International Human Resource Management

Managing people in a multinational context

Chapter Objectives
Define key IHRM terms Review expatriate management evolution Outline differences between domestic and international HRM Discover the increasing complexity and potential challenges of current IHRM

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Terms
HRM IHRM
HCN PCN TCN

NAFTA UNCTAD

MNE culture shock emi-etic distinction

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expatriate inpatriate

Figure 1-1

Inter-relationships between approaches to a field

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Defining HRM
An organizations HRM activities include: 1. Human resource planning 2. Staffing (recruitment, selection, placement) 3. Performance management 4. Training and development 5. Compensation (remuneration) and benefits 6. Industrial relations

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Figure 1-2

Inter-relationships between approaches to the field

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Figure 1-3

International assignments create expatriates

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Differences between domestic HRM and IHRM

IHRM complexity can be attributed to six factors: 1. Human resource planning 2. Staffing (recruitment, selection, placement) 3. Performance management 4. Training and development 5. Compensation (remuneration) and benefits 6. Industrial relations

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Figure 1-4

Variables that moderate differences between domestic and international HRM

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Laurents steps to truly international HRM

1. Recognize that ones own HRM reflects home culture assumptions and values. 2. Recognize that ones own peculiar ways are neither universally better nor worse than others - just different and likely to exhibit strengths and weaknesses, particularly abroad. 3. Recognize that organizations foreign subsidiaries may prefer other ways to manage people ways that are neither intrinsically better nor worse, but possibly more effective locally. 4. Headquarters willingness to acknowledge cultural differences and steps to make them discussable and therefore usable. 5. Build shared genuine belief that cross-cultural learning will result in more creative and effective ways of managing people.

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Table 1-1

World top ten non-financial transnational corps., ranked by transnational index

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Table 1-2

World top ten non-financial transnational corps., ranked only by foreign assets

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Figure 1-5

Strategic HRM in multinational enterprises

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Discussion Questions
1. What are the main similarities and differences between domestic and international HRM? 2. Define these terms: IHRM, PCN, HCN, and TCN. 3. Discuss two HR activities in which a MNE must engage that would not be required in a domestic environment. 4. Why is a greater degree of involvement in employees personal lives inevitable in many IHRM activities? 5. Discuss at least two of the variables that moderate differences between domestic and international HR practices.
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