International

HRM (IHRM) is the process

of:
Procuring, Allocating, and Effectively utilizing human resources in a multinational

corporation, While balancing the integration and differentiation of HR activities in foreign locations.

competition Growth in mergers, acquisitions and alliances Organization restructuring Advances in technology and telecommunication
Global

Need for flexibility Local responsiveness Knowledge sharing Transfer of competence

a global mindset More weighting on informal control mechanisms Fostering horizontal communication Using cross-border and virtual teams Using international assignments
Developing

Domestic Human Resource Management

International Human Resource Management

Staffs are placed within the national boundaries. Less number of Rule and Regulations to be managed.- mostly employment and taxation rules of the home country. There is uniform policy in administration

Staffs work outside their national boundaries. Very high number of rules and regulations which are related to taxation, employment rules, language translating services, work permit etc. Broader Perspective- Management has to be done according Host Country Nationals (HCNS) , Parent Country Nationals (PCNS) and Third Country Nationals.(TCNS)

Domestic Human Resource Management

International Human Resource Management

No special attention into the personal life. Confined to crche and cultural interactions. Challenges are confined to the situation of a particular country.

Special attention to personal life of expatriate employees- cultural training, schooling of children, employment opportunity for spouse. IHRM management has to be ready to face challenges like underperformance of expatriate employees, diplomatic relationships between host country and parent country, currency exchange rates which are variable and may impact the benefits of TCNS and PCNS.

Special Training is not required for Socio Special Training for expatriates so that Cultural adaptation. they might not face unnecessary hassles in the alien socio cultural environment.

 Managing

international assignments Employee and family adjustment Selecting the right person for a foreign assignment Culture, communication and gauge Language and communication

 Clarifying taxation issues Coordinating foreign currencies, exchange rates Compensation plans Working directly with the families of employees More involvement in employees personal life,

facility etc. Different HR systems for different geographic locations More complex external constituencies, foreign Governments, political and religious groups Heightened exposure to risks such as health, terrorism, legal issues, human and financial consequences of mistakes

 Variations Perception

of HR Attitude and actions of headquarters towards HR Resistance to change Cultural differences in learning and teaching styles

 High failure rates of expatriation and repatriation Deployment getting the right mix of skills in the

organization regardless of geographical location Knowledge and innovation dissemination managing critical knowledge and speed of information flow Talent identification and development identify capable people who are able to function effectively Barriers to women in IHRM International ethics Language (e.g. spoken, written, body)

Different labor laws Different political climate Different stage(s) of technological advancement Different values and attitudes e.g. time, achievement, risk taking Roles of religion e.g. sacred objects, prayer, taboos, holidays, etc Educational level attained Social organizations e.g. social institutions, authority structures, interest groups, status systems

 Cultural

differences between nations can influence the effectiveness of HRM policies and practices HRM must be congruent with the cultural orientation of the workers Hefstede says cultures vary in five dimensions:
Individualism versus collectivism Power distance Avoidance of uncertainty Masculinity Long-term versus short-term orientation

 Ethnocentric:

Highly centralized. HQ controls PCNs dominate. Polycentric: Decentralized. Each subsidiary has some degree of decision making autonomy. HCNs manage subsidiaries. Geocentric: Ignores nationality in favor of ability and competence needs in a worldwide integrated business strategy. 115

 Corporate

International Strategy Political and Legal Concerns Level of Development in Foreign Locations Technology and the Nature of the Product Organizational Life Cycle Cultural Differences

116

An employee who is working and temporarily residing in a foreign country

Some firms prefer to use the term international

assignees Expatriates are PCNs from the parent country operations, TCNs transferred to either HQ or another subsidiary, and HCNs transferred into the parent country

 Career

blockage, Culture shock, Lack of cross-cultural training, An overemphasis on technical qualifications, A tendency to use international assignments as a way to get rid of problem employees, Family problems

 Factors

associated with expatriate success:

Good technical and language skills Strong desire to work overseas Specific knowledge of overseas culture Well-adjusted family situation Complete support of spouse Behavioral flexibility Adaptability and open-mindedness Good relational ability Good stress management skills

Expatriates are more successful when their organizations train them to prepare for their life and work abroad. Lack of training is a major cause of expatriate failure

 The

Labor relations function identifies and defines the roles of management and workers in the workplace. relations issues that may arise in the international environment: Unions Labor laws Less emphasis on written contracts How much participation employees are entitled to in HRM policies

Labor