Presented to:

Dr. Siraj Jamal Siddiqui

Presented by:
Usman Kamal (11286)
Awal Raza
(11254)
Fariha Younus

Globalization is a process of interaction and

integration among the people, companies,
and governments of different nations, a
process driven by international trade and
investment and aided by information
technology.

Global Population Changes:

Some countries have slow population growth and
some have high growth.
Large population demands more products from
other countries.

Global Economic Interdependence:

What happens in one country can impact others,
whether its a positive or negative change.
Incidents as: Recession of late 2000s, 9/11 and many
more, affected the economy of the world.

Regional Alliances:
NAFTA (North American Free Trade Association)
EU (European Union)

ASEAN (Association of Southeast Asian Nations)

AU (African Union)

Global Communication:
Telecommunications
Television and telephone makes it easy to transfer
information and do business.

Internet
Companies accessing information and doing business
over internet.

Global Competition:
More production at lowest cost:
Technological Changes:
New machines that aid manufacturing and outdates old
technology and saves operating costs.

Cheap Labor in Asian, Latin American and African

countries:
Firms save huge labor costs while shifting their workforce
to low waged labor countries.

Importing & Exporting

HR activities are not affected except for travel
policies.

Multinational Enterprises:
HR activities are affected as they send employees to
host countries.

Global Organizations:
HR is the backbone of global organizations.

Legal and Political Factors:

Stability of political systems vary from country to
country.

The HR of an organization should review the

political and operational environment before
entering the country.

Economic Factors:
Different countries have different economies:
Mixed economies and command economies

Employment restrictions and wage levels in

developed countries are high
Tough for countries with weak economy to maintain
and upgrade infrastructure which leads to no
foreign investment

Cultural Factors:
Set of values, symbols, beliefs, languages, and
norms that guide human behavior within country
Convincing people from different ethnic
backgrounds to work together may be difficult

Hofstedes 5 dimensions for identifying and

comparing culture:
Power Distance
Individualism
Masculinity/Femininity
Uncertainty Avoidance
Long-term orientation

 Selecting, placing and locating

employees in other countries.

Cost is major factor to be

considered.

Expatriates

Host Country Nationals

Third Country Nationals

Extensive
cultural skills
needed

Limited
cultural skills
needed

Technical

Functional

Developmental

Strategic

Global Employees Selection Factors

Cultural Adjustment

Personal characteristics

Cultural awareness
Cultural adaptability
Diversity acceptance
Global experiences

Flexibility and risk taking

Emotional stability
Physical stress coping

Communication skills

Organizational requirement
Organizational knowledge
Technical abilities
Job related skills

Personal/family factors
Personal life demands
Family consideration
Career development

Language capabilities
Nonverbal awareness
Listening skill
Conflict resolution abilities

 Compensating expatriates is complex

Two approaches to compensation:

Balance Sheet approach

Global Market approach

Equalizes the cost of difference between the

international and same country assignments.

Home-Country Reference Point:

Compensation is given as much to maintain the standard

of living of that of the home country.

Head quarters Approach:

Compensation not decided by location but by adjusting
cost of living allowances.

Is more comprehensive in providing core

components of compensation and benefits
and views global assignments as continual
Efficient global managers make their own
global market
It requires greater flexibility, detailed analysis
and significant admin efforts

Tax Concerns:
Global employees only pay tax of the country they
are situated in by their organization.

Global Benefits:
Paid Leaves
Health care

Worker Consultation Regulations:

EU requirement of firms with 50 or more employees
would consult their labor unions before downsizing

Global Labor-Management Relations:

Labor unions of some countries are strong and
some are weak.

Global Health and Safety:

Firms to provide safety and health to global
employees.

Global Security:
HR to keep check on the security conditions of the
countries their employees are working in.

Kidnapping and Terrorism:

KR (kidnapping and ransom insurance)

Pre-departure training:

Training provided employees and their families if they

are being located in high risk areas.