International HRM (IHRM)

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Chapter 17 International HRM (IHRM)
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Chapter outcomes

• Identify key forces driving the globalisation of
  organisations
• Identify the types of organisational forms used
  for competing internationally
• Understand the different types of cultures found
• Explain how domestic and international HRM differ
• Discuss the staffing process for individuals
  working internationally
• List and define four types of international
  employees
• List the different types of international
  assignments found
• Discuss issues relating to the orientation of
  international employees

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Chapter outcomes (continued)

• Identify the unique training needs for
  international assignees
• Reconcile the difficulties of home country and
  host-country performance appraisals
• Identify the characteristics of a good
  international compensation plan
• Explain the activities needed to increase
  expatriate completion rates
• Discuss the key issues in industrial relations of
  multinationals
• Describe several international health, safety and
  security concerns
• Discuss the importance of a global human resource
  management information system

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Definition

• IHRM -

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Main dimensions of IHRM

• Selection and recruitment of qualified
  individuals capable of furthering organisational
  goals
• Training and development of personnel at all
  levels to maximise organisational performance
• Assessment of employee performance to ensure that
  organisational goals are met
• Retention of competent corporate personnel, who
  can continue to facilitate the attainment of
  organisational goals
• Management of the interface between labour and
  management to ensure smooth organisational
  functioning

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Why do companies decide to do business abroad?
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Organisational firms used internationally

• Exporting
• Licensing
• Management contracts
• Sole ownership
• Types

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What types of cultures are found around the world?

• What is culture?
• Identifying international cultures

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What impact does going abroad have on the
activities of HR professionals?

• More functions
• More involvement in employees personal lives
• Change in emphasis as the ________________ varies
• More ____________ influences

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Environmental forces
National forces
Economic forces
___________
HR systems Policies/procedures Recruitment
___________ Training Motivation/reward systems
__________________Career paths
Corporate culture
Corporate culture
__________
Legal forces
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Recruitment

• Expatriates
• Ethnocentric approach
• Polycentric approach
• Regiocentric approach
• Geocentric approach
• Inpatriate

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Reasons for expatriate failure

• Inability of the manager's spouse to adjust to a
  different physical or cultural environment
• The manager's inability to adapt to a different
  physical or cultural environment
• Other family-related problems
• The manager's personality of emotional immaturity
• The manager's inability to cope with the
  responsibilities posed by overseas work
• The manager's lack of technical competence and
• The manager's lack of motivation to work overseas

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International assignments

• Length and duration
• Short-term
• Extended
• Long-term
• Types

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Selection

• 4 different types of employees are normally
  appointed to overseas positions

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SELECTION (CONTINUED)
Factors to be considered when selecting
candidates for overseas appointments

• Adaptability
• Diplomacy
• Language ability
• Communication skills
• Managerial talent
• Maturity emotional stability
• Leadership skills
• Cultural sensitivity
• Technical knowledge

• Experience within the company
• Interest in overseas work
• Initiative and creativity
• Previous overseas experience
• Age
• Stability of marital relationship
• Spouses and familys adaptability

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Orientation

• Traditional people involved still remains valid
• Need for additional background information (e.g.
  cultural practices, language etc.)
• For longer projects local orientation is also
  important

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Training Development

• Preparation of expatriates
• _____________ of expatriates before, during and
  after foreign assignments
• _____________ and training of expatriate families
  before, during and after foreign assignments
• _____________ of the headquarters staff
  responsible for the planning, organisation and
  control of overseas operations

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Training Development (continued)

• Techniques are categorised into 5 groups
• Field experiences

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Training Development (continued)

• Many companies neglect TD of expatriates for the
  following reasons
• Training is not thought to be effective
• The period of time between selection
  expatriate's departure is short, leaving little
  time to expose him or her to in-depth training
  prior to departure
• The temporary nature of most assignments does not
  warrant budget expenditures for training
• The individual dimensions needed for successful
  acculturation are not well enough known to devise
  sound training programmes
• There is a belief that technical skills are the
  main success factors for assignments abroad

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Performance appraisal

• Performance appraisal (PA) is a fundamental
  management tool that can be useful as a basis for
  functions such as
• Making administrative decisions regarding
  personnel actions (eg. promotions and transfers
  and support for taking disciplinary actions or
  terminations)
• Coaching employees in improving areas of weakness
  and building upon their areas of strength

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Performance appraisal (continued)

• Value of PA can be increased by planning, ongoing
  performance monitoring and employee development
• Choice of evaluator
• Evaluators amount of contact with the expatriate
• Inadequate establishment of performance objectives

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Retention of personnel

• Compensation
• Repatriation

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Typical expatriate compensation components
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Six approaches followed to compensate expatriates

• Negotiation
• Balance sheet approach
• Localisation
• Lump sum

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Repatriation

• Have to facilitate adaption to foreign adjustment
  and on return to headquarters
• Some expatriates are frustrated as they can often
  not use their new skills obtained abroad
  immediately
• Companies should provide a better support system
  to ally the employees concerns about career
  issues and they should have a proper expatriate
  staffing policy in place

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Expatriate adjustment stages
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Labour relations

• Approaches to follow
• Hands-off
• Strategic planning
• Managed totally from headquarters
• Interface of headquarters, international human
• resource and line management in the field

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Discipline dismissals

• Are they the same in all countries?
• Compensation
• Companies should be well acquainted with the
  legal implications of international staff

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Transfers, lay-offs and retirement

• Movement of people as part of development
• Cultural differences and language
• Legal implications

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Health, safety security issues

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Summary

• Globalisation of business continues to grow after
  1994 when South Africa became a full member of
  the international community again.
• Organisations doing business internationally may
  evolve from organisations engaged in exporting
  activities to multinational enterprises, global
  and transnational organisations.
• Legal, political, economic and cultural factors
  influence global HR management.
• One scheme for classifying national cultures
  considers power distance, individualism
  masculinity/feminity, uncertainty avoidance and
  long-term orientation.

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Summary

• Staffing global jobs can be done using
  expatriates, host-country nationals and third
  country nationals.
• Global assignments can be used for a number of
  reasons and for varying durations.
• The selection of employees should consider
  cultural adjustment, organisational requirements,
  personal characteristics, communication skills
  and personal/family factors.
• Once selected, the assignments of global
  employees must be managed through both effective
  expatriation and repatriation.

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Summary

• Training and development for employees focus on
  pre-departure orientation and training, continued
  employee development and readjustment training
  for repatriates.
• Compensation practices for employees are much
  more complex than those for domestic employees
  because of the numerous factors to be considered.
• To balance the pros and cons of home-country and
  host-country evaluations, performance evaluations
  should combine the two sources of appraisal
  information.
• Labour-management relations vary from country to
  country.
• Global organisations must be concerned about the
  health, safety and security of their employees.