IHRM Chapter 1 International Human Resource Management Managing

IHRM Chapter 1 International Human Resource Management Managing people in a multinational context Introduction

Chapter Objectives • Define key IHRM terms • Review expatriate management evolution • Outline differences between domestic and international HRM • Discover the increasing complexity and potential challenges of current IHRM v IHRM Chapter 1 2

Terms HRM IHRM HCN PCN TCN MNE culture shock emi-etic distinction v IHRM Chapter 1 NAFTA UNCTAD expatriate inpatriate 3

Figure 1 -1 v Inter-relationships between approaches to a field IHRM Chapter 1 4

Defining HRM An organization’s HRM activities include: 1. Human resource planning 2. Staffing (recruitment, selection, placement) 3. Performance management 4. Training and development 5. Compensation (remuneration) and benefits 6. Industrial relations v IHRM Chapter 1 5

Figure 1 -2 v Inter-relationships between approaches to the field IHRM Chapter 1 6

Figure 1 -3 v International assignments create expatriates IHRM Chapter 1 7

Differences between domestic HRM and IHRM complexity can be attributed to six factors: 1. Human resource planning 2. Staffing (recruitment, selection, placement) 3. Performance management 4. Training and development 5. Compensation (remuneration) and benefits 6. Industrial relations v IHRM Chapter 1 8

Figure 1 -4 v Variables that moderate differences between domestic and international HRM IHRM Chapter 1 9

Laurent’s steps to truly international HRM 1. Recognize that one’s own HRM reflects home culture assumptions and values. 2. Recognize that one’s own peculiar ways are neither universally better nor worse than others - just different and likely to exhibit strengths and weaknesses, particularly abroad. 3. Recognize that organization’s foreign subsidiaries may prefer other ways to manage people – ways that are neither intrinsically better nor worse, but possibly more effective locally. 4. Headquarters willingness to acknowledge cultural differences and steps to make them discussable and therefore usable. 5. Build shared genuine belief that cross-cultural learning will result in more creative and effective ways of managing people. v IHRM Chapter 1 10

Table 1 -1 v World top ten non-financial transnational corps. , ranked by transnational index IHRM Chapter 1 11

Table 1 -2 v World top ten non-financial transnational corps. , ranked only by foreign assets IHRM Chapter 1 12

Figure 1 -5 v Strategic HRM in multinational enterprises IHRM Chapter 1 13

Discussion Questions 1. What are the main similarities and differences between domestic and international HRM? 2. Define these terms: IHRM, PCN, HCN, and TCN. 3. Discuss two HR activities in which a MNE must engage that would not be required in a domestic environment. 4. Why is a greater degree of involvement in employees’ personal lives inevitable in many IHRM activities? 5. Discuss at least two of the variables that moderate differences between domestic and international HR practices. v IHRM Chapter 1 14