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Introduction toIHRM
By
Deepti Gautam
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Scope of the textbook,
Define key terms in international human resourcemanagement (IHRM)
Outline the differences between domestic and
international human resource management and thevariables that moderate these differences
Discuss trends and challenges in the global work
environment
Operations of the internationalizing firm and its
consequences on the management of people in the
multinational context.
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Figure 1-1: Inter-relationships between approaches in the field
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Figure 2-1: A model of IHRM
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What is an expatriate?
An employee who is working and temporarilyresiding in a foreign country
Some firms prefer to use the terminternational assignees
Expatriates are PCNs from the parent countryoperations, TCNs transferred to either HQ oranother subsidiary, and HCNs transferredinto the parent country
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Figure 1-3: International assignments create expatriates
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Differences between domestic
and international HRM
More HR activities
The need for a broader perspective
More involvement in employees personallives
Changes in emphasis as the workforcemix of expatriates and locals varies
Risk exposure
Broader external influences
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More HR Activities
Such as, International taxation
International relocation & orientation
Administrative services
Host- government relations
Language translation services
Providing housing
Shopping
Recreation & Schooling etc.
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Need for a broader Perspective
A broader, more international perspective
on expatriate benefits would endorse the
view that all expatriate employees ,
regardless of nationality, should receive a
foreign service or expatriate premium when
working in a foreign location.
Example complex equity issues arise when
employees of various nationalities work together
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More involvement in employees
personal lives
IHRM involves a greater degree of
involvement in employees personal life
than domestic HRM.Such as ,
Handling banking, investments
Providing suitable housing and schooling Assist children in left behind in the home country
Marital status
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Changes in emphasis as the workforce
mix of expatriates and locals varies
After a foreign operation mature, the focus
is changed from
Expatriate taxation, relocation , orientation
to activities such as
selection, training & MDPs
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Risk ExposureThe human & financial consequences of failure
in the international arena are more severe than
in domestic business.
It includes Direct & Indirect costs
Eg. Expatriate Failure
Broader external influences
Ex.- Types of government
State of economy
Employment opportunities
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Figure 1-4: Variables that moderate differences between domestic and
international HRM
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Cultural Environment
Culture is understood as the customs,
beliefs, norms and values that guide the
behavior of the people in a society that arepassed on from one generation th the
next.
Culture has a normative value People experience Cultural shock
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Levels of Culture
Dominant Culture
Organizational
Culture
Sub-Culture
Occupational
Culture
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Hofstedes Cultural Dimension
1. Power Distance
2. Uncertainty Avoidance
3. Individualism Vs. Collectivism4. Masculine Vs. Feminine
5. Universalism Vs. Particularism
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Industry Type
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Reliance of the multinational on its home-
country domestic market
1. Rio Tinto(UK/Australia)
2. ThomsonCorporation(Canada)
3. ABB (Switzerland)
4. Nestl(Switzerland)
5. British AmericanTobacco (UK)
A large domesticmarket influencesthe attitudes of
senior managerstowards theirinternational
assignments.
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Complexities Involved
Forces for change1. Global competition
2. Organizational restructuring
3. Advances in technology and
telecommunication
4. Growth in mergers, acquisition and
alliances
5. Knowledge sharing
6. Transfer of competence
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Figure 1-5: Factors influencing the global work environment