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International Human Resource Management
By
Gaurav Jain
INTERNATIONAL HUMAN RESOURCE
MANAGEMENT
• Simple definition is ‘the process of managing people in
international settings’
• Scyllion (1995) defined IHRM as ‘the HRM issues and
problems arising from the internationalization of business, and
the HRM strategies, policies and practices which firms pursue
in response to the internationalization process
• IHRM is the management of HR in business operations in
atleast two nations
DIFFERENCES BETWEEN IHRM & DOMESTIC HRM
IHRM Domestic HRM
• Address a broad range of
HRM activities
• HR issues relate to
employees belonging to more
than one nationality
• Greater involvement of HR
manager in the personal life of
employees
• Address a narrow range of
HRM activities
• HR issues relate to employees
belonging to single nationality
• Limited involvement of HR
manager in the personal life of
employees
IHRM Practices
• International staffing
• Pre-departure training for international assignments
• Repatriation
• Performance management in international assignments
• Compensation issues in international assignments
International staffing
• refers to the process of selecting employees for staffing
international operations of an MNC
MNCs can be staffed using three different sources
a. Home country or Parent Country National (PCN)
b. Host Country Nationals (HCN)
c. Third Country Nationals (TCN)
• PCN
Employees of an organization who are citizens of the country in
which the headquarters of the company is located
• HCN
Employees of an organization who are the citizens of the country
in which the foreign subsidiary is located
• TCN
Employees of an organization who are the citizens of the country
other than the country where the organization is headquarterd and
the country that is hosting the subsidiary
Approaches to staffing subsidiaries
• Ethnocentric
foreign subsidiary has little autonomy. All strategic decisions are made at the
headquarters. PCNs staff key positions at quarters as well as the foreign
subsidiary
• Polycentric
staff foreign subsidiaries of the firm with HCNs and headquarters consist of
PCNs
• Geocentric
staff my be PCNs, HCNs or TCNs ability and not nationality is the key to
staffing
Pre-departure Training for International Assignments
•To make it easier for the employee to assume job responsibilities
and be effective in the foreign country as soon as possible
• To facilitate cultural adaptation as quickly and as effectively as
possible
3 elements of T&D programme
1.Language training
2.Cultural training
3.Managing personal and family life
Performance Management in International
Assignments
Performance is the combination of several factors
Compensation Package
Task Assigned to the Expatriate
Headquarter’s Support
Environment
Cultural Adjustment
Compensating Managers in International
Assignments
Components of expatriate compensation
• Home leave and travel allowances
• Children’s education allowance
• Currency differential payments
• Relocation allowance
• Housing allowance
• Cost of living adjustment
• Payments to protect from negative tax consequences
IHRM

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IHRM

  • 1. International Human Resource Management By Gaurav Jain
  • 2. INTERNATIONAL HUMAN RESOURCE MANAGEMENT • Simple definition is ‘the process of managing people in international settings’ • Scyllion (1995) defined IHRM as ‘the HRM issues and problems arising from the internationalization of business, and the HRM strategies, policies and practices which firms pursue in response to the internationalization process • IHRM is the management of HR in business operations in atleast two nations
  • 3. DIFFERENCES BETWEEN IHRM & DOMESTIC HRM IHRM Domestic HRM • Address a broad range of HRM activities • HR issues relate to employees belonging to more than one nationality • Greater involvement of HR manager in the personal life of employees • Address a narrow range of HRM activities • HR issues relate to employees belonging to single nationality • Limited involvement of HR manager in the personal life of employees
  • 4. IHRM Practices • International staffing • Pre-departure training for international assignments • Repatriation • Performance management in international assignments • Compensation issues in international assignments
  • 5. International staffing • refers to the process of selecting employees for staffing international operations of an MNC MNCs can be staffed using three different sources a. Home country or Parent Country National (PCN) b. Host Country Nationals (HCN) c. Third Country Nationals (TCN)
  • 6. • PCN Employees of an organization who are citizens of the country in which the headquarters of the company is located • HCN Employees of an organization who are the citizens of the country in which the foreign subsidiary is located • TCN Employees of an organization who are the citizens of the country other than the country where the organization is headquarterd and the country that is hosting the subsidiary
  • 7. Approaches to staffing subsidiaries • Ethnocentric foreign subsidiary has little autonomy. All strategic decisions are made at the headquarters. PCNs staff key positions at quarters as well as the foreign subsidiary • Polycentric staff foreign subsidiaries of the firm with HCNs and headquarters consist of PCNs • Geocentric staff my be PCNs, HCNs or TCNs ability and not nationality is the key to staffing
  • 8. Pre-departure Training for International Assignments •To make it easier for the employee to assume job responsibilities and be effective in the foreign country as soon as possible • To facilitate cultural adaptation as quickly and as effectively as possible
  • 9. 3 elements of T&D programme 1.Language training 2.Cultural training 3.Managing personal and family life
  • 10. Performance Management in International Assignments Performance is the combination of several factors Compensation Package Task Assigned to the Expatriate Headquarter’s Support Environment Cultural Adjustment
  • 11. Compensating Managers in International Assignments Components of expatriate compensation • Home leave and travel allowances • Children’s education allowance • Currency differential payments • Relocation allowance • Housing allowance • Cost of living adjustment • Payments to protect from negative tax consequences