Chapter 1: Introduction

IHRM: International Human Resource Management (IHRM) can be defined as a set of

activities targeting human resource management at the international level. It strives to meet
organizational objectives and achieve competitive advantage over competitors at national and
international level.

Function of HRM:

1. Human resource planning.

2. Staffing (recruitment, selection, placement).

3. Training and development.

4. Compensation (remuneration) and benefits.

5. Performance management.

6. Industrial relations.

Classification of Employee:

1. Parent-country nationals (PCN)

2. Host-country nationals (HCN);
3. Third-country nationals (TCN).

Morgan’s presents IHRM on three dimensions (3-D):

1. The HR activities of procurement, allocation & utilization

2. The countries where IHRM occurs:

 Host-country where subsidiary may be located

 Parent-country where firm is headquartered
 Other-countries that may be source of labor, finance & other inputs

3. The employees of an international firm:

 Host-country nationals (HCNs);
  Parent-country nationals (PCNs); and
 Third-country nationals (TCNs).

Expatriates: An expatriate is an employee who is working and temporarily residing in a

foreign country.

IHRM can be attributed to six factors:

1. more HR activities
2. a need for a broader perspective
3. more involvement in employees’ personal lives
4. changes of emphasis as the mix of expatriates & locals varies
5. more risk exposure
6. broader external influences

Managing and staffing subsidiaries: The four major approaches are:

1. Ethnocentric staffing approach
2. Polycentric staffing approach
3. Regiocentric staffing approach
4. Geocentric or global staffing approach

1. Cross culture management

2. IHRM in the multinational contest
3. Comparative HR and IR systems