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Mib ihrm

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  • 1.  Human resource management (HRM) is the set of activities directed at attracting, developing, and maintaining the effective workforce necessary to achieve a firm’s objectives. Recruiting and selecting employees, providing training and development, appraising performance, and providing compensation and benefits are all part of HRM.
  • 2. What is IHRM International HRM is the process of procuring, allocating and utilizing human resource in an a global firm. Differences in culture, levels of economic development, and legal systems among countries may force changes in HRM systems
  • 3. The International Human Resource Management Process ©2004 Prentice Hall 20-4 HRM’s Strategic Content Recruitment and Selection Training and Development Performance Appraisal Compensation and Benefits Labor Relations Contribution to Organizational Effectiveness
  • 4. Why International Human Resource Management? Increasing globalization, firms and employees in them moving all over the world. Major problems in international operations because of human resource management The role of HR in International Operations Managing a Multicultural Workforce Developing Managerial Talent in a Global Business Environment
  • 5. Main challenges in IHRM  Different labor laws  Different political climate  Different stage(s) of technological advancement  Different values and attitudes e.g. time, achievement, risk taking  Roles of religion e.g. prayer, taboos, holidays, etc  Educational level attained  Social organizations e.g. social institutions, 7
  • 6. Necessary Skills and Abilities for International Managers Skills and Abilities Necessary to Do The Job •Technical •Functional •Managerial Skills and Abilities Necessary to Work In a Foreign Location •Adaptability •Location-specific skills •Personal characteristics Improved Chances of Succeeding in An International Job Assignment
  • 7. Scope of Internationalization  Size of staffing tasks depends on scope of firm’s international involvement  Export department  International division  Global organization
  • 8. Centralization versus Decentralization of Control  Centralized firms  Favor home country managers  Decentralized firms  Favor host country managers  Most common amongst multi domestic firms
  • 9. Major Areas of IHRM  The management of human resources in global corporations  The management of expatriate employees  The comparison of HRM practices in a variety of different countries
  • 10. Questions for HR professionals • Do we have a strategy for becoming an international firm? • What type of managers will we need to be successful? • How can I find out about the way that HRM is conducted in other countries (laws, trade unions, labor market). • What will be the impact of cultural norms on our HR policies. • How will we choose whether to send expatriates or use local employees. • How do we move people to different locations • How do we manage transfer of knowledge across borders
  • 11. Strategic Significance  The international HRM process involves understanding the strategic context of HRM within the firm’s overall strategy, recruiting and selecting appropriate managerial personnel, providing necessary training and development, assessing performance, providing compensation, and evaluating managerial retention and turnover.
  • 12. International Managerial Staffing Needs  Most firms begin their international expansion with small- scale exporting. Thus, during a firm’s initial foray into foreign markets a home-country citizen, who may or may not have special training in working in foreign markets, usually manages the firm’s international transactions.  Later when the firm establishes an international department, subsidiary managers (usually host country citizens) report to the authority of the international division (usually a home country citizen).  As a firm further expands its operations in a global organization, a team of managers with expertise in the firm’s product lines, necessary functional skills, individual country markets, and the firm’s global strategy is usually assembled.
  • 13. Parent-country Nationals Advantages  Control and co-ordination by HQ is maintained.  Promising managers get international experience.  PCNs may be the best people for the job.  Assurance that the subsidiary will comply with company objectives policies etc. Disadvantages  HCNs promotion opportunities are limited.  Adaptation to host country may take a long time.  PCNs may impose an inappropriate HQ style.  Compensation differences between PCNs and HCNs may cause problems.
  • 14. Host-country Nationals Advantages  No problems with language and culture.  Reduced hiring costs.  No work permits required.  Continuity of management improves since HCNs stay longer in positions.  Govt. policy may force hiring of HCNs.  Promotional opportunities not limited - so higher morale among HCNs. Disadvantages  HQ may have less control over operations.  HCNs may still have limited career opportunities outside the subsidiary.  Hiring HCNs limits opportunities for PCNs to gain overseas experience.  Hiring HCNs may encourage a federation of disintegrated national units rather than one integrated global unit.
  • 15. Third-country Nationals Advantages  Salary and compensation may be lower than for PCNs.  May be more familiar with host country than the PCNs. Disadvantages  Host government may resent TCNs as much as PCNs.  TCNs may not comply with HQ style of management.  TCNs may not want to return after assignment.
  • 16. Complications for IHRM compared to HRM  Firms must decide whether managers will be selected from the home country, from the host country or from third countries.  Training and development in an international firm may be more complex than in a domestic firm.  Compensation systems must be adapted to meet the needs of each country’s labor market.
  • 17. Complications for IHRM compared to HRM  International HR managers face a more complex task than their domestic counterparts because differing cultures, levels of economic development, and legal systems among countries may require companies to adapt their hiring, firing, training, and compensation programs to each country.
  • 18. Major differences between domestic HRM and IHRM  Business activities e.g. taxation, international relocation, expatriate remuneration, performance appraisals, cross- cultural training and repatriation  Increased complexities e.g. currency fluctuations, foreign HR policies and practices, different labor laws  Increased involvement in employee’s personal life e.g. personal taxation, voter registration, housing, children’s education, health, recreation and spouse employment  Complex employee mix – cultural, political, religious, ethical, educational and legal background  Increased risks e.g. emergency exits for serious illness, personal security, kidnapping and terrorism