Chapter

Chapter 11 Introduction
Introduction
International Dimensions of HRM/ Basic Differences in Between
HRM and IHRM
Approaches to IHRM.
International Corporation, Multinational Corporation, Global
Corporation
Model of International HRM
Functions of International HRM
Variables that Moderate Differences between Domestic and
International HRM
Top Ten Multinationals in the World

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Figure 1-1: Inter-relationships between approaches in the field

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Meaning
Meaning International
International HRM
HRM
Meaning International HRM which deals with practices of
managing people on international scale, has got
attention of enterprises operating globally. IHRM
examines policies, decisions, issues, challenges and
trends in managing a global workforce. Peter J. Dowling
and his associates have concluded that the complexity
involved in operating in different countries and
employing different national categories of employees,
rather than any major differences between the HR
activities performed. International HRM basically
involves HR activities of procuring, allocating and
utilizing human resources in international business.

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Differences
Differences between
between domestic
domestic and
and
international
international HRM
HRM
More HR activities
The need for a broader perspective
More involvement in employees personal
lives
Changes in emphasis as the workforce mix of
expatriates and locals varies
Risk exposure
Broader external influences

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Approaches
Approaches to
to IHRM
IHRM..

Focus on some Human Resource Management Practices Shift to

Recruitment of Host Country Nationals One of the four approaches
are used for recruitment by the MNCs:
Ethno-centric Key positions held by citizens of home country.
Poly-centric Primary positions are held by nationals from host
country.
Regio-Centric Primary positions are by people from countries with
similar cultures, experience and management practices.
Geo-centric Best qualified individuals are hired at home and
abroad regardless of nationality, treating world as market to
implement global business operations.

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International
InternationalCorporation,
Corporation,Multinational
MultinationalCorporation,
Corporation,Global
Global
Corporation
Corporation

Enterprises involved in international business are usually referred

to as international corporations, multinational corporations or
global corporations.
The firms that exports their products to other countries as
international corporations
The firms that establish subsidiaries in foreign countries as
multinational corporations.
Global corporations- world corporations or stateless corporations.

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Model
Model of
of International
International HRM
HRM

Figure 2-1: A model of IHRM

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HR
HR activities
activities

Human resource planning

Staffing
Recruitment
Selection
Placement
Training and development

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HR
HR activities
activities
Compensation (remuneration)
and benefits
Industrial relations

Figure 2-2: Stages of

internationalization

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What
What is
is an
an expatriate?
expatriate?
An employee who is working and temporarily
residing in a foreign country
Some firms prefer to use the term
international assignees
Expatriates are PCNs from the parent country
operations, TCNs transferred to either HQ or
another subsidiary, and HCNs transferred into
the parent country

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Cont.
Cont.

Figure 1-3: International assignments create expatriates

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Variables
Variablesthat
thatModerate
ModerateDifferences
Differencesbetween
between
Domestic
Domesticand
andInternational
InternationalHRM,
HRM,

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Figure
Figure 1-5:
1-5: Factors
Factors influencing
influencing the
the global
global
work
work environment
environment

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Forces
Forces for
for change
change
Global competition
Growth in mergers, acquisitions and alliances
Organization restructuring
Advances in technology and telecommunication

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Impacts
Impacts on
on multinational
multinational management
management
Need for flexibility
Local responsiveness
Knowledge sharing
Transfer of competence

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Managerial
Managerial responses
responses
Developing a global mindset
More weighting on informal control mechanisms
Fostering horizontal communication
Using cross-border and virtual teams
Using international assignments

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