2. OUT LINES:
1. Def Of IHRM
2. What are reasons that encouraged global organizations to
develop international HR strategies?
3. OBJECTIVES OF IHRM
4. TYPES OF INTERNATIONAL ORGANIZATIONS
5. DIFFERENCES BETWEEN IHRM & DOMESTIC HRM
6. IHRM Practices
7. External environment & IHRM
8. ACTIVITIES INVOLVED IN IHRM
9. EFFECTIVE 'HRM IMPLEMENTATION
3. 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.
4. Simple definition is ‘the process of
managing people in international
settings’
IHRM is the management of HR in
business operations in at least two
nations
5. What are reasonsthat encouraged global organizations
to develop international HR strategies?
Global competition and differences in
organizational environment across nations
Globalization of Business
Effective HRM determinant of success in
international business
6. 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
9. Multinational Corporations
MNCs have operating units (subsidiaries)
located in foreign countries
Subsidiaries function as autonomous units
Examples : Shell, Philips, Xerox
10. Global Corporations
Maintains control over its worldwide
operations (subsidiaries) through a
centralized home office.
They treat the entire world as a single
market
Examples : Matsushita
11. Transnational Corporations
Provides autonomy to independent country operations
but bring these operations together into an integrated
whole through networked structure
They combines the local responsiveness of an MNC and
the efficiency of a global corporation
Examples : Ford & Unilever
12. 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)
13. DIFFERENCES BETWEEN IHRM &
DOMESTIC HRM
IHRM
Address a broad range of
HRM activities
HR issues relate to
employees belonging to
more than one nationality
Greater involvement of
HR manager in the
personal life of employees
Domestic HRM
Address a narrow range of
HRM activities
HR issues relate to
employees belonging to
single nationality
Limited involvement of HR
manager in the personal life of
employees
14. IHRM Domestic HRM
Greater exposure
to risks in
International
assignments
Has to manage
several external factors
such as government
regulations of foreign
country
Limited risks in
domestic
assignments
Limited external
factors to deal with.
16. 1) International staffing
refers to the process of selecting employees for
staffing international operations of an MNC
MNCs can be staffed using three different sources
a. Home country or Parent Country National (PCN)
b. Host Country Nationals (HCN)
c. Third Country Nationals (TCN)
17. PCN
Employees of an organization who are citizens of the country
in which the headquarters of the company is located
HCN
Employeesof anorganizationwhoarethecitizensofthe
country in which the foreign subsidiary is located
TCN
Employees of an organization who are the citizens of the
country other than the country where the organization is head
quarterd and the country that is hosting the subsidiary
18. Approaches to staffing subsidiaries
Ethnocentric
foreign subsidiary has little autonomy. All strategic
decisions are made at the headquarters. PCNs staff key
positions at quarters as well as the foreign subsidiary
Polycentric
staff foreign subsidiaries of the firm with HCNs and
headquarters consist of PCNs
Geocentric
staff my be PCNs, HCNs or TCNs
ability and not nationality is the key to staffing
19. 2)Pre-departure Training for
International Assignments
To make it easier for the employee to assume
job responsibilities and be effective in the
foreign country as soon as possible
To facilitate cultural adaptation as quickly and
as effectively as possible
20. 3)Repatriation
It is the process of bringing an expatriate home
after he/she has completed the international
assignment
21. Organizations can follow 3 practices
1. Create knowledge and develop global leadership
skills
2. Ensure that candidates have cross-cultural skills to
match their technical abilities
3. Prepare people to make the transition back to
their home offices
22. 4)Performance Management in International
Assignments
Performance is the combination of several factors
Compensation Package
Task Assigned to the Expatriate
Head quarter’s Support
Environment
Cultural Adjustment
23. 5)Compensating Managers in
International Assignments
Components of expatriate compensation
Home leave and travel allowances
Children’s education allowance Currency
differential payments Relocation allowance
Housing allowance
Cost of living adjustment
Payments to protect from negative tax consequences
26. EFFECTIVE 'HRM
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 organization (multi
domestic, international, global or transnational?)
27. 2)Determine the extent to which HR policies and practices should
be standardized or localized in accordance with overall
organizational strategy
3)Assess the extent to which local cultural economic and legal
factors will
impinge on any attempts to apply standard HR policies if integration
is a key
factor in organizational strategy.
4)Ensure a computerized database of global human resources is used
if integration is desired.
28. 5)Work with the senior management team to
identify the competencies required to
achieve global organizational 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 organization.