Hiring and Hiring and Managing Managing EmployeesEmployees

Module 2Module 2

Sapna Sapna

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Human Resource Management Human Resource Management (HRM)(HRM)

Refers to the activities an organization carries out to use its human resources effectively

Four major tasks of HRM - Staffing policy

- Management training and development

- Performance appraisal

- Compensation policy

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International Human Resource International Human Resource ManagementManagement

Strategic role: HRM policies should be congruent with the firm’s strategy and its formal and informal structure and controls

Task complicated by profound differences between countries in labor markets, culture, legal, and economic systems

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International H.R.M.International H.R.M.

Often modifiedOften modified

ExpatriatesCitizens of one country who are living

and working in another country

ExpatriatesCitizens of one country who are living

and working in another country

Recruitment and selectionRecruitment and selection

Training and developmentTraining and development

Compensation Compensation

Labor relations Labor relations

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Factors Making International HR Factors Making International HR DifficultDifficult

Different labor markets- Mix of available workers- Mix of labor costs

International worker mobility problemsNational management styles and practicesNational orientationsStrategy and control

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International Managerial International Managerial TermsTerms

Locals – citizens of the countries in which they are working

Expatriates – non-citizen - Home-country national

- Third-country national

International labor Market International labor Market SourcesSources

PCNs- to start up, own people are preferred

- They have the necessary technical & managerial expertise

• HCNs- acquiring local talent(middle & lower level positions)

- Sometimes according to Government’s restrictions

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TCNs- two important reasons to hire them-

- These people have the necessary expertise

- They were judged to be the best ones for the job

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International labor Market International labor Market SourcesSources

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Approaches to Staffing-Approaches to Staffing-1. Ethnocentric Staffing1. Ethnocentric Staffing

AdvantagesAdvantages

+ Tight control over subsidiaries

+ Locally qualified people not always available

+ Re-create local operations in home-office image

+ Interests of home office may be better protected

– Relocations are expensive

– Create “foreign” image for the businessDisadvantagesDisadvantages

Individuals from home country manage operations abroadIndividuals from home country manage operations abroad

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2. Polycentric Staffing2. Polycentric Staffing

AdvantagesAdvantages+ Responsibility on those knowing local business+ Avoid expensive relocations from home nation

– Potentially lose control of subsidiaryDisadvantagesDisadvantages

Individuals from host country manage operations abroadIndividuals from host country manage operations abroad

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3. Geocentric Staffing3. Geocentric Staffing

AdvantagesAdvantages+ Develop global managers who can adjust easily to any business environment

– These individuals command high salariesDisadvantagesDisadvantages

Best-qualified individuals, regardless of nationality,Best-qualified individuals, regardless of nationality,manage operations abroadmanage operations abroad

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Filling Foreign Managerial Filling Foreign Managerial PositionsPositions

Typically more difficult to fill than domestic positions because:- People don’t like to move

- There are legal impediments to using expatriates

- Many are apprehensive about language issues

- Many assignments are open-ended

- Perception that assignment abroad will negatively affect family lifestyle

- Living is more expensive abroad

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Reasons to Use ExpatriatesReasons to Use Expatriates

Lack of locally qualified candidatesBroaden the companies understanding of the overall corporate systemGain professional/foreign experienceCan control operations according to headquarters’ preferencesNeed to transfer technology abroadGain valuable educational experience

Reasons to use Host Country Reasons to use Host Country NationalsNationals

They are more familiar with the Local culture

They know the Local Language

They cost less than home country nationals

Employing locals is simply good PR

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Main Challenges in IHRMMain Challenges in IHRM

High failure rates of expatriation & repatriation

Deployment – getting the right mix of skills in the organization regardless of geographic allocation•

Knowledge and innovation dissemination –managing critical knowledge and speed of information flow

Talent identification and development – identify capable people who are able to function effectively

• Barriers to women in IHRM

• International ethics

• Language (e.g. spoken, written, body)

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Main Challenges in IHRMMain Challenges in IHRM

Different labour laws

Different political climate

Different stage(s) of technological advancement

Different values and attitudes e.g. time, achievement, risk taking

Roles of religion e.g. sacred objects, prayer, taboos, holidays, etc

Educational level attained

Social organizations e.g. social institutions, authority structures, interest groups, status systems

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Human Resource PlanningHuman Resource Planning

Phase 1 Phase 2 Phase 3

Take inventory of

current human

resources

Estimate firm’s

future human

resource needs

Develop plan to recruit and select people for vacant and anticipated new positions

Forecasting human resource needs and supplyForecasting human resource needs and supply

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Recruiting Human ResourcesRecruiting Human Resources

• Recent college graduatesRecent college graduates

• Local managerial talentLocal managerial talent

• Non managerial workersNon managerial workers

• Current employeesCurrent employees

Process of identifying and attracting a qualified pool of applicants for vacant positions

Methods of RecruitmentMethods of Recruitment

Using Head-hunters

Cross-national advertising

E-recruitment

International graduate programs

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Selecting Human ResourcesSelecting Human Resources

Ability to bridge cultural differences is key

Expatriates must adapt to new ways of life

Cultural sensitivity raises odds for success

Process of screening and hiring the best-qualified applicantswith the greatest performance potential

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Selecting the Proper Selecting the Proper ExpatriateExpatriate

Technical competenceLocal acceptancePersonal attributes-emotional maturity, empathy, respect towards other value systemsFamily situation-Most common reason for failure is inability of the expatriate’s family to adjustCountry specific requirements- hardship postings- distance, culture, climate etcCompany specific requirements- processes, duration, nature of responsibilityLanguage

Selection TechniqueSelection Technique

Screening the applicant’s background

Testing the candidate’s ability to adapt to the new culture & environment

Investigating the family conditions of the potential candidate according to foreign environment & culture

Assessing the capacity of the manager to fit in the foreign culture

Using various tests to check the personality of the candidate

Finally selection when there is a match in JD & JS

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The Expatriate ProblemThe Expatriate Problem

Expatriate failure: premature return of the expatriate manager to his/her home country

• Cost of failure is high: estimate = 3X the expatriate’s annual salary plus the cost of relocation (impacted by currency exchange rates and assignment location)

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Reasons for Expatriate Reasons for Expatriate FailureFailure

US multinationals- Inability of spouse to adjust

- Manager’s inability to adjust

- Other family problems

- Manager’s personal or emotional immaturity

- Inability to cope with larger overseas responsibilities

European multinationals

Inability of spouse to adjust

Japanese Firms

- Inability to cope with larger overseas responsibilities

- Difficulties with the new environment

- Personal or emotional problems

- Lack of technical competence

- Inability of spouse to adjust

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Stage I:

Thrilling experience

Stage II:

Downward slide

Stage III:

Recovery begins

Stage IV:

Embrace local culture

Culture ShockCulture Shock

Psychological process affecting people living abroad that is characterized by homesickness, irritability,

confusion, aggravation and depression

Refresh Your Mind!!!!

Training & DevelopmentTraining & Development

Module 3

Sapna

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IntroductionIntroduction

T is the process of altering employee behavior, attitudes & knowledge in a way that increases the probability of individual & organizational goal attainment

It helps in following ways-- It minimizes personal problems like politeness, tolerance,

sensibility etc- T is important as clients, suppliers, customers will be from all

over the world- It makes expatriates familiar with customs, cultures & work

habits etc- It can also improve the overall management style- It enhances team work, leadership effectiveness etc

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Components- Components- Predeparture TrainingPredeparture Training

Cultural awareness programme

Preliminary visits

Language training-- Role of English as language of world- Host- country language skills & adjustment- Knowledge of Corporate language• Practical assistance- relocation specialist• Job related factors

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Types of Cross cultural TTypes of Cross cultural T

Environmental briefing

Cultural Orientation

Cultural assimilators

Language training

Sensitivity T to develop attitudinal flexibility

Field Experience

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Cultural Training MethodsCultural Training Methods

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Compiling a Cultural ProfileCompiling a Cultural Profile

CultureGramsBackground

NotesCountry

Studies AreaHandbooks

T leads to Learning T leads to Learning OrganizationsOrganizations

Personal Mastery

Mental models

Building shared vision

Team Learning

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Repatriation of ExpatriatesRepatriation of Expatriates

A critical issue in the training and development of expatriate managers is preparing them for reentry into their home country

Repatriation should be seen as the final link in an integrated, circular process that selects, trains, sends, and brings home expatriate managers

Research shows that there is a problem with the repatriation process

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Reverse Culture ShockReverse Culture Shock

Psychological processof readapting to one’s

home culture

Methods ofreducing its effects

• Once-natural thoughts andfeelings now strange

• Can be more unsettling thanculture shock

• Many companies reabsorbexpatriates poorly

• Once-natural thoughts andfeelings now strange

• Can be more unsettling thanculture shock

• Many companies reabsorbexpatriates poorly

• Home-culture reorientationprograms

• Career-counseling sessions• Career-development program

before posting abroad

• Home-culture reorientationprograms

• Career-counseling sessions• Career-development program

before posting abroad

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Repatriation of ExpatriatesRepatriation of Expatriates

Didn’t know what position they hold upon return.

Firm vague about return, role and career progression.

Took lower level job.

Leave firm within one year.

Leave firm within three years

10 20 30 40 50 60 70percent

Shortcomings- T & DShortcomings- T & D

International assignments are temporary in nature

Competency requirement of project & individual not known to HR accurately

Debate between technical skills or relational skills leads to confusion

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