Global Staffng

8/3/2019 Global Staffng

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Human Resource Management and

FunctionsHuman resource management (HRM): dealswith the entire relationship of the employeewith the organizationRecruitment: process of identifying andattracting qualified people to apply for vacantpositionsSelection: process of filling vacant positions inthe organization



B asic HRM Functions

Training and development: giving employeesthe knowledge, skills, and abilities to performsuccessfullyPerformance appraisal: system to measureand assess employees work performance



B asic HRM Functions

Compensation: organization s entire rewardpackage, including financial rewards, benefits,and job securityLabor relations: ongoing relationship betweenan employer and those employeesrepresented by labor organizations



International Human ResourceManagement ( IHRM)

All HRM functions, adapted to theinternational setting

Two added complexities compared todomestic HRM- Must choose a mixture of international employees- Must decide the extent of adaptation to local

conditions



Types of Employees in MultinationalOrganizations

Expatriate: employee from a different countryHome country nationals: expatriate

employees from the parent firm s homecountryThird country nationals: expatriate workerswho come from neither the host nor homecountry



Types of Employees in MultinationalOrganizations

Host country nationals: local workers whocome from the host country where the unit islocatedInpatriate: employees from foreign countrieswho work in the country where the parentcompany is located

Flexpatriates: employees who are sent onfrequent but short-term internationalassignments



The Expatriate or the Host CountryManager

Multinationals must decide whether to useexpatriates or home country nationals

Need to look at some questions- Given the firm s strategy, what is the preference for

the position?





Is the Expatriate Worth It?

Decisions must take into account costs of suchassignments- High cost- High failure rate



Strategic Role of ExpatriateAssignments

Helps managers acquire international skillsHelps coordinate and control operations

dispersed activitiesCommunication of local needs/strategicinformation to headquartersIn-depth knowledge of local markets

Provide important network knowledge



International Cadre

International cadre (or Globals): Separategroup of expatriate managers who specializein a career of international assignments- Have permanent international assignments- Move from international assignments to

international assignments- Recruited from any country- Sent to worldwide locations to develop cross-

cultural skills



Flexpatriates

The frequent flyers who travel on short noticefor shorter time durations while maintainingtheir family and personal lives at the home-country locationKey functions- Sent to explore markets

- Consider problem areas in the foreign subsidiary- Manage projects- Help with transfer of technology



Flexpatriates

Advantages- Do not experience many of the family and personal

difficulties and stress associated with expatriateassignments

- Much less expensive than expatriate norelocation or repatriation costs



Flexpatriate

Disadvantages- Taxation issues can become complicated if the

assignment exceeds six months he companymay end up paying the tax

- Does not fully integrate into the local workenvironment and does not learn low to adapt

locally- May be resented for neglecting the host-country

culture





Exhibit 11.2: Expatriate Success Factorsand Selection Methods



Priority of Success Factors

Assignment length- Technical and professionals skills are key for short

assignments

Cultural similarityRequired interaction with local peopleJob complexity and responsibility



Exhibit 11.3: Selecting Expatriates: Priorities for SuccessFactors by Assignment Characteristics



Training and Development

Cross-cultural training: increases the relationalabilities of future expatriates and theirspouses and familiesTraining rigor: extent of effort by both traineesand trainers required to prepare the traineesfor expatriate positions



Training and Development (cont.)

Low rigor training- Short time period- Lectures and videos on local cultures

- B riefings on company operationsHigh rigor training- Last over a month- Experiential learning- Extensive language training- Includes interactions with host country nationals



Exhibit 11.4: Training Rigor: Techniquesand Objectives



Exhibit 11.5: How the Rigor of Training Relates to theB asic Expatriate Assignment Conditions



Expatriate Performance Appraisal

Conducting reliable performance appraisal forthe expatriate is very challengingChallenges

± Fit of international operation in multinationalstrategy

± Unreliable date ±

Complex and volatile environments ± Time difference and distance separation ± Local cultural situation



Steps to Improve the ExpatriatePerformance Appraisal

1.Fit the evaluation criteria to strategy2.Fine-tune the evaluation criteria

3.Use multiple sources of evaluation withvarying periods of evaluation



Exhibit 11.6: Evaluation Sources, Criteria, and TimePeriods for Expatriate Performance Appraisals



Expatriate Compensation

Compensation packages tend to include manycommon factors includes:- Local market cost of living- Housing- Taxes- B enefits



Exhibit 11.7: Average Rent of Two- B edroom,Unfurnished Apartments in Selected European Cities



The B alance-Sheet Approach

Provides a compensation package thatequates purchasing power

Allowances for cost of living, housing, food,recreation, personal care, clothing, education,home furnishing, transportation, and medicalcare





Additional Allowances and Perquisites

Foreign service premiumsHardship allowance

Relocation allowancesHome-leave allowances



Expatriate ManagerCompensation: Other Approaches

Headquarters-based compensation: payinghome country wages regardless of location

Host-based compensation system: adjustingwages to local lifestyles and costs of livingGlobal pay systems: worldwide jobevaluations, performance appraisal methods,and salary scales are used



Repatriation Problem

Difficulties faced coming back homeThree basic cultural problems reverse

culture shocks- Adapt to new work environment and culture of home

- Expatriates must relearn own national and

organization culture- Need to adapt to basic living environment



Strategies for Successful Repatriation

Provide a strategic purpose for the repatriationEstablish a team to aid the expatriateProvide parent country information sourcesProvide training and preparation for the returnProvide a home-leave policy to encourageexpatriates to make regular visits to the home

officeProvide support for the expatriate and family onreturn



International Assignments for Women:Two Myths

Myth 1: Women do not wish to takeinternational assignments.

Myth 2: Women will fail in internationalassignments because of the foreign culture sprejudices against local women.Successful women expatriates- Foreign not female emphasize nationality not

gender



International Assignments for Women:Advantages

More visibleStrong in relational skills

Wider range of interaction options



International Assignments for Women:Disadvantages

Face the glass ceiling- Isolation and loneliness- Constant proving of themselves, working harder

than male

Need to balance work and familyresponsibilities

Need to worry about accompanying spouse



More Women in the Future?

Women expatriate managers are expected togrow

Acute shortage of high-quality managersIncreasing number of women provide rolemodels



What Can Companies Do To EnsureFemale Expatriate Success?

Provide mentorsProvide opportunities for interpersonal

networks as a form of organizational supportRemove sources of barriersProvide support to cope with dual-careerissues



Multinationals and ElectronicHuman Resource Management

Electronic human resources (e.HR):automation of various aspects of the humanresources system of a company



Strategic B enefits of e.HR Systems

Reduce HR and administrative system costImprove HR services to employees

Employees take control of their own dataRepository of the wealth of knowledge andskills of expatriates

Employee tracking for career managementand other HR purposes



Proper Steps to e.HRImplementation

Develop business case to justify using e.HR orupgrade to e.HRMake the system customer-focusedB e proactiveOrganize collected data in ways that is usefulto the organization



Multinational Strategy and IHRM

IHRM orientation: company s basic tactics andphilosophy for coordinating IHRM activities formanagerial and technical workers



Exhibit 11.9: IHRM Orientation and IHRMPractices for Managers and Technical Workers









Multinational Strategy and IHRM

Ethnocentric IHRM: all aspects of HRM formanagers and technical workers tend tofollow the parent organization s home-countryHRM practices





Costs of Ethnocentric IHRM

May limit career development for hostcountry nationalsHost country nationals may never identifywith the home companyExpatriate managers are often poorly trainedfor international assignments and makemistakesExpatriates may have limited careerdevelopment



Regiocentric and Polycentric IHRM

Regiocentric IHRM: region-wide HRM policiesare adoptedPolycentric IHRM: firm treats each country-level organization separately for HRMpurposesGreater responsiveness to host countrydifferences



B enefits of Polycentric andRegiocentric HRM Policies

Reduces costs for training of expatriatemanagers from headquartersNo investment in language trainingFewer problems with adjustments to localcultures

Less expensive





Global IHRM Orientations

Recruiting and selecting worldwideAssigning the best managers to internationalassignments regardless of nationality





IHRM Orientation andMultinational Strategy

Early stages of internationalizationethnocentric IHRMMultilocal strategies ethnocentric orregiocentricRegional strategy regiocentric, polycentric orglobal



Exhibit 11.10: IHRM Orientationsand Multinational Strategies



Conclusion

When basic HRM practices are applied to acompany s international operations, theybecome International HRM

Chapter focused on HRM practices as appliedto the expatriate employeesExpatriates present special challenges formultinationalsIt is important for multinationals to find waysto properly manage expatriates to benefitfrom their experiences

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