Global Human Resource Management

By Ameet Shinde

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Types of Global Organizations

Types
Importing and Exporting Multinational Enterprise (MNE) Global Organization Selling and buying goods and services with organizations in other countries An organization with operating units located in foreign countries. An organization having corporate units in a number of countries integrated to operate worldwide.

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Transition to Global Organizations

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Transition to Global Organizations

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Transition to Global Organizations

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Global Human Resource Management Why organizations expand internationally To capture enhanced market opportunities that foreign countries may present. To achieve economies of scale in production and administration by expanding scope and volume of operations to international markets. Keeping up with industry leaders may require organization to enter foreign markets Acquiring ownership of foreignbased organization or subsidiary

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Factors Affecting Global HR Management

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Selected Countries on Hofstede’s Culture Dimensions

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Selected Countries on Hofstede’s Culture Dimensions

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Functions of IHRM

 Management of human resources in global corporations, including issues of expatriation and repatriation  Implementing corporate global strategy by adapting appropriate human resources management practices in different national, economic, and cultural environments
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 Adopting labor relation practices

Types of Global Employees

Types of Global Employees

Expatriate/ PCN
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HostCountry National

ThirdCountry National

Domestic HRM and IHRM Compared

More HR activities. Need for a broader perspective -Pay Systems -Health Insurance -Family More involvement in employee personal lives -Internal Human Resource

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HRM in the Asia-Pacific Region NepotismEspecially in Hong Kong and Singapore where non-relatives are seen as being easier to manage.

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As for Romance at work ,Koreans see it as a natural social development ,while Indonesians ,Malaysians ,and Filipinos feel it inappropriate

HRM in the Asia-Pacific Region Gender-Based pay-This belief was specially strong in Korea, Singapore ,Japan and Indonesia ex-glass ceiling Over Time:-Australian and Singaporean VS Korean and Japanese firms.

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Domestic HRM and IHRM Compared Changes in emphasis Emphasis placed on various HR activities change. Bring high-potential local staff to corporate head quarters. Risk exposure Physical safety of employees Emergency evacuation procedures . An avg expatriate manager ,with family costs an MNC nearly $2,50,000(US). E rate2540% in 1965-1985.

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International HR Activities
HRP Recruitment and Selection Training and Development Performance Management Remuneration Repatriation
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O-E

Employee Relation

HR Planning 1 Identifying top-management potential early. 2 Identifying critical success factors for future international managers. 3 Providing developmental opportunities. 4 Tracking and maintaining commitment to individual in international career paths. 5 Tying strategic business planning to HRP an Vice-versa.
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6 Dealing with multiple business units

Recruitment and Selection Ethnocentric Key management positions filled by parent-country nationals Ex-P&G ,Philips, Matsushita. -Dutch Mafia. -29 % Japanese Comp had presidents who were not Japanese Polycentric Host-country nationals manage subsidiaries Parent company nationals hold key headquarter positions Best suited to multi-domestic

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Recruitment and Selection Regiocentric Hiring and promoting employees on the basis of the specific regional context of the subsidiary Geocentric Seek best people, regardless of nationality not always possible Best suited to Global and trans-national businesses EX-Colgate-Palmolive
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Global Human Resource Management

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Types of Global Assignments

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Global Employee Selection Factors

The Expatriate Problem
Crisis and Adjustment Determining The Need Departure
or

Reassignment Abroad

Post-arrival Orientation and Training
or

Repatriation And Adjus

The Selection Process
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Pre-assignment Training

Crisis and Failure

Causes of Expatriate Assignment Failure

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Expatriate Failure Rates

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Reasons for expatriate failure

• US multinationals – Inability of spouse to adjust – Manager’s inability to adjust – Other family problems – Manager’s personal or emotional immaturity – Inability to cope with larger overseas responsibilities • European multinationals • Inability of spouse to

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Reasons for expatriate failure

• Japanese Firms – Inability to cope with larger overseas responsibilities – Difficulties with the new environment – Personal or emotional problems – Lack of technical competence – Inability of spouse to adjust.
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Factors in Expatriate Selection
Cross-Cultural Suitability Technical Ability
individual

Family Requirements

Selection Decision

situational

Country-Cultural Requirements Language
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MNC Requirement

Global Assignment Management Cycle

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Training and management development Training: Obtaining skills for a particular foreign posting Cultural training : Seeks to foster an appreciation of the host-country’s culture Language training : Can improve expatriate’s effectiveness, aids in relating more easily to foreign culture and fosters a better firm image Practical training: Ease into day-to-day life of the host country and adapt alien culture ex-feel Like “at Home”

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Expatriate Adjustment Stages

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Management development & strategy Development programs designed to increase the overall skill levels of managers through: On going management education Rotation of managers through a number of jobs within the firm to give broad range of experiences Used as a strategic tool to build a strong unifying culture and informal management network
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Above techniques support

Expatriate Pay

Typically use balance sheet approach Equalizes purchasing power to maintain same standard of living across countries Provides financial incentives to offset qualitative differences between assignment locations.
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Pay for Schools, health care, etc.

Expatriate Pay Base Salary Same range as a similar position in the home country Foreign service premium Extra pay for work outside country of origin Allowances Hardship, housing, cost-ofliving and education allowances Taxation Firm pays expatriate’s income tax in the host country Benefits

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The balance sheet

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Repatriation process

Preparation

Physical relocation Repatriation process

Transition

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Re-adjustment

International labor relations

Key Issue Degree to which organized labor can limit the choices of an international business Aims to foster harmony and minimize conflicts between firms and organized labor

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International labor relations

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Multinational can counter union bargaining power with threats to move production to another country Multinational will keep highly skilled tasks in its home country and farm out only low-skilled tasks to foreign plants Easy to switch locations if economic conditions warrant Bargaining power of organized labor is reduced Attempts to import employment practices and contractual agreements from multinationals home country

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