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Human Resource Management Session 22

International HRM

Session Objectives:

1. Examine models of international staffing


2. Expatriation of employees
3. Impact of international legislation on HRM

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So what is International HRM?

“ ...all issues relating to the management of people in an


international context (including) human resource issues facing
MNCs in different parts of their organisations (and)
comparative analysis of HRM in different countries”

(Stahl and Bjorkman, 2006)


International Operations
• The modern world is often referred to as a ‘global village’

• Most large organisations are staffed by a diverse mix of people from different
nationalities, ethnicities and cultures

• Embarking on international operations is easier now than it has ever been


before due to faster transport links and the use of the internet

• International markets are ‘vital ground’ for big businesses in order to stay
competitive

• It is therefore imperative that managers have cross-cultural competency and


understand the issues that may apply to managing international workforces,
especially in overseas locations

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Issues Influencing International HRM
• Most experience comes from large Multi-National Corporations

• Tension between integration and differentiation

• Subject to a business world that is rapidly changing

• New patterns of mobility and trade

• Productivity levels

• Demography of the labour market

• Utilisation of labour
Key debates of HRM and Internationalisation
• Do we have a strategy for becoming international?

• What type of managers do we need?

• Where do we get them?

• How do local laws, trade unions, employment markets, etc,


affect us

• Relationship between ‘our way of working’ and local culture


Key debates of HRM and Internationalisation
• Do we use local employees or expatriates?

• How do we manage any expatriates?

• How do we manage knowledge across geographical and


cultural distance?
What skills do International HRM Practitioners
Need? (CIPD 2002)
• Interpersonal skills (especially cultural empathy)

• Influencing and negotiating skills

• Analytical and conceptual abilities

• Strategic thinking
Perlmutter’s International Staffing (EPRG)
Model(1969)
• Ethnocentric – Home country management style and appraisal criteria
are superior. Only parent country nationals considered suitable for
management positions at home and abroad.

• Polycentric – National differences and the need to be responsive to


local conditions require local management. Home country managers
remain dominant in HQ with host country managers on site.

• Regiocentric - Recognises the importance of national and cultural


differences but perceives them at a regional level e.g.within Europe, or
within Asia but not across regional boundaries

• Geocentric – A global view, managers drawn form any regions of the


world and appointed to positions regardless of nationality.

Brewster (2011)
Debate it…
• What are the advantages of employing a UK manager
(expatriate) to run our foreign workplace instead of a local
manager from the host country?

• What about vice-versa?

Debate this in your groups for 10 minutes and be prepared to


share your thoughts with the class. The lecturer will invite
responses.
Some possible advantages of using an
expatriate manager
• Accustomed to organisational culture

• Knows the ‘company way’

• Probably extensive managerial expertise

• Neutral to suppliers, local government, and other stakeholders

• Fresh pair of eyes

• Trusted employee and loyal to parent organisation

Brewster et al (2011)
Some possible disadvantages of using an
expatriate manager
• Cultural shock

• Doesn’t understand local legislation and customs

• Potential language barriers

• No local knowledge of the market, competitors, suppliers, etc

• Adjustment time and acceptance by local workers

• Cost may be expensive

Brewster et al (2011)
Questions so far?

Short Break – 5 minutes


International Assignments - Stages

• Planning
• Selection
• Preparation
• Adjustment
• Rewards
• Performance measurement
• Repatriation

Brewster et al (2011)
Planning – Assignment Objectives
Possible Examples

• To improve business performance

• To foster parent corporate culture in the subsidiary

• To break down barriers between parent company and


subsidiary

• To solve technical problems

• To develop top talent and future leaders of the company


Selection Methods (Sparrow 1999)

• Clinical risk assessment process

• Competency approach including Psychometric factors


Selection Criteria
• Professional, technical competence and experience

• Relational ability 1 – Personality traits and relational abilities

• Relational ability 2 – perceptual dimensions and life strategies

• Self maintenance factors

• Leadership and motivational factors

• Cultural awareness

• Family situation
Preparation

• Training (including cross cultural)

• Briefings

• Visits

• Shadowing
Adjustment Model (Black and Stephens 1989)

• Interaction

• General adjustment

• Work adjustment

* Has been criticised as too simplistic


Repatriation
• Pre-departure career discussions

• Named contact at home country organisation

• a mentor (both on location and ‘at home’)

• Re-entry counselling

• Family repatriation programmes

• Employee debriefings

• Succession planning

Brewster et al (2011)
Issues
• Much research was originally based on North American MNCs,
their attitudes and methods

• The world is changing – globalisation reduces the international


effect

• Security issues are now widespread

• Frequent flying/IT/Satelite video link, etc are changing the need


for expatriation

• Elite cadres of expatriate managers are now normal

• High attrition rate post-repatriation


Watch it…
One US expatriate manager’s experience…

https://www.youtube.com/watch?v=KphEXAf4yMA

Cultural shock even within geographical regions…

https://www.youtube.com/watch?v=M-44JKRqapY
Questions so far?

Long Break – 15 minutes


Analyse it…

Carry out the case-study ‘An Englishwoman Abroad’

You have 15 minutes to read and analyse the case. Discuss it


in your groups. Be prepared to feedback to the rest of the
class. The lecturer will invite responses.
Summary
Attitudes to practices of reward, equality and much more may be
affected by a range of cultural issues, such as perceptions of:

• Power Distance: How much the manager’s authority may or


may not be questioned, and also which members of society
may be leaders (caste systems)

• Collectivism v Individuality: Individualist societies may accept


performance related pay more than collectivist societies, etc

• Gender Equality: How much are women represented in the


workplace, and what positions do they hold
Summary
• Managers have to be well versed in cross-cultural skills in the
modern world

• Legislation may be radically different in other countries and this


may have a direct impact on normal HRM procedures/policy

• Managers should concentrate on developing a HRM system that


is ‘best fit’ rather than ‘best practice’
References
Banfield, P and Kay, R (2012). Introduction to Human Resource Management
(2nd Ed). Oxford. Oxford University Press.

Brewster C, Sparrow P, Vernon G and Houldsworth E (2011). International


Human Resource Management (3rd Edition). London; CIPD.

Carberry, C and Cross, C (2015). Human Resource Development: A Concise


Introduction. London; Palgrave.

Deal, T.E. and Kennedy, AA (1982) Corporate cultures: the rites and rituals of
corporate life, Harmondsworth, Penguin.

Handy, CB (1999) [1976] Understanding organizations, London, Penguin.

Gilmore, S and Williams, S (2013). Human Resource Management (2nd Ed).


Oxford; Oxford University Press.

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References
Mankin D (2009). Human Resource Development. Oxford; Oxford University
Press.

Mello J A (2015). Strategic Human Resource Management (4th Edition).


Stamford; Cengage.

Northouse, PG (2015). Leadership: Theory and Practice. 7th Ed. London. Sage
Publications Ltd.

Schein, EH (2004). Organisational Culture and Leadership. 3rd ed. San


Francisco: Jossey-Bass.

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