ihrm – an introduction

8/18/2019 Ihrm – an Introduction

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IHRM – AN INTRODUCTION

KIRTI SHIVAKUMAR


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Human Resource Management

(HRM)

• set of organ!atona" act#tes ame$ ate%ect#e"& managng an$ $rectng 'umanresources"aour to*ar$s ac'e#ng

organ!atona" goa"s+• T&,ca" functons ,erforme$ & HRM sta%

– HRA

– HRD tranng an$ $e#e"o,ment- ,erformance

management – Dsmssa"- se,araton

– Mot#aton an$ re*ar$s

– Com,ensaton an$ .ene/ts


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IHRM•

IHRM can be defned as set o activitiesaimed managing organizational humanresources at international level to achieveorganizational objectives and achievecompetitive advantage over competitors at

national and international level.• IHRM includes typical HRM unctions such as

recruitment, selection, training anddevelopment, perormance appraisal and

dismissal done at international level andadditional activities such as globalsills management, e!patriate managementand so on.


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IHRM

• International HRM "IHRM# is theprocess o$ procuring, allocating,and e%ectively utilizing humanresources in a multinationalcorporation, &hile balancing theintegration and di%erentiation o

HR activities in oreign locations.


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• IHRM s concerne$ aout managng 'uman resourcesat Mu"tnatona" Com,anes (MNC) an$ t n#o"#esmanagng 01 t&,es of em,"o&ees name"&- – Home country employees' (mployees belonging to

home country o the frm &here the corporate head)uarter is situated.

– Host country employees' (mployees belonging to thenation in &hich the subsidiary is situated.

– *hird country employees' *hese are the employees&ho are not rom home country+host country but areemployed at subsidiary or corporate head )uarters.s an e!ample a merican M- &hich has asubsidiary at India may employ a /rench person asthe (0 to the subsidiary.*he /renchman employed is a thirdcountry employee.


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Internatona" HRMD%erences

• 2reater Numer of Ser#ces

• S,eca" Ser#ces to Un3ue 2rou,

•

Com,ensaton Com,"e4t&• 5oregn 64c'ange Rate Attenton

• 7anguage an$ Cu"tura" D%erences


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InternationalMergers andc)uisitions

1lobalompetition

Importance o1lobal Human

ResourcesManagement

/oreignHuman

Resources

Maretccess

0pportunities

Increasing Importance o 1lobalHuman Resources 2nderstanding


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ompos on o e u ura(nvironment o International

3usinessRe"gon

sacre$ o8ects,'"oso,'ca"s&stemse"efs 9 norms,ra&ertaoos'o"$a&srtua"s

Tec'no"og& an$Matera" Cu"turetrans,ortatonenerg& s&stemstoo"s 9 o8ectscommuncatonsuran!aton

scencen#enton

Va"ues an$ Atttu$es

To*ar$:tmeac'e#ement*or;*ea"t'c'angescent/c met'o$rs;


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4ey Issues in International HRM

5. 6orld&ide Human Resources 7lanning –

Recruiting and 8election – (!patriate orientation and training

– Repatriation

– 7erormance appraisal

9. ompensation –

:ealing &ith in;ation and une!pected changesin e!change rates

– 7roviding su. Housing "omple! problems at home andoverseas#


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Ke& Issues n Internatona" HRM

?. 3enefts 7lanning –

:eveloping e)uity among employees – 8everal plans necessary or di%erent categories

o personnel

@. *a!ation "7rolieration o ne& la&s#

A. ommunication o HR 7olicies and

7rograms 6orld&ide – *reat communication as a continuous process

– /ace'to'/ace contact re)uently

– Mae policy manuals brie and simple

– 3e sensitive to needs o receiver

– 8end regular &ritten e!planations o policychanges

– 7eriodic rotation o overseas HR managersdesirable

– 8ecurity


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Internatona" Cor,oraton

Domestc /rm t'at uses ts e4stngca,a"tes to mo#e nto o#erseasmar;ets+


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Mu"tnatona" Cor,oraton(MNC)

5rm *'c' n$e,en$ent usnessunts o,eratng n mu"t,"e countres+


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2"oa" Cor,oraton

5rm t'at 'a$ ntegrate$ *or"$*$eo,eratons t'roug' a centra"!e$'ome o=ce+


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Transnatona" Cor,oraton

5rm t'at attem,ts to a"ance "oca"res,ons#eness an$ g"oa" sca"e #a anet*or; of s,eca"!e$ o,eratng

unts+


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T&,es of Organ!atons

2"oa"6=cenc&

High

2"oa"

Ve*s t'e *or"$ as asng"e mar;et? o,eratonsare contro""e$ centra""&from t'e cor,orate o=ce+

Transnatona"

S,eca"!e$ fac"tes,ermt "oca"res,ons#eness? com,"e4coor$naton mec'ansms,ro#$e g"oa"

ntegraton+

Low

Internatona"

Uses e4stng ca,a"testo e4,an$ nto foregnmar;ets+

Mu"tnatona"

Se#era" sus$areso,eratng as stan$


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T'e Mu"t


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Managng n a 5oregn

6n#ronment• Atttu$es Var&

• Mot#atona"

Too"s areDstnct"&D%erent


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Cu"tura" 6n#ronmentof Internatona" .usness


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C"usterng Natons A,,roac'

• 2eogra,'&

• 7anguages

• Re"gon

• @o Atttu$es

• or;2oa"s

• Va"ues

•

Nee$s


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Managera" Va"ues

• Ro"e of Com,etton

• Ro"e of ."ame

•

Ro"e of S'ame• Ro"e of >artc,aton: @a,an (')

• Ro"e of Autocratc: 6uro,e (') an$

Sout' Amerca (')


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Sources of Managera" Ta"ent

• Home Countr& Natona"s(64,atrates)

• Host Countr& Natona"s (Nat#es)

• T'r$ Countr& Natona"s (Non<HomeHost)


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A$#antages of D%erent Sources

for O#erseas Managers Host ountry Home ountry *hird ountry

•7ess cost

•>reference of 'ost

countr&go#ernment

•Kno*"e$ge ofen#ronment

•7anguage fac"t&

• Ta"ent a#a"a"e*t'n com,an&

•

2reater contro"

•Com,an&e4,erence

•Mo"t&

•64,erence,ro#$e$ tocor,oratee4ecut#es

•.roa$ e4,erence

•Internatona"

out"oo;

•Mu"t


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Ma8or Reasons for Amercan 64,atrate5a"ures n 5oregn 6n#ronment

• Ina"t& of t'e managers s,ouseto a$8ust to a $%erent cu"tura"en#ronment+

• T'e managers na"t& to a$a,t to

a $%erent ,'&sca" or cu"tura"en#ronment+ Ot'er fam"&


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Se"ecton Met'o$s

• Inter#e*s (e4ecut#es an$,s&c'o"ogsts)

• Assessment Centers (e4ercses)

• Tests ("anguage an$ s,eca" tests)

• Ro"e of 5am"&

" ' f ' "


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5"o*c'art of t'e Se"ectonrocess

8tart the 8election 7rocess

Can t'e ,oston e /""e$ & a "oca" natona"E

I$entf& $egree of nteracton re3ure$ *t'"oca" communt& – usng a F< or G< ,ont sca"e-rangng from "o* to 'g'- n$cate t'e $egreeof nteracton *t' "oca" communt& re3ure$

for successfu" ,erformance on t'e 8o+

Se"ect "oca" natona" an$ su8ect 'm'er totranng asca""& ame$ at m,ro#ng tec'nca"

an$ managera" s;""s+

6m,'ass on tas;s #ara"es+

Secon$ ut & no means unm,ortant 3uestons to as; *'et'er t'e n$#$ua" s *""ng to

ser#e aroa$+

Is can$$ate *""ngE

7robably not suitable orposition

6m,'ass on tas; #ara"es

I$entf& $egree of sm"art& $ssm"art& et*een cu"tures –

usng a F< or G


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>re,arng for an Internatona"Assgnment

Stu$& t'e fo""o*ng su8ects:• Soca" an$ usness et3uette+

• Hstor& an$ fo";"ore+

• Current a%ars- nc"u$ng re"atons et*eent'e countr& an$ t'e Unte$ States+

• T'e cu"tures #a"ues an$ ,rortes+

• 2eogra,'&- es,eca""& t'e ctes+

• Sources of ,r$e: artsts- muscans- no#e"sts-s,orts- great ac'e#ements of t'e cu"ture-nc"u$ng t'ngs to see an$ $o+

• Re"gon an$ t'e ro"e of re"gon n $a"& "fe+

• >o"tca" structure an$ current ,"a&ers+

• >ractca" matters suc' as currenc&-trans,ortaton- tme !ones- 'ours of usness+

• T'e "anguage+


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Cu"tura" S'oc;

• A Dsorentaton t'atCauses >er,etua"Stress

– Dsorentng Inc$ents

– Im,oss"e

Communcaton – Te"e,'one D=cu"tes

– 5am"& 5rustratons


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S,eca" Cons$eratons

• Career De#e"o,ment Rs;s

• Reentr& >ro"ems

•

Managng 5am"& 7fe• Terrorsm


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Recrutment

• 2o#ernment Regu"atons

• or; >ermts Un#ersa""& Re3ure$

•

Recrutment of 7oca"s Vares• 2uest or;ers

• Ro"e of C'urc'-Re"gon-5am"&-

>o"tcs


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Se"ecton

•

Mert Versus .est5am"&

• 5am"& Tes

•

Soca" Stan$ng• Orgn

• In$ustra"!e$ #ersus

7ess De#e"o,e$


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Tranng Issues

• 7oca" Resources

• 7ess Tec'nca" Ca,a"tes

•

A,,rentces', Strengt's n 6uro,e• Management De#e"o,ment

• 7anguage (6ng"s' Nee$)


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Com,ensaton• Host Countr& 6m,"o&ees

– >ro$ucton Stan$ar$ or Tme orComnaton

– .ene/ts (often 'g'er t'an ,arent

countr&) – >ro/t S'arng (ma& e Re3ure$)

• Managers –

Narro*ng of Sa"ar& 2a,


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64,atrate Com,ensaton

• .ase >a&

• D%erenta"s

• Incent#es

• Com,an& Assstance


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Com,ensaton of 64,atrateManagers

L+ >ro#$e an ncent#e to "ea#et'e ,arent countr&+

+ Mantan a $ecent stan$ar$of "#ng+

1+ 5ac"tate reentr& nto t'e,arent countr&

+ >ro#$e for t'e e$ucaton ofc'"$ren+

+ Mantan re"atons',s *t'fam"&- fren$s- an$ usnessassocates+

*o be e%ective, a compensationprogram must$


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Com,ensaton 6"ements of an64,atrate

• >rograms use$ & man& MNCs 'a#e four e"ements:

• .ase ,a& – e3ua" to ,a& of $omestc counter,arts ncom,ara"& e#a"uate$ 8os+

• D%erenta"s – to o%set t'e 'g'er costs of o#erseas goo$s-ser#ces- an$ 'ousng+

• Incent#es – to com,ensate t'e ,erson for se,araton fromfam"&- fren$s- an$ $omestc su,,ort s&stems+

• Com,an& assstance ,rograms – to co#er a$$e$ costs suc'as mo#ng an$ storage costs- automo"e- an$ e$ucatone4,enses+


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T'e >rce of an 64,atrate

An employer’s typical frst-year expenseso sending a U.S. executive aroad.

:irect ompensation osts

.ase Sa"ar& L00P

5oregnersona" ncome ta4 aroa$ 0P

-ote$ dditionalcosts oten incurred

arenJt listed above,including languageand cross'culturaltraining oremployee andamily, and costs o

selling home andcars in the 2.8.beore moving.

K/igures tae intoaccount paymentsby employee tocompany based onhypothetical 2.8.income ta! andhousing costs.

KIt is not unusual to

triple costscom ared to 28


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ihrm – an introduction

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