By, Priya Unadkat

Introduction:

The Enduring Context of

IHRM

Three Approaches to IHRM

• Cross-cultural management

• Examine human behavior within organizations from an

international perspective

• Comparative HRM and Industrial Relations

• Seeks to describe, compare and analyze HRM systems

and IR in different countries

• HRM in multinational firms

• Explore how HRM is practiced in multinationals

Interrelationships between Approaches to the Field

The General Field of HR

‘HRM refers to activities undertaken by an organization to effectively utilise its human resources’

• Major Functions and Activities

• Human resource planning

• Staffing – Recruitment, Selection, Placement

• Performance management

• Training and development

• Compensation (remuneration) and benefits

• Industrial relations

A Model of IHRM (Morgan)

Head

Quarter

Subsidiary

Source of raw

material

H

O

M

E

H

O

S

T

O

T

H

E

R

TCN

PCN

HCN

As per Morgan,

IHRM is the interplay between three categories : HR

activities, Types of employees and countries of

operation.

What is an expatriate?

An employee who is working and temporarily residing

in a foreign country

“International assignees”

• Inpatriate

• Transpatriate

• Global flow of HR

International Assignments Create Expatriates

Differences between Domestic HRM and IHRM

• More HR activities

• The need for a broader perspective

• More involvement in employees’ personal lives

• Changes in emphasis as the workforce mix of

expatriates and locals varies

• Risk exposure

• Broader external influences

Cont’d

More HR activities

Tax equalization

Relocation & orientation

Administrative services

Host government relation

Language translation

The need for a broader perspective

More than one national group

Policies for PCNs, HCNs, TCNs

Cont’d

More involvement in employees’ personal lives

Schooling, housing

Banking, investment

Recreational program

Changes in emphasis as the workforce mix of expatriates and

locals varies

As operations matures

Local staff availability

Taxation, relocation, orientation

Staffing, training & development

Cont’d

Risk exposure

Expatriate failure

Under performance

Higher cost of failure – direct & indirect

Terrorism

Broader external influences

Type of government

Developed / developing country

Labour availability, labour policies

Variables that differentiate Domestic & IHRM

Variables that differentiate Domestic & IHRM

Not always a conscious effect

Culture shock

Cultural awareness

E.g.

Individualistic – Collective

Vacation

Hand movement

..\..\..\Extra\2. Hand Gestures around the World.mp4

Hofstede’s cultural framework

Power distance

Individualism Vs Collectivism

Masculinity Vs Femininity

Uncertainty avoidance

Long term Vs Short term orientation

..\..\..\Extra\Videos\Map The World - Hofstede's 5

Cultural Dimensions visualized on a world map.mp4

Power distance

Degree to which people accept that power in the

organization is distributed unequally

High power distance Low Power distance

(Large power inequalities) (Equality & opportunity)

Malaysia US

Cont’d

Individualism Vs Collectivism

Individualism

Degree to which people prefer to act as individual

rather than group - US

Collectivism

Tight social frame work where people expect to be

in group where they can be look after and protected.

Cont’d

Masculinity Vs Femininity

Masculinity

Favors traditional masculine role as power, achievement,

control. Separate roles to men and women with men

dominating - US

Femininity

Little difference between men and women. Treat women as

equal to men.

Cont’d

Uncertainty avoidance

Degree to which people prefer structured over

unstructured situations.

High uncertainty avoidance Low uncertainty avoidance

(Anxiety about uncertainty, (Accepting uncertainty,

uses rules and laws to less rule oriented, take

reduce uncertainty) risk and accept change)

US

Cont’d

Long term Vs Short term orientation

Long term

Look to the future, value thrift (saving), persistence

and tradition. – Asian countries

Short term

Value here and now, accept change easily, don’t see

commitment as obstacle to change - US

Japan

Germany

UK

France

China

Singapore

Thailand

Variables that differentiate Domestic & IHRM

International competition

Multi-domestic Global

Industry Industry

Independent Influenced

Variables that differentiate Domestic & IHRM

Domestic market Vs Foreign market

Size

Availability of resources

Variables that differentiate Domestic & IHRM

Barriers to effective global HRM

Variations – Social, Political, Economical

Perception for HR

Attitude & actions of HQ towards HR

Resistance to change

Cultural differences in learning & teaching style

Instructional style

Used in US

Not credible in Japan

Strategic view of IHRM

External factors • Industry ch’s

• Country ch’s

Internal factors

• MNE structure

• MNE strategy

• Experience in

international operations

• International orientation

SHRM • HR functions and

• practices

MNE concerns and goals

• Competitiveness

• Efficiency

• Flexibility

(De Cieri & P.J. Dowling)

Factors that Influence the Global Work Environment

• Chinese multinationals

• Bharti Airtel's acquisition

Zain Africa

• Internet