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1. Sample Essay on Human Resource
Management Practices
Similarities between the Domestic and International HRM
Human Resource Management, in different kinds of organizations plays
a very crucial role (Sims, 2007). As a matter of fact, it is the center of
corporate strategy. This is attributed to the fact it helps companies
make performance improvements and form sustainable competitive
advantages. What is more, it helps organizations have guiding role,
especially with enterprise management.
General HRM is a term used to refer to activities undertaken by
organizations for purposes of proper utilization of human resources. As
such, international and domestic HRM have some similarities in how
they function. This means all basic functions of these two are the same,
regardless of whether they are definite in one country or in several.
Such functions include utilization, motivation, procurement and
allocation. What is more, both the domestic and international HRM
have some major functions and activities in HR recruitment,
performance management, training, industrial relations, development
and compensation.
Another similarity is related to environmental forces, which greatly
influence functions of HRM. Some of the external constraints include
legal, economic, cultural and political. The impact these have on the
manner in which HR functions are carried out in both the global and
domestic environment (Sims, 2007).
What is more, both the international and domestic HRM have the same
objectives. One of these objectives is that of making sure the
organization has maximum satisfaction in as far as the demands for
human resource are concerned. Another major objective is making sure

2. the organization enjoys the highest level of effectiveness. This can be
attained through interventions. The other HRM objective is to promote
sustainable development of firms. This can be attained through
maximizing development of internal and external human resource
management.
Differences between the Domestic and International HRM Practices
Differences between the international and domestic HRM are very
striking compared to similarities. So far as globalization goes, HRM
activities are quite different from domestic operations. Reason for this
is that Domestic HRM deals with employees from one nation only.
International HRM on the other hand deals with operations across
national boundaries. Due to this, the national patterns of domestic
HRM are quite different from one nation to another. This is due to HRM
factors coupled by institution, business structure, culture and
competence. As such, differences refer to the manner they complete
administrative functions in different environments (Sims, 2007).
Literature regarding HRM is plenty and indicated the differences
between domestic and international HRM. Among the major
distinctions in HRM comes essentially from interconnections among
cultures and structure of specific societies.
The distinction between International HRM and domestic HRM is based
on core activities. Some of these activities include development and
training, recruitment and selection, expatriate management,
performance management and rewards. Some of these activities need
cultural sensitivity so as to make IHRM effective in cross-cultural
management.
So as to understand differences above better, International HRM is
defined as interaction to some dimension. These include Countries of
Operation, HR Activities and the Type of Employees. Therefore, it can
be pointed out the important variable that differentiates international

3. HRM from domestic HRM is mostly the complexity to operate in
different countries and employ different national employee’s
categories. This is quite different from major differences between HRM
activities performed
Standardization of HRM Practices
Standardization of MNE is defined as standardization of overseas
subsidiaries’ management practices towards HQ practices. Some of the
factors include organizational context, context of host country and
strategic issues.
The organizational context includes strategy and firm structure, the size
and maturity of firm as well as operation mode that is used. It as well
includes relative significance of a particular subsidiary. The size of the
firm in relation to MNE has impact on HRM practices. Closely linked to
the size of the firm is the level of international experience.
A multinational firm, under strategic issues operates within the
framework of worldwide conditions. Some of these conditions include
external situations of religion, nation, inter-organizational networks
and alliances as well as industry. Apart from the factors that influence
international HRM strategy and the practice, they also have great
influence on MNE goals.
Usually, factors that drive standardization are related. Mostly, they
revolve around the environment host. Therefore, it is crucial to have an
understanding of the host’s culture. This, is yet another driving force for
standardization. Work behavior as well is culturally determined. It is
contained in role definition and the expectations. It is supposed to be
clearly stated if corporate culture can supplant or succeed other
cultures. This however, is usually a subject that draws great debate.
Often, what is meant by corporate culture of often translated to
common practices instead of common values.

4. Three cultures that interact in order to influence standardization and
adaptation include national culture in parent company, the national
culture in subsidiary unit and corporate culture. The corporate culture
serves as the delicate informal control mechanism. Additionally, it also
serves as potential unifier. Standardization process can be attained
through practices of HR which include staffing procedures and the
criteria as well as training and development programs, staff rotation,
the appraisal systems and corporate conduct code.
Research shows that cultures and the institutional context have great
impact on HRM practices. Existing research presents evidence that
MNEs can to a certain degree, adapt to national cultures where they
operate. Additionally, subsidiaries that are consistently managed with
national cultural experiences have been discovered to perform far
better when compared to subsidiaries otherwise management.
The purpose of global standardization of HRM is reaching transparency,
consistency and alignment of workforces that are geographically
fragmented around common principles and objectives. Therefore, it is
advantageous for MNE to adopt global corporate culture for each its
subsidiaries. This will make it possible for organizations to realize goals,
as it avoids cultural clashes.
The Role of Subsidiaries
In the MNEs subsidiaries plays a very crucial role. Among the major
roles of these subsidiaries includes specifying positions of specific units.
This can be carried out in accordance to how the units related to the
rest of the selected organization (Kretshcmer, 2008). Additionally, they
are often expected to perform the contributions. Apart from this, it is
crucial to note that subsidiaries vary in the manner they function,
power and resource relationships as well as initiative taking. They
always carry out their functions in host-country environment. The
position that is held by a particular subsidiary in a global family is quite

5. a crucial aspect. This is especially true in the course of discussions on
the transfer of work practices (Kretschemer, 2008).
The Global Innovators
The Global Innovator (GI) subsidiary is fountainhead of knowledge for
other units (Morgan, Kristensen, & Whitley, 2001). The role of the
subsidiary has become quite important as the MNCs move towards
transnational model through which individual subsidiaries act as the
center-of-excellence for specific product lines.
The Integrated Player
Integrated Players (IP) also take part in transfer of knowledge to other
organization units but at some point they are at receiving end of
knowledge flow from other units. Consequently, this kind of subsidiary
is a crucial node in MNC network.
The Implementers
Subsidiaries with an implementer (IM) role do not engage in extensive
creation of knowledge and as such, they provide little knowledge to
other organizational units. They are also heavily dependent on
knowledge inflows from either headquarters or other subsidiaries.
The Local Innovators
Local innovators (LI) are subsidiaries that are self-standing, they do not
engage in creation of knowledge, but they never transfer the
knowledge to other units in the organization nor do they receive
knowledge from them. Typically, this state of affair occurs whenever
knowledge is seen as idiosyncratic to be of any use in other units of the
organization.
Every company has its own role to play. This, however, will depend on
the company status among other factors. The best role any company
can play that is starting to expand internationally is that of Local

6. Innovators. This is attributed to the fact they have great knowledge
regarding the local. The fact they do not need to transfer the
knowledge to other units is an advantage in this instance.
Localization of HRM Practices
Expatriates localization has become increasingly familiar in recent days.
This has proven too much as the companies need to reduce the number
of assignees and control costs as well. There are a couple of factors that
drive localization of HRM practices. These include factors of
institutional environment, subsidiary roles, mode of operation abroad
and cultural environment (Kretschemer, 2008). Majorly, localization is
based on culture of the region where the subsidiary company is
situated. This is attributed to culture of that specific region which
always defines activities of the individuals concerned. As such, it is
crucial to consider the expected role of the subsidiaries before settling
on localization.
Localization appears to be the appropriate answer to majority of
problems that are associated with HRM practices. Majority of people
have great belief in localization as compared to standardization. As a
matter of fact, the future of multinational companies is currently based
on staffing at different levels with local employees. This is attribute to
the fact localization is always based on equality motions in opportunity
and fairness.
The prime reason behind why most companies prefer to move towards
localization is cost savings. Though cost savings are a result, they
typically other reasons as to why companies should consider
localization in the first place. Often, it aligns the terms of employment
with business purpose.
Another reason companies prefer localization is to improve equity
among peers in the country of assignment. This is especially applicable
when temporary assignees have the same role as local employees.

7. Integration with the local culture and the business practices, along
these line can be the reason for and result for localization and can be
beneficial to a company in the face of globalization.
The Impact of the Culture and Institutional Context
HRM practices, just as majority of management practices are based on
cultural beliefs, which are a reflection of the basic assumptions and the
values of national culture in which organizations are embedded. This
then leads to the question of what takes place in case the MNEs are
interested in transferring some of their HRM practices overseas,
especially in instances when assumptions underlying such practices do
not fit with cultures of recipient-host countries. Failing to adapt HR
practices to the host-country culture leads to negative results that can
hinder performance of the subsidiary.
Some of the effects are as explained below:
Impact on the Recruitment and Selection
Always, recruitment plays a crucial role in HRM. In the environment,
the importance of finding the appropriate individual for a job cannot be
overly emphasized. This is due to the fact the decision of appointing an
individual is one of the most crucial decisions employers make
(Morgan, Kristensen & Whitley, 2001). Selections decisions while
dealing with MNE should not be based on ethnic or tribal lines. The new
environment challenges traditional approach to selection and
recruitment.
Impact on Training and Development
There is a need to continually develop and train the workforce. This is
meant for purposes of achieving competitive advantage. Training
makes sure the employees develop appropriate skills, knowledge and
attitudes that make it possible for them to carry out their jobs

8. efficiently and effectively. Employees from varying cultures require a
different kind of training. As such, the HRM is supposed to come up
with programs that suit their employees best in their specific culture
and environments. In turn, this will raise the costs involved.
Impact on Compensation
Wages do provide sources of motivation for different employees. In
turn, this makes it possible for them to effectively perform. The amount
and the nature of compensation is greatly determined by the culture
and the environment of the employees. Globalization results to free
labor mobility. Due to this, people from different culture interact freely.
This however has great impact on HRM, especially when it comes to
matters of compensation. International companies as well can
advertise through the Internet as well as recruit employees from across
borders.
Impact on Task Distribution
The participation of employees tends to enhance their contributions
despite their environment or culture. As a matter of fact, there are
different techniques of employee involvement. These might include
joint consultation, suggestion schemes and quality circles (Morgan,
Kristensen &Whitley, 2001).
Managers as well are supposed to have a vision. They are supposed to
always have an understanding of what’s expected of them. Due to their
Cultural Differences and complexity, the managers are supposed to be
trained in a manner that enables them to think in a global manner but
act locally. Additionally, there is supposed to be people succession for
management. The ability of any organization to attain its business
strategies in light of critical factors of success for the business are
dependent largely on capability of the managers as developed in an
organization in order to meet specific circumstances and demands.
Some of these include quality leadership and innovation etc.

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10. References
Kretschmer, K. (2008). Performance evaluation of foreign
subsidiaries (1. Aufl. ed.). Wiesbaden: Gabler Edition Wissenschaft.
Morgan, G., Kristensen, P. H., & Whitley, R. (2001). The multinational
firm: organizing across institutional and national divides. Oxford:
Oxford University Press.
Sims, R. R. (2007). Human resource management: contemporary issues,
challenges, and opportunities. Charlotte, N.C.: Information Age Pub..
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