Inter-Organizational Relationships Assignment Example | Topics and Well Written Essays - 3000 words

Inter-Organizational Relationships - Assignment Example This proposed dissertation explores the feasible ways by which organizations with the interlocking relationships of the global economy can best respond to the challenges posed by increased business competition and complexity. It will focus on human resource management, which has assumed a new dimension because of the presence of a third party organization that can exercise control over employees of another firm. The paper will propose that in the multi-employer environment of business globalization, the best-fit or best practice objectives of HRM can be achieved by incorporating the inherent advantages of franchising in a company's HR strategies, especially in the matter of pay and reward. The present-day challenge of human resource development is to design HR practices that fit with the new business requirements or, in the words of Mohmann & Lawler (1999), to formulate practices that fit into a "dynamic, unpredictable corporation with a myriad of approaches to getting the work done." In this concern, the franchising sector provides a microcosm of the difficulties being encountered by the human resource department in working out innovative assessment systems that will demonstrate their influence over the company's bottom lines, which are profitability and shareholder value (Becker, et al., 2001). The reason is that franchise holders, especially those engaged in the sale and servicing of cars, have as many third-party partners as the existing number of automotive manufacturers who all demand a voice in deciding the franchisee's HRM practices (Swart, et al., 2002). Franchising in effect typifies the inter-organizational dependency involving human resource management and the attendant dilemma on how the HR department of a franchisee firm can implement a strategic pay-and-reward system that promotes its long-term interest without alienating its network partners. Curran & Stanworth (1983) define franchising as "a business form essentially consisting of an organization with a market-tested product or service maintaining a contractual relationship with another organization to sell the brand." In general, franchisees are self-financed and independently owned and managed small firms operating under the franchiser's brand name to produce or market goods or services according to a format specified by the franchiser. Because of the subsequent growth of this sector, the franchising outlet was later redefined as "a legally separate business entity with its own capital base, set of employees, organizational structure and specific customer relations (Stanworth & Curran, 2003)," which indicate that franchisees have become analytically independent of their franchisers. On franchising as growth sector, Floyd & Fenwick (2003) note that this business sector now accounts for over one-third of retail sales in the US and 29 percent of those in UK, thus claiming a huge proportion of the workforce of either country. The