An important and upcoming business management function - International Human Resources Management. This presentation gives an birds eye view on the various dimensions of IHRM

1. INTERNATIONAL HUMAN
RESOURCE MANAGEMENT

2. 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

3. Myths about globalization
 Myth #1: Global = International
 Myth #2: Global strategy means doing same
thing everywhere
 Myth #3: Globalizing = stateless corporation, no
national/community ties
 Myth #4: Globalization requires abandoning
country images and values
 Myth #5: Globalizing means tackling on
acquisitions or alliances in other countries,
without much integration/change
 Myth #6: A strategy must involves
sales/operations in another country

4. Strategies of international, multinational,
global & transnational organizations
 International company – transports its business
outside home country; each of its operations is a
replication of the company's domestic
experience; structured geographically; and
involves subsidiary general managers
 Companies offering multiple products often find
it challenging to remain organized e.g. need to
have a common information systems for
accounting, financial and management controls,
and marketing. Most evolve to become
multinational companies

5. Strategies of international, multinational,
global & transnational organizations
 Multinational company – grows and defines its
business on a worldwide basis, but continues to
allocate its resources among national or regional
areas to maximize the total.

6. Strategies of international, multinational,
global & transnational organizations
 Global organizations – treat the entire
world as though it were one large country;
may be the entire company or one or
more of its product lines; may operate
with a mixture of two or more
organizational structure simultaneously.

7. Strategies of international, multinational,
global & transnational organizations
 Transnational organization - Use
specialized facilities to permit local
responsiveness; more complex
coordination mechanism to provide global
integration

8. Global efficiency and local responsiveness
of different types of firms
Global Transnational
International Multinational
Global
Efficiency
High
Low
High
Local Responsiveness

9. IHRM - a shift in thinking
Laurent (1986)
 Explicit recognition by parent org of the
existence of assumptions and values of
home & host cultures
 Explicit recognition by parent org –
ethnocentrism is neither good/bad, has
strengths and weaknesses
 Explicit recognition of subsidiaries’
preferences – which may be different

10. IHRM - a shift in thinking
Laurent (1986)
 Willingness to acknowledge cultural
difference – discuss and learn
 Genuine belief in creative and effective
ways of managing people through cross-
cultural training/learning

11. Important lessons for global firms
 The need to manage change
 The need to respect local cultures
 The need to understand a corporation’s
culture
 The need to be flexible
 The need to learn

12. Main challenges in IHRM
 High failure rates of expatriation and repatriation
 Deployment – getting the right mix of skills in
the organization regardless of geographical
location
 Knowledge and innovation dissemination –
managing critical knowledge and speed of
information flow
 Talent identification and development – identify
capable people who are able to function
effectively
 Barriers to women in IHRM
 International ethics
 Language (e.g. spoken, written, body)

13. 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. sacred objects, prayer,
taboos, holidays, etc
 Educational level attained
 Social organizations e.g. social institutions,
authority structures, interest groups, status
systems

14. Strategies for managing a global
workforce
(1) Implement the aspatial career strategy
 Get people from everywhere (geocentric approach)
 Expats work in multiple countries during the course of
their career
 Gain a lot of knowledge about different cultures &
operations
 Develops in-depth knowledge
 Use previous knowledge for new assignment
 Extremely high cost
 Mainly managers, not technicians

15. Strategies for managing a global
workforce
(2) Implement the awareness-building assignment
strategy
 Expose a candidate to cultural training exercises
 Usually for short term (3 months to one year)
 Family members usually not required to relocate
 Usually used to train candidates for future
assignments
 Learn from foreign assignment and bring experience
back to HQ

16. Strategies for managing a global
workforce
(3) Implement the SWAT team strategy
 Highly mobile teams for short term
assignments
 Deployed throughout the organization to
different parts of the world
 No development agenda, plain
troubleshooting
 Transfer technical knowledge to locals as they
fix problems
 E.g. technical troubleshooters

17. Strategies for managing a global
workforce
(4) Implement the virtual solutions strategy
 Collection of practices that exploit electronic
communication
 E.g. internet, intranet, videoconferencing,
electronic databases, email, electronic expert
systems
 Low cost and very fast in terms of
disseminating knowledge
 Used by Xerox and Ford

18. Key learning themes
 Understand the main differences
between domestic HRM and
international HRM
 Able to demystify globalization
 Understand strategies adopted by
international, multinational, global
and transnational organizations
 Important lessons to be learnt by
global firms
 Understand the
difficulties/challenges in IHRM
 Strategies for managing a global
workforce