Sub Human Resource Management Paper Code MBA203 Unit

Sub: Human Resource Management , Paper Code: MBA-203, Unit -7: HRM for Multinational Organization Dr. Debasish Biswas

International Human Resource Management (IHRM) Ø IHRM is the process of employing and developing people in international organizations which operate globally. It means working across national boundaries to formulate and implement resourcing, development, career management and remuneration strategies, policies and practices which can be applied to an international workforce (Michael Armstrong). Allocate HCNs PCNs TCNs Utilize Home Procure Other IHRM is the interplay among HR activities (viz procure, allocate and utilize), types of employees (viz host country nationals, parent country nationals and third country nationals) and countries (viz host country, home country and other countries). Host Ø Counties Types of employees Ø It is the process of managing people across international boundaries by international companies. It involves worldwide management of people, not just the management of expatriates.

Characteristic of IHRM: 7 Cs Characteristics 1. Cosmopolitan: People tend to be either members of a high-flying multilingual elite or expatriates who may relocate after periods of several years who can have significant problems on repatriation. 2. Culture: Major differences in cultural backgrounds are prevalent. 3. Compensation: Special requirements for the determination of the pay and benefits of expatriates and host country national are taken into consideration/given weightage. 4. Communication: Maintaining good communication between all parts of the organization worldwide is a necessity. 5. Counsultancy: Greater need to bring in expertise to deal with legal problems etc exists/prevails. 6. Competence: Developing a wider range of competences for people who have to work across political, cultural and organizational boundaries is one of the major characteristics of IHRM 7. Coordination: Devising formal and informal methods of getting the different parts of the international business to work closer together is very much needed.

Differences between IHRM and HRM No. Perspective International Human Resource Management (IHRM) It is the process of managing people across international boundary by international companies Human Resource Management (HRM) It is the process of managing people in the organizations which operate within the national boundary 1. Concept 2. Dimension It interplays among three dimensions viz. a. Type of employees-PCNs, HCNs & TCNs b. Countries-home country, host country and other country c. HR activities-procurement allocation & utilization Since it operates domestically the question relating to dimension like HCNs, and also host country does not arise. 3. Jurisdictional activities It has wide jurisdictional activities. It has limited jurisdictional activities. 4. Concept of subsidiary It has subsidiary unit/s in other country/ies It is absent 5. Workforce It deals with multicultural workforce Dealing with multicultural workforce is absent/minimum

No. Perspective International Human Resource Management (IHRM) It is a regular activity Human Resource Management (HRM) It is absent/occasional 6. Expatriation 7. Programmes, Different programmes, policies are Uniform programmes, policies, administered for different national practices are made for all practices employees in organizations 8. HR activities 9. Interpersonal a. Chances are more to develop a. Chances are less Relations interpersonal relations between HR b. Scope of involvement of HR executives and employees executives in employees’ b. Scope of involvement of HR personal lives is limited/absent executives in employees’ personal lives for the selection, training and effective management is wide. More HR activities are practiced like Such activities are not required to international taxation international be performed by HR relocation & orientation, language executives/manages translation, immigration activities etc.

No. Perspective International Human Resource Management (IHRM) Management (HRM) a. Effective selection of employees for a. Question of international assignment depends on assignment does not arise inter alia, to what degree/extent HR b. Expatriation issue is executives have information about absent personal lives of executives b. Ineffective selection makes a great loss to the company when expatriates return much before completing their tenure 10. Selection activities 11. Emphasis It needs to put much emphasis in HR Such activity is absent operations as a foreign subsidiary matures 12. External Influence It is influenced by major external factors (like External influences are absent type of govt. , state of economy, accepted practices of doing business in host countries) 13. Risk exposure Human and financial consequences of failure These are absent are severe. For example, expatriate failure is a potentially high-cost problem for international companies

No. Perspective International Human Resource Management (IHRM) Management (HRM) a. It needs to deal with terrorists activities a. Such activities are b. Rules, procedures need to be made to minimum tackle situation as and when required. b. It does not affect much. The situation if cropped up then it needs to be tackled effectively 14. Terrorist activities 15. Management It may be Ethnocentric, philosophy on Polycentric, Geocentric executive staffing 16. Environment Regiocentric, Polycentric, and Regiocentric approaches are absent. But some company may recruit executive from other countries in terms of geocentric approach. It has to face international environment The influence of international which is complex, highly competitive, environment is very much but dynamic, vibrant. its complexity, dynamism is comparatively less.