Chapter 11 International International Human Human Resource Resource Management Management © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Learning Objectives •• Know Know the the basic basic functions functions ofof human human resource resource management management •• Define Define international international human human resource resource management management •• Understand Understand the the difference difference between between international international and and domestic domestic human human resource resource management management •• Know Know the the types types ofof workers workers used used by by multinationals multinationals © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Learning Objectives •• •• •• •• Know Know how how and and when when toto use use expatriate expatriate managers managers Know Know the the skills skills necessary necessary for for aa successful successful expatriate expatriate assignment assignment Understand Understand how how expatriate expatriate managers managers are are compensated compensated and and evaluated evaluated Appreciate Appreciate the the issues issues regarding regarding expatriate expatriate assignments assignments ofof women women managers managers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Learning Objectives •• Know Know what what companies companies can can do toto make make the the expatriate expatriate assignment assignment easier easier for for their their female female expatriates expatriates •• Understand Understand the the relationship relationship between between choice choice ofof aa multinational multinational strategy strategy and and international international human human resource resource management management © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Human Resource Management and Functions •• Human Human resource resource management management (HRM): (HRM): deals deals with with the the overall overall relationship relationship ofof the the employee employee with with the the organization organization •• Recruitment: Recruitment: process process ofof identifying identifying and and attracting attracting qualified qualified people people toto apply apply for for vacant vacant positions positions •• Selection: Selection: process process ofof filling filling vacant vacant positions positions inin the the organization organization © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Basic HRM Functions •• Training Training and and development: development: giving giving employees employees the the knowledge, knowledge, skills, skills, and and abilities abilities toto perform perform successfully successfully •• Performance Performance appraisal: appraisal: system system toto measure measure and and assess assess employees’ employees’work work performance performance •• Compensation: Compensation: organization’s organization’s entire entire reward reward package, package, including including financial financial rewards, rewards, benefits, benefits, and and job job security security •• Labor Labor relations: relations: ongoing ongoing relationship relationship between between an an employer employer and and those those employees employees represented represented by by labor labor organizations organizations © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part International Human Resource Management (IHRM) •• •• All All HRM HRM functions, functions, adapted adapted to to the the international international setting setting Two Two added added complexities complexities compared compared toto domestic domestic HRM HRM Must Must choose choose aa mixture mixture ofof international international employees employees Must Must decide decide the the extent extent ofof adaptation adaptation toto local local conditions conditions © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Types of Employees in Multinational Organizations •• Expatriate: Expatriate: employee employee who who comes comes from from aa different different country country that that isis different different from from the the one one inin which which they they are are working working •• Home Home country country nationals: nationals: expatriate expatriate employees employees who who come come from from the the parent parent firm’s firm’s home home country country •• Third Third country country nationals: nationals: expatriate expatriate workers workers who who come come from from neither neither the the host host nor nor home home country country © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Types of Employees in Multinational Organizations •• Host Host country country nationals: nationals: local local workers workers who who come come from from the the host host country country where where the the unit unit isis located located •• Inpatriate: Inpatriate: employees employees from from foreign foreign countries countries who who work work inin the the country country where where the the parent parent company company isis located located •• Flexpatriates: Flexpatriates: employees employees who who are are sent sent on on frequent frequent but but short-term short-term international international assignments assignments •• International International cadre: cadre: managers managers who who specialize specialize inin international international assignments assignments.Also Also called called “globals” “globals” © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part The Expatriate or the Host Country Manager •• Multinationals Multinationals must must decide decide whether whether toto use use expatriates expatriates or or host host country country nationals nationals •• Need Need toto consider consider some some questions questions Given Given the the firm’s firm’s strategy, strategy, what what isis the the preference preference (host, (host, home, home, or or third third country country national) national) for for the the position? position? © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part International Assignments for Women: Advantages •• •• More More visible visible Excel Excel inin relational relational skills skills © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part International Assignments for Women: Disadvantages •• Face Face the the glass glass ceiling ceiling Isolation Isolation and and loneliness loneliness Constant Constant proving proving ofof themselves, themselves, working working harder harder than than male male •• Need Need toto balance balance work work and and family family responsibilities responsibilities •• Need Need toto worry worry about about accompanying accompanying spouse spouse © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part More Women in the Future? •• •• •• Women Women expatriate expatriate managers managers are are expected expected toto grow grow Acute Acute shortage shortage ofof high-quality high-quality multinational multinational managers managers Increasing Increasing number number ofof women women provide provide role role models models What What companies companies can can do toto ensure ensure success success ofof women: women: •• Provide Provide mentors mentors •• Provide Provide opportunities opportunities for for networking networking with with other other women women •• Identify Identify and and remove remove sources sources ofof barriers barriers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Multinational Strategy and IHRM •• IHRM IHRM orientation: orientation: company’s company’s basic basic tactics tactics and and philosophy philosophy for for coordinating coordinating IHRM IHRM activities activities for for managerial managerial and and technical technical workers workers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Exhibit 11.8a: IHRM Orientation and IHRM Practices for Managers and Technical Workers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Exhibit 11.8b: IHRM Orientation and IHRM Practices for Managers and Technical Workers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Multinational Strategy and IHRM •• Ethnocentric Ethnocentric IHRM: IHRM: all all aspects aspects ofof HRM HRM for for managers managers and and technical technical workers workers tend tend toto follow follow the the parent parent organization’s organization’s home-country home-country HRM HRM practices practices © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Benefits of Ethnocentric IHRM •• Little Little need need toto recruit recruit qualified qualified host host country country nationals nationals for for higher higher management management •• Greater Greater control control and and loyalty loyalty ofof home home country country nationals nationals •• Little Little need need toto train train home home country country nationals nationals •• Key Key decisions decisions centralized centralized © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Costs of Ethnocentric IHRM •• May May limit limit career career development development for for host host country country nationals nationals •• Host Host country country nationals nationals may may never never identify identify with with the the home home company company •• Expatriate Expatriate managers managers are are often often poorly poorly trained trained for for international international assignments assignments and and make make mistakes mistakes © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Regiocentric and Polycentric IHRM •• Regiocentric Regiocentric IHRM: IHRM: region-wide region-wide HRM HRM policies policies are are adopted adopted •• Polycentric Polycentric IHRM: IHRM: firm firm treats treats each each country-level country-level organization organization separately separately for for HRM HRM purposes purposes •• Greater Greater responsiveness responsiveness toto host host country country differences differences © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Benefits of Polycentric and Regiocentric HRM Policies •• •• •• Reduces Reduces training training expenses expenses Fewer Fewer language language and and adjustment adjustment issues issues Lessened Lessened hiring hiring and and relocation relocation costs costs © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Costs of Polycentric and Regiocentric IHRM Policies •• Coordination Coordination problems problems with with headquarters headquarters based based on on cultural, cultural, language, language, and and loyalty loyalty differences differences •• Limited Limited career-path career-path opportunities opportunities for for host host country country and and regional regional managers managers •• Limited Limited international international experiences experiences for for home home country country managers managers © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Global IHRM Orientations •• •• Recruiting Recruiting and and selecting selecting worldwide worldwide Assigning Assigning the the best best managers managers toto international international assignments assignments regardless regardless ofof nationality nationality © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Global IHRM Orientations •• Benefits Benefits Bigger Bigger talent talent pool pool High High international international expertise expertise Development Development ofof transnational transnational organizational organizational cultures cultures •• Costs Costs Difficulty Difficulty inin importing importing managerial managerial and and technical technical employees employees Added Added expense expense © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Conclusion •• When When basic basic HRM HRM practices practices are are applied applied toto aa company’s company’s international international operations, operations, they they become become IHRM IHRM •• Chapter Chapter focused focused on on HRM HRM practices practices for for expatriate expatriate ss •• Expatriates Expatriates present present special special challenges challenges for for MNCs MNCs •• Successful Successful IHRM IHRM aa challenge challenge inin 21 21stst century century •• Globalization Globalization allows allows MNCs MNCs toto hire hire from from worldwide worldwide pool pool •• ItIt isis important important for for multinationals multinationals toto find find ways ways toto properly properly manage manage expatriates expatriates toto benefit benefit from from their their experiences experiences © 2011 Cengage Learning All Rights Reserved May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part ... functions ofof human human resource resource management management •• Define Define international international human human resource resource management management •• Understand Understand the the... and domestic domestic human human resource resource management management •• Know Know the the types types ofof workers workers used used by by multinationals multinationals © 2011 Cengage Learning... posted to a publicly accessible website, in whole or in part Training and Development •• Cross- cultural Cross- cultural training: training: increases increases the the relational relational abilities