Ch11
- 1. CHAPTER 11 INTERNATIONAL HUMAN RESOURCE MANAGEMENT
- 2. COMPONENTS OF HRM • Recruitment • Selection • Training & Development • Performance Appraisal • Compensation • Labor Relations
- 3. INTERNATIONAL HRM (IHRM) • Basic HRM issues remain • Must choose a mixture of international employees • How much to adapt to local conditions?
- 4. EMPLOYEES IN MULTINATIONAL ORGANIZATIONS • Host country nationals • Expatriates • Home country nationals • Third country nationals • Inpatriates
- 5. MULTINATIONAL MANAGERS • Host country or expatriate?
- 6. USING HOST COUNTRY MANAGERS • Do they have the expertise for the position? • Can we recruit them from outside the company?
- 7. USING EXPATRIATE MANAGERS • Do parent country managers have the appropriate skills? • Are they willing to take expatriate assignments? • Do any laws affect the assignment of expatriate managers?
- 8. •IS THE EXPATRIATE WORTH IT? • High cost • High failure rate
- 9. •EXHIBIT 11.1 PAYING FOR THE EXPATRIATE MANAGER 400000 350000 300000 250000 $ 200000 150000 100000 50000 0 Hong Kong Taipei Salary Tokyo Home London Singapore
- 10. •REASONS FOR U.S. EXPATRIATE FAILURE • Spouse fails to adapt • Manager fails to adapt • Other problems within the family • Personality of the manager • Level of responsibilities
- 11. •Reasons for expatriate failure, continued • Lack of technical proficiency • No motivation for assignment
- 12. •MOTIVATIONS TO USE EXPATS • Managers acquire international skills • Coordinate and control operations dispersed activities • Communication of local needs/strategic information to headquarters
- 13. •KEY EXPATRIATE SUCCESS FACTORS • Professional/technical competence • Relational abilities • Motivation • Family situation • Language skills • Willingness to accept position
- 14. •PRIORITY OF SUCCESS FACTORS • Depends on : • assignment length • cultural distance • amount of required interaction with local people • job complexity/responsibility
- 15. •EXHIBIT 11.3 SHOWS A DECISION MATRIX USED TO SET PRIORITIES OR DIFFERENT SUCCESS FACTORS DURING SELECTION
- 16. Assignment Characteristics Greater Expatriate Longer More Interaction More Success Duration Cultural and Complex or Factors Dis- Communica- Respon- similarity tion sible Job Requirements with Locals Professional/ High Neutral Moderate High Technical Skills Relational Moderate High High Moderate Abilities International High High High High Motivation Family High High Neutral Moderate Situation Language Moderate High High Neutral Skills
- 18. •TRAINING RIGOR • The extent of effort by trainees and trainers required to prepare the trainees for expatriate positions
- 19. •LOW RIGOR TRAINING • Short time period • Lectures • Videos on local culture • Briefings on company operations company operations
- 20. •HIGH RIGOR TRAINING • Lasts over a month • Experiential learning • Extensive language training • Often includes interactions with host country nationals
- 21. •EXHIBIT 11.4 SHOWS VARIOUS TRAINING TECHNIQUES AND THEIR OBJECTIVES AS THE RIGOR OF THE CROSS- CULTURAL TRAINING GROWS
- 22. Techniques: Field trips to host country, meetings High with managers experienced Training in host country, meetings Rigor with host country nationals, intensive language training. Objectives: Develop comfort with host country national culture, business culture, and social institutions.
- 23. Techniques: Experiential learning exercises, role playing, Mid- simulations, case level studies, survival Training language training. Rigor Objectives: General and specific knowledge of host country culture, reduce ethnocentrism.
- 24. Techniques: Lectures, videotapes, reading background material. Objectives: Provide Low background information on Training host country business and Rigor national cultures, basic information on company operations.
- 25. •CHALLENGES OF EXPATRIATE PERFORMANCE APPRAISAL • Unreliable data • Complex and volatile environments • Time differences and distance separation • Local cultural situations
- 26. •STEPS TO IMPROVE THE PROCESS • 1. Fit the evaluation criteria to strategy. • 2. Fine tune the evaluation criteria • 3. Use multiple evaluators with varying periods of evaluation
- 27. •EXHIBIT 11.6 Shows several sources of information a superior or the HRM professionals may use to evaluate an expatriate managers
- 28. Evaluation Sources Criteria Periods Self evaluation Meeting objectives Six months and at the Management skills completion of a major Project successes project Subordinates Leadership skills After completion of Communication skills major project Subordinate development Peer expatriate and Team building Six months host country manages Interpersonal skills Cross-cultural interaction skills On-site supervisor Management skills At the completion of Leadership skills significant projects Meeting objectives Customers and clients Service quality and Yearly timeliness Negotiation skills Cross-cultural interaction skills
- 30. •THE BALANCE SHEET APPROACH • Provides a compensation package that equates purchasing power
- 31. •BALANCE SHEET COSTS • Allowances for cost of living, housing, utilities, furnishing, educational expenses, medical expenses, club memberships, and car and/or driver expenses
- 32. Domestic Assignment Expatriate Assignment Expenses and Expenses and Balanced Spendable Income + Allowances Spendable Income Base Salary = Base Salary Allowances as an incentive to take position, + foreign service premium, hardship pay, R&R Taxes = Taxes + Allowances to balance extra tax payments Goods and = Goods and Services Services Allowances to cover cost of living differences, + housing, children’s education, medical costs, automobile, recreation, home leave travel Housing = Housing Allowances for moving expenses, settling in + expenses, initial housing costs, and furnishing allowances Spendable = Spendable Income Income
- 33. •OTHER APPROACHES • Parent country wages everywhere • Wean expatriates from allowances • Pay based on local or regional markets • Cafeteria selection of allowances • Global pay systems
- 34. •THE REPATRIATION PROBLEM • Difficult for many organizations • "Reverse culture shock" • Expatriates must relearn own national and organizational culture • Includes whole family
- 35. •STRATEGIES FOR SUCCESSFUL REPATRIATION PROVIDE: • A strategic purpose for repatriation • A team to aid the expatriate • Home country information sources • Training and preparation for the return • Support for expatriate and family
- 36. •WOMEN EXPATRIATES: TWO IMPORTANT "MYTHS" • Myth 1: women do not wish to take international assignments • Myth 2: women will fail in international assignments because of the foreign culture's prejudices against local women
- 37. •SUCCESSFUL WOMEN EXPATRIATES • Foreign not female • emphasize nationality not gender • The woman's advantage • strong in relational skills • wider range of interaction options
- 39. •IHRM ORIENTATIONS • Ethnocentric • Polycentric • Regiocentric • Global
- 40. •IHRM ORIENTATION AND MULTINATIONAL STRATEGY • Early stages of internationalization = ethnocentric IHRM • Multilocal strategies = ethnocentric or regiocentric • Regional strategy = closer to the global
- 41. • International strategy = ethnocentric or polycentric IHRM • Transnational strategies = a global IHRM
- 42. •CONCLUSIONS • HRM functions • IHRM challenges • Expatriate managers • The role of women in multinational organizations • Multinational strategies and IHRM orientations