Q no 1:-explain the approaches relevant to cross cultural human resource management?

Ans:-The H R M uses four terms to describe multi-national corporations [M N Cs] approaches to managing and staffing their subsidiaries .ethnocentric, polycentric, regiocentric, and geocentric .these terms are derived from the work of perlmutter [1969] who claimed that. It was possible to identify among international executive three primary attitudes ethnocentric, polycentric and geocentric towards building a multinational enterprise,based on top managemet assumptions upon which key product,functional, and geographical decisions where made. To demonstrate these three attitudes, perlmutter (1969) used aspects of organizational design, such as decision making, evaluation and control, information flows, and complixty of organization. H also include perpetuation, which he defined as recruiting, staffing, development. A forth attitude-regiocentric-was added later (Human and perlmutter 1979). It is important briefly outline them here, since they have a bearing on our discussion of the organizational structure and control mechanism that are typically adopted by firms as there3 internationalization progresses. The four approaches are: 1: Ethnocentric: few foreign subsidiary have any autonomy; strategic decisions are made at headquarters. Key positions at the domestic and foreign operations are held by management personnel of headquarters. In other words, subsidiaries are managed by expatriates from the home country (PCNs). 2: Polycentric: The MNC treats each subsidiary as a distinct national entity with some decisionmaking autonomy. Subsidiaries are usually managed by local nationals (HCNs) who are seldom promoted to positions at headquarters. Likewise, PNCs are rarely transferred to foreign subsidiary operations. 3. Geocentric: Here, the MNC takes a worldwide approach to its operations, recognizing that each part (subsidiaries and headquarters) make a unique contribution with its unique competence. It is accompanied by a worldwide integrated business, and nationality is ignored in favor of ability.

4: Regiocentric: Reflects the geographic strategy and structure of the multinational. Like the geocentric approach, it utilizes a wider pool of managers but in a limited way. Personnel may move outside their countries but only within the particular geographic region. Regional manages may not be promoted to headquarter positions but enjoy a degree of regional autonomy in decision-making. It may be seen as a precursory step towards geocentrism. It should be stressed that the above categories refer to managerial attitudes that reflect the socio-cultural environment in which the internationalizing firm is embedded. These attitudes also may reflect a general top management attitude. However , the nature of international business often forces adaptation upon implementation. For instance, a firm may adopt an ethnocentric approach to all its foreign operation, but a particular host government may require the appointment of its own people in the key subsidiary positions; so, for that market, a polycentric approach is mandatory , marking a uniform approach unachievable. Q no2:-state the key components of international compensation? Ans:-the key components of international compensation comprise, as stated above, the basic salary, incentives, benefits, allowances, foreign inducement, long term benefits and taxes. Base salary:- base salary is common in any compensation strategy-domestic or foreign. In fact base salary is so critical that it is the base on which other elements are built. The base salary is the foundation block for international compensation. Incentives:-increasingly, MNCs these days are designing special incentive programs for keeping expatriates motivated. In the process, a growing number of firms have dropped the ongoing premium for overseas assignments are replaced it with a one-time, lump sum premium. For example, in the early 1990, over 60s per cent of MNCs gave ongoing premiums to their overseas assigners.today, the percentage is under 50 and the declining trend continues. Referral &retention bonuses are other incentives that are highly popular: Referral bonus is a popular way of bringing in new talent by employs introducing friends, relatives & acquaintances to the company. Eligibility to receive a hiring bonus varies across job

levels, but is relatively unaffected by company size or industry sector .executives & technical employees are the most likely to be offered hiring bounces, whereas sales representatives and hourly/non-exempt employees are the least likely. Use of retention bonuses/raise for employees is common in industries like IT/BPO & in the services industry .surveys indicates that about a third of technology & life sciences companies use a formal or discretionary retention bonus plan to retain key employees .this practice is more common in larger companies but does not very by industry sector. In calculating retention bonus, companies typically pay in flat dollar amounts few companies choose to pay retention bonuses based on a formula of time worked ,which though prevalent is not very popular. Allowances Allowances are an inevitable feature of international compensation. One common allowance relates so the cost of living- an adjustment for difference in the cost of living between the home country and foreign assignment. This allowance is designed to provide the expatriate with the same standard of living that he or she enjoyed in the home country . Spouse assistance, housing allowance, home leave allowance, relocation, allowance and education allowances are the popular allowances provided for in the expatriate compensation. Spouse assistance is provided to help guard against or offset the income lost by an expatriates trailing spouse. Some organizations search for job for spouses, often in the same organization in the same organization as the assignees are employed. Housing allowance are paid either on an assessed or on actual basis. Alternatively, housing allowances could be disbursed as company provided housing, a fixed housing allowance or assigning a part of the income, out of which actual housing costs are paid. Housing issues are often addressed or assigned on a case-by-case basic, but as an organization globalises , formal policies need to be put in place. Home level allowances is offered to facilitate overcome adjustment problems when he or

she is repatriater. MNCs may like ensure that the home level allowance is utilized only to visit ones own country and not to undertake any other foreign travel. Foreign service/ Hardship premium This is often perceived as an inducement in the form of a salary premium to accept an overseas assignment. Generally, salary premiums vary from 5-40 per cent of the base salary. Actually salaries depends upon the assignment, actual hardship, tax consequences and length of assignment. In addition, if the workweek in the host country is longer than in the home country, the assignee will be paid for the extra hours worked. Certain countries are highly hostile to the foreigners staying and working. Indians engaged in road construction in Afghanistan, for reat to their lives. In fact, two such example got killed in recent times. Expatriates in such environment are paid 2 to 3 times more than their domestic salaries. Benefits Alternatively known as indirect compensation, hidden salaryroll, fringes or service programmes, benefits constitute a substantial portion of international compensation. Benefits include a suite of programs such as:

Entertainment Festival celebration Gifts Use of club facilities Provision of hospitality including food and beverage Conference attendance Employee welfare Use of health club and similar other facilities Conveyance, tour and travel Hotel board and lodging

Vehicles Telephone and other telecommunication facilities Sponsorship of children Benefits have a place of prominence in any compensation strategy. Employees might not always prefer benefits (for example, health and life insurance) can generally be purchased by the employees at group rates, which are typically lower than those that the employees could have negotiated individually. Employers could prefer benefits to direct salary. Increase in benefits distort salary structures less and are often more easy to explain to shareholders with respect to the social responsibilities of the organization. Besides, fringes often involve complex financial arrangements and underwritings so that their true cost may not be discernible to employees or unions. Taxes Yet another component of the expatriates compensation relates to taxes. Taxes need to be handled with caution as they evoke an emotional response from expatriate. No one enjoys paying taxes, and this issue can be tie consuming for both the organization and the expatriate. MNCs generally select one of the following approaches to tackle international taxation.

Tax equalization:- organizations with hold an amount equal to the home-country tax obligation of the PCN, and pay all taxes in the host countries.

Tax protection:- the employee pays up to the amount of taxes he or she would pay on remuneration in the home country. In such a situation, the employee is entitled to any windfall received if the total taxes are less in the foreign countries than in the home country.

Two other approaches suggested are:ad hoc and laissez-faire. In the ad hoc approach, each expatriate is handled differently, depending upon the terms of the employment contract between the company and the assignee. The laissez-

faire approach suggests that the expatriates be left on their on to solve taxation problems. Use of long term benefits The most common long-term benefits offered to employees of MNCs are employee stock schemes. Traditionally, shock option plans were used as means to reward top management or key people of the organization. However, it is increasingly gaining popularity amongst wholly owned technology companies, in order to retain and reward employees across the organization. This is stemming from the argurment that all employees can create an impact on the organizations performance and will directly contribute to the organisations profitability. Hence, the primary objective for providing stock opyions is to reward and improve employee performance and/or attract/retain critical talent in the organization. Employee stock option plan (ESOP) This is a plan established by a company, whereby a certain number of shares are reserved for purchase and issuance to key employees. Such shares usually vest over a certain period to serve as an incentive for employees to build long-term value for the company. Restricted stock unit (RSU) This is a plan established by a company, within units of stock are provided with restrictions on when they can be exercised. It is usually issued as partial compensation for employees. The restriction generally lifts in 3 to 5 years when the stock vests.

Q N0:-Define recruitment. What are the guidelines for international recruitment? Ans:-Recruitment may be defined as that process by which an organization attracts people to apply for their job openings. the goal is to recruit a pool of qualified candidates from which the desired people may be selected. In order to be certain the recruitment process follows

prescribed guidelines: organizations may establish recruitment: policies. Recruitment can be categorized into two types: (1) external recruitment; and (2) internal recruitment. Pierce and DUNHAM (1990) contend that external recruitment is conducted in four steps: 1. Planning: Human resource managers must first determine those jobs they wish to fill, how many candidates they can reach and how many of them would accept the job offer. 2. Strategy Development: Next, a strategy is developed that specifies where to look for candidates, as well as how and when to look. 3. Searching: Based on the plan and the strategy, candidates are conducted and given job information and applications are collected. From this pool of candidates, the required new people are hired. 4. Programme Evaluation: the recruitment program must be continuously monitored, evauated, and changed as required. Typically, sources for external recruitment include direct applications received (walk-ins and applications by mail), public employment agencies, private employment agencies, executive search firm , school and colleges, professional associations, all branches of the military, unions, the handicapped, summer interns, and former employees. Internal recruitment consists of promotion from within, job posting, and contacts and referrals by current employees. Another especially good source of recruitment candidates is through the collection of temporary, part-time, and contract workers that has become known as the temps(cherrington, 1991).
Guidelines for international recruitment: 1. 2. 3. 4. Incorporate the global nature of the business in advertising designed to attract personnel. Use both global and local recruiting firms. Partner with MBA programmes that have an international business focus. Recruit from foreign services or other fields with extensive international experience and exposure. 5. Implement a system with automatic resume/ application skills tracking that can be used globally. 6. Modify policies and procedures to reflect local customs and laws ; be aware of culturally appropriate and inappropriate questions during the recruitment / selecting process; remember

that in some countries, once a worker is hired, it is almost impossible to terminate that worker without extensive, drawn-out procedures and costs. 7. Use government report from labour and state agencies to gain a realistic understanding of the skills available in the labour market where you are recruiting. 8. Tailor the recruiting and selection process to fit local conditions.

Q no 4:-outline the various objectives & principles of international compensation? Ans:- International compensation is understood as provision of monetary and nonmonetary rewards, including base salary, benefits, perquisites and long and short-term incentives, valued by employees in accordance with their relative contributions to performance. Attract individuals who are competent and interested in international assignments. Facilitate movement of expatriates from one subsidiary to another, from the home country to subsidiaries, and from subsidiaries back to the home country. Provide a consistent and reasonable relationship between the pay levels of employees at the headquarters, domestic affiliates and foreign subsidiaries. Be cost-effective by minimizing unnecessary expenses. Be consistent with the overall strategy, structure and business needs.

Other objectives of international compensation:

Better decision-making: Give executives an instant, global view of your organisations compensation structure, helping you make the right decisions based on accurate data.

Balance your compensation budget: Ensure you meet your financial obligations with better salary planning, tight budget control, and appropriate merit increases.

Drive high performance: Create a compensation management strategy that links performance to reward, engaging and motivating staff at all levels.

Find and keep the best: Use the latest market data and research to compare compensation across jobs, industries and locations. Benchmark your compensation to retain talented people and attract the best external talent.

Be fair and transparent: Create consistency across teams and skill areas, with review processes that avoid internal or external imbalances and minimize your retention risk. Principles of international compensation:International compensation is based on following principles: 1. It must be individually designed to achieve worldwide corporate objectives, satisfy Each nations laws and customs and meet each employees need and expectations. 2. Sending people on international assignments is costly and the reward systems are complex. Therefore, international compensation should facilitate the transfer of international employees in the most cost effective manner for the MNE. By focusssing , on cost-effectiveness, a company reduces the likelihood of cuttings costs while hurting employee mobility and equity objectives. 3. It should serve to motivate employees to join the firm and be productive while members of the firm. 4. It should be consistent with the overall strategy, structure and business needs of the multinational companies. 5. It must work to attract and retain staff in the areas where the multinational has the greatest need and opportunities, hence must be competitive and recognize factors such as incentive for foreign service, tax equalization and reimbursement for reasonable costs. 6. It should facilitate the transfer of international employees in the most costeffective manner for the firm.

Q no 4:-explain the various factors affecting international compensation? Ans:- The trend towards person-centric compensation notwithstanding, compensation paid to an expatriate is determined by
several factors. International compensation is influenced by internal and external forces, which are shown in below figure:

MNC Internal Environment 1.Goal Orientation 2.Capacity to pay 3.Competitive strategy 4.Organisational culture 5.Internal work place composition 6. labour relations 7.subsidiary role

1. MCN Internal Environment: The internal environment of an MCN environment includes the following: 1) Goal orientation : its goal orientation may be profit-making or service provision. Typical business enterprises seek profile maximization and non-profit organizations pursue services to society as their goal. Profit maximization or service provision has significant influence on international compensation. 2) Capacity to pay: The capacity of an organization is a critical internal factor influencing compensation. All the theories and principles for paying attractive compensation notwithstanding, what finally matters is the organizations ability to pay. Obviously, international compensation strategy must reflect the consideration of cost constraints on the MNC. The compensation plan must derive from an assessment of what must be paid to attract and retain the right people, what the

organisation can afford and what will be required to meet the organisations strategic objectives. 3) Competitive strategy: successful MNCs follow consistent strategies and compensation packages are embedded in those strategies. International businesses are known to be defenders, prospectors, or analysers depending on their orientation. These can be explained as follows:
a) Defender: where the MNC is a defender, the approach is to seek narrow and relatively

stable product-market domains. Compensation system are based on hierarchical positions in the organization. The focus is on internal equality and consistency. Compensation is primarily driven by superior/subordinate differentials.
b) Prospector: In the prospector strategy, an international business comtinuously searches for

product and market opportunities and experiments with response to environmental trends. The compensation system then depends on expatriate performance, as opposed to his or her hierarchical position in the organization. The focus is on external competitiveness and equity. Compensation includes more of incentives than other components.
c) Analyser: Through an analyser strategy, the MNC seeks to operate in two types of

products-market domains- one relatively stable and the other changing. Compensation in such MNCs is both hierarchy- based as well as performance-driven. Analysers try to balance internal consistency with external competitiveness.
iv)

Organisational culture: It has a strong impact on international compensation. Whether compensation is based on seniority or the performance of the expatriate, benefits are generally determined by organisational culture.

v)

Internal Workforce C omposition: Workforce demographics such as age, education level, qualifications and competence, along with workforce tastes and preferences have there impact on international compensation.

vi)

Labor Relations: Labor relations comprising the extent of unionization of the organization and the nature of employment relationship deserve due consideration while designing and administering international compensation.

vii)

Subsidiary Role: The strategic role of the subsidiary determines the compensation system. If the goods/services provided by the subsidiary contribute significantly to the achievement of the global objective of the MNC, the strategic role of the unit allows it to position itself competitively with reference to the design and deployment of its compensation strategy.

2) MNC External Environment: External forces influencing international compensation are as follows: i) Parent nationality: parent nationality as reflected in its culturally reflection attitudes and values towards compensation policy and practices, is one such external force having impact on expatriate compensation. If the parent country has high-power distanceorentation as its culture, compensation will be based on hierarchical positions in the organizations. Thus, there will be large compensation differentials between executives and team members. Similarly, if the parent countrys culture is characterized by low uncertainty avoidance, compensation would be based on performance and not on seniority. ii) Labor Market Characteristics: these include supply and demand, education and skill levels of individuals, and experience of players in the labor market. Irrespective of industry, labor market features are the key determinants in deciding compensation strategies both globally and at a unit level. Where demand exceeds supply, as it is happening to IT and ITES workforce, compensation tends to be high. Similarly, skilled and highly educated people with experience command a premium.

iii) 3. Local culture:iv) it influences international compensation strategy through the dominant societal values, norms, attitudes and beliefs concerning, e.g, bases for compensation differences , degrees of compensation differences between managerial and non- managerial personnel, and the prospensity for using particular types of compensation. v) 4.Home and host country governments roles:

vi) Government of the local countries lay- down certain norms, regarding minimum wages, bonus, and gender-based payments. It is true that MNCs pay above what local laws prescribe, but under no circumstances can compensations fall below . vii) 5.Industry type: viii) It is crucial in determining international compensation .companies in IT , software , pharmaceutical , and service sector pay much higher than other industries. Even the components of compensation depend on the type of industry. Stock options are more common in the new economy organization than their counterparts in the old economy. ix) 6. competitors strategies: x) Pay packages of MNCs cannot be behind what their rivals are paying to their employees. In fact, international business needs to excel its competitors if it desires to be a market leader. xi) International and external forces of an MNC will influence its staffing orientations. Staffing philosophy can be ethnocentric, polycentric, geocentric, or a mixture of the three. International compensation strategy is flavoured by the staffing orientation. When a MNC expatriates its manager from its headquarters to head subsidiaries, compensation tends to be equal to the home country packages in addition to some allowances to motivate them to accept such assignment. Qno1:- Mention any three or four theories of international compensation? Ans:- Four theories are discussed in the international compensation contingency: contingency: resource-based agency and equity. Contingency theory Contingency theory, the most popularly followed in international business, the contingency theory posits that expatriate compensation should be based on particular contingencies or situation prevailing in a host country. Stated differently, there cannot be a standardized compensation package applicable to all expatriates across the globe. The compensation philosophy in such organizations is normally de-centralized and allows units to compensation situation.

 Resource based theory This theory suggests that an MNC should pay well to attract and train competent people who contribute to its competitive advantage. Human resource constitutes the greatest asset of the MNC and the firm should do anything to acquire, retain and use it for organisational effectiveness. It is a change in such organizations to ensure a fixed structure and stay within clearly defined salary bands. Such organizations remain market-sensitive and are constantly reviewing compensating to retain their position in the hiring and retaining of talent. The agency theory This theory focuses on the divergent interests and goals of an organizations stakeholders and the way that employee compensation can be used to align these interests and goals. According to the theory, there exists a principle- agency relationship between the MNCs headquarters and its subordinates, the former being the principle and the latter acting as agents. The principle obviously delegates responsibilities to the agents. Given that the headquarters

does not have all the unique knowledge of the subsidiaries, not all the decisions in the MNC can be made by the headquarters. It must depend on the goals of the headquarter. It must depend on the subordinates and an agency problems arises if the goals of the headquarters and the subsidies managers are not aligned. International compensation strategy, therefore, must include those elements that motivate appropriate behaviors to implement the MNC strategy. Equity theory Equity theory suggests that there should be a fair balance between an expatriates contribution to an MNC or what he or she receives as compensation. Inequality between the two results in reduced performance and even with drawls. Establishing the equity principle in a domestic business may be relatively easy but in an international business, the task is daunting. Relativities are much more difficult to establish within the complex organization of an MNC, due to its geographic and cultural spread, and its work force mix of home, host and third country nationals. Of late, the equity principle is sought to be compromised with a new approach to compensation but all systems of HRM are sought to be made individual specific

and not job grade based. This transaction has immense implications for international HR practices. Q no3:- Give the various approaches in international compensation? The various approaches in international compensation are as :Ans:- Going Rate Approach: In this, expatriates are paid according to the host country salary structure. Where salary structures in host countries are lower, additional salary payments are made of the expatriates. Going rate approach is credited with certain advantages. It is easy to understand and simple to administer. One problem in implementing the going rate approach is to collect information about local salary structures. This difficulty can be overcome by conducting salary surveys. Secondly, party with host county nationals can be maintained. Finally, MNCs can maintain equity among different nationalities. However, there are problems associated with the going rate approach. First, there are variations between expatriates of the same nationality in different locations. For e.g., Indians expatiated to the us many be compensated better than those assigned to a developing country. Obviously, expatriates glamour for assignment in developed countries. In addition, there is the reentry problem. On return to whom country, the expatiate finds that his or her compensation is lower than that the host country. For example, a Japanese bank operating in New York would need tp decide whether its reference point would be local U.S., salaries, other Japanese competators in New York, or all foreign banks operating in New York. With the Going Rate Approach, if the location is in a lowpay country, the multinational usually supplements base pay with additional benefits and payments Based on local market rates. Relies on survey comparisons. Local nationals (HCNs)

Expatriates of same nationality Expatriates of all nationalities

Compensation based on the selected survey comparison. Base pay and benefits may be supplemented by additional payments for low-pay countries. There are advantages and disadvantages of the Going Rate Approach that are summarized in figure 4.2. advantages include: equality with local nationals (very effective in attracting PCNs or TCNs- to a location that pays higher salaries that those received in the home country), approach in a simple and easy for expatriates to understand, expatriates are able to identify with the host country and there is often equity among expatriates of different nationalities.

Advantage and Disadvantages Advantages Equally with local national. Simplicity Disadvantages Variation between assignments for same employees. Variation between expatriates of the same nationality in different countries. Identification with host country nationalities. Fig4.2: advantages and disadvantages of going rate approaches. The balance sheet approach The key characteristics of this approach ( the most widely used approach for international comensation) are summarized in fig 4.3 the basic objective is to keep the expatrate whole (Teague, 1972) (i.e, maintaining relative PCN colleagues, compensating for the cost of international assignment) through maintainance of homecountry living standard, plus a financial inducement to make the package attractive. The approach links the base salary for PCNs and TCNs to salary structure of the revelant home country. E.g, a U.S. executive taking up an international would have his Potential re-entry problems

or her compensation pakage built on the U.S. base-salary level rather then the applicable to the host country. The key assumption of this approach is that foreign assignees should not suffer not a material lose due there transfer, and this is accomplished through the utilization of what is generally referd to as a balance sheet approach.

The basic objective is maintenance of country living standard, plus financial inducements. Home-countries pay and benefits are the foundation of a approach. Adjustment to home package to balance additional exepnditure in host countries. Financial incentives (expatriate/hardship premium) added to make the package attractive. Most common system in usage by multinational firms. Advantages and disadvantages Advantages Equity Between assignments Between expatriates of the same nationality. Facilities expatriates re-entry. Easy to communicate to employees. Disadvantages Can result in great disparities. Between expatriates to different. Nationalities. Between expatriates and local nationals. Can be quite comples to administer.

Other approaches There are other approaches to international compensation too, but they are not in popular usage. One such approach is the Internaional compensation too, but

they are not in popular usage. One such approach is the international citizens approach. In this approach to expatriate compensation, an international basket of goods is used for all expatriates, regardless of countries of origin. The basket of goods includes food, clothing, housing and so forth. However, expatriates are not provided salary adjustments that would allow them to purchase exactly the same items in the host country as in the home countries. Rather they receive adjustments that would allow them to purchase a compatibility local product of the same nature; for example, rather than a Mercedes (which they have in the home country); they would buy a local luxury car Q No2:-give the detailed note on compensation practices across various countries? Ans:- Spain Due to the restrictive laws and existing regulations in Spain, management of compensation is one of the most difficult processes for strategic management. This high level of intervention has direct implications when analysing the procedure used to establish compensation. The procedure will vary according to professional categories. Thus, in the case of directors, 74 percent of firms adopt an individualized approach and use personal contracts. When it comes to technical staff, the number of personal contracts falls to 47 percent, while for the remaining categories (administration, operators) the traditional method is the collective agreement at a national or sector level (CranfieldEsade, 2000). According to a study by Romero and Valle on a group of large firms, the most important features of the compensation systems in spain are: When fixing the basic salary, the compensation system tends to be based more on the job or professional category the person holds than on his or her skills and capabilities. Changes to the basic salary are the effect of experience and length of service. Although the compensation system is characterized by several levels, most companies

do not consider themselves as having a very hierarchical system, meaning that large differences do not exist between the top and bottom salaries in the organization. . The wage system is heavily conditioned by the important weight of the basic or fixed salary, which usually ranges from a minimum of 7075 percent for managerial jobs to a maximum of 9095 percent for non managerial jobs. The variable part of the salary, in contrast, has little effect on total pay, and is primarily connected with the level of individual performance and, to a lesser extent, with the skills and capabilities of the person. As for performance based earnings or incentive schemes, those most used are bonuses for meeting short term targets (sales, profits, etc). Links between payment and long term objectives are only found in 22 percent of firms. Germany the compensation system traditionally favored in Germany is highly conditioned and deeply set in the social relations maintained by firms, workers and government. As a result of these social relations there is, on the one hand, very generous compensation for employees and, on the other, a highly regulated compensation system as a result of control exerted by government and collective negotiation at the sectorial level These characteristics are summarized below: The compensation system is usually based more on the job held by the worker than on his or her skills and capacities. In particular the basic salary is established according to work assessment, although the age of the employee does have some influence. The compensation structure has many levels with small differences between each and the compensation systems are, therefore, predominantly egalitarian. Regarding external equity policies, the predominant pay level is that fixed at the level

of the competition. Comparison of salaries between organizations is made on the basis of tariffs agreed between unions and employers at an industry level which establish the basic salary for the job. With respect to compensation components, the basic salary has a very important specific weight in the total pay between 70 percent and 80 percent, depending on the professional category. The basic salary is fixed according to the value of the job as stipulated in the tariffs agreed on by the social agents. Variable compensation has traditionally had quite a low standing in the wage package, accounting for less than 15 percent in most organizations. For non managerial jobs, the variable amount is usually established in the tariff agreements. The administration of the compensation system in German forms is characterized by its large centralization aimed at achieving correct cost control. It can be classified as bureaucratic and of somewhat inflexible policies. United States:One basic distinguishing feature of the United Status is its labor relations system. This is reflected by its scarce trade union presence (only 14 percent of employees are covered by collective agreements) and minimum government intervention. The system has relatively little regulation and the different parties, employer and employees, are allowed a lot of freedom to negotiate work conditions. The only norms which have to be fulfilled in work relations in general are the state laws which have rulings on minimum levels in aspects such as discrimination, equal opportunities, social benefits, safety, health and dismissals (Gomez-Mejia and Sanchez, 2006). With these general norms as the basis, companies are free to negotiate job conditions and salaries for each employee at the individual or collective level, which is local, and at a national or sector level (Stone, 1998).

The specific features of compensation systems can be summarized along the lines of the comments of Gomez-Mejia and Sanchez (2006) and Milkovich and Newman (2008): The compensation system is based on the job when fixing the basic salary. The basic salary is calculated according to the internal valuation of the jobs and their market price. In recent years, skills and competence of employees have begun to be considered as defining elements of internal compensation structures. The compensation structure is characterized by few salary levels, although the differences between these are usually sizeable. There is, therefore, a strong hierarchy, especially when managerial and non managerial jobs are compared. Regarding external equity policy, American firms clearly tend to follow what is determined by the market and go for the average salary of the competition. When comparing with competitors special attention is paid to levels of variable pay and incentives rather than to the fixed salary. Among compensation components, the basic salary has a moderate specific weight. This value ranges between a maximum of 60 percent for non management employees to a minimum of 35 percent for management employees. Variable pay, in contrast, tops the bill for American employees. It has a relative weight ranging from 30 percent for non management employees to 55 percent for managers. Performance based compensation systems are the main variable pay system. Stand outs among these are the bonus plan for the individual and profit sharing or gainsharing systems based on group performance at the department or corporate level. Special mention needs to be made of long term incentives, which have a very high specific weight (on average 35 percent of the total pay) and are usually based on variations in the firms share values. They are widely used in share purchase options and shares awarded for performance. Compensation administration is usually flexible and based on very informal policies and procedures. Decision making is relatively decentralized to favor rapid adjustment

to individual and organizational conditions. India In india , basic wage correspond with what has been recommended by fair wage committee and the 15th labour conference . criteria for determining the basic wage areskills needs of the job, experience needed, difficulty of work, training needed, responsibilities involved and hazardous nature of job. Dearness allowance in india linked with factors, such as, all india consumer price index. Government of india has set-up separate wage boards for fixing and revising wages for separate industries. Wage and allowances are determined through the pay commissions appointed by appropriate governments. Apart from the above, bonus is another important part of employees earning. Japan:Labor relations in Japan traditionally rest on three basic pillars: (1) job security in a particular company; (2) compensation and promotion systems based on the length of service; and (3) the firms trade unions decentralized institutions which represent the employees of a single company. These three basic aspects substantially influence and shape the characteristics of the compensation systems, which can be summarized as follows (Shibata, 2000; Yashiro, 1996): The compensation system tends to place more emphasis on the person than on the job when establishing the basic salary: length of service with the firm and the skills the workers possess will be more decisive in establishing their basic salary than will the value of their job or their performance. Any modifications are governed mostly by length of service. Promotions, which come with a change in salary, are made according to assessment by supervisors of the training and skills of employees, and not just of performance. In most firms, employees rise according to the classification of their jobs, and according to length of service and merit.

 The compensation is made up of many levels with small differences between them since increases based on merit or length of service are very small. The structure can, therefore, be considered egalitarian. Japanese firms tend to set pay levels at the same level as the competition. The information they use to fix the level comes from comparing a series of tables which relate the basic salary to the employees age. The wage package is characterized by a high weight for fixed salary, ranging from 60 to 80 percent of the total pay and determined by the rank of the individual within the organization. China Taking into account the cultural and institutional environment in which they are developed, compensation practices are characterized by the following aspects : The compensation system is characterized by the length of time the person has been in the firm as the main element for establishing and modifying the basic wage of the employee, and so it rewards loyalty to the firm. Promotions, which come with a rise in the employees basic salary, are established principally on the basis of the length of time the employee has held his or her position, rather than on performance. Job security is usually guaranteed by the firm. Performance assessments are, therefore, not carried out by any formal, rigorous or individualized method which measures effort. It is rather a professional classification based on the technical qualification of the employee and the importance of that job within the organization. The compensation structure can be considered as egalitarian since differences in salary between jobs and levels are low and politically not desirable.

 The wage packet is heavily weighted towards fixed salaries, which are determined by the technical category of the job and, above all, by the length of time the worker has been with the company. The variable part is low because performance is barely relevant in determining total employee salary. Variable pay is established through group incentives. Employee incentives are established annually through gainsharing systems. Profit sharing, on the other hand, is not frequently used. Individual incentives and bonuses are practically non existent. Social benefit schemes are widespread and an important element (much more than variable payment) in the salary package. Given the paternalistic and state role of the employer, benefits are aimed at covering a broad spectrum of needs such as health, unemployment and sick leave. Compensation administration is, like the rest of HRM, centralized, not very formalized and based on vague unspecified procedures. It is not common for information on compensation mechanisms to be shared or available Q no 6:- Discuss the criteria for international selection? Ans:-It should be noted that selection is a two-way process between the individual and the organization . a prospective candidates may reject the expatriate assignment, either for individual reasons , such as family consideration, or for situational factors, such as the perceived toughness of a particular culture.

1. TECHNICAL ABILITY: Technical and managerial skills are an essential criteria .companies seems to focus their slection efforts on single criteria that of technical competences despite the importance of all the other criteria co-related to interaction successes.

Reinforcing the emphasis on technical skills is relative ease with which the multinational may asses the potential candidates potential, since technical and managerial competence can be determined on the basis of past performance . since expatriates are usually internal recruits personnel evaluation records can be examined and checked with the candidate past and present superiors. 2. Cross- culture suitability:

The culture environment in which expatriates operate is an important factor in determining successful performance. Apart from the obvious technical ability and managerial skills, expatriates require cross-cultural abilities that enable the person to operate in a new environmental. These includes: cultural empathy, adaptability , diplomacy, language ability, positive attitude, emotional stability , and maturity.

3. Family requirenments: The contribution that the family, particularly the spouse, makes to the success of the international assignment. For example: u. s expatriates and their spouses working in japan, Taiwan and hong kong found that a fovourable opinion about the international assignment by the spouse is positively related to the spouse adjustment. The adjustment of the spouse was found to be highly correlated to the adjustment of the expatriates manager. 4. Country/ cultural requirement: SOME Regions and countries are considered hardship postings- remote areas away from major cities or modern facilities, or war-torn region with high physical risk. Accompanying family members may be an additional responsibility that the MNC does not want to bear. There may be a reluctance to select females for certain MIDDLE EAST OR SOUTH EAST EAST ASIAN REGION. Indeed , some countries will not issue a work permit for a female . these aspects may result in the selection of HCN rather than expatriates.

5. MNC requirenment:

The multinational may consider the proportion of expatriates to local staff when making selection decisions, mainly as an outcome of its staffing philosophy. However, operations, in particular countries may require the use of more PCNs and TCNs than would normally be the case, as multinational operating in parts of eastern Europe and china are discovering .

6. Language: The ability to speak a second language is an aspect often linked with cross culture ability. Language skills may be regarded as of critical importance for some expatriates positions. Some would argue that knowledge of the host-country language is an important aspect of expatriates performance, regardless of the level of positions. Another components to language as a situation factor in the selection decision is the role of the common corporate language. More multinationals, at some point, whether consciously or not, adopt a common corporate language as a way of standardizing reporting systems and Q no7:-Discuss the meaning & characteristics of decision making in international context? Ans:Decision-making can be regarded as the cognitive process resulting in the selection of a belief or a course of action among several alternative possibilities. Every decisionmaking process produces a final choice that may or may not prompt action. Decision making is one of the central activities of management and is a huge part of any process of implementation. Good decision making is an essential skill to become an effective leaders and for a successful career. Decision making is the study of identifying and choosing alternatives based on the values and preferences of the decision maker. Making a decision implies that there are alternative choices to be considered, and in such a case we want not only to identify as many of these alternatives as possible but to

choose the one that has the highest probability of success or effectiveness and best fits with our goals, desires, lifestyle, values, and so on. Decision making can be regarded as the cognitive process resulting in the selection of a course of action among several alternative scenarios. Every decision making process produces a final choice. The output can be an action or an opinion of choice.

Q no 1:- what do you mean by cross cultural human resource management. Explain the features of cross cultural human resources management? Ans:- International human resource management is the process of managing people across international boundaries by multinational companies. It involves the world wide management of people not just the management of expariates. Companies that functions globly compress international and multinational firms, International firms are those where operation takes place in subsidiaries over seas which relay on the business expertise or manufacturing capacity of the parent company. They may be highly centralized with tight control. Multinational firms are ones in which a number of businesses in different countries are managed as a whole from the center. International Human Resources management is the process of procuring allocating and effectively utilizing human resources In a multinational corporation. If the Multi National Company is simply exposing its products, with only a few small offices in foreigns locations, then the task of international Human Resources Manager is relatively simple. However, in global firms human resource managers must achieve two some what conflicting objectives . first they must integrate human resource policies and practices across a number of subsidiaries in different countries so that overall corporate objectives can be achived. At the same time the approach to human resource management must be sufficiently flexible to allow for significant

differences in the type of human resource policies and practices in different business and cultural settings. Cross cultiral Human Resource Management is a process concerned broadly with recruiting of persons, training them and putting them to the most productive usage. It is als o c o n c e r n e d w i t h maintaining of congenial international industrial relations. It is the essential prerequisite for the success of the international firm owning to its complexities.

international human resource management (IHRM) is the process of procuring, allocating, and effectively utilizing human resources in a multinational corporation. If the MNCis simply exporting its products, with only a few small offices in foreign locations, then the task of the international HR manager is relatively simple. However, in global firms human resource managers must achieve two somewhat conflicting strategic objectives. First, they must integrate humanresourcepolicies andpracticesacrossa numberof subsidiaries indifferent countri es so that overall corporate objectives can be achieved. At the same time, the approach to HRM must b e s u ff i c i e nt l y fl ex i bl e t o al l o w fo r si gni fi c ant di f fe r en c es i n t h e t yp e o f HR pol i c i e s an d practices that are most effective in different business and cultural settings.

Features of cross-cultural Human Resource Management:The main features of international HRM are as: Flexibility:- Everyone knows HR is burdened with a lot of processes and guidelines. Companies strive for standardization across their entire enterprise. A good international HR pro understands that flexibility is a key to success. Every country is different and the

standard approach that HQ designed might not work perfectly in every country. So be flexible about the application of global standards and processes. Be Comfortable with Uncertainty:- International HR staff are often faced with situations they have not encountered before and for which there is no precedent. You need to analyze the situation and create a solution, even if there are no clear cut answers. A real pro finds a solution that works for the client group, and satisfies corporate at the same time. Uncertainty simply comes with the territory, so learn to deal with it. Cultural Awareness and Sensitivity :-Each nation of the world is different, and it doesnt matter if they speak your language or share a border each country is separate, distinct and unique. Learn how to embrace cultural differences and turn them into competitive business advantages. Listen to your people in-country before telling them what they should do. Learn what is happening in-country and how the history and culture influence how business is conducted. There are obvious things to avoid such as holiday celebrations that are not part of the national culture. But it is the subtle things that are often overlooked. Adaptability:- You are working in areas which require adaptability to the situation on the ground. Its often different from HQ. The roles of labor unions in Europe and Latin America, for example, create requirements that are very different from the US. If you start applying US-style labor relations in Europe you will embarrass yourself and your company. So learn the rules and adapt your style as needed. Curiosity:- It is not a coincidence that the NASA Mars Rover is called Curiosity. This trait is imperative for success in international business, and international HR is certainly part of that! Explore the differences you encounter, get to know your local colleagues and demonstrate genuine interest in learning new things. Ask questions a lot of questions so you can understand why things are the way they are in different countries. Sharing and Listening:Over the years I have worked with people from many countries. One of the most striking things Ive noticed is how easily people from around the globe are willing to share their

ideas with others, and how many great ideas people have that I may not have encountered before. So listen to your international colleagues and embrace their ideas. Share your experiences and ideas in return. Work on solutions collaboratively. You will benefit from their ideas and have a friend in every country Other features of international HRM IHRM involves employment of the right people at the right positions, irrespective of geographic locations.

It requires the development of a long-term HR plan to make sure of an effective alignment of the HR strategies with the corporate objectives.

It requires the development of a diversified range of skills for employees, especially for those who need to work beyond national boundaries.

It necessitates the determination of compensation for host-, home- and third-country nationals on the basis of country-specific factors.

It requires the creation of centralized reporting relationships around the world for faster information sharing.

International Human Resource Management (GHRM) -- the planning, selection, training, employment, and evaluation of employees for global operations.

How a firm recruits, trains, and places skilled personnel in its worldwide value chainssets it apart from competition. The combined knowledge, skills, and experiences of e m pl o ye e s a r e di s t i n ct i v e a nd p ro vi d e m yr i ad a dv an t a ges t o t he fi rm s op er at i on s worldwide

.GHR managers serve in an advisory or support role to l i n e m a n a g e r s b y p r o v i d i n g guidelines, searching, training, and evaluating employees.

Q no 7:-elucidate the nature & motives of international staffing? Ans:1. Staffing is an important managerial function- Staffing function is the most important mangerial act along with planning, organizing, directing and controlling. The operations of these four functions depend upon the manpower which is available through staffing function. 2. Staffing is a pervasive activity- As staffing function is carried out by all mangers and in all types of concerns where business activities are carried out. 3. Staffing is a continuous activity- This is because staffing function continues throughout the life of an organization due to the transfers and promotions that take place. 4. The basis of staffing function is efficient management of personnels- Human resources can be efficiently managed by a system or proper procedure, that is, recruitment, selection, placement, training and development, providing remuneration, etc. 5. Staffing helps in placing right men at the right job. It can be done effectively through proper recruitment procedures and then finally selecting the most suitable candidate as per the job requirements. 6. Staffing is performed by all managers depending upon the nature of business, size of the company, qualifications and skills of managers,etc. In small companies, the top management generally performs this function. In medium and small scale enterprise, it is performed especially by the personnel department of that concern. Q NO 11:-enumerate the major factors that influence cross cultural human resource management? Ans:- Managing human resources in different cultures, economies, and legal systems presents some challenges. However, when well done, HR management

pays dividends. A seven-year study in B ri t a i n o f ov e r 10 0 fo r ei gn co m p an i e s s ho w ed t h at go od H R m an a gem en t , a s w el l a s ot h e r factors, accounted for more of the variance in profitability and productivity than did technology, or research and development. The most common obstacles to effective HR management are cross-cultural adaptation, different organizational/workforce values, differences in management style, and management turnover. Doing business globally requires that adaptations be made to reflect these factors. It is crucial that such concerns be seen as interrelated by managers and professionals as they do business and establish operations globally. Figure 2.1 depicts the general considerations for HR managers with global responsibilities. Each of those factors will be examined briefly.Fig.2.1

2.1 Legal and Political Factors Th e na t u r e an d s t a bi l i t y o f p ol i t i c al s ys t em s v a r y f ro m co un t r y t o cou nt r y. U.S . fi rm s a r e accustomed to a relatively stable political system, and the same is true in many of the other d e ve l op e d co u nt r i e s i n Eu ro pe . Al t hou gh p r esi de nt s , p ri m e m i ni st er s , p r em i e rs , gov e rn or s, senators, and representatives may change, the legal systems are well-established, and globalfirms can depend on continuity and consistency.

pending Economists disagree about many matters, but not about unemployment. Generally they agree that l ab o r m a rk et s n e ed t o b e fl ex i bl e , but i n Eu ro p e an c oun t r i e s t h e y a r e r el at i v el y r i gi d . Ve r y generous unemployment benefits, high minimum wages, strong unions, and unique (by U.S.standards) laws dissuade employers from hiring more employees. For example, in Spain, a permanent employee who is fired can get 45 days pay times the number of years he has been wi t h t h e co m pa n y. It i s a l a r ge l i abi l i t y, s o f e w fi rm s c r e at e m o re p er m a n ent j o bs. S i m i l a r legislation in

other countries tends to keep those who have jobs at work, but the effect of the protective legislation keeps employers from creating more jobs. Economists tell us that in thelong run, without such laws, firms that cut costs and become more productive create more jobs because productive industries tend to expand.The pressure of world competition that is forcing painful reform is not popular in Europe. ManyE ur op e an s a re cr yi n g eno u gh, a nd qu es t i oni n g ho w qui c kl y t he E ur op e an ec on o m i e s c an t r a n s f o r m t h e m s e l v e s i n t o t h e A n g l o S a x o n m o d e l o f c a p i t a l i s m . T h a t f o r m u l a - h i g h productivity, low jobless rates, and a minimal social safety net is not typical in most WesternEuropean countries. For example, a recent French poll found that two-thirds of the French people prefer their rich benefits and high unemployment to Americas approach of lower unemploymentand limited social welfare benefits. Of course, elected politicians tend to follow the wishes of their constituents, bringing political and legal factors together in this case, resulting in anaverage of 12% unemployment. Europe cannot seem to shake its chronic unemployment. Theu ne m pl o ym en t r at e ha s r an ge d f rom al m os t 2 0 % i n S pa i n t o o v er 1 0% i n F r an c e b ut i t averages about 12%. Joblessness is much higher in Europe than in the United States or Japan.

Economic Factors Economic factors affect the other three factors. Different countries have different economicsystems. Some even still operate with a modified version of communism, which has essentiallyf a i l ed . F or ex am pl e, i n C hi n a c om m u ni sm i s t h e of fi ci al e c ono m i c a pp ro a ch. Bu t as t h e government attempts to move to a more mixed model, it is using unemployment and layoffs to reduce government enterprises bloated with too many workers. Many lesser-developed nations are receptive to foreign investment in order to create jobs for their growing populations. Global firms often obtain significantly cheaper labor rates in thesecountries than they do in Western Europe, Japan, and the United States. However, whether firmscan realize significant profits in developing nations may be determined by currency fluctuationsand restrictions on transfer of earnings. Also, political instability can lead to situations in whichthe assets of foreign firms are seized. In addition, nations with weak economies may not be able to invest in maintaining and

upgrading the necessary elements of their infrastructures, such as roads, electric power, schools, and telecommunications. The absence of good infrastructures maymake it more difficult to convince managers from the United States or Japan to take assignments overseas. Economic conditions vary greatly. Cost of living is a major economic consideration for global corporations. In many developed countries, especially in Europe, unemployment has grown, but employment restrictions and wage levels remain high. Consequently, many European firms are transferring jobs to lower-wage countries, as Mercedes-Benz did at its Alabama plant. In addition, both personal and corporate tax rates are quite high. These factors all must be evaluated as part of the process of deciding whether to begin or purchase operations in foreign countries. Cultural Factors Cultural forces represent another important concern affecting international HR management.Culture is composed of the societal forces affecting the values, beliefs, and actions of a distinctgroup of people. Cultural differences certainly exist between nations, but significant culturaldifferences exist within countries also. One only has to look at the conflicts caused by religion or et h ni c i t y i n C ent r al Eu ro pe and ot h er p a rt s o f t he w o rl d t o s e e t h e i m po rt a nc e of c ul t ur e o n international organizations. Getting individuals from different ethnic or tribal backgroundswo rki n g t o ge t h e r m a y b e di ff i c ul t i n so m e p ar t s of t he wo rl d . C ul t ur e c a n l e ad t o e t h i c al differences among countries.One widely used way to classify and compare cultures has been developed by Geert Hofstede, aDutch scholar and researcher. Hofstede conducted research on over 100,000 IBM employees in 53 countries.

Q no 12:-discuss the various challenges of cross cultural human resource management? Ans:- The environment faced by HR management is a challenging one; changes are occurring rapidly across a wide range of issues. A study by the Hudson Institute highlighted some of the most important workforce issues. From that and other sources, it appears that the most prevalent challenges facing IHR management are as follows:

Occupational shifts

Projections of the growth and the decline in jobs, illustrates the economic and employment shifts cu r re nt l y o c c ur ri n g. It i s i n t e r est i n g t o not e t h at m ost o f t h e f ast es t gr owi n g o c cu pa t i o n s percentagewise in 2002-03 were related to information technology or health care. The increase in the technology jobs was due to the rapid increase in the use of information technology, such as databases, system design and analysis, and desktop publishing.HRM in the new economy ought to be human centric with a strong technology focus. We need to l ev e r a ge o n em er gi n g t e c hno l o gi e s t o be t t er s at i sf y t h e w a nt s a nd ne ed s of t h e kn o wl e d ge workers, and in the process, build a competitive advantage that lasts. Attraction and retention of talent have become the main external influence on Nokias human resources strategies, as other companies also strive to be the employer of choice. GLOBAL COMPETITION One major factor affecting these shifts is the globalization of economic forces. As seen the past few years, the collapse of Asian economies had significant effects on many organizations.E.g. Nokia was in pressure because of thriving of and stiff competition by other companies like Siemens, Samsung and sony-ericsson. And as a result of it their market share collapsed from34% to 31% in US and Europe. But nokia still made it to profits because of Indian and Asian markets. This now made outbreak of a war between companies i.e. competitors will approach high profile employees in others organization and may get that employee. Thus, causing the later company lose a valuable asset. This is particularly true with more highly skilled, technical jobs in technology-driven industries. DEMOGRAPHICS AND DIVERSITY The workforce has been changing dramatically. It is more diverse racially, women are in thelabor force in much greater numbers than ever before, and the average age of the workforce isnow considerably older than before. As a result of these demographic shifts, HR management inorganizations has had to adapt to a more varied labor force both externally and internally.

Thet h r e e m ost p rom i ne nt di m en si o ns o f t he d em o gra phi c sh i f t s af f e ct i n g o r ga ni z at i on s a r ehighlighted next.

RACIAL/ETHNIC/RELIGIOUS DIVERSITY The Asian and Hispanic labor forces are expected to increase faster than the AfricanAmericanlabor force. The importance of all these shifts is that HR professionals must ensure that diversegroups are managed and treated equitably in organizations. Also, HR professionals will have todevelop diversity-oriented training so that all employees, regardless of background and heritage,can succeed in workplaces free from discrimination and inappropriate behaviors. It also meanst ha t m or e a t t ent i on w i l l ha ve t o b e gi ve n t o r ec r ui t i n g, st a f fi n g, a nd p ro m ot i n g i ndi v i d ua l s without regard to their racial/ethnic heritage, so that equal employment results for all.

AGING OF THE WORKFORCE M os t o f t h e de v el o p ed c ou nt ri es a r e ex p e ri en ci n g an a gi n g o f t h ei r pop ul at i ons i n cl ud i n g Australia, Japan, most European countries, and the United States. In these countries, the medianage will continue to increase. The aging of the population also is reflected in the occupationalshifts noted previously. The growth in medically related jobs will be due primarily to providingcare to older persons who will live longer and need greater medical care. Taken together, this aging issue means that HR professionals will continue to face significant staffing difficulties.Efforts to attract older workers through the use of part-time and flexible staffing will increase.HR will face significant challenges in replacing them with workers having the capabilities and work ethic that characterize many older workers. For HR management, elder care will grow as amajor HR issue. More workers will have primary care responsibilities for aging. BALANCING WORK AND FAMILY For many workers, balancing the demands of family and work is a significant challenge. Whilethis balancing has always been a concern, the growth in the number of working women and dual-career couples has resulted in greater tensions for many workers, families and households todaycan be described as follows:The decline of the traditional family and the increasing numbers of dual career couples andworking single parents place more stress on

employees to balance family and work. For instance,many employees are less willing than in the past to accept relocations and transfe rs if it meanssacrificing family or leisure time. Organizations that do get employees to relocate often musto f f e r e m p l o y m e n t a s s i s t a n c e f o r s p o u s e s . S u c h a s s i s t a n c e c a n i n c l u d e c o n t a c t i n g o t h e r employers, providing counseling and assistance in resume development, and hiring employmentsearch firms to assist the relocated spouse. Additionally, balancing work and family concerns has p a rt i c u l a r c ar e e r i m pl i c at i ons f or wom en , be c au s e w om en m o r e t h an m en t e nd t o i nt e r ru pt careers for child rearing.To r es po nd t o t h es e c on c er ns e m p l o ye r s a r e f ac i n g gr owi n g p re ss ur es t o p ro vi d e f am i l y - friendly policies and benefits. The assistance given by employers ranges from maintainingreferences on child-care providers to establishing onsite child-care and elder-care facilities.

ORGANIZATIONAL RESTRUCTURING Many organizations have restructured in the past few years in order to become more competitive. Also, mergers and acquisitions of firms in the same industries have been made to ensure global com p et i t i v en es s. Th e m e ga m e r ge rs i n t h e ba n ki n g, p et r ol eu m , a n d t el e com m un i c at i o ns industries have been very visible, but mergers and acquisitions of firms in many other industries have increased in recent years. As part of the organizational changes, many organizations have right sized either by Eliminating layers of managers, C l o s i n g f a c i l i t i e s , Merging with other organizations, or O u t p l a c i n g w o r k e r s . One of the challenges that HR management faces with organizational restructuring is dealing with the human consequences of change. Where many large firms have cut jobs by reducing their workforces, many smaller firms have continued to create jobs. This is particularly true in hight e c h n o l o g y i n d u s t r i e s , s u c h a s s o f t w a r e d e v e l o p m e n t a n d s e r v i c e s i n d u s t r i e s . T h e s e entrepreneurial firms are faced with growth, while trying to attract sufficient workers with flexible capabilities and to conserve financial resources.

DECISION MAKING ON MERGERS, ACQUISITIONS, AND DOWNSIZING In many industries today, organizations are merging with or acquiring other firms. The merger of Chrysler and Daimler-Benz has had significant implications for the automobile industry. Many ot h er ex am p l e s c oul d be ci t ed a s w el l . In a l l of t h e se m e r ge rs a nd a cqu i s i t i on s t h er e a r e numerous HR issues associated with combined organizational cultures and operations. If they are viewed as strategic contributors, HR professionals will participate in the discussions prior to top management making final decisions. For example, in a firm with 1,000 employees, the Vice-P r esi d ent o f Hum an R es ou r ce s s p end s on e w ee k i n an y f i rm t h at i s pr o pos ed fo r m e r ge r or acquisition to determine if the corporate cultures of the two entities are compatible. Two potential acquisitions that were viable financially were not made because he determined that the organizations would not mesh well and that some talented employees in both organizations probably would quit. Q No 14:-outline the importance of cross-cultural human resource management? Ans:- Various threats generated by liberalization of economy can be met only through bringing corresponding changes in management practices including practices related to International HRM. In the newer management practices, more emphasis has been given to International HRM because of the following factors: 1. Emphasis on Core Competency. Post-liberalization, many organizations have started focusing on their core competence and businesses are being organized around that. A core competence is unique strength of an organization which may not be shared by others. This may be in the form of unique financial resources (finance available at a much lower cost), manpower resources, marketing capability, or technological capability. If the business is organized on the basis of core competency, it is likely to generate competitive advantages. Because of this reason, many organizations have restructured their businesses-divesting those businesses which do not match core competence such as Tata Group divesting many businesses and acquiring Tetley, a UK tea processing company, divestment of businesses by Voltas, Birla Group, etc. or acquiring those businesses which fit core competence such as Reliance acquiring four yarn/fiber manufacturing companies, Gujarat Ambuja acquiring cement companies, and so on. The organization of business around

core competence has changed the mind set and in this change, more emphasis has been given to human factor. 2. Reorganization. Along with restructuring, there has been emphasis on reorganization too. Many companies are restructuring their organization structure by thinning their management levels and expanding span of control. Thus, there is emphasis on flat structure against tall structure as followed earlier. The old concept of seven layers in the pyramid and seven direct subordinates under each boss which has been the historic norm for many large companies in the past is becoming extinct. Further, departmentalization based on functional lines is being changed to strategic business unit departmentalization to focus more sharply on products or services. This reorganization has created need for additional skills on the part of the organizational human resources which can be met by appointing new managerial talents or by developing the existing human resources. The latter course of action is preferable because of the increasing competition for human talents. 3. Competition for Human Resources. With the entry of foreign firms in the Indian industrial scene, nature of competition for human resources has changed. Foreign firms, particularly those operating in sector such as consultancy, merchant banking, investment banking, etc. and computer software companies of Indian origin, have put lot of competition for acquiring managerial talents. 4. Technological Changes. With the removal of restrictions on technology import and acquisition, many organizations have opted for newer technologies. Increased use of computers has added another dimension to technological innovation. With the result, old skills are fast becoming obsolete. In their place, the operatives have to acquire newer skills which have increased the training needs in such organizations, and HR departments have to be more active. 5. Need for Workforce Empowerment. Throughout the world, there has been increasing emphasis on workforce empowerment, that is, giving them authority matching their responsibilities. India cannot lag far behind because of the international impact. For workforce empowerment, there has to be a change in mindset as well as there should be change in skills of workforce. The role of HRM is crucial in both these respects.

With the increasing role of human resources and their management, organizations have accorded HRM a higher status than what it previously was.

Q NO 12:-what do you mean by cross cultural conflict.How to resolve cross cultural conflict. Ans:- Cross-cultural conflict can be defined as conflict generated, and perhaps exacerbated or perpetuated, by cultural differences among the groups involved in the conflict. A person's culture informs his or her worldview, moral code, judgments, and ideas or perceptions about others. Of course, these aspects of a culture can be incorrect or misinformed, leading to conflict with other cultures or groups of people. The power of culture is strong, however, and it can be difficult to overcome cross-cultural conflict, as evidenced by the numerous conflicts between different cultural groups that continue to rage around the world today. According to onathan H. Turner :- it as a conflict caused by "differences in cultural values and beliefs that place people at odds with one another"

Cross-cultural conflict resolution:Successful conflict resolution comprises three aspects: 1. Desire and necessity for the conflict to be resolved 2. Understanding of possible barriers to the resolution of the conflict 3. The choice of method of conflict resolution. 1. Desire and necessity for the conflict to be resolved:To resolve cross-cultural conflicts or misunderstandings, community service and disability service workers need to be committed to resolving potential conflicts and take responsibility for bridging the cultural gaps. They must:

have self-awareness of their own cultural practice, including prejudice, stereotyping and bias

understand various cultural factors contributing to cultural differences be sensitive and appreciate a migrants migration experience have a good knowledge of, and skills in, communication be able to work with interpreters be willing to accept and appreciate other cultures.

2. Understanding of possible resistances During the conflict resolution process, you might experience internal resistance to recognition of problems or problem-solving. This resistance may take the form of:

resistance to examining your own values resistance to acknowledging your own cultural stereotyping or bias denial of the existence of conflict tendency to blame others for causing problems looking for the right time to deal with conflicts. You must take prime responsibility for exploring the barriers and minimising this resistance to conflict resolution.

3. Methods of conflict resolution Different people might accept different conflict resolution methods, so it is important to use methods or approaches that are suitable to all parties and enlist the help of acceptable people in resolving cross-cultural conflicts. To resolve conflicts arising from cultural differences, you need to:

identify the similarity and differences between your cultural practice and those of the person in conflict with you

acknowledge the differences and attempt to balance the interests of both parties.

Build on common ground Instead of focusing on the differences, you could look for common ground between you and the other party, and build on it. Break down power structure The imbalance of power between community service and disability service workers and clients or between co-workers is an obstacle for conflict resolution.

Clients may feel powerless: Such feelings may act as a force of resistance in the conflict resolution process. One way to break the power structure is to respect clients as experts in their own conditions.

Power differences also exist between workers, due to seniority: The focus should be directed to the cause of conflict instead of seniority of the position.

Use of mediation Mediation means to have a middle person acting in the role as a go-between or facilitator. The role of mediator is to provide both parties with opportunities to put forward their views and assist in analysing the problem and looking for solutions. Mediation with clients or their family If you have conflict with a client or a clients family members, you could approach your team leader to act as a mediator or you may seek external mediators from multicultural organisations (with the clients or their family members consent). Mediation with co-workers When you have conflict with co-workers, you could use the conflict resolution process or the grievance procedure used in your workplace. Both of these processes would involve a mediator. The mediator could be:

a senior from your discipline area, if you and the co-worker are from the same discipline a team leader or other senior staff member an independent person from human resources management.

Q no19:- Discuss the needs &Guidelines for effective international training and development? Ans:Following guidelines have been suggested as key to international training and development: 1. Think and act globally : A global enterprise must think about and prepare for a presence in all the critical markets in the world, not just its home region.

2. Become an equidistant global learning organization: Learning from all cultures, anytime, in any manner possible, must be facilitated.

3. Focus on the global system , not its parts: Development programmes need to focus on breaking down the silos of departments and even the boundaries between countries and those that separate customers and suppliers and focus on the big picture global organizational system.

4. Develop global leadership skills: Global leadership requires competencies different from those needed in the domestic marketplace. These should be the focus of global training and development programmes.

5. Empower teams to create a global future:

Multinational and cross-border teams should be increasingly used and empowered to perform critical organizational projects and problem solving activities. In addition, multinational teams can, themselves be a major tool in the development of crosscultural competencies.

6. Make learning a core competence for the global organization: The global organization needs to become a global learning organization, where learning and development permeates all that the organization does.

7. Regularly re-invent yourself and the global organization: Constant self-development must become the cornerstone of strategies for both individuals and organizations in todays highly competitive global economy. Need for Training and Development for Global Jobs To match employee specifications with the job requirement and organizational needs To achieve organizational viability and the transformation process To meet the challenges of technological advancement To understand the organizational complexity

To make the employee and his family members familiar with the language, customs, traditions etc of the foreign country

Q no 17:-Outline the various Guidelines for international selection? Ans:-

Various guidelines for effective international selection are as follows: 1. Select the expatriate and accompanying members carefully: One of the major steps an employer can take to reduce the uneasiness of going abroad is in selecting the right candidate for the assignment. Just having technical expertise or management skills does not make an employee right for international assignments. More important to this particular kind of job is an individual inherent cultural sensitivity, flexibility, adaptability, and interpersonal communication skills.

2. Providing facilities to expatriates: From a human resource perspective, the best thing which can be done is to provide service, equity, and stability for the expatriate and their accompanying members. Select the providers that provide highest quality service as it will ultimately help you to provide the same level of high service to expatriates.

3. Feedback: Sometimes, performance issues can be related to the adjustment situation into a new country. Therefore, management and human resource needs to be very proactive with feedback.

4. Discussion with family members: It is difficult on at leaving family, friend, and normal customs behind in the home country and going on an international assignment. Some members of the family may not be able to overcome these issues. Therefore, it is essential that hr professionals make potential assignees understand that they must talk to their families and see if there are many roadblocks that would prevent them from successfully completing an assignment.

5. Careful selection process:

In addition, selection process for an expatriate should be taken seriously as the failure, often begins at the selection process.

6. Consideration of essential characteristics:

Cultural adaptability, ability to adjust to a new location, willingness to learn new customs and make new friends are critical elements for a successful expatriates experience. Therefore, it is important to take these characteristics into consideration during the assignment selection process. Q no16:- Elaborate the various selection methods at international level? Ans:Informal methods: Traditionally, little consideration has gone into the specific requirements of an international assignment, and instead candidates have been selected informally, based on personal contacts. Harris and Brewster call this the coffee-machine system of selection, and present a scenario in which selection of the candidate results from a manager saying to a colleague as they take a coffee break, we need someone to take over the Beijing assignment , and the colleague responding. Well Perkins has been to china, he might do it. to play devils advocate for a moment, it was mentioned above that what often makes or breaks an international assignment is not so much the formal qualifications of the assignee as the intangible the assignees ability to get by in a particular situation . Under such circumstances, a colleagues feeling about the candidate suitability might be as reliable a guide as anything else. Formal methods: Formal methods, while more reliable are not entirely problem free. Selection on the basis of past experience for instant is often deemed reliable guide for future performance. However simply because a manager has per formal well in the home context or in particular host country environment. it does not follow that they will do will where ever they are assigned indeed , as

countries and people change over time it does not even necessarily mean they would do well in the country of their first assignment, past experience is thus that bartleed and ghoshal not , not necessarily and indicator of future performance capability . There is also the case of selection by skill. As noted in the previous chapter it is unfortunately common among MNCs street international experience or global awareness as a kind of bold on, if u need a manager for car factory, for instant, you select a good engineer and give him some intercultural training. The problem is that some skills and experiences cannot be formally taught. the authors own research at a large Anglo German MNC for instance revealed the case the German expatriates who was competent at his job but who lack of ability to communicate with the staff of the uk office to which he was assigned resulted in mutual attention and a rapid declaration of expatriate failure. While one might discover hidden interculture capability in some international assignees, it is best to treat these as pre-existing skills and abilities rather as something can be downloaded into any suitable person. Formal selection methods may be as problematic as informal ones, depending on the criteria for selection while they may used as criteria for making the Initial selection, other methods will be needed subsequently to determine the best candidate. Test and examinations: In theory, at least, formal tests and assessments are more objective than the selection methods we have considered above, in that they are less based on advantageous friendships or on formal criteria which may or may not be good indicators of future performance. As expatriate assignments become more common, and consequently more consideration goes into the selection of candidates, more emphasis is being placed on using formal test, examination and so forth. Some of the means of selection are fairly familiar, such as: 1. Interview:

When interviewing a candidate for an international assignment, it is advantageous to have a variety of people from different parts of the organization consider the candidate even, perhaps, to have them assessed by people from both head office and the office to which they may be assigned. In this way, a more balanced assessment of the candidates skills can be obtained.

2. References/ resumes: Success in one international assignment does not necessarily guarantee success in another. As also noted, some assignments require a global orientation rather than previous experience. References and past experience are thus not always the best means of selection, although they can provide a useful indication of the candidates skills and background.

In addition, more specialized means of selection may be used:-

a. Selection test: These are often used for non-international assignment; however, in the case of selecting expatriates, they may also include test for linguistic ability, intercultural ability, psychological fitness for expatriation, and other, perhaps assignment specific, criteria. b. Assignment centres: These, again, are often used for selecting for non- international positions. However, they can be useful in assessing abilities such as flexibility, quick thinking, coping with multi- ethnic teams and handling difficult situations. In the future, we may increasingly see assessment centres specifically geared towards international assignments. However, as barrel et al. note, the key problem with selection is that it is exceedingly difficult to simulate cultural influences, meaning that it is doubtful that an assessment centre would prove to be a better guide than any other to the candidates potential fitness of the assignment.

c. Specific monitoring of disadvantaged groups: This is a legal requirement in some cases, and should be practiced even when it is not, for reasons discussed below. The purpose is to ensure that the selection is effective, efficient and fair for all candidates. Whatever criteria are used initially to select candidates, they should be followed up with tests and assessments. It is worth bearing in mind, however, that tests can also show bias, as can examiners, when selecting candidates.

Q No 12:-Explain the Recent trend in international staffing? Ans:- Over the past, few years, some distinct trends observed in international staffing can be studied as: managing work force diversity, off-shoring, increasing use of background checks, indentifying recruiting sources, and challenges of dual career couples. 1. Managing diversity: A typical MNC today has a work force representing different regions, ages, religions, genders and cultures. Effective management of such diversity benefits the company in terms of innovation, motivation and productivity .towards this end, MNCs generally have a d iversity policy which acts as a global guideline. The policy focuses on the following: a. Need for diversity-why should a company seek diversity? What will be the benefits to the company and its customers? b. Vision of diversity-what should diversity look like? What is the ideal form of diversity for this company? c. Commitment to diversity-who all need to be supportive and involved in making the initiative real? d. Systems and structures for diversity how to institutionalize diversity throughout the management practice. e. Sustain it- how to devise action plans for creating and sustaining diversity?

Hr manager need to take the lead to built diversity. They need to evolve hiring practices that are sensitive to ensure opportunities for all sections, while competency is not compromised. Beyond this, actions need to be designed that will help built a true cosmopolitan organization in which equity shall be the decisive criterion in assessing performance, promotion or compensation policies.

2. Outsourcing:

Outsourcing, also known as off-shoring, is the act of moving some of the organizations internal activities and decision responsibilities to external service providers. The reasons why an origination outsources its activities can vary. Outsourcing allows an organization focus on activities that represent its core competencies. Thus, a company can create a competitive advantage while reducing cost. On the flip side, outsourcing results in loss of jobs in the company resorting to outsourcing, leaking out of sensitive information and the questionable quality and ethical practices of the service provider. Outsourcing is highly visible in the IT sector. Such activities as creation, storing and dissemination of information are increasingly being outsourced and the business of IT outsourcing runs into several billions of dollars every year.

3. Background: In international staffing background checks of new hires are very common. The objective of background or references checking is to verify information that the new hire has furnished in his or her application. It has been estimated that between 10 and 30 percent of applications falsify their resumes in some way, so such a checking is a reasonable precautions. Such checks are also used to discover new information on the history or past performance of the candidate, such as reason for leaving a previous job. Background checks help MNC avoid hiring people who would otherwise misuse information accessible to them while at work. These investigations

may be performed by the company itself or by a specialist organization retained for the purpose. 4. Source of recruitment:

With the constantly increasing demand for resources, more effective means to attract and hire competent staff has changed the way recruitment is managed in MNCs. Website tops the list of recruitment demand sources with 92 percent of the company using it. Relying on the company websites is common with 85 percent, ads in local media 48 percent, campus recruitment 45 percent and blogs 3 percent.

Most common recruitment source Recruitment tool Job position Your company websites Employee referral programmed Recruitments( external) Recruitment(internal) Ads in local media Your companys intranet percent of companies 92 85 81 59 50 48 47

5. Dual career couples : Dual career couples refer to a situation where both husband and wife are in jobs. It becomes difficult for the hr manager to convince the employee to accept foreign assignment if the spouse is not willing to accompany him or her because of the effect of such an assignment on his or her career prospects. Spousal or dual career issues are often cited as the reason for rejecting international assignments, particularly in the US and European organizations, but it is less visible in Asian countries.

Q NO 19:- what are the basic forms of Multicultural teams/ culturally diverse teams. Explain how to motivate & manage Multicultural teams? Ana:Multicultural teams comprise members coming from more than one culture. Multicultural teams can be divided into three types: a. Token teams: in which only one member is from another culture. An example would be a group of Japanese retailers and a british attorney, who are looking into the benefits and shortcomings of setting up operations in Bermuda. b. Bicultural teams : have members from two cultures. An example would be a team of four Mexicans and four Canadians who have formed a team to investigate the possibility of investing in Russia. c. Multicultural teams: it have member s from three or more cultures. An example is a group of three Americans, three german, three Uruguayans, and three Chinese managers who are looking after mining operations in chile.

Managing culturally diverse teams: Cultural diversity can be an important source of energy in enhancing organizational effectiveness. More and more organizations are realizing the virtues of cultural diversity , but surprisingly little do they know how to manage it. There is a significant amount of learning that every organization goes through in understanding and accommodating the cross-cultural corporate challenges. What organization can do about it is to create awareness about the cultural differences and sensitivity to the work values prevalent in the countries that the MNCs require to interact with, either as a customer or as host unit. Organization that adopt a multinational strategy can become more than a sum of their parts . operations in each culture can benefit from operations in other cultures through an enhanced understanding of how the world looks and works. On the flip side, multicultural teams often generate frustrating management dilemmas. Cultural differences can create substantial obstacles to effective team-work but these may be subtle and difficult to recognize until significant damage has already been done. But by intervening, leaders tend to create more problems than they resolve. The challenge in managing multicultural teams effectively is to recognize underlying cultural causes of conflict, and to intervene in ways that only get the teams back on track but empower their members to deal with future challenges effectively. Strategies for managing teams: Four strategies have been suggested to tackle problems of multicultural teams: a. Adaptation- acknowledging cultural gaps openly and working around them.

b. Structural intervention- changing the shape of the team. c. Managerial intervention- setting norms early or bringing in a higher level manager. d. Exit- removing a team member when other options have field. Some other ways of managing culturally diverse teams are: a. Task- related selection: leaders should select team members based on their task-related abilities rather than on ethnicity. Team members should be homogenous in ability levels but heterogeneous in attitude . such members help maximize team effectiveness.

b. Establishing a vision: Members of diverse teams have more difficulty agreeing on their purpose and task than do members of homogenous groups. Global alliances often become troubled because partners from different cultures do not clearly understand each others intent-their purpose , goals, and strategy because they are initially unable to communicate with each other. c. Equalizing power: Teams generally produce more and better ideas if all members participate. Cultural dominance is therefore, counterproductive because it stifles non-dominant team members contributions. In multicultural teams, leaders must guard against vesting disproportionate power in host-country members, members of the home country, members with ideologies most constant with their own.

d. Creating mutual respect: For most teams to work effectively , members must respect each other. Prejudice is the antonym of mutual respect. Equal status, close contact , and cooperative effort towards a common goal decrease prejudice. Team leader can enhance mutual respect by selecting members of equal ability , making prior accomplishment and skills known to all team members, and minimizing early judgement based o