What is IHRM International HRM (IHRM) is theprocess of: procuring,allocating, andeffectively utilizing human resourcesin a multinational corporation, whilebalancing

the integration anddifferentiation of HR activities inforeign locations. Types of International Employees Expatriate (Expat): Any employee residing and working outside of his or her home country. May work for a foreign or domestic company. Regional or Intra-regional Expatriate: Any employee residing and working in a neighboring host country but outside of his or her home country. (A Saudi in Dubai, a Taiwanese in China). Third Country National (TCN): A citizen of country A (e.g.: American) working in country B (e.g.: Brazil) for a company that is headquartered in country C (e.g.: Canada). Key Local National (KLN): Executive, partner or high level manager working in his/her own country for a foreign company. U.S.-bound Expatriate: A non-U.S. citizen working and residing in the U.S. Business Traveler: An employee who travels outside his or her home country or country of assignment on the business of the policyholder. Staffing philosophy. Global staffing is quite a complex affair. It involves activities on a global basis, including candidate selection, assignment terms and documentation, relocation processing and vendor management, immigration processing, cultural and language orientation and training, compensation administration and payroll processing, tax administration, career planning and development, and handling of spouse and dependent matters. Multinational companies (MNCs) employ several

types of international managers. Locals are citizens of the countries where they are working. Expatriates are non-citizens of the countries in which they are working. Home-country national are citizens of the country in which the multinational company has its headquarters. Third-country nationals are citizens of a country other than the parent or the host country. Expatriates still represent a minority of multinationals managers. Yet there ar e also reasons for using expatriates-either home-country or third country nationalsfor staffing subsidiaries. The major reason is usually technical competence. Multinational also view a successful stint abroad as a required step in developing top managers.

An international human resource manager must proceed with the job of hiring the right number of people of the right type. The international human resource manager must not only select people with skills, but also employees who can cope with the organizations culture. MNCs tries to staff its operations with local persons under the assumption that local people are better equipped to do business at their home locations. However, expatriates are needed in the system for a specific set of skills that might not exist at a particular location.

Values and International Staffing Policy:

Experts sometimes classify top executives values as ethnocentric, polycentric, or geocentric, and these values translate into corresponding corporate behaviors and policies. These values translate into three broad international staffing policies. The vital factors that affect Multinational enterprises (MNEs) staffing include strategy, organizational structure, and subsidiary specific factors such as its duration of operations, technology, production and marketing technologies, and host country characteristics such as level of economic and technology development, political stability, regulations and culture. Thus the philosophies of staffing abroad are ethnocentric, polycentric and geocentric.

Ethnocentric Staffing: In ethnocentric staffing, Parent Country Nationals (PCNs) are selected for key position regardless of location. Japanese, European, U.S and Korean firms utilise ethnocentric staffing. With an ethnocentric staffing policy, the firm fills key management jobs with parent country nationals. Reasons given for ethnocentric staffing policies include lack of qualified host-country seniormanagement talent, a desire to maintain a unified corporate culture and tighter control, and the desire to transfer the parent firms core competencies to a foreign subsidiary more expeditiously. Polycentric Staffing: The polycentric staffing policy requires host-country nationals to be hired to manage subsidiaries, while parent-country nationals occupy key positions at corporate headquarters. Although home-country personnel fill top management positions, this is not always the case. For example, many US MNCs use home-country managers to get the operations started, and then hand it over to the host-country managers. Hindustan Lever Ltd, (HLL), the Indian subsidiary of Unilever, has local as its chiefs. Preference for home-country citizens for key positions does not fit into a pattern, unless government interventions dictate selection processes. In Brazil, for example, two-thirds of the employees in any foreign subsidiary traditionally had to be Brazilians. In additions, many countries exert real and subtle pressures to staff the upper management ranks with nationals. The polycentric approach to staffing has both merits as well as demerits. Hiring host country nationals eliminates language barriers, expensive training periods and cross-cultural adjustment problems of managers and their families. The disadvantages of the polycentric approach are equally strong. Local managers may have difficulty bridging the gap between the subsidiary and the parent company, because the experience and exposure they posses may not have prepared them to work as part of global enterprises. Language barriers, national loyalties, and a range of cultural differences may isolate the corporate headquarters staff from the various foreign subsidiaries. Finally, consideration of only home and host-country nationals may result in the exclusion of competent executives. Geocentric Staffing: This staffing philosophy seeks the best people for key jobs throughout the organization regardless of nationality. Seeking the best person for the job, irrespective of nationally is most consistent with the underline philosophy

of a global corporation. Colgate-Palmolive is an example of a company that follows the geocentric approach. A geocentric policy is based on assumptions that, highly competent employees are available not only at headquarters, but also in the subsidiaries; international experience is a condition for success in top position; managers with high potential and ambition for promotion are always ready to be transferred from one country to another; competent and mobile managers have an open disposition and high adaptability to different conditions in their various assignments; and those not blessed initially with an open disposition and high adaptability can acquire these qualities as their experience abroad accumulates. The geocentric approach has merits and demerits. Among its advantages is the possibility of making the best use of its human resources and it enables the firm to build a cadre of international executives who feel at home working in a number of cultures. In addition, the multinational composition of the management team that results from geocentric staffing tends to reduce cultural myopia and to enhance local responsiveness. Thus, other things being equal, a geocentric policy seems to be the most attractive. Among the disadvantages, the restrictions imposed on staffing by host governments that a high number of their citizens are to be employed in subsidiaries, the increased training and relocation costs and a remuneration structure with standardized international base pay are the prominent. Regiocentric Approach Company's international business is divided into international geographic regions. The regiocentric approach uses managers from various countries within the geographic regions of business. Although the managers operate relatively independently in the region, they are not normally moved to the company headquarters. The regiocentric approach is adaptable to the company and product strategies. When regional expertise is needed, natives of the region are hired. If product knowledge is crucial, then parent-country nationals, who have ready access to corporate sources of information, can be brought in.

One shortcoming of the regiocentric approach is that managers from the region may not understand the view of the managers at headquarters. Also, corporate headquarters may not employ enough managers with international experience.