11

Chapter 12 Global Human Resource Management

2

The international HRM wheel

Corporate

Internationalpersonnel

Local personnel

3

4

The changing features of international managers

Recruitment essentiallyHQ in home country

Expat package

Local recruits stay local

Strong ‘corporate style’diffused in the subsidiaries

‘Foreign office’ type of career

Dual career system

Performance appraisal focuses on local performances

Recruitment from all over the world

Increasingly ‘local’ contracts

Possibilities for locals tobecome part of the core

A lot of job rotation: regional; global

A lot of international management development programmes

Performance appraisalsinclude local plus global orregional achievement

From To

5

The international manager

The international manager

6

The dual allegiance of international managers

Allegiance to local firm

International managers who see themselves as free agents

International managers who “go native”

International managers who see themselves as dual citizens

International managers who leave their hearts at home

Allegiance to parent firmLow

Low

High

High

7

Pattern Pros Cons

Free agent Often have superior international capabilities (e.g. language, negotiation) Often somewhat less costly than traditional international managers

Often leave with little warning Replacement costs may be significant May serve self-interests more than company interests

Go native

Adjust well and quickly to local culture Usually effective in local environment including interactions with employees, customers, suppliers, etc.

May fight global initiatives May be slow to implement directives from

headquarters Likely to leave firm after repatriation

Heart at home

Quick to implement directives from headquarters More likely to stay with firm after repatriation

Adjusts poorly and slowly to local culture and environment

Likely to inappropriately implement directives from the parent organization

Dual citizen

Adjust well and quickly to local culture Usually effective in local environment Facilitates the coordination of global initiatives Responsive to directives from head- quarters

Requires serious thought and commitment from the company to develop into dual citizen

Are a rare breed and are attractive to other firms who may try to steal them away

The dual allegiance of international managers

8

Adjustment in an international assignment: the “U-curve hypothesis”

Adjustment/ Satisfaction

0 2 4 6 8 10 12

Honeymoon

Culture shock

Adjustment

Mastery

Months

9

Benefits for the

company

Time

Local impact

Global integration

Acculturation Productive tenure

Optimum tenure

Total benefitsA

B

C

X

The country assignment

10

The impact of international cultural differences for management

Multicultural teams- International managers vs locals- Group

building/working/relationships- Conflict resolutions

Partnerships/transactions- Contract negotiations- Joint ventures/partnerships- Official meetings- Community events/social events

Interpersonal relationships- Communication- Etiquette- Decoding attitudes and behaviour- Understanding ‘silent’ language

Hierarchical/managerial interactions (boss/colleagues/subordinates)

- Feedback- Control- Reward/punishments- Personal space- Motivations

11

“Local employees avoid telling their boss they think they are wrong” – agree or disagree?

Hong Kong

Japan

Korea

China

Malaysia

Thailand

Indonesia

Philippines

Singapore

Taiwan

Strongly agreeStrongly disagree

12

“Employees and managers prefer to tell stories than admit they made a mistake” – agree or disagree?

Korea

China

Malaysia

Indonesia

Hong Kong

Taiwan

Philippines

Thailand

Japan

Singapore

Strongly agreeStrongly disagree

13

“Telling an employee in front of others that he/she made a mistake is not acceptable” – agree or disagree?

MALAYSIA

HONGKONG

INDONESIA

CHINA

PHILIPPINES

KOREA

TAIWAN

SINGAPORE

THAILAND

JAPAN

Strongly agreeStrongly disagree

14

International managers: culture shock

PHYSICAL DIFFERENCES

CULTURAL DIFFERENCES

LEVEL OFDISORIENTATION

STRESS UNEASE

FLIGHT ACCEPT GOES NATIVEFIGHT

• rejects• retreats• insulates

• hostility• disgust• disapproval

• interested• looks for contacts• learns about culture

• enthusiastic• adopts local practices: food; dress; style• local ‘companion’

THELOCALIZED

EXPAT

THECOSMOPOLITAN

EXPAT

THE“COLONY”

REACTIONS

15

Problems on repatriation• The majority of international managers experience some degree of culture

shock during repatriation• More than half of returning international managers feel their overseas

assignment had a negative impact on their careers• 1 out of every 5 managers who finish an international assignment want to

leave the company when they return• The majority of international managers feel their re-entry position is less

challenging and satisfying than their overseas assignment• Most returning international managers feel there are limited opportunities

for using their newly acquired knowledge and skills, and feel their international expertise is not appreciated by their firms

16

HRM practices which support effective expatriation

Staffing and selection• Communicate the value of international assignments for the company’s global mission• Recruit employees who see international assignments as a challenging opportunity• Recruit employees who demonstrate cultural openness• Provide a realistic job and career preview

Training and career development• Make international assignments a part of the career development process• Encourage early international experience• Provide ongoing mentoring and coaching• Create learning opportunities during the assignment• Use international assignments as a leadership development tool

17

Performance appraisal and compensation• Differentiate performance management based on international manager roles• Align incentives with expatriation objectives• Tailor benefits to the international manager’s needs• Focus on equality of opportunities, not cash• Emphasize rewarding careers rather than short-term outcomesExpatriation and repatriation activities• Involve the family in the orientation and repatriation program• Establish mentor relationships between international managers and executives from the home

location• Provide support for dual careers.• Secure opportunities for the returning manager to use knowledge and skills learned while on the

international assignment

HRM practices which support effective expatriation cont.

18

Different types of international managers according to the stage of subsidiary development

BUILD

GROW

CONSOLIDATE

PIONEER DEVELOPER ORGANIZER

19

Individual skills for international managers in emerging countries

CULTURALSKILLS

RELATIONSHIPSKILLS

POLITICALSKILLS

Understanding of andsensitivity to etiquette,social norms, religions,ethnical characteristics

Knowledge andreference to arts andliterature

Language skills canhelp

Ability to build andmaintain a networkof contacts

Ability to negotiate

Ability to learn

Ability to understandthe local politicalcontext and subtleties

Ability to communicatewith opinion leadersand keydecision-makers

Ability to integrate local national priorities intobusiness strategies andpractices

Knowledge and expertise in product and services

Performancedemonstration

LEADERSHIPSKILLS

PROFESSIONALSKILLS

Ability to motivate

Ability to teachand coach

Ability to lead teams

Ability to respect

Role model

Paternalistic

Ability to inspire

Ethics

Ability to communicate without arrogance

20

More pressure to localize staff

From host country government• To accelerate transfer of technology• To develop human resources• To create employment

From head office• To cut costs• To build competences• To keep staff

From local staff itself• To satisfy ambition• To develop career• To improve conditions

21

Integrating local staff

• Career development and the ‘glass ceiling’• Fairness• Feedback• Rewards• Discipline and education• Long-term policies

22

Skills that Chinese employees consider to be important for international managers

• Cultural sensitivity • Guidance • Clarity• Teaching orientation• Expertise (to be tested)• Short-term Presence (commitment?)• Adaptability• Fairness• Morality• Personal touch (paternalism)

23

• Hard work and productivity• Knowledge• Language• Desire to learn• Loyalty• Honesty and morality• Initiative• Leadership

Skills that international managers consider to be important for Chinese employees