Lesson 1

Learning Outcomes
When you nish reading this chapter you should: be able to differentiate between personnel management and HRM know about the origins of HRM realise the important role that IHRM plays in the management of multinational companies
2

Learning Outcomes
be familiar, through a real-life case study, with some of the HRM issues faced by staff in a foreign subsidiary of a major multinational company

Human Resource Management

Utilization of individuals to achieve organizational objectives All managers at every level must concern themselves with human resource management Five functions
1-4

Evolution of HRM

Human Resource Management Functions

Human Resource 1 Management

Safety and Health

1-6

Interrelationships of HRM Functions

All HRM functions are interrelated Each function affects other areas

1-7

PM Vs HRM
EMPLOYMENT PLANNING EMPLOYEE COMMUNICATION
EMPLOYEE FEELINGS EMPLYMENT TERMS EMPLOYMENT COST-BENEFITS EMPLOYMENT DEVELOPMENT PERSONNEL MANAGMENT NARROW TECHNICAL FOCUS COLLECTIVE/NEGOTIATING FOCUS HUMAN RESOURCE MANANGMENT CLOSER LINKS WITH BUSINESS STRAGETY MORE DIRECT COMMUNICATION WITH EMPLOYEES CONCERN WITH TOTAL ORGANISATIONAL CULTURE CONCERN ON ORGANISATIONAL EFFECTIVENESS FOCUS ON ORGANISATIONAL EFFECTIVENESS AND THE BOTTOM LINE FOCUS ON LONG TERM EMPLOYMENT CAPABILITIES 8 SOURCE: MAHONEY AND DECKUP (1986)

FOCUS ON JOB SATISFACTION COMPENSATION POLICES FOCUSED ON INDIVIDUALS FOCUS ON COST-REDUCTION (EG. REDUCING ABSENTEEISM AND TURNEOVER) FOUCS ON INDIVIDUAL SKILLS

Matching Model

Harvard Model

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10

Dynamic Human Resource Management Environment

1-11

11

Environment of Human Resource Management

Unions
Legal Considerations

EXTERNAL ENVIRONMENT INTERNAL ENVIRONMENT

Society

Technology

Marketing

Operations

Unanticipated Events

Human Resource 1 Management

Economy

Finance

Safety and Health

Other Functional Areas

Shareholders

Customers

Copyright 2010 Pearson Education, Inc. Competition publishing as Prentice Hall

Labor Market

1-12

Labor Market
Potential employees located within geographic area from which employees are recruited Always changing

1-13

Legal Considerations
Federal, state and local legislation Court decisions Presidential executive orders

1-14

Society
No longer content to accept, without question, the actions of business Ethics - Discipline dealing with what is good and bad, or right and wrong, or with moral duty and obligation Corporate social responsibility - Implied, enforced or felt obligation of managers to serve or protect interests of groups other than themselves
1-15

Unions
Group of employees who have joined together for purpose of dealing collectively with their employer Becomes a third party when dealing with the company
1-16

Shareholders
Owners of corporation Because they have invested money in firm, they may at times challenge programs considered by management to be beneficial to organization
1-17

Competition
Firms may face intense competition in both their product or service and labor markets Must maintain a supply of competent employees Bidding war often results

1-18

Customers
People who actually use firms goods and services Management has task of ensuring its employment practices do not antagonize members of market it serves Workforce should be capable of providing top-quality goods and services
1-19

Technology
The world has never before seen technological changes occur as rapidly as they are today. Created new roles for HR professionals Additional pressures on them to keep abreast of technology In 2008 survey of CEOs worldwide, 83% ranked change as most important issue confronting their organization
1-20

Cyberwork
Possibility of never-ending workday BlackBerrys, cell phones, text messaging, and e-mail create endless possibilities for communication Some workers believe their employer wants them available 24/7
1-21

Economy
In general, when economy is booming, it is often more difficult to recruit qualified workers. When a downturn is experienced, more applicants are typically available.
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Unanticipated Events
Occurrences in external environment that could not be foreseen Every disaster, whether manmade or by nature, requires a tremendous amount of adjustment with regard to human resource management
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Porters Value Chain

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DIFFERENCES DOMESTICS AND INTERNATIONAL HRM 1. Unique of operation sites, distribution networks, suppliers, and their customers are spread across nations beyond their familiar home ground 2. They need to negotiate entry into other countries, adjust their operations to comply with the host country legal requirements 3. Modify their products and services to reflect the religious and other cultural preferences of their foreign customers 4. Deal with a variety of accounting and taxation systems and trade policies 5. They also employ people from different parts of 25 the world.

Market Entry Strategies

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International division structure

CHALLENGING ASPECT OF INTERNATIONAL HRM

1. Operations is the multi- cultural nature of their workforce 2. HRM, like so many other managerial functions, takes place not in a vacuum but within the overall internal organisational environment and the external national and international context in which the company operates 3. Business imperatives associated with the form of MNCs' internationalisation, and their overall business and market strategies can also influence the ways in which they manage their employees located in their subsidiaries scattered around the world.
29

A Global Perspective: Cultural Differences in Global HR

Countrys culture is the set of values, symbols, beliefs, languages, and norms that guide human behavior within the country Learned behavior develops as individuals grow from childhood to adulthood Companies operating in the global environment recognize that national cultures differ and that such differences cannot be ignored

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Cultural Differences
When Nike learned that this stylized Air logo resembled Allah in Arabic script, it apologized and pulled the shoes from distribution.