International HRM Introduction

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International HRMMessiah College

January 22, 2014


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attribution

Attribution in this presentation: all figures come

from Peter J. Dowling, a.o., International HumanResource Management , South-Western Cencage

Learning, 2008, ISBN 978-1-84480-542-6, unless

mentioned otherwise.


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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


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A definition of IHRM

“We define the field of IHRM broadly to cover all

issues related to the management of people in

an international context. Hence our definition

of IHRM covers a wide range of human resource

issues facing MNC’s in different parts of their

organizations. Additionally, we include

comparative analyses of HRM in differentcountries.”

Stahl and Bjorkman, page 5, Chapter 1.


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expatriate

management


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Terms

NAFTA

UNCTAD

MNE

culture shock

emi-etic distinction

HRM

IHRM

HCN

PCN

TCN

expatriate

inpatriate


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Inter-relationships between

approaches to a field


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Defining HRM

An organization’s HRM activities include:

1. Human resource planning

2. Staffing (recruitment, selection, out-placement)

3. Performance management

4. Training and development

5. Compensation (remuneration) and benefits

6. Industrial relations


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Human resource planning


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Recruitment & Selection


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Performance management


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Renumeration


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Training & Development


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Differences between domestic HRM

and IHRM

The complexity of IHRM can be attributed to six

factors:

1. More HR activities

2. The need for a broader perspective

3. Move involvement in employees’ personal lives

4. Changes in emphasis as the workforce mix ofexpatriates and locals varies

5. Risk exposure

6. Broader external influences


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from SWOT to Strategy

Implementation of Strategy

• corporate governance

• organizational structure

• coordination and control

• leadership

•

entrepreneurship• innovation

• change and sustainability


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approach and focus

• Suitability, does the strategy address the key

issues?

• Acceptability, will the strategy achieve an

acceptable return, reasonable level

of risks?

• Feasibility, can the strategy be pursued within

the resources, capabilities and

competences of the organization?


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opportunities international strategy


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Internationalization causes

differences in costs/risks

• Exporting high cost and low risk

• Licensing low costs and high risk

• Strategic alliances shared costs and sharedrisks, but having problems of integration andtherefore control

• Acquisitions rapid, high cost and high risk

• The establishment of a new subsidiary alsohigh cost and high risk, greater opportunity for

management control and above average

returns


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Determinants of national advantage

• Factor conditions labor, land, naturalresources, financial capital, infrastructure

• Demand conditions demand for basic and

advanced goods and services in the home market• Related and supported industries important

networks of suppliers, buyers, services

•Firm’s strategy, structure and rivalry someplaces in different countries are the location of

choice for particular industries, products,services


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viability of the firm


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framework for thinking flexibly about

culture

• Unitary and unique organizational culture

• Organizations as meetings points of ‘fields’ of

culture

• Local subcultures

• Ambiguous cultural configurations

•

Integration

consistency and consensus• Differentiation variation and sub-culture

conflict

• Fragmentation ambiguity, inconsistency and

fluctuation


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knowledge strategies


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four knowledge management

strategies

• Leveraging communicate and transfer existingknowledge within the organization

• Expanding create and build on existingknowledge

• Appropriate strategy take new knowledgefrom external individuals andorganizations and transfer this into

your organization• Probing strategy create new, propriatory

knowledge from your internalorganizational resources


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A model of the variables that moderate differences

between domestic and international HRM


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Variables that moderate differences

between domestic and international HRM

1. The complexity involved in operating in

different countries and employing different

national categories of employees

2. The cultural environment

3. The industry (or industries) with which the

MNE is primarily involved

4. The extent of reliance of the MNE on its

home-country domestic market

5. The attitudes of senior management


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Strategic HRM in multinational

enterprises


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truly international HRM require following steps

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.


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Discussion Questions

1. What are the main similarities and differencesbetween 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 domesticenvironment.

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


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The end

International HRM Introduction

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