rN INTERNATIONAL Vy HUMAN RESOURCE MANAGEMENT CHAPTER INTRODUCTION \cal borders for the Purpose of “The eoncapt of global Globalisation of business, consequent upan the erosion of national polit tation of global village. : business, along with information technology, resulted nthe form vilage resulted in exchange of cutures across the giobe, location of manulacturng centres f varlour by treating the entire plobe 2s a single country, producing the components in one county, seser bing te product in the second couniry, marketing ihe product in the third county, the banks in the fourth coMrlry finance the operations, surance companies ithe ith country provide insurance facilties, al ne couriries provide human resources and s0 on, so forh. Thus, the global business employs the people from various Countries and manages the poopie of mult-cultures and multi-skills. Stages of internationalieation: These are four stages of intermationalisation, viz.,intemational company, multinational company, global company and transnational company. ‘= International Company: international companies export the products manutactured in the home country, ¢ Multinational Company: Multinational company establishes its branches/subsidiaries in various countries and operates like 2 Comestic company in each foreign country. * Global Company: Global company produces globally and markets locally or produces locally and, markets globally. Dr, Reddy's Lab designs and produces drugs in india and markets globally. «Transnational Company: Transnational company produces, markets, invests and operates across the world. Itis an integrated global enterprise which links global resources with global markets at profi, We use these terms interchangeably in this chapter. Human resource management policies and practices vary from a domestic company to a multinational company/transnational company. Globalisation of business across the world increased the significance of HRM across the national boundaries, in addition to HAM in the subsidiaries of MNCs operating in India. We now discuss the distinctive HAM practices in MNCs and TNCs. Global Recruitment MNCs and TNCs mostly use the following techniques of recruitment. ¢ Head-hunting ¢ Body shopping ‘+ Tele-recruitment.They ep actnicians, wose-snocers Hest country ational are emp "0 the bear is cca + Tid COUN Nanette ssseiSary in France-Mt Athi forthe qn ayn erate averting rere caty atonal an emoiee ol antaney oe ae ‘ocated in a county, wn ts not his home country | GLOBAL SELECTION APPROACH Selector roach contibites forthe, achievements of giobaly and act nen, Meter testes crepe viz. tne etmnorenite approach, tne paso ppro@ch an + The Ethnocentric Approach: Under this ap Hey mandgemertobs. This approach wns, Toyato etc re ee ee Employing host: country nations shin iness.1.2. the strategic goal of a global bus! ness, followed in selection process in global busin* 1d the geocentric approach. jor allthe preach, parent country nationals are: ae ‘widely folowed by Procter and Gamble, Phitps, Matsus! ted countries can Business Implications: MNCs with very imited geographic seope in cutraly lta counties So acop! the ethnocontrc approach, whereas the companies wth vide geographic iqetilce meena ‘countries may adopt polycentric approach. However, the transnational senparioss poe ae aay “ery wide, may adopt geocentric approach. Geocentric approach is appropriate for Coca Cola, Selection ‘Techniques for Global. Jobs (iobal companies require te human resources but also to the cultural Tequirements of various {rom nose of domestic jobs, These jirements, ‘adaptable nat only to tha job and organisational requ inries, As such, the selection techniques tor global jobs Vary countries. As such, ‘techniques include: ‘Sereening the ‘applicant's background ‘Testing the candidate's bility to adapt to the new culture and environment Testing the ablities of the ‘environment . ‘ sand . Spouse and family members of the candidate to the foreign culture: Predicting the aclustment ofthe candidata ‘Testing the skil of adjustment with the host nationals, Job duties and responsibilities,Pearce ee ptinogT crate feels comtertable long and working in rine new arrivals atid COmPICteIY ealects the o eSntsa, Dunng this stage. the employee haste ‘confused and unhappy ite previously armed employee and hex tarsiy afar Ir _ Bunnag tm lake care of himeelt and his tarmiy members. Expairate gots "ustrat ea long ana working abroad. His soca! relatans are e:sijusioned during this stage. He g8ts the shock of + Acjustment stage: The expatriate stony learns the values, norms, behaviour Of 1h People, their cuiturs oe Pe slowly chants sed to tho catare oft forefgn Coury + Mastery stage: Tne expatriate after adjusing himself with the culture of the foreign country can concorirato on working efficiently He learns and adopts to the new environment Completely ang becomes ikea chizon He behaves and functions lke a ctizen at this stage. Cross-cultural Training Cross-cultural training enables the expatriates to learn the cultural norms, values, aptitudes, attitudes, beliefs, behaviours and practices of the host country, . The expatriate, attor training can use this cross-cultural knowledge to behave according to the cultura) requirements of the host country. The adage “Do in Rome as Romans do” holds good here. The traineg expatnate can transfer the knowledge gained in the training programme Into new cognitive and physical behaviours, This process gives the trainee more satisfaction in thelr foreign assignment (See Box 35,1). Ee ee ee Procter and Gamble trained their selected candidates for thelr company In Japan regarding the Japanese culture that srase lite more of informality. they hesiiale [0 sa/ No and they linaise more of heir business dealings outalde the office ‘mosiy in restaurants In the evenings. The employees trancferred this knoviladge Into thelr cognitive and phyelect Towra and became successtil in dealing with Japanese. Thus, they became efficiont In dolng thelr obs and interacting ne host counir/s nationals Compensation in Global Companie: Compensation Is the amount of remuneration paid to the employees. The two Issues Involved in compensation management are national economic differences and payment practices. The second Issue is the mode to payment fo expatriate managers. There are significant differences in the compensation levels andof ott “ite arom on ronal Human Resource mang diferent county ' Me frre Baye exocuiwes of various countios based 10 Pay: Expatr, : 0 nT ad ee Boas) pasedon the balance sheet approach, Under fhe Balance mania the $8178 Standard of vg That enabies he expat inate employees hairpins amongemploymentiocatong, |” O08 aa proves or ottastang quanttatve alulty: Expatriate ergy a a ie ‘cae eae aa 278 bald gratuty at a fxed rate tor every year of compton oS yr te foreign country, "Ye rcucamenito te expanalon to work tor gut 10000 «Allowances: Eats erpje allowance, using atomeres foes #8 Bald sentiment edical allowance etc. a nce, 0 various allowances like car allowance, (ese TT al 'P allowance, cost-ot-lving allowance, education os PAY Taxation: Some countnes pay tay the count S it ratuity. Most o! arabe salary andgratuay at 21%® SLAY andor exten gray compensation for Overseas Personnel Compensation of Overgeas Personne = Salary + Salary = Purchasing power + Income tax benefits » Income taxbenefits = Premiums + Housing = Housing = Incentives = Goods and services = Goods and services «= Gratuity = Reserves + Reserves: | WOMEN IN INTERNATIONAL BUSINESS equal js not le of women ‘Women recently started playing vital role in international business. However, lero oountny-TH2 ‘o that of men even today. The role of women in economic activities varies from following axampies incicate the role ol women in diferent countries: tk. women to Wor * {)Sausi Arabia restrictions on women’s freedom to move around make it dificult for Fi * ytel stay in anol Te amele. women are not permitted to drive, to travel on an airplane alone, ot to stay without a male family member, : within InJapan, women seldom werk after mariage, consequently, women are unikaly to progress fa organisations. In the US, women have attal din top ined a degree of equality in businass, but they are seldom foun’ management positions. roe + In/reland, the Constitution has bosn interpreted to mean that awoman should only join the worklo if her husband Is not able to look after the amily economically, © In St. Vincent, a West Indies istang en, ‘Country, the minimum wage for women is lower than for m regardless of the work pertormed,construction workors, and foresters 370 "eM 1y of ne same positions as mar + Inthe People's Republic of China, women Mok doratand tna he foro conomic activly and in business a vommon. Understanain, my a unerntard he ein tnaeanen rece Cempitcatan sane et qrarae of a SOU eer swith one tamny members by ave transnational ‘yrubberpanion® ond > Women ae arteyet Team irate ee, women in white-collar occupa! i + Trosorannat banka ancisorioo organisations omeloyed dane tee en gccuny er avejone. ae transnational companies ee rapafd, unskilled, or semi-skilled Workers: se cor women employees ii business in oP oso fend, oF relatives, and go to CAomen are not permitted to work with men, + Export Processing Zones (EP2Zs) 0 tions to uncerstand ar @ itis dificult for Western corporation’ Gi Arabian peningula. The married women in Saudi Arabia can Wi shops only, buta male relative should accompany them. in Sauct arabia. een 1h Bafaif) Weinen arp educated ard are\ofven equal opportunity. ut Wey afo| Ciacci seeking employment. + Stops are taken to encourage women employment in Oman. = Intlong Kong, women are found in all organisational levels. They are effecti women are in secretarial positions. + In Malaysia, though the equal opportunity is given to women, they norm: + In Singapore, women employment is quite common. Eighty per cent of the women workforce is in the age group of 10 to 24 years. Professional women are in government service. However, they play subordinate role to men. + In South Korea, women rarely enter business. The prospects for their advancement are slim. Mostly they are employed until the age of 30 or till they marry. « In Thailand, women are seen as “the hind legs of the elephant” — powerful but following — and are in subordinate positions. However, some women hold top positions in government and private business, ive business people. Mostly ally do not enter the business, * In People's Republic of China, almost all women work. The Government provided extensive educational facilties for women. Women in China work in scientific profession and governmental organisations also. Traditionally, women in Japan worked in lower paid and lewer level positions. University toppers were also appointed for clerical jobs. Japanese Government in 1986 passed Anti-discrimination legislation prohisting discrimination based on sex. Now, the position s improved and women are treated equally mn men in goverament and public sector organisations. However, the traditional role of woman looking iter the family after marriage is still accepted, esmeeearNen Denman gui 32 wok ot S808 in Spain te meteors = oye Penelusion ofthe contr ee a ea or karate And equal Jor many ane wore ha ama ta aes ae ene a ie nod © hve are gut Ae Mea tal would bora ter See eres * wopreag etnies eral cohen mont St On Eom ete tny ma eat Ant at ee Situation in Usa, anc een Seon nt countries n ompared worn omen wena *eprohitoain ge Canaga ig. Gite beter c 2 WOE. Howeyet Discrimination Based oq duste: {expioyment in almost altho otNet aagbetsnate tl men in USA and Canes, Seuntres. Absence ot women at he Lop pao a ae Whats the compensation package in ‘ntemational business? ‘Whats the role of women in global bi usiness? See