An Introduction

to International
Human
Resource
Management
 Why International Human Resource
Management?

 Increasing globalization, firms and

employees in them moving all over the
world.
 Major problems in international operations
because of human resource management
blunders
 Hence need to understand human
resource management in a global
perspective
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 Why International Human Resource
Management? (cont’d)

 The role of HR in International Operations

 Managing a Multicultural Workforce
 Developing Managerial Talent in a Global
Business Environment

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 Three Approaches to IHRM

• Cross-cultural management
 Examine human behavior within organizations
from an international perspective
• Comparative HRM and Industrial Relations
 Seeks to describe, compare and analyze HRM
systems and IR in different countries
• HRM in multinational firms
 Explore how HRM is practiced in multinationals

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Interrelationships between
Approaches of IHRM

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 A Definition of Human Resource
Management
• Human Resource Management (HRM)
involves all management decisions and
practices that directly affect the people who
work for the organization.
• “Human Resources” the people who work
for the organization.
organization

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 The General Field of HR

 Major Functions and Activities

– Human resource planning
– Staffing
• Recruitment
• Selection
• Placement
– Performance appraisal
– Training and development
– Compensation and benefits
– Industrial relations
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 Human Resource
Management Functions

• Planning for Organizations, Jobs, and

People
– The Strategic Management of Human
Resources
– Human Resource Planning
• Acquiring Human Resources
– Selection
– Recruitment
– Integration
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 Human Resource Management
Functions (cont’d)

• Building and Motivating Performance

– HR Development
– Performance Appraisal
– Compensation Systems

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 Human Resource Management
Functions (cont’d)

• Maintaining Human Resources

– Benefits
– Safety & Health
– Collective Bargaining
– Organizational Exit
– Employment transitions
• Multinational Human Resource
Management
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Strategic Decisions and Their Implications
for Human Resource Management

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Strategic Decisions and Their Implications for
Human Resource Management (cont’d)

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What does IHRM add into the Traditional
Framework of HRM?
• Types of employees
– Within and cross-cultural workforce diversity
– Coordination
– Communication
• Human resource activities
– Procurement
– Allocation
– Utilization of human resources
• Nation/country categories where firms expand
and operate
– Host country
– Parent country
– Third country
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A Model of IHRM

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 Some Terms Defined

• Host Country National (HCN): Belongs to

the Country where the subsidiary is located
• Parent Country National (PCN): Belongs to
the Country where the firm has its
headquarters
• Third Country Nationals (TCN): Belongs to
any other country and is employed by the
firm

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Differences between Domestic HRM and IHRM

 More HR activities: taxation, culture

orientation, administrative services
 The need for a broader perspective : cater to
multiple needs
 More involvement in employees’ personal
lives: adjustment, spouses, children
 Changes in emphasis as the workforce mix of
expatriates and locals varies : fairness
 Risk exposure: expatriate failure, terrorism
 Broader external influences : government
regulations, ways of conduct
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Differences between Domestic HRM
and IHRM: variables
• Complexity involved in operating in different
countries, varied nationalities of employees
• The different Cultural Environment
• The industry or industries with which the
MNC is involved
• Attitudes of Senior Management
• Extent of reliance of MNC on home country
domestic market

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Factors that Influence the Global Work Environment

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 Approaches To International Human
Resource Management

• Ethnocentric: Highly centralized. HQ controls

PCNs dominate.
• Polycentric: Decentralized. Each subsidiary
has some degree of decision making
autonomy. HCNs manage subsidiaries.
• Geocentric: Ignores nationality in favor of
ability and competence needs in a worldwide
integrated business strategy.

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Thank You

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