International

human resource management

Submitted To -

Mrs. Palak MamSubmitted By -

Somitra Upadhyay

MBA 1st Year

What is IHRM?

• IHRM can be defined as set of activities aimed managing

organizational human resources at international level to

achieve organizational objectives and achieve competitive

advantage over competitors at national and international

level.

• IHRM includes typical HRM functions such as recruitment,

selection, training and development, performance appraisal

and dismissal done at international level and additional

activities such as global skills management, expatriate

management and so on.

OBJECTIVES OF IHRM

• Create a local appeal without compromising upon

the global identity.

• Generating awareness of cross cultural sensitivities

among managers globally and hiring of staff across

geographic boundaries.

• Training upon cultures and sensitivities of the host

country.

NEED FOR IHRM

• Managing expatriates

• Globalization has forced HRM to have international

orientation

• Effectively utilise services of people at both the

corporate office and at the foreign plants

FUNCTIONS OF IHRMRECRUITMENT

SELECTION

EXPATRIATES

PERFORMANCE APPRAISAL

TRAINING AND DEVELOPMENT

COMPENSATION

WOMEN IN INTERNATIONAL BUSINESS

DUAL CAREER GROUPS

INTERNATIONAL INDUSTRIAL RELATIONS

TRADE UNIOUNS

PARTICIPATIVE MANAGEMENT

More HR activities

Need for a broader perspective

More involvement in employee personal lives

Changes in emphasis as the workforce mix of expatriates and locals vary

Risk exposure

More external influences

Characteristics of IHRM

6

Pay issues

• Different countries, different currencies

• Gender based pay in Korea, Japan, Indonesia

Health insurance for employees & their families

Overtime working – Korean & Japanese firms

Promotions based on seniority or merit

Need for Broader Perspective

7

Reasons for Growing Interest in IHRM

8

Globalisation of Business

Effective HRM determinant of

success in international business

Movement to network organisations from

traditional hierarchical structures

Significant role in implementation &

control of strategies

STAFFING POLICIES IN IHRM

• Ethnocentric: Here the Key management positions are

filled by the parent country individuals.

• Polycentric: In polycentric staffing policy the host

country nationals manage subsidiaries whereas the

headquarter positions are held by the parent company

nationals.

• Geocentric: In this staffing policy the best and the most

competent individuals hold key positions irrespective of

the nationalities.

Recruitment & Selection

10

Ethnocentric Approach

• Key management positions held by parent-country nationals

• Appropriate during early phases.

Polycentric Approach

• Host-country nationals hired to manage subsidiaries

• Parent-country nationals occupy key positions at corporate HQ.

Geocentric Approach

• Seeks best people for key jobs, irrespective of nationality

• Underlying principle of a global corporation

Regiocentric Approach

• Variation of staffing policy to suit particular geographic areas

• Provides a 'stepping stone' for a firm wishing to move from an ethnocentric or polycentric approach to a geocentric approach

categories of employees can be hired – parent country nationals (PCNs), host country nationals (HCNs) & third country nationals (TCNs)

How It Is Different from Domestic HRM

• Domestic HRM is done at national level and IHRM is done at international level.

• Domestic HRM is concerned with managing employees belonging to one nation and IHRM is concerned with managing employees belonging to many nations (Home country, host country and third country employees)

• Domestic HRM is concerned with managing limited number of HRM activities at national level and IHRM has concerned with managing additional activities such as expatriate management.

• Domestic HRM is less complicated due to less influence from the external environment. IHRM is very complicated as it is affected heavily by external factors such as cultural distance and institutional factors.

ISSUES IN IHRM

• Managing International Assignments

• Employee and Family Adjustments

• Selecting the right person for foreign

assignments

• Culture and Gauge

• Language and Communication

EFFECTIVE IHRM

IMPLEMENTATIONThe following checklist identifies some of the criticaldecisions/actions required in the formulation andimplementation of an effective IHR strategy.

1. As certain the current and intended nature ofinternational operations in the organisation (multi-domestic, international, global or transnational?)

2. Determine the extent to which HR policies andpractices should be standardised or localised inaccordance with overall organisational strategy.

3. Assess the extent to which local cultural, social,political, economic and legal factors will impinge onany attempts to apply standard HR policies ifintegration is a key factor in organisational strategy.

4. Ensure a computerised database of global human

resources is used if integration is desired.

5. Work with the senior management team to identify the

competencies required to achieve global

organisational objectives.

6. Work with national HR and line managers to

formulate IHR policies and practices in the key areas

of sourcing, development and reward which will

embed a transnational mindset in the organisation.

Expatriate Failure

15

Premature return of expatriates to their home country

Reasons

• Inability to adjust to host country culture leads to culture shock

• Personal & emotional problems

• Difficulties with the environment

• Inability to cope with larger international responsibilities

• Other family reasons

THANK YOU