
Blended approach to learning
 Global women
leaders task force was formed and expanded its technology camps for girls’
summer program to encourage for technical degree



Understanding the market and strategic innovations is
essential to survive in the competitive environment. Therefore, the companies
should focus on generating new ideas which will lead to new strategies and this
will eventually lead to inventions and the practices should be implemented
accordingly. And these practices will result in the growth and the development
of employees and the organisation. With the increased number of employees, the
employee turnover has increased drastically. It is seen that innovative HR
strategies have a positive relationship with performance and growth of the
Indian and Foreign Multi-National Companies

One of the reason behind the success of Infosys were
its innovative HR strategies such as “Infosys Toastmasters Club” and its
decisions to accept challenges in the changing economic, demographic and cultural
environments. TATA hired external consultant McKinsey & Co. which started
Performance Ethnic Program to promote young dynamic personnel with management
programs. To build confidence within the employees, Google cultivates a taste
of failure and employees are encouraged so that they can try again and again.
It also gives them 20% of the time towards employee’s independent projects, CSR
activities, parties, game rooms, reward system and the available resources for learning
any four foreign languages. Google has been awarded a high-performance company
and superb place to work. Ford has been named a leader in HR practice by People
Management consistently over the years.



Due to globalisation and the changing economic,
demographic and legal landscapes, it is essential for the companies to analyse
what constitutes an effective HR strategy and how it may be best practiced is a
challenge today. Due to competitor pressure, the Indian companies are not in an
advantaged position as they failed to adopt to such changes. While, Foreign Multi-National
Companies are trying hard to do business in India, Indian companies must focus
on Information technologies and the practices to retain and motivate employees
to reach the peak of the world.



This study has been limited to a small sample size and
is restricted to a few sectors. So, generalizations cannot be made.



There has been a successful improvement in the HR
practices. These practices serve as key drivers for employee commitment and
employee engagement. Globalisation has presented dynamics to cultures across
the globe, hence the focus of human resources on valuing diversity is crucial
to employee engagement and satisfaction which ultimately result in retention
and development through appropriate training programmes. Investments on
initiatives that improve the quality
of life and ultimately employee retention and development is a necessary cost
to any business. Companies should give
adequate attention to their HR policies as it is essential to both the Indian
as well as Foreign Multi-National Companies in formulating their strategies and
implementing policies. Human resources policies and practices play an important
role in Indian as well as foreign Multi-National Companies for the development
of the company. However, problems
differ from company to company and therefore strategies must be undertaken accordingly.









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8. Research
paper by Gireesh Sharma ON top ten hr practices.

9. Research
paper of foreign Multi-National Companies in India by, Dayanand Arora.





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