Submitted By-

AMIL AJITH
MBA D SECTION
RA1652001010304
 What is IHRM?
IHRM can be defined as set of activities aimed
managing organizational human resources at
international level to achieve organizational
objectives and achieve competitive advantage
over competitors at national and international
level.
IHRM includes typical HRM functions such as
recruitment, selection, training and development,
performance appraisal and dismissal done at
international level and additional activities such
as global skills management, expatriate
management and so on.
 OBJECTIVES OF IHRM
Create a local appeal without compromising
upon the global identity.
Generating awareness of cross cultural
sensitivities among managers globally and
hiring of staff across geographic boundaries.
Training upon cultures and sensitivities of the
host country.
 NEED FOR IHRM
Managing expatriates
Globalization has forced HRM to have
international orientation
Effectively utilise services of people at both
the corporate office and at the foreign plants
FUNCTIONS OF IHRM
RECRUITMENT
SELECTION
EXPATRIATES
PERFORMANCE APPRAISAL
TRAINING AND DEVELOPMENT
COMPENSATION
WOMEN IN INTERNATIONAL BUSINESS
DUAL CAREER GROUPS
INTERNATIONAL INDUSTRIAL RELATIONS

TRADE UNIOUNS

PARTICIPATIVE MANAGEMENT
 Characteristics of IHRM
More HR activities

Need for a broader perspective

More involvement in employee personal lives

Changes in emphasis as the workforce mix of

expatriates and locals vary

Risk exposure

More external influences

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More Human Resource Activities
Human Difficulty in implementing HR in host
countries
Resource Developmental opportunities for
Planning international managers.

Ability to mix with organisations culture

Employee Ethnocentric, polycentric or geocentric
staffing approach
Hiring Selection of expatriates
Managing repatriation process

Emphasis on cultural training

Training & Language training
Development Training in manners & mannerisms
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 Devising an appropriate strategy to compensate
expatriates
Minimising difference in pay between parent,
Compensation host & third country nationals
Issues relating to the re-entry of expatriates into
the home country

Constraints while operating in host

countries need to be considered.
Performance
Management Physical distance, time differences & cost of
reporting system add to the complexity.

Handling industrial relations problems in a

subsidiary.
Industrial
Relations Attitude of parent company towards unions
in a subsidiary
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 Need for Broader Perspective

Pay issues
Different countries, different currencies
Gender based pay in Korea, Japan, Indonesia
Health insurance for employees & their families

Overtime working Korean & Japanese firms

Promotions based on seniority or merit

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 More involvement for both parent-country &
More third-country nationals
Involvement in Housing arrangements
Employees Health care
Remuneration packages
Personal Lives Assist children left behind in boarding schools

Changes in
emphasis as Need for parent-country & third-country
the workforce nationals decrease as more trained locals
become available.
mix of Resources reallocated to selection, training &
expatriates and management development
locals vary
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 Physical safety of the employees.
Risk
Failure of expatriates to perform well
Exposure financial losses to the firm

Dealing with ministers, political figures,

economic & social interest groups
External Hiring procedures dictated by host
country.
Influence Catch up with local ways of doing
business.
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Reasons for Growing Interest in IHRM

Effective HRM
Globalisation of determinant of
Business success in
international business

Movement to network
Significant role in
organisations from
implementation &
traditional hierarchical
control of strategies
structures

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 STAFFING POLICIES IN IHRM
Ethnocentric: Here the Key management positions are
filled by the parent country individuals.
Polycentric: In polycentric staffing policy the host
country nationals manage subsidiaries whereas the
headquarter positions are held by the parent company
nationals.
Geocentric: In this staffing policy the best and the most
competent individuals hold key positions irrespective of
the nationalities.
 Recruitment & Selection
Ethnocentric Polycentric Regiocentric Geocentric
Approach Approach Approach Approach
Key Host-country Variation of Seeks best
management nationals hired staffing policy to
suit particular
people for key
positions held to manage jobs,
geographic areas
by parent- subsidiaries
irrespective
country
nationals Provides a of nationality
Parent-country 'stepping stone'
nationals for a firm wishing
Appropriate occupy key to move from an Underlying
during early positions at ethnocentric or principle of a
phases. corporate HQ. polycentric global
approach to a
geocentric corporation
approach

categories of employees can be hired parent country nationals (PCNs), host country
nationals (HCNs) & third country nationals (TCNs)

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IHRM MODEL
 How It Is Different from
Domestic HRM
Domestic HRM is done at national level and IHRM is done
at international level.
Domestic HRM is concerned with managing
employees belonging to one nation and IHRM is concerned
with managing employees belonging to many nations
(Home country, host country and third country employees)
Domestic HRM is concerned with managing limited number
of HRM activities at national level and IHRM has concerned
with managing additional activities such as
expatriate management.
Domestic HRM is less complicated due to less influence
from the external environment. IHRM is very complicated
as it is affected heavily by external factors such as cultural
distance and institutional factors.
ACTIVITIES INVOLVED IN IHRM
 ISSUES IN IHRM
Managing International Assignments
Employee and Family Adjustments
Selecting the right person for foreign
assignments
Culture and Gauge
Language and Communication
 EFFECTIVE IHRM
IMPLEMENTATION
The following checklist identifies some of the critical
decisions/actions required in the formulation and
implementation of an effective IHR strategy.
1. As certain the current and intended nature of
international operations in the organisation (multi-
domestic, international, global or transnational?)
2. Determine the extent to which HR policies and
practices should be standardised or localised in
accordance with overall organisational strategy.
3. Assess the extent to which local cultural, social,
political, economic and legal factors will impinge on
any attempts to apply standard HR policies if
integration is a key factor in organisational strategy.
4. Ensure a computerised database of global
human resources is used if integration is
desired.
5. Work with the senior management team to
identify the competencies required to achieve
global organisational objectives.
6. Work with national HR and line managers to
formulate IHR policies and practices in the key
areas of sourcing, development and reward
which will embed a transnational mindset in
the organisation.
 Expatriate Assignment Life Cycle
Determining the
Crisis & Reassignment
need for an
Adjustment Abroad
expatriate

Repatriation &
Post-arrival
Adjustment
Departure Orientation &
Training

Selection Pre-assignment Crisis & Failure

Process training

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 Expatriate Failure

Premature return of expatriates to their home country

Reasons
Inability to adjust to host country culture leads to culture shock
Personal & emotional problems
Difficulties with the environment
Inability to cope with larger international responsibilities
Other family reasons

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THANK YOU