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International Human Resource Management: MGMT414 Assoc. Prof. Dr. Cem Tanova
International Human Resource Management: MGMT414 Assoc. Prof. Dr. Cem Tanova
Resource Management
MGMT414
Assoc. Prof. Dr. Cem Tanova
1. French, Bic;
2. Godiva chocolate is
3. Algidas owner is
2. American, Campbell
Soup;
3. Anglo-Dutch, Unilever
4. British, Grand
Metropolitan;
5. Firestone (Bridgestone)
tires are
6. RCA televisions are
made by a(n) company
5. Japanese, Bridgestone
Corp;
6. French, Thompson;
Introduction to International
Human Resource Management
How the world is changing,
Importance of globalization,
IHRM as a key factor in the success
of international business.
An overview of domestic HRM and
discussion on what is different in
IHRM.
Questions to consider
What are the key elements of best
practice in HRM?
Can the best practices be applied on
a global level?
To what extent are the principles of
managing people universal and to
what extent culture specific?
Transport/communication barriers
Rising protectionism
- Homeogeniziing markets
- Improved transport, communications
Irwin/McGraw-Hill
MULTI-NATIONAL PERSPECTIVE
-
GLOBAL PERSPECTIVE
- GROWING CONCERN ABOUT INTERNATIONAL COMPETITION AND
INEFFICIENCIES
OF MULTI-NATIONAL RESPONSE
-
AND
TRANS-NATIONAL PERSPECTIVE
-
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
Copyright 2003-2006, Chris Chan
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.
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.
Copyright 2003-2006, Chris Chan
10
Strategies of international,
multinational, global &
transnational organizations
Transnational organization - Use
specialized facilities to permit local
responsiveness; more complex
coordination mechanism to provide
global integration
11
High
Global
efficiency
Low
Global
Transnational
International
Multinational
Local responsiveness
High
12
TransNational
Global
Global
Coordination
Integration
International
Low
Low
Irwin/McGraw-Hill
National differentiation,
Responsiveness
MultiNational
High
TOYOTA
- DRIVEN BY
SCALE AND
TECHNOLOGY
- REINFORCED
BY GLOBAL
COMPETITION
G.M
- DRIVEN BY SCOPE
AND MARKETS
Irwin/McGraw-Hill
- REINFORCED BY
GOVERNMENTS
FIAT
Key Trends
63,000 transnational companies account
for more than half (2/3) of world trade.
The top 100 companies account for 14%
of worldwide sales, 12% of assets, and
13% of employment.
Physical location of value creation is
very difficult to determine.
Much of the force of globalisation comes
through mergers and acquisitions.
Questions for HR
professionals
Do we have a strategy for becoming an international
firm?
What type of managers will we need to be
successful?
How can I find out about the way that HRM is
conducted in other countries (laws, trade unions,
labor market).
What will be the impact of cultural norms on our HR
policies.
How will we choose whether to send expatriates or
use local employees.
How do we move people to different locations
How do we manage transfer of knowledge across
borders
Parent-country Nationals
Advantages
Control and co-ordination by
HQ is maintained.
Promising managers get
international experience.
PCNs may be the best
people for the job.
Assurance that the
subsidiary will comply with
company objectives policies
etc.
Disadvantages
HCNs promotion
opportunities are limited.
Adaptation to host country
may take a long time.
PCNs may impose an
inappropriate HQ style.
Compensation differences
between PCNs and HCNs
may cause problems.
Host-country Nationals
Advantages
No problems with
language and culture.
Reduced hiring costs.
No work permits required.
Continuity of management
improves since HCNs stay
longer in positions.
Govt. policy may force
hiring of HCNs.
Promotional opportunities
not limited - so higher
morale among HCNs.
Disadvantages
HQ may have less control
over operations.
HCNs may still have
limited career
opportunities outside the
subsidiary.
Hiring HCNs limits
opportunities for PCNs to
gain overseas experience.
Hiring HCNs may
encourage a federation of
disintegrated national
units rather than one
integrated global unit.
Third-country Nationals
Disadvantages
Transfers must
Advantages
consider national
Salary and
animosities.
compensation may be Host government may
lower than for PCNs.
resent TCNs as much
May be more familiar
as PCNs.
with host country than TCNs may not comply
with HQ style of
the PCNs.
management.
TCNs may not want to
return after
assignment.
empathy
flexibility
patience
openness
reliability
confidence
emotional stability
communication skills
tolerance for
differences
humor
resourcefulness
sensitivity
teaching skills
International Compensation
If compensation is high then
problems may be encountered on
return to head office.
If compensation is not adequate
then there may be no incentive to
go for the international
assignment given the hardships
that are usually involved in doing
so.
International Compensation
Expatriation Premium
Cost of Living Allowance
Swamp Pay Allowance
Shelter Allowance
Educational Allowance
Home Leave
Repatriation
Virtually all repatriated personnel
experienced some personal difficulty
in reintegrating on return home. The
main complaints were loss of status
loss of autonomy lack of recognition
of the value of the experience and
lack of career direction.
Repatriation: Reverse
Culture-shock
SOCIAL FACTORS
Expat assignment different type of social
interaction (going from
a very close expat
community to where
everyone is very busy
with their own lives)
Problems of spouse
returning to the
workforce
Lack of peer support for
teenagers