Ihrm i Module

8/2/2019 Ihrm i Module

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INTERNATIONAL HUMAN RESOURCE

MANAGEMENT


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COMPONENTS OF HRMCOMPONENTS OF HRM

Recruitment

Selection

Training & Development Performance Appraisal

Compensation

Labor Relations


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INTERNATIONAL HRM (IHRMINTERNATIONAL HRM (IHRM))

Basic HRM issues remain

Must choose a mixture of international

employees How much to adapt to local conditions?


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EMPLOYEES IN MULTINATIONALEMPLOYEES IN MULTINATIONALORGANIZATIONSORGANIZATIONS

Host country nationals(HCN)

Expatriates

Parent country nationals(PCN)

Third country nationals(TCN)

Inpatriates


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Dimensions of IHRM

1. Human resource activities

2. countries

3. type of employeeHR activities: procure, allocate, utilize

Eg., nokia, skoda, dabur


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Definition

It is the interlink between 3 dimensions like HR

activities, types of employees and countries of

operation

IHRM addresses the complexity that results

from recruiting, selecting, developing and

maintaining a diverse workforce on a global

scale


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Approaches to IHRM

Cross cultural management

IHRM in multinational context

Comparative HR & IR systemsExpatriate: are PCN, go to work in HCN/TCN

An expatriate is an employee, who is working

and temporarily residing in a foreign country.Some firms call them as international

assignees.


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Inpatriate: the transfer of subsidiary staff into

parent country(head quarter operations)

Also an expatriate


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Difference between domestic &

international HRM

More HR activities

The need for a broader prospective

More involvement in employee personal life

Changes in emphasis as the workforce mix of

expatriates and local varies

Risk exposure

Broader external influence


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1. More HR activities

Ensure no tax incentives Arranging for pre-departure training

2. Need for a broader prospective

Foreign service or expatriate premiums

3. More involvement in employee personal life

Housing, health care, cost of living allowances,

bank transactions handling, investmentshandling


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4. change in emphasis as the workforce mix of

expatriates and local varies

5. Risk exposure

Terrorism, 9/11 incident, premature return from

the work, troublesome political climate,

broader external influences

Type of government, economy state, practices of

doing business in the host countries, hiringprocedure conformity to quotas, labour laws,

tax, health & safety


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Models of HRM

1. Matching model:

2. Highlights the resource aspect of HRM

3. Emphasises the efficient utilization of humanresources to meet organizational objectives

4. Right fit between organizational strategy,

organization structure & HRM systemsAlso called as hard model of IHRM


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Harward model: stresses the human soft

aspect of HRM

Concerned with employee and employer

relationship

Highlights the interests of differentstakeholders in the organization and how their

interests are related to management

objectivesAlso called as soft model of IHRM


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3. Contextual model

Based on the premise that organizations may followa number of different pathways inorder toachieve the same results

Because of linkage between external and internallinkages of an organizations HRM

4. 5 p model

Pholosophies

Policies

ProgrammesPractices

Processes with strategic needs


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5. European model:

Based on the argument that european

organizations are constrained at both

international and national level by national

culture and legislationAt organization level by culture , pattern of

ownership

At trade union level by trade union involvement& consultative arrangements


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Internationalizational of HRM

Socio-cultural context

Nations culture:

Sweedan : people here pocesses the strongcollectivist culture which prohibits

development of more individualistic

orientation to employment relationships

Dutch: culture is more faminine and encourages

the antipathy of Dutch employees


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Germany: the culture is dominated by strongrole of unions and the formal consultative

structure between employers and employees

France; the culture hinders the decentralizationUk: changed the name of personnel

management to the HR

Iran: people are from military, retired from theirwork


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Broad employee management issues

1. Management style

Participative

Consultative

Paternalistic

Autocratic

2. Authoritative structure

Decentralised

centralised


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Organization structure

Leadership style

Employee relationship with the company

Specific HRM issues

Staffing, policies, recruitment & selection, T&D

performance appraisal, promotion,

retirement, layoff, industrial relations, foreign

assignments


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Major cultural attitudes & values

which influence the soft aspects of

organization Attitude to power & authority

Tolerance for ambiguity & resistance

Risk taking

Individualism, self-orientation

Collectivism, group orientation


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Acceptance of responsibility

Interpersonal trust

Attitude to other people opinion

Attitude to sharing information by knowledge

with others

Preference for some leadership behavior


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Preference for independence & autonomy

Self-confidence, self-reliance

Achievement orientation

Attitude to conflict & harmony

Work ethic & honesty

Attitude to nature of human beings


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Role of culture in IHRM Selection & recruitment

UK: high professionalism, formal procedure to

selection

Middle east/ African: informal networks orrelatives, friends

Japan: recruit someone with broad educational

qualification & years of cross functionaltraining

US: based on specialization, with or without

training


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Britain: recruitment broadly fit the job basics

& are then trained to perform that job

properly

Developing nations: apprenticeship is the

major channel of new recruitment

France: medium & large size cos are required

by law to spend a certain % of their annual

turnover on employment training


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Performance appraisal, reward &

promotion policies Middle east loyalty to superiors

Western quality & quantity output

Collectivist team based performance

Individualistic individual performance

White collar setting targets, goals reports


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Blue collar objectives criteria, measurable

French promotion on seniority or group

loyalty criteria English staff reduction decision on the

performance to salary ratio


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Challenges of IHRM

High failure rates of expatriation &

repatriation

Deployment: getting the right means of skills

in the organization regardless of geographicallocation

Knowledge & innovation dissemination

Talent identification & development Barriers to women in IHRM


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International ethics

Language

Different labour laws

Different political climate

Different stages of technological advancement

Different values & attitudes

Roles of religion

Educational level attained


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MULTINATIONAL MANAGERSMULTINATIONAL MANAGERS

Host country or expatriate?


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USING HOST COUNTRYUSING HOST COUNTRY

MANAGERSMANAGERS

Do they have the expertise for the position?

Can we recruit them from outside the

company?


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USING EXPATRIATE MANAGERSUSING EXPATRIATE MANAGERS

Do parent country managers have the

appropriate skills?

Are they willing to take expatriate

assignments?

Do any laws affect the assignment of

expatriate managers?


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IS THE EXPATRIATE WORTH IT?IS THE EXPATRIATE WORTH IT?

High cost

High failure rate


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EXHIBIT 11.1 PAYING FOR THE

EXPATRIATE MANAGER

0

50000

100000

150000

200000

250000

300000

350000

400000

$

Home

Salary

Hong

Kong

Taipei


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REASONS FOR U.S. EXPATRIATEREASONS FOR U.S. EXPATRIATE

FAILUREFAILURE

Spouse fails to adapt

Manager fails to adapt

Other problems within the family

Personality of the manager

Level of responsibilities


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Reasons for expatriate failure,Reasons for expatriate failure,

continuedcontinued Lack of technical proficiency

No motivation for assignment


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MOTIVATIONS TO USE EXPATSMOTIVATIONS TO USE EXPATS

Managers acquire international skills

Coordinate and control operations dispersedactivities

Communication of local needs/strategicinformation to headquarters


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KEY EXPATRIATE SUCCESS FACTORSKEY EXPATRIATE SUCCESS FACTORS

Professional/technical competence

Relational abilities Motivation

Family situation

Language skills Willingness to accept position


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PRIORITY OF SUCCESS FACTORSPRIORITY OF SUCCESS FACTORS

Depends on :

assignment length

cultural distance

amount of required interaction with local people

job complexity/responsibility


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RIGOR OF THE CROSSRIGOR OF THE CROSS-- CULTURALCULTURAL

TRAINING GROWSTRAINING GROWS

exhibit 11.4 shows various trainingexhibit 11.4 shows various trainingtechniques and their objectives as thetechniques and their objectives as the


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Techniques: Field trips to

host country,meetings

withmanagersexperiencedinhost country,meetings

withhost country

nationals,intensive

language training.

Objectives: Develop

comfort withhost countrynational culture, business

culture,andsocial

institutions.

HighTraining

Rigor


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Techniques:

Experientiallearningexercises,roleplaying,

simulations, case

studies,survival

language training.

Objectives: Generaland

specific knowledgeofhost country culture,

reduceethnocentrism.

Mid-

levelTraining

Rigor


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Techniques: Lectures,

videotapes,readingbackgroundmaterial.

Objectives: Provide

backgroundinformationon

host country businessand

national cultures, basic

informationon companyoperations.

Low

Training

Rigor


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CHALLENGES OF EXPATRIATECHALLENGES OF EXPATRIATE

PERFORMANCE APPRAISALPERFORMANCE APPRAISAL Unreliable data

Complex and volatile environments

Time differences and distance separation Local cultural situations


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STEPS TO IMPROVE THESTEPS TO IMPROVE THE

PROCESSPROCESS

1. Fit the evaluation criteria to strategy.

2. Fine tune the evaluation criteria

3.Use multiple evaluators with varying periodsof evaluation


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EXHIBIT 11.6 Shows several sources ofEXHIBIT 11.6 Shows several sources of

information a superior or the HRMinformation a superior or the HRM

professionals may use to evaluate anprofessionals may use to evaluate an

expatriate managersexpatriate managers


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Evaluation Sources Criteria Periods

Self evaluation Meeting objectivesManagement skills

Project successes

Six months and at thecompletion of a major

projectSubordinates Leadership skills

Communication skills

Subordinate development

After completion ofmajor project

Peer expatriate andhost country manages

Team buildingInterpersonal skills

Cross-cultural interactionskills

Six months

On-site supervisor Management skills

Leadership skillsMeeting objectives

At the completion of

significant projects

Customers and clients Service quality andtimelinessNegotiation skills

Cross-cultural interaction

skills

Yearly


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EXPATRIATE COMPENSATIONEXPATRIATE COMPENSATION


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THE BALANCE SHEET APPROACHTHE BALANCE SHEET APPROACH

Provides a compensation package that equates

purchasing power


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BALANCE SHEET COSTSBALANCE SHEET COSTS

Allowances for cost of living, housing,

utilities, furnishing, educational expenses,

medical expenses, club memberships, and car

and/or driver expenses


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Domestic

AssignmentExpenses and

Spendable

Income

Expatriate Assignment Expenses and Balanced

Spendable Income +Allowances

BaseSalary = BaseSalary

+Allowancesasanincentive to takeposition,

foreignservicepremium,hardshippay,R&R

Taxes = Taxes

+ Allowances to balanceextra taxpayments

GoodsandServices

= GoodsandServices

+

Allowances to covercost oflivingdifferences,

housing, childrenseducation,medical costs,

automobile,recreation,homeleave travel

Housing = Housing

+

Allowancesformovingexpenses,settlinginexpenses,initialhousing costs,andfurnishingallowances

Spendable

Income= Spendable Income


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OTHER APPROACHESOTHER APPROACHES

Parent country wages everywhere

Wean expatriates from allowances

Pay based on local or regional markets

Cafeteria selection of allowances

Global pay systems


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THE REPATRIATION PROBLEMTHE REPATRIATION PROBLEM

Difficult for many organizations

"Reverse culture shock"

Expatriates must relearn own national andorganizational culture

Includes whole family


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STRATEGIES FOR SUCCESSFULSTRATEGIES FOR SUCCESSFUL

REPATRIATION PROVIDE:REPATRIATION PROVIDE:

A strategic purpose for repatriation

A team to aid the expatriate

Home country information sources

Training and preparation for the return

Support for expatriate and family


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WOMEN EXPATRIATES: TWOWOMEN EXPATRIATES: TWO

IMPORTANT "MYTHS"IMPORTANT "MYTHS"

Myth 1: women do not wish to take international

assignments

Myth 2: women will fail in international

assignments because of the foreign culture's

prejudices against local women


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SUCCESSFUL WOMENSUCCESSFUL WOMEN

EXPATRIATESEXPATRIATES

Foreign not female

emphasize nationality not gender

The woman's advantage

strong in relational skills

wider range of interaction options


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MULTINATIONAL STRATEGY ANDMULTINATIONAL STRATEGY AND

IHRMIHRM


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IHRM ORIENTATIONSIHRM ORIENTATIONS

Ethnocentric

Polycentric

Regiocentric Global


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IHRM ORIENTATION ANDIHRM ORIENTATION AND

MULTINATIONAL STRATEGYMULTINATIONAL STRATEGY

Early stages of internationalization =ethnocentric IHRM

Multilocal strategies = ethnocentric or

regiocentric Regional strategy = closer to the global


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International strategy = ethnocentric or

polycentric IHRM

Transnational strategies = a global IHRM


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CONCLUSIONSCONCLUSIONS

HRM functions

IHRM challenges

Expatriate managers

The role of women in multinationalorganizations

Multinational strategies and IHRM

orientations

Date post:	06-Apr-2018
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