INTERNATIONAL HUMAN

RESOURCE MANAGEMENT

An introduction
 An Introduction….
• Societies and economies around the world are becoming more
integrated. This integration has been the result of reduced costs of
transport, lower trade barriers, faster communication of ideas,
rising capital flows and intensifying pressure for migration.

• A few years ago, going global was considered to be a big

achievement, today it is part of a company’s survival kit, ever so
essential to de risk the organisation from a single country shock.
 Contd…..
• Globalization in turn has revolutionized the way human resource
policies have evolved and have been implemented.
• Policies relating to employees hiring, training, training
compensating or maintaining are formulated keeping global
needs in mind.
• The international human resource manager needs to have a global
perspective of business so that he or she will; be effective in
formulating and implementing HR policies and practices.
 Defining IHRM

• IHRM refers to the HR policies and practices applied

by an international firm across all its subsidiaries
located in different countries.

• IHRM is the process of procuring, allocating And

effectively utilizing human resources in a
multinational ORGANISATIONS.
 THREE MAIN DIMENSIONS OF IHRM

1. Three broad human resource activities i.e. procurement,

allocation and utilization .
2. Three national or country categories involved in IHRM activities:
a) Host country: where subsidiary may be located
b) Home country: where the head office is located
c) ‘Other’: countries that may be suppliers of labour, finance and
other resources.
3. Three categories of employment of an international firm:
a) Host country nationals (HCN)
b) Parent country nationals (PCN)
c) Third country nationals (TCN)
 Few examples………

• US multinational employs Australian citizens in its

Australian operations (HCN), often sends US citizens
to Asia Pacific countries (PCN) and may send some
of its Singaporean employees on an assignment to its
Japanese operations (TCN)
 Growing interest in IHRM

• Globalisation of businesses has added to the number of MNC’s

resulting in greater mobilization of resources.

• HRM has become a major determinant of success and failure in

international business.

• Underperformance or failure in overseas assignments is costly

both in human and financial costs.

• HR plays a significant role in the implementation and control

of strategies in an internatiuonal business.
 Significant IHRM activities and issues

• HRP
• Recruitment and selection
• Performance management
• Training and development
• Knowledge transfer
• Leadership
• Team building
• Salary and benefits
• Global labour laws standards and ethics
• Trade unions and negotiations
• Women in HRM
• Strategic issues
• Industrial relations
• Cultural contexts
• Organizational structural issues
• Managing diverse HR
 More HR activities

External Influences Broader Perspective

IHRM

Involvement in
Risk Exposure
Employee lives

Change in emphasis
 WHO IS AN EXPATRIATE??

• An expatriate is an employee who is working

and temporarily residing in a foreign country
 Expatriate Failure
• Means premature return of an expatriate manager before the
completion of his/her international assignment due to person’s
failure to attain to the expected performance levels and due to
person’s continuing inability to adjust to the new work and
cultural environment
• A simple puzzle for you all…..

• Parent country
HQ operation

• Subsidiary
• Subsidiary
operations
operations
Country A
country B