International Human Resource Management

BUS-1-08-MB

Chapter 2 Recent Developments in Theory & Empirical Research

Prepared by: hiew First Prepared on: 31-01-05 Last Modified on: xx-xx-xx Quality checked by: hkp Copyright 2004 Asia Pacific Institute of Information Technology

Topic & Structure of the lesson

Ethical and Social Issues

Learning Outcomes
Understanding the differences between domestic and multinational firms Professionalism Social Responsibility in business

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Learning Outcomes
Ethical and Social Issues

At the end of this module, YOU should be able to: Recognise the Othree ideal type of multinational companies Objective of HRM in MNCs

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Main Teaching Points

Ethical and Social Issues

Strategy and International HRM

The role of the corporate HR function in the international firm Global Management Development Roles and responsibilities of transnational managers

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Introduction
Ethical and Social Issues

The main reasons for the growth of interest in IHRM over the last decade have been confined by Scullion: 1) The rapid growth of internationalisation & global competition has increased the number & significance of MNCs 2) The effective management of human resources is increasingly being recognised as a major detriment to success or failure of global business

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Ethical and Social Issues

3)Underperformance or failure of international assignments continues to be costly; both in human & financial terms 4) the implementation of global strategies is frequently constrained by shortages of international management talent 5)IHRM issues are becoming increasingly important in a wider range of organisation partly due to the rapid growth of small & SME

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Strategy & International HRM

Adler & Ghadars phases of internationalisation:

Ethical and Social Issues

Based on Vernons life cycle theory distinguishes 3 phases in the international life product cycle: 1) High tech focuses on product, R & D 2) growth & internationalisation developing & penetrating markets 3) maturity implement cost control measures
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Influences of Culture
Ethical and Social Issues

According to Alder & Ghadar, the impact of cultural background of a country differs from one phase to the next: Domestic: focus on home market & export International: focus on local responsiveness & transfer of learning Multinational focus on global strategy Global: focus on both local responsiveness & global integration
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The Role of the Corporate HR Function in the International Firm

Ethical and Social Issues

Many studies of corporate HR role largely ignored the links between the growing internationalisation of the companies & the new corporate HR roles 2 reasons for the above: 1) British is more globally oriented 2) Since early 1990s there is a
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Ethical and Social Issues

significant increase in the pace of internationalisation of UK companies. However, recent empirical study examined the role of the corporate HR function specifically in the international firm and identified emerging agenda for corporate HR (Scullion & Starkey, 2000) they identified 3 distinctive group of companies: 1) centralised HR companies - international assignments were linked to the organisational & career development process; group wide appraisal, job evaluation & reward system

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Ethical and Social Issues

2) decentralised HR companies - co-ordination of international transfer of managers are highly decentralised business was problematic due to greater tensions between the short term needs of the operating companies & long term strategic mgt development needs of the business.

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Ethical and Social Issues

3) Transition HR companies - concentrates on how to develop global managers

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Global Management Development

Ethical and Social Issues

Researchers have identified a number of important lessons for MNCs which do seek to develop HCN (host country nationals) 1) the need to avoid the mistake of simply exporting parent country training & development programmes to other countries

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Ethical and Social Issues

2) the management development programmes needs to be linked to the strategic situation in each country as well as overall strategy of the firm (Scullion & Brewster) 3) is the need to utilise the practice of impatriation (selective process of transferring)

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Roles & Responsibilities of Ethical and Social Issues Transnational Managers

Global business management world wide business strategists, resource configuration, cross border co-ordinator & controller Worldwide functional management responds to challenges of development & diffusing innovation on a world wide basis

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Ethical and Social Issues

* geographic subsidiary management multinational responsiveness, responding to the needs of national customers and satisfying the demands of host country government

top-level corporate management take all challenges like efficiency, learning and reponsiveness into account

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Quick Review Question

Ethical and Social Issues

1) Discuss the reasons for the rapid growth in significance of international HRM over the last decade. 2) Examine the changing role of the corporate human resource function in international firm.

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Follow Up Assignment
Ethical and Social Issues

Barlett, C A Ghoshall, S. (1989) Managing Across Borders, The Transnational Solution

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Question and Answer Session

Ethical and Social Issues

Q&A
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