IHRM- Module 1 *Introduction *Difference between DHRM IHRM

Introduction
Flat Globe- Govt liberalization, FDI invitation across many countries in many sectors Difficulty to survive in global competition. Need to compete in the global playing field To understand how to compete globally with global competitive advantage. A Major portion on these firm being its own employees, the HR and HRM in the international sense has become a necessity

A Firm said to have a global competitive advantage means having a effective HRM in the international context and quality HRM in the international sense An organizations HRM refers to all those activities that the firms HR does to effectively utilize its HR. These activities include

3

Defining HRM

human resource planning staffing (recruitment, selections, placement) performance management training and development compensation (remuneration) and benefits industrial relations
(c) 2009 by Nelson Education Limited.

So what activities changes when HRM goes International?

Lets Define IHRM. In general IHRM is all about worldwide management of Human Resources.(Brewster and Suutari) Schuler and Tarique In the field of IHRM it is about understanding, researching, applying n and revising all HR activities in their internal and external context- as they impact the process of managing HR in Organization through out the global environment to enhance the experience of the multiple stakeholders

Simple words Definition

The purpose of IHRM is to enable the firm to be globally successful at a global level.

Morgons Word
According to P.V. Morgan: IHRM is the interplay between 1) All HR activities that are done 2)The country /national categories involved (eg. various host countries where subsidiary are located) 3)3 categories of employees of an international firm(host country, parent country and third country) Inter-relation among 3 dimensions: HR Activities Types of employees Types of Countries of operations

Nature of IHRM
HR ACTIVTIES
STAFFING COMPENSTATION DEVELOPMENT

TYPES OF NATIONALS PARENT HOST THIRD TYPES OF COUNTRY PARENT HOST THIRD COUNTRY COUNTRY COUNTRY

A Typical model of IHRM

Expatriates
Any International Assignments Create Expatriates. Who/What are Expatriates? An employee who is working and temporarily residing in a foreign country .some refer them as international assignees. They are PCNs transferred from parent country operations HCNs transferred into parent country operations TCNs transferred from other subsidiaries.

Expatriates

It can be attributed to six factors 1. More HR activities : International

1. 2. 3. 4. 5. taxation relocation and orientation expatriate administrative services host government relations language translation services

Differences Between Domestic HRM and IHRM

2. The need for a broader perspective:

1. administering programs that are equitable for more than one group.

3. More involvement in employees personal lives: Ensure expatriates understand

1. 2. 3. 4. 5. housing arrangements Healthcare programmes compensation (cost-of-living allowances, premiums, taxes) visa requirements Schooling

4. Changes in emphasis as the workforce mix of expatriates and locals varies

5. Risk exposure:
1. 2. 3. 4. 5. expatriate failure direct costs indirect costs militant activities emergency evacuation

6. Broader external influences:

1. 2. 3. 4. 5. 6. government economy labour standards and costs taxation health and safety laws, compliance regulations, codes of conduct

Variable of IHRM
CULTURE TYPES OF INDUSTRY EXTENT OF DEPENDENCY OR RELIANCE OF THE SUBSIDIARIES SENIOR MANAGEMENT ATTITUDE COMPLEXITY OF MANAGEMENT OF PERSONAL

Forces for Change

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

IBUS 618 Dr. Yang

16

Forces of Changes: What Impacts it does on the firm?

It creates a need for increased flexibility of operations- domestically and internationally in a global view Increased Local responsiveness in host ,parent and third countries respectively. Create a platform of knowledge sharing and knowledge repositories-keeping technological advantages in the host, third countries Transfer of competence for mutual benefit in global as well as multi-domestic industry
IBUS 618 Dr. Yang 17

As a HR Manager what are Managerial Responses/changes sought from you?

Developing a global mindset More weighting on informal control mechanisms in a multi-domestic industry Encouraging horizontal communication Start Using cross-border and virtual teams Using international assignments

IBUS 618 Dr. Yang

18

To survive and grow in global level

IBUS 618 Dr. Yang

19

New Terms
HRM IHRM NAFTA UNCTAD

HCN PCN TCN

MNE culture shock

expatriate inpatriate
(c) 2009 by Nelson Education Limited.

20

Multinational Enterprise (MNE)

a firm which owns or controls business activities in more than one foreign country

21

(c) 2009 by Nelson Education Limited.