INTERNATIONAL HR MANAGEMENT

GOING INTERNATIONAL
Exporting Licensing

One firm leases the right to use its intellectual property to another firm in exchange for a fee

Franchising
An independent organization operates a business under the name of another in exchange for a fee

Foreign Direct Investment

Joint Ventures; strategic alliances Sole ownership

International Business Strategies

Multilocal Decentralized Collection of independently operating organizations Export Global

Market approach

Parent company maintains centralized control Hybrid combination of multilocal and export

Domestic vs. International HR

Basic function and objective remains the same: procurement, allocation, and utilization of people. Primary difference between IHR and domestic HR lies in the complexity of operating in different countries with different cultures and laws. Degree of complexity depends on:

Extent of cultural diversity Approach taken to multinational entry Top management attitudes (parochialism)

International HR Strategies

Ethnocentric
Centralized HR Managed by Parent Country Nationals (PCNs) Pay based on local market for employees; home country for PCNs Training aimed at KSAs to perform the job

Polycentric
Decentralized HR Managed by Home Country Nationals (HCNs) Pay based on local market Training given added importance

International HR Strategies
Geocentric

Global workforce deployed throughout the world Positions filled by most qualified regardless of nationality: HCNs, PCNs, or TCNs, Compensation based on value-added Training and development emphasized
Regiocentric

Why Do International Managers Fail?

Does

it change the essence of HR? Culture Shock Cultural arrogance (Parochialism) Cultural Insensitivity The Key success factor?
Cultural adaptability

CULTURAL ENVIRONMENT

Language Communication styles

Nonverbal Direct vs. Indirect Greeting: physical and verbal

Space
Structural & interpersonal

Time orientation
Punctuality Monochronic vs. Polychronic

Religion Respect/formality Consensus seeking

HOFSTEDES DIMENSIONS
Individualism

vs. Collectivism Power Distance Uncertainty Avoidance Masculinity vs. femininity Long-term orientation