Global human resource management


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Global human resource management

  2. 2. PURPOSE OF THIS CLASSPURPOSE OF THIS CLASS To understand the management of global human capital To understand the role of the global human resource function To begin pre-preparation for your international experience To begin the process of “writing a thesis”
  3. 3. RANK COUNTRY POPULATION % OF WORLD POPULATION - World 6.7 billion 100% 1 People’s Republic Of China 1.3 billion 19.9% 2 India 1.1 billion 17.04% 3 United States .3 billion 4.57% 4 Indonesia .2 billion 3.47% 5 Brazil .18 billion 3.81% 6 Pakistan .16 billion 2.46%
  4. 4. FACTS For PUBLICLYFACTS For PUBLICLY TRADEDTRADED • 60,000 MNE’s employ over than 45mm people60,000 MNE’s employ over than 45mm people • By 2010 this will increase to 75mmBy 2010 this will increase to 75mm • In 1957 US contributed 53% to global GDP – today 18%In 1957 US contributed 53% to global GDP – today 18% • In 2003 25 countries employed 40mm people with a totalIn 2003 25 countries employed 40mm people with a total of USD 13.73 trillion in annual revenues and USD 45of USD 13.73 trillion in annual revenues and USD 45 trillion in assetstrillion in assets • Key players besides US, Germany, Great Britain, FranceKey players besides US, Germany, Great Britain, France and Japan is; south Korea, Mexico, Russia, China, Braziland Japan is; south Korea, Mexico, Russia, China, Brazil
  5. 5. OTHERSOTHERS • Some of the largest international firms areSome of the largest international firms are owned by families, especially in China,owned by families, especially in China, Taiwan, Thailand, Hong Kong, Indonesia,Taiwan, Thailand, Hong Kong, Indonesia, Malaysia and SingaporeMalaysia and Singapore • Growing numbers of Small MultinationalsGrowing numbers of Small Multinationals (SME’s)(SME’s) – In Germany there are 350 SME’s thatIn Germany there are 350 SME’s that dominate their market nichedominate their market niche
  6. 6. DRIVERS FORDRIVERS FOR GLOBALIZATIONGLOBALIZATION • Scale EconomiesScale Economies • Scope EconomiesScope Economies • Shorter Product Life CyclesShorter Product Life Cycles • Direct Foreign InvestmentDirect Foreign Investment • TechnologyTechnology
  7. 7. RATIONALE FOR GLOBAL HRMRATIONALE FOR GLOBAL HRM • Increased travelIncreased travel • Rapid and extensive globalRapid and extensive global communicationscommunications • Rapid transfer of new technologyRapid transfer of new technology • Growing trade, foreign competitionGrowing trade, foreign competition • Improving educationImproving education • Emigration of large numbers of peopleEmigration of large numbers of people
  8. 8. Porter’s Diamond (Adapted from Porter:1990) Firm Strategy, Structure and Rivalry Factor Endowments Demand Conditions Related and Supporting Industries COMPETITIVE ADVANTAGE OF NATIONS
  9. 9. TRENDS IN THE INTERNATIONALTRENDS IN THE INTERNATIONAL DIVISION OF LABOR- Reich’s New WorldDIVISION OF LABOR- Reich’s New World OrderOrder • Routine ProductionRoutine Production ServicesServices • In-person ServicesIn-person Services • Symbolic AnalyticSymbolic Analytic ServicesServices • Zero-sum NationalismZero-sum Nationalism • CosmopolitanismCosmopolitanism • Positive EconomicPositive Economic NationalismNationalism
  10. 10. Routine production servicesRoutine production services Routine production as an employee on an assembly line or supervisory jobs or clerical jobs involving repetitive checks on employees and enforcement of standard operating procedures
  11. 11. In person servicesIn person services Simple repetitive tasks with little training providing services directly to the consumer, e.g. salespersons, hairdressers, waiters, cleaning staff, receptionists, etc.
  12. 12. Symbolic-analytic servicesSymbolic-analytic services These jobs require skills in problem solving and problem identification, e.g. engineers, architects, managers, research scientists, etc.
  13. 13. Zero sum nationalismZero sum nationalism “ The assumption that there are only two outcomes possible in economic warfare: either we win or they win, so we had better make sure that we win. Countries therefore close their eyes to globalization and try to protect and improve their own position. Government subsidies for deteriorating industries and a renewed interest in protectionism are the hallmarks of this scenario.
  14. 14. CosmopolitanismCosmopolitanism The ideal of free trade is championed. This is not a zero sum game: the world as a whole can improve Through free trade. By making products where they can be made most cheaply, we all benefit in the end. Reich maintains this is the attitude that will most likely determine the future.
  15. 15. Positive economic nationalismPositive economic nationalism Each nations citizens take primary responsibility for enhancing the capabilities of their countrymen for full and productive lives, but also work with other nationals to ensure that these improvements do not come at others’ expense. This argument provides for free trade with some form of government intervention
  16. 16. What is Human ResourceWhat is Human Resource ManagementManagement As a field it is about: the understanding, researching, applying and revising all human resource activities in their internal and external contexts as they impact the process of managing human resources in enterprises throughout the global environment to enhance the experience of multiple stakeholders, including investors, customers, employees, partners, suppliers, environment, and society.
  17. 17. Forms of International HRMForms of International HRM • Operation of parent-country firmsOperation of parent-country firms • Operation of foreign firms in the homeOperation of foreign firms in the home countrycountry • Operation of Third party nationalsOperation of Third party nationals • Employment of foreign citizens (or recentEmployment of foreign citizens (or recent immigrants and/or their familiesimmigrants and/or their families
  18. 18. DIFFERENCES BETWEENDIFFERENCES BETWEEN DOMESTIC AND INTERNATIONALDOMESTIC AND INTERNATIONAL HRMHRM • Responsibility for greater number of activitiesResponsibility for greater number of activities • Need for greater level of expertiseNeed for greater level of expertise – e.g. employment lawse.g. employment laws • Necessity for closer involvement with employees (e.g.Necessity for closer involvement with employees (e.g. expatriate familiesexpatriate families • Greatly expanded and different mix of employeesGreatly expanded and different mix of employees • Having to deal with more external influencesHaving to deal with more external influences • Having to face greater exposure to problems andHaving to face greater exposure to problems and difficultiesdifficulties