International Human Resource Management

International Human Resource Management

1. General functions

   • Managing human resources on global scale
   • Implementing corporate global strategy
     • Ethnocentric staffing approach
       • Values, attitudes practices and priorities of headquarters determine the HR policies and practices
     • Polycentric staffing approach
       • Consideration of local environment when formulating policies and practices on HR area
         • E.g. Managerial positions --> host country employees
     • Regiocentric staffing approach
       • Focus on Region not local. E.g. Region 'Europe'
     • Geocentric/global staffing approach
       • Optimal use of HR, policies developed at headquarters and are consistent (all subsidiaries), no adaption of local/regional concerns.
     • Factors for selecting approach
       • National concerns
         • Legal framework of host country and Political volatility
       • Economic concerns
         • Cost of living in host country
       • Organizational concerns
         • Stage of PLC and internationalization of company
       • Cultural concerns
         • Differences corporate and societal cultures of headquarters and subsidiaries
       • Technological concerns
         • Availability of skilled employees due to technological advances
   • Adopting labor practices to local requirments

2. What and why?

   • The development of human resource capabilities to meet the needs on global scale
   • Major determinant of success in the global environment

3. HRM Areas

   • Recruitment & Selection
     • Recruitment: Process of attracting qualified applicants for available positions
     • Selection: Process of choosing qualified applicants plus ensuring that the skills, knowledge and abilities match the requirements of the positions
   • Classifying employees
     • Parent-Country national (PCN)
     • Host-country national (HCN)
     • Third-country national (TCN)
       • Important for determination of approach
   • Performance evaluation
     • Purposes: Evaluation and Development. Checking the job performance of employee.
     • Evaluation --> Compensation and/or advancement decisions
     • Focus on feedback to improve performance
   • Compensation and benefits
     • Development of uniform salary systems, health insurances, pension funds, vacation and sick pay. Must be competitive to attract and keep qualified employees and must take local market conditions into account but consistency throughout the company as well.
   • Training and development
     • Planning of effective learning processes, organizational development and internal career development. International training programs --> (de)centralized).
   • Labor relations
     • Assisting managers and employees to determine their relationships within the workplace

4. Expatriates

   • Selection
     • Technically competent, Job related competence, ability to adaptation, language skills, knowledge of area/region.
   • Managing
     • Cost of failure
     • Compensation issues
     • Benefits
     • Allowances
     • Incentives
     • Taxes
   • Cultureshock
     • Definition: State of anxiety and disorientation caused by exposure to a new culture/environment
     • Can form a significant barrier in adjustment in performance
     • Phases: Honeymoon > Culture Shock > Adjustment > Mastery
   • Dual-career expatriates
     • Managing and creating policies in order to make the separation of spouse/family easy
   • Repatriation
     • Return of home-country manager. Readjustment with transition strategies.
   • Definition: People living in a foreign country

5. Competitive advantage

   • Era of globalization
   • Technology and capital flow freely across national and cultural boundaries
   • HR critical strategy assets or factor of production which is not easily mobile
   • Free movement of labor
   • Sustained competitive advantage: Recruiting from a global workforce talented personnel who are able to manage technology and knowledge, motivate people in various worldwide subsidiaries and exercise proper leadership and negotiating skills
     • Main barriers: Language differences, cultural preferences and natural propensities to stay and work in country of birth
   • Increasing recruitment of women is one way to ensure continued success in the global work force

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