This chapter discusses global human resource management challenges. It covers how cultural, legal, and economic differences between countries affect HRM practices. Some key topics discussed include selecting and training expatriate employees, developing a global HR system, different international staffing policies, compensating expatriates, and characteristics of international labor relations. The chapter provides best practices for implementing a global HR system and improving expatriate assignments through careful selection, training, and benefits packages.

1. © 2008 Prentice Hall, Inc.© 2008 Prentice Hall, Inc.
All rights reserved.All rights reserved.
PowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie Cook
The University of West AlabamaThe University of West Alabama
1
Human ResourceHuman Resource
ManagementManagement
ELEVENTH EDITIONELEVENTH EDITION
G A R Y D E S S L E RG A R Y D E S S L E R
Managing Global Human ResourcesManaging Global Human Resources
ChapterChapter
1717
Part 5 | Employee RelationsPart 5 | Employee Relations

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After studying this chapter, you should be able to:
1.1. List the HR challenges of international business.List the HR challenges of international business.
2.2. Illustrate how intercountry differences affect HRM.Illustrate how intercountry differences affect HRM.
3.3. Discuss the global differences and similarities in HRDiscuss the global differences and similarities in HR
practices.practices.
4.4. Explain five ways to improve international assignmentsExplain five ways to improve international assignments
through selection.through selection.
5.5. Discuss how to train and maintain internationalDiscuss how to train and maintain international
employees.employees.

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HR and the Internationalization of BusinessHR and the Internationalization of Business
• The Global ChallengesThe Global Challenges
 Coordinating market, product, and production plansCoordinating market, product, and production plans
on a worldwide basis.on a worldwide basis.
 Creating organization structures capable ofCreating organization structures capable of
balancing centralized home-office control withbalancing centralized home-office control with
adequate local autonomy.adequate local autonomy.
 Extending HR policies and systems to serviceExtending HR policies and systems to service
staffing needs abroad.staffing needs abroad.

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Intercountry Differences Affecting HRMIntercountry Differences Affecting HRM
International
Human Resource
Management
Cultural
Factors
Legal and Industrial
Relations Factors
Economic
Systems

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Global Differences and SimilaritiesGlobal Differences and Similarities
in HR Practicesin HR Practices
International
Human Resource
Management
Training and
Development
Practices
Use of Pay
Incentives
Purpose of
Performance
Appraisal
Personnel
Selection
Procedure

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How to Implement a Global HR SystemHow to Implement a Global HR System
• Best practices for making a global HR systemBest practices for making a global HR system
more acceptable to local managers:more acceptable to local managers:
1.1. Remembering that global systems are moreRemembering that global systems are more
accepted in truly global organizations.accepted in truly global organizations.
2.2. Investigating pressures to differentiate andInvestigating pressures to differentiate and
determine their legitimacy.determine their legitimacy.
3.3. Working within the context of a strong corporateWorking within the context of a strong corporate
culture is best.culture is best.

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A Global HR System (cont’d)A Global HR System (cont’d)
• Best practices for developing a more effectiveBest practices for developing a more effective
global HR system:global HR system:
 Form global HR networks that make local HRForm global HR networks that make local HR
managers a part of global teams.managers a part of global teams.
 Remember that it’s more important to standardizeRemember that it’s more important to standardize
ends and competencies than specific methods.ends and competencies than specific methods.
• Best practices for implementing the global HRBest practices for implementing the global HR
system:system:
 Remember, “You can’t communicate enough.”Remember, “You can’t communicate enough.”
 Dedicate adequate resources for the global HRDedicate adequate resources for the global HR
effort.effort.

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Staffing the Global Organization (cont’d)Staffing the Global Organization (cont’d)
Ethnocentric
Polycentric
Geocentric
International
Staffing
Policy
Top Management Values

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Staffing the Global Organization (cont’d)Staffing the Global Organization (cont’d)
Inability of Spouse
to Adjust
Inability to Cope
with Overseas
Responsibilities
Lack of
Cultural Skills
Why Expatriate
Assignments
Fail
Personality
Personal
Intentions
Family
Pressures

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Staffing the Global Organization (cont’d)Staffing the Global Organization (cont’d)
Realistic Previews
Careful Screening
Cultural and Language Training
Improved Benefits Packages
Improved Orientation
Helping Expatriate
Assignments Succeed

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Selecting Expatriate ManagersSelecting Expatriate Managers
• Adaptability ScreeningAdaptability Screening
 Assessing the assignee’s (and spouse’s) probableAssessing the assignee’s (and spouse’s) probable
success in handling the foreign transfer.success in handling the foreign transfer.
 Overseas Assignment InventoryOverseas Assignment Inventory
 A test that identifies the characteristics and attitudesA test that identifies the characteristics and attitudes
international assignment candidates should have.international assignment candidates should have.
• Realistic PreviewsRealistic Previews
 The problems to expect in the new job, as well as theThe problems to expect in the new job, as well as the
cultural benefits, problems, and idiosyncrasies of thecultural benefits, problems, and idiosyncrasies of the
country.country.

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Compensating ExpatriatesCompensating Expatriates
• The “Balance Sheet Approach”The “Balance Sheet Approach”
 Home-country groups of expenses—income taxes,Home-country groups of expenses—income taxes,
housing, goods and services, and discretionaryhousing, goods and services, and discretionary
expenses—are the focus of attention.expenses—are the focus of attention.
 The employer estimates what each of these fourThe employer estimates what each of these four
expenses is in the expatriate’s home country, andexpenses is in the expatriate’s home country, and
what each will be in the host country.what each will be in the host country.
 The employer then pays any differences such asThe employer then pays any differences such as
additional income taxes or housing expenses.additional income taxes or housing expenses.

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International Labor RelationsInternational Labor Relations
Industry-Wide
Centralization
Content and
Scope of
Bargaining
Employer
Organization
Multiple Union
Recognition
Characteristics of
European Labor
Relations

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K E Y T E R M S
codeterminationcodetermination
expatriates (expats)expatriates (expats)
home-country nationalshome-country nationals
third-country nationalsthird-country nationals
offshoringoffshoring
ethnocentricethnocentric
polycentricpolycentric
geocentricgeocentric
adaptability screeningadaptability screening
foreign service premiumsforeign service premiums
hardship allowanceshardship allowances
mobility premiumsmobility premiums