7/28/2019 Managing Human Resource Globally
1/17
Managing Human
Resources Globally
Presented By Apra Chordia
7/28/2019 Managing Human Resource Globally
2/17
Trend toward Expansion into Global Markets
Tap New Markets with largenumbers of global customers
Capitalize on lower labor cost
Build a 24 X 7 follow the Sun Modelfor development and support
7/28/2019 Managing Human Resource Globally
3/17
HRM in a Global Environment
Global activities are simplified and encouraged bytrade agreements among nation like GATT , NAFTA
Increasing international competition accentuates theneed of manage HR effectively Organizations need employees who understand
the customers and suppliers in foreign countries. Organizations need to understand the laws and
customs that apply to employees in othercountries.
7/28/2019 Managing Human Resource Globally
4/17
Employees in an International Workforce
Parent-country national employee who was born
and works in the country in which an organizationsheadquarters is located
Host-country national employee who is a citizenof the country (other than parent country) in which an
organization operates a facility Third-country national employee who is a citizen
of a country that is neither the parent country nor the
host country of the employer
Expatriates
An employee sent by his or her
company in one country to manage operations in
different country
7/28/2019 Managing Human Resource Globally
5/17
Employersin the Global Marketplace
International organization
An organization that sets up one or a few facilities in one or a fewforeign countries
Need to have HRM practices conforming to host countrys laws
Multinational company
An organization that builds facilities in a number of different countriesin an effort to minimize production and distribution costs
Need to select managers capable of functioning in a variety of setting,give them necessary training and flexible compensation
Global organization
An organization that chooses to locate a facility based on the ability toeffectively, efficiently, and flexibly produce a product or service using
cultural differences as an advantage
7/28/2019 Managing Human Resource Globally
6/17
Transnational HRM System
Transnational HRM system: makes decisions from a global perspective
includes managers from many countries
based on ideas contributed by people representing a
variety of cultures
Decisions that are the outcome of a transnational
HRM system balance uniformity with flexibility.
Transnational Scope+ Transnational Process +Transnational Process ---> Cultural Synergy
7/28/2019 Managing Human Resource Globally
7/17
Factors Affecting HRM in International Markets
GlobalHRM
Culture
EducationEconomicSystems
Political-Legal
Systems
7/28/2019 Managing Human Resource Globally
8/17
Culture
Set of important assumptions that members of a community share
Culture can greatly affect a countrys laws.
Often determines the effectiveness of various HRM practices.
Influences what people value, so it affects peoples economic systems and
efforts to invest in education.
Affect a countrys economy through their promotion of individual workethics and incentives for individuals to increase their human capital
Organizations must prepare managers to recognize and handle cultural
differences.
Recruit managers with knowledge of other cultures
Provide training
7/28/2019 Managing Human Resource Globally
9/17
HofstedesFive Dimensions of Culture
1. Individualism/Collectivism Describes the strength of the relation between anindividual and other individuals in the society.
2. Power Distance Concerns the way the culture deals with unequal
distribution of power and defines the amount of
inequality that is normal.3. Uncertainty Avoidance Describes how cultures handle the fact that the
future is unpredictable.
4. Masculinity/Femininity The emphasis a culture places on practices or
qualities that have traditionally been considered
masculine or feminine.5. Long-term/Short-term
Orientation
Suggests whether the focus of cultural values is
on the future (long term) or the past and present
(short term).
7/28/2019 Managing Human Resource Globally
10/17
Education and Skill Levels
Companies with foreign operations locate incountries where they can find suitable employees.
The educations and skill levels of a countrys laborforce affect how and the extent to which companies
want to operate there. In countries with a poorly educated population,
companies will limit their activities to low-skill, low-wage jobs.
7/28/2019 Managing Human Resource Globally
11/17
Economic System
The economic system provides many of theincentives or disincentives for developing the valueof the labor force.
In developed countries with great wealth, labor costs
are relatively high. This impacts compensation andstaffing practices.
Income tax differences between countries make paystructures more complicated when they cross
national boundaries.
7/28/2019 Managing Human Resource Globally
12/17
Political-Legal System
The countrys laws often dictate the requirements forHRM practices: training, compensation, hiring, firing,
and layoffs.
An organization that expands internationally must
gain expertise in the host countrys legal
requirements and ways of dealing with its legal
system.
Organizations will hire one or more host- country
nationals to help in the process.
7/28/2019 Managing Human Resource Globally
13/17
Managing Expatriates: Selecting Expatriate
Managers
Expatriate managers need technicalcompetence in the area of operations.
In addition, many other skills are necessary tobe successful in an overseas assignment:Ability to maintain a positive self-image and feeling
of well-being
Ability to foster relationships with host-countrynationals
Ability to perceive and evaluate the host countrysenvironment accurately
7/28/2019 Managing Human Resource Globally
14/17
Topics for Assessing Candidates for
Overseas AssignmentsMotivation
Health
Language ability
FamilyConsiderations
Resourcefulness
Adaptability
Career Planning
Financial
7/28/2019 Managing Human Resource Globally
15/17
Managing Expatriates:
Preparing Expatriates
Pre-assignment sitevisit
Job orientation
Country orientation
Culture orientation
Language training
Compensation / benefits
/ taxes counseling
Housing counseling
Health care / schools /
shopping / recreation
counseling
Counseling by returning
expatriates
Local sponsorship from
host country
C ti E t i t
7/28/2019 Managing Human Resource Globally
16/17
Compensating Expatriates
Balance sheet approach this approach adjusts
the managers compensation so that it gives themanager the same standard of living as in the
home country plus extra pay for the inconvenience
of locating overseas.
This approach involves an effort by the globalorganization to ensure that its expatriates are
made whole.
7/28/2019 Managing Human Resource Globally
17/17
THANK YOU!
Top Related