Unit 5 Global Business Bba Notes
Unit 5 Global Business Bba Notes
Unit 5 Global Business Bba Notes
RESOURCE MANAGEMENT
MEANING, RECRUITMENT, SELECTION, PERFORMANCE APPRAISAL, TRAINING
AND DEVELOPMENT, COMPENSATION, PUBLIC RELATIONS
MEANING
• Human resource management (HRM) is defined as managing (planning,
organizing, directing and controlling) the functions of employing, developing,
compensating and maintaining human resources resulting in the creating and
development of human relation with a view to contribute proportionately
(due to them) to the organizational ,individual and social goals
• The term human resources can be thought of as, ‘the total knowledge skills,
creative abilities, talents and attitudes of an organization's workforce, as well
as the values, attitudes and believes of the individual involved’.
GLOBAL RECRUITMENT
• Recruitment means the searching for prospective candidates and stimulating them to
apply for jobs.
• Recruitment attracts a large number of qualified applicants who desire to work in the
company.
• The recruitment information given by the Global companies help the qualified candidates
who are willing to work to send their resume along with a letter expressing their desire to
work.
• It also helps the unqualified candidates to self select themselves out of the job candidacy.
• Accurate information provided by Global company attracts qualified and repels the
unqualified candidates.
• Thus recruitment helps the Global company in finding out potential candidates for actual
or anticipated vacancies in the company
GLOBAL RECRUITMENT
SOURCES OF GLOBAL RECRUITMENT
• 1. Ethnocentric approach
• Under this approach parent country nationals are selected for all the key Management jobs. This approach
was widely followed by Procter and gamble Phillips Toyota etc. some of the international firms follow this
approach due to the following reasons
non availability of qualified personnel in host countries particularly developing countries
to maintain a unified corporate culture
to transfer the core competencies of the company when the core competencies are held by the existing
employees of parent country nationals
• Disadvantages
when important positions of the subsidiaries are filled with the parent country nationals, the staff of the
host country feel frustrated resulting in low productivity
the subsidiary may fail to understand and respond to the host countries culture due to ‘cultural myopia’.
GLOBAL SELECTION
GLOBAL SELECTION APPROACH
• 2. Polycentric approach
• Under this approach the positions including the senior management positions of the subsidiaries are filled by the
host country nationals. The reasons for adopting this approach includes
host country nationals are familiar with the culture of the country including business culture
level of job satisfaction of the employees of the subsidiaries can be enhanced
it is less expensive as the salary level of the host country National is lower than that of the host country nationals
in case of MNCs of Advanced countries
it reduces overall cost of staff of subsidiaries
• Disadvantages
this approach limits the mobility of employees among subsidiaries and between subsidiaries and the headquarters
organizational culture of the parent company cannot be completely adopted in the subsidiaries
culture of the subsidiaries and the headquarters cannot be exchanged as it isolates the headquarters from their
subsidiaries
GLOBAL SELECTION
GLOBAL SELECTION APPROACH
• 3. Geocentric approach
• Under this approach the most appropriate candidates are selected for job from any part of the globe .Global
firms follow this approach due to the following reasons
to have the most appropriate human resources
to develop the people with multi culture and meet the challenges of cultural diversity
to build multi skilling as a core competency and transfer it to all the subsidiaries
to avert the problems of Cultural myopia and enhance local responsiveness of the host country
• Disadvantages
most of the countries insist that MNCs should employ their citizens .MNCs are allowed to employ foreign
nationals only in the rarest cases
implementation of this policy takes time as the MNC has to train and develop the people in multi cultures
implementation of this policy is also expensive
GLOBAL SELECTION
SELECTION TECHNIQUES FOR GLOBAL JOBS
• Global companies require the human resources adaptable not only to the job and organizational
requirements, but also to the emotions of the people of different countries of the world. As such, The
selection techniques for Global jobs vary from that of domestic jobs. Now we shall discuss the selection
techniques for Global jobs
screening the applicant's background
conducting tests to determine the candidates suitability to the job norms
conducting test to evaluate the candidates suitability and adaptability to the new culture and
environment
conducting tests to evaluate the suitability and adaptability of candidates spouse and family members
to the new culture and environment
predicting the adjustment of the candidate his spouse and family members to the new job ,culture of
the company, country and the new environment
The candidate should be asked question related to his adjustment, interaction with the host nationals,
technical competence, cultural Novelty, family situation, communication skills etc.
GLOBAL SELECTION
SELECTION TECHNIQUES FOR GLOBAL JOBS
• The company has to measure the candidate on various variables regarding adjustment. Variables to be
measured include
Individual dimension the variables used to measure the candidates suitability in this area include
candidates self efficiency, relational skill of the candidates, perceptual skills of the candidates, job skills,
stress reduction skills
Non work dimensions the variables to be measured in the dimension include cultural Novelty, host
country’s religions, social, cultural, sociological, historical, political and economic system. adjustment of the
candidate his spouse and family members to this new environment
Job dimension the variables in this dimension include job duties, responsibilities, tasks ,etc. technical
competency, human relations skills at the workplace
Organizational cultural dimension culture of candidate’s previous Organization in his home country,
candidate’s background of working in different organizations with different cultures, candidates ability to
adapt to the new organizations workplaces group norms and expectations
EXPATRIATES
• The employees of global companies mostly work and live in foreign countries and their
family members also live in foreign countries . Employees and their family members
working and living in foreign countries are called expatriates in the foreign country.
• Expatriates are those living or working in a foreign country. The parent country
nationals working in foreign subsidiary and third country nationals are expatriates.
Large number of expatriates normally have adjustment problems with the working
culture of the company, country’s culture, laws of the country etc..
• Some expatriate adjust themselves easily, while some others face severe problems of
adjustments. Such employees about their assignments and return to home country by
terminating their work contracts. Many Indian expatriate employees in Maldives could
not adjust to the culture and return to India before their assignments were completed.
Thus the major problem with expatriates is adjustment in the new international
environment.
EXPATRIATES
• International adjustment the international adjustment is the
degree to which the expatriate feels comfortable living and working in the
host culture. This influences job performance. The expatriate is completely
new to the host country environments, social rules, norms etc..
Expatriates have a strong desire to reduce psychological uncertainty in the
new environment. Psychological uncertainty is also called cultural
shock
• There are four stages
• 1. Honeymoon stage expatriate and his family members are fascinated by
the culture of the host country, the accommodation, transportation
facilities, educational facilities to the children etc. during the early stage of
arrival. This stage last up to 2-3 months period
EXPATRIATES
• 2. Culture shock stage the company takes care of the new arrivals and completely
neglects the previously arrived employee and his family after 3 months. During this
stage the employee has to take care of himself and his family members. Expatriate
gets frustrated confused and unhappy with living and working abroad. His social
relations are disillusioned during this stage. He gets the shock of the existing culture
• 3. Adjustment stage The Expatriate slowly learns the values, norms, behavior of the
people, their culture etc.. He slowly adjust himself to the culture of the foreign
country
• 4. Mastery stage the expatriate after adjusting himself with the culture of the foreign
country can concentrate on working efficiently. He Learns and adopts to the new
environment completely and becomes like a citizen. He behaves and functions like a
citizen at this stage
EXPATRIATES
• Dimensions of the international adjustment
• It has three degrees i.e. adjustment to the Overseas workplace,
adjustment to interacting with the host nationals and adjustment to the
general environment. there are four dimensions of adjustment that is
individual, non-work, job and organization culture
• 1. Individual dimension: It includes skills and capabilities that expatriate
possess. These skills include cross cultural skills. There are three sets of
individual skills:
• (A) Self efficacy skills
• (B) Relational skills
• (C) Perception skills
EXPATRIATES
• (A) Self efficacy skills :the expatriate should have self confidence, self-esteem and
mental hygiene. He should be able to keep mental and social health with a feeling of
being able to control or deal with surprises from the host cultural environment. Areas
of self efficacy are:
• (i) Stress reduction: It include abilities to deal with interpersonal conflict, financial
difficulties, variations in business systems, social alienation, pressure to conform,
loneliness, differences in housing climate etc.. These factors affect the expatriate job
performance. Expatriate should have an ongoing clear strategy to reduce the stress.
• (ii) Technical competence: it is an important factor that determines the degree of
employee adjustment in the foreign country.
• (iii) Reinforcement substitution: this skill involves “replacing activities that bring
pleasure and happiness in the home culture with similar, yet different activities that
exist in the host culture” The common interest would be sports, music, art, dance and
social groups
EXPATRIATES
• (B) Relational skills: It include expatriate’s ability, Desire and tendency to interact,
mix or involve and develop relationships with host nationals. This skills include
• (i) Finding mentors: the expatriates find the host nationals who have similar
interest and can guide them
• (ii) Willingness to communicate : the expatriate should make efforts to learn the
language as a means for familiarizing with the foreign nationals and their culture,
using proverbs, popular song, famous incidents from the history, jokes, information
about religion, sports of the host country, this is also called conversation currency,
this fastens the process of building relation with foreigners
• (C) Perception skills these skills include expatriates Ability to understand the
behavior of the host nationals, their practices, culture etc.. These skills reduce the
degree of psychological uncertainties associated with cross cultural experiences.
The expatriate should not view the host nationals as backward or stupid or
unsophisticated
EXPATRIATES
• Traditional methods:
• Modern methods
graphic rating scale
behaviorally anchored ranking scales
ranking method
assessment centers
paired comparison method
human resource accounting
forced distribution method
Management by objective
check list method
psychological appraisal
essay or free from appraisal
group appraisal
confidential reports
PERFORMANCE APPRAISAL
• Guidelines for performance appraisal: the following guidelines help to solve the
problem of performance appraisal of expatriate employees.
more weight should be given to the rating of the onsite managers appraisal
due to proximity
host country managers should also give the weight age to the culture of the
expatriate employees
due weight should also be given to self appraisal
TRAINING AND DEVELOPMENT
• Participative management
• It is a system of communication and consultation either formal or informal by which
employees of an organization are kept informed about the affairs of the undertaking
and through which they express their opinions ideas suggestions contribute to the
development of alternative solutions evaluate them and help the management in
decision making.