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International Human Resource Management: Managing People in A Multinational Context

This document discusses key concepts in international human resource management (IHRM). It defines IHRM and outlines differences between domestic and international HRM practices. Specifically, it notes that IHRM involves broader HR activities and perspectives to account for external cultural influences. Managing expatriates, host country nationals, and third country nationals adds complexity to staffing, performance management, and other HR functions in a global context.

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Udeeshan Jonas
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143 views17 pages

International Human Resource Management: Managing People in A Multinational Context

This document discusses key concepts in international human resource management (IHRM). It defines IHRM and outlines differences between domestic and international HRM practices. Specifically, it notes that IHRM involves broader HR activities and perspectives to account for external cultural influences. Managing expatriates, host country nationals, and third country nationals adds complexity to staffing, performance management, and other HR functions in a global context.

Uploaded by

Udeeshan Jonas
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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International Human Resource Management

Managing people in a multinational context

IHRM
Module Objectives
• Define key IHRM terms
• Review expatriate management evolution
• Outline differences between domestic and
international HRM
• Discover the increasing complexity and
potential challenges of current IHRM

IHRM
Key Trends
• Multinational are economically dominant
• 70,000 transnational companies dominate
world trade, accounting 2/3 of it
• The top 100 corporation account for 14% of
worldwide trade, 12% of assets & 13% of
employment
• The 10 biggest have annual sales larger than
the Australian government’s tax revenue

IHRM
Recent Survey …

• Average cost of moving an Australian abroad is


$40,000, most spent on removalist, storage, airfare &
accommodation
• 60% of the relocated were middle managers
• 57% of companies reported a rise in domestic &
international relocations
• Most focus on Asia but biggest rise (20%) in 1997-
2000 to the USA

IHRM
Factors Creating the Global
Marketplace

• Increase travel
• Global technology & telecommunications
• Rapid development of new technology
• Free trade
• Education
• Migration of large number of people

IHRM
Factors Creating the Global
Marketplace

• Search for new markets


• Convergence of global lifestyles & values,
accelerated by global languages
• E-commerce
• Lowering of the costs of doing business
globally

IHRM
HR needs to address the following
in Internationalisation
• Do we have a strategy for becoming an international firm?
• What type of managers will we need and how do we find and
develop them?
• How can I find out about the way HRM is conducted in other
countries?
• What will be the impact of local culture & norms?
• Do we send expatriates or use locals?
• Do we manage international moves if we send people out?
• How do we manage knowledge across geographical and
cultural distance?

IHRM
Terms
HRM
IHRM
HCN
PCN
TCN
MNE expatriate
culture shock inpatriate
emi-etic distinction

IHRM
Figure
1-1
Inter-relationships between approaches to a field

IHRM
Defining HRM
An organization’s HRM activities include:
1. Human resource planning
2. Staffing (recruitment, selection, placement)
3. Performance management
4. Training and development
5. Compensation (remuneration) and benefits
6. Industrial relations

IHRM
Figure
1-2
Inter-relationships between approaches to the field

IHRM
Figure
1-3
International assignments create expatriates

IHRM
Differences between Domestic
and International HRM
•More HR Activities
•The need for broader perspective
•Move involvement in employees’ personal lives
•Changes in emphasis as the workforce mix of
PCNs and HCNs varies
•Broader external influences
•Risk exposure

IHRM
Figure Variables that moderate differences between
1-4 domestic and international HRM

IHRM
Laurent’s steps to truly international HRM
1. Recognize that one’s own HRM reflects home culture
assumptions and values.
2. Recognize that one’s own peculiar ways are neither universally
better nor worse than others - just different and likely to exhibit
strengths and weaknesses, particularly abroad.
3. Recognize that organization’s foreign subsidiaries may prefer
other ways to manage people – ways that are neither intrinsically
better nor worse, but possibly more effective locally.
4. Headquarters willingness to acknowledge cultural differences and
steps to make them discussable and therefore usable.
5. Build shared genuine belief that cross-cultural learning will result
in more creative and effective ways of managing people.

IHRM
Figure
1-5
Strategic HRM in multinational enterprises

IHRM
Discussion Questions
1. What are the main similarities and differences between
domestic and international HRM?
2. Define these terms: IHRM, PCN, HCN, and TCN.
3. Discuss two HR activities in which a MNE must engage
that would not be required in a domestic environment.
4. Why is a greater degree of involvement in employees’
personal lives inevitable in many IHRM activities?
5. Discuss at least two of the variables that moderate
differences between domestic and international HR
practices.

IHRM

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