Professional Documents
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Human Resource Management 4: Fundamentals of
Human Resource Management 4: Fundamentals of
CHAPTER 15
Managing Human Resources
Globally
McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All Rights Reserved. 15-1
What Do I Need to Know?
15-2
What Do I Need to Know? (continued)
15-3
HRM in a Global Environment
15-4
As companies in the
United States and
Britain cut software
jobs and outsource to
other countries in
order to drive down
costs, countries such
as India continue to
see employment rise.
15-5
HRM in a Global Environment (continued)
15-6
Employees in an International Workforce
15-7
Employees in an International Workforce
(continued)
15-8
Figure 15.1: Levels of Global Participation
15-9
Employers in the Global Marketplace
15-10
Test Your Knowledge
• Hans works for a company who’s headquartered in
France and has foreign operations in Germany, only.
Hans is a citizen of the Netherlands. Which of the
following is most likely true?
a) Hans works for a domestic company and is from the parent
country.
b) Hans works for a multinational company and is from the
host country.
c) Hans works for a global company and is from a third
country.
d) Hans works for an international company and is from a third
country.
15-11
Transnational HRM System
15-12
Factors Affecting HRM in
International Markets
15-13
Culture
15-16
In Taiwan, a country that is high in
collectivism, coworkers consider
themselves more as group members
instead of individuals.
15-17
Culture (continued)
15-19
Economic System
• The economic system provides many of the
incentives or disincentives for developing the
value of the labor force.
• In developed countries with great wealth,
labor costs are relatively high. This impacts
compensation and staffing practices.
• Income tax differences between countries
make pay structures more complicated when
they cross national boundaries.
15-20
Political-Legal System
15-22
Criteria for Selection of Employees for
Foreign Assignments
1. Competency in the employee’s area of expertise
2. Ability to communicate verbally and nonverbally in
the foreign country
3. Flexibility, tolerance of ambiguity, and sensitivity to
cultural differences
4. Motivation to succeed and enjoyment of challenges
5. Willingness to learn about the foreign country’s
culture, language, and customs
6. Support from family members
15-23
Qualities associated with success in foreign
assignments are the ability to communicate in
the foreign country, flexibility, enjoying a
challenging situation, and support from family
members.
15-24
Figure 15.2: Emotional Cycle Associated
with a Foreign Assignment
15-25
Test Your Knowledge
• Rachel, an expatriate working in Japan is
feeling very uncomfortable in her
surroundings. She often feels as if she has
said the wrong thing. Rachel is most likely in
which emotional stage of expatriation:
a) Honeymoon
b) Culture shock
c) Learning
d) Adjustment
15-26
Training and Developing a
Global Workforce
• Training and development programs should be
effective for all participating employees,
regardless of their country of origin.
• When organizations hire employees to work in a
foreign country or transfer them to another
country, the employer needs to provide the
employees with training in how to handle the
challenges associated with working in a foreign
country.
15-27
Table 15.1: Effects of Culture on Training
Design
15-28
Test Your Knowledge
15-29
Delivering Training in Other Countries
15-30
Foreign Assignments
15-31
Cross-Cultural Preparation
15-32
Performance Management Across
National Boundaries
• When establishing • Differences may
performance include:
management methods – Which behaviors are
in other countries, rated
organizations have to – How and the extent to
consider: which performance is
– Legal requirements measured
– Who performs the rating
– Local business practices
– How feedback is
– National cultures
required
15-33
Compensating an International Workforce
15-34
Figure 15.3: Earnings in Selected
Occupations in Three Countries
15-35
Compensating an International Workforce
(continued)
15-36
Figure 15.4: Average Hours Worked in
Selected Countries
15-37
International Labor Relations
• Labor relations on an international scale involves
differences in laws, attitudes, economic systems,
and differences in negotiation styles.
• Organizations establish overall policies and goals
for labor relations, overseeing labor agreements,
and monitoring labor performance.
• The day-to-day decisions about labor relations
are usually handled by each foreign subsidiary.
15-38
Managing Expatriates:
Selecting Expatriate Managers
• Expatriate managers need technical
competence in the area of operations.
• In addition, many other skills are necessary to
be successful in an overseas assignment:
– Ability to maintain a positive self-image and feeling
of well-being
– Ability to foster relationships with host-country
nationals
– Ability to perceive and evaluate the host country’s
environment accurately
15-39
Topics for Assessing Candidates for
Overseas Assignments
15-40
Managing Expatriates:
Preparing Expatriates
• Pre-assignment site visit • Housing counseling
• Job orientation • Health care / schools /
• Country orientation shopping / recreation
• counseling
Culture orientation
• • Counseling by returning
Language training
expatriates
• Compensation /
• Local sponsorship from
benefits / taxes
counseling host country
15-41
Figure 15.5:
Impressions of
Americans –
Comments by
Visitors to the
United States
15-42
Compensating Expatriates
15-43
Figure 15.6: The Balance Sheet for
Determining Expatriate Compensation
15-44
Toyko Tops Priciest Cities
15-45
Compensating Expatriates (continued)
15-46
Figure 15.7:
International
Assignment
Allowance Form
15-47
Helping Expatriates Return Home
15-48
Summary
• More and more companies are entering international
markets by exporting and operating foreign facilities.
• Organizations therefore need employees who
understand customers and suppliers in other countries.
• They need to understand local laws and customs and
be able to adapt their plans to local situations.
• To do this organizations may hire a combination of
parent-country, host-country, and third-country
nationals.
15-49
Summary (continued)
• A global organization needs a transnational HRM
system, which:
– Makes decisions from a global perspective
– Includes managers from many countries
– Is based on ideas contributed by people representing a
variety of cultures
• The most important influence is the culture of each
market – its set of shared assumptions about how
the world works and what ideals are worth striving
for.
15-50
Summary
• Another influence on international HRM is the
foreign country’s political-legal system.
• A country’s economic system, as well as the
government’s involvement in the economy, is a
strong factor determining HRM practices.
• HR planning involves decisions about where and how
many employees are needed for each international
facility.
• Most foreign operations positions are filled with
host-country nationals.
15-51
Summary (continued)
• Foreign positions are also filled with parent-country
and third-country nationals.
• Pay structures can differ substantially among
countries in terms of pay level and the relative worth
of jobs.
• Laws may dictate differences in benefits packages,
and the value of benefits will differ if a country
requires them or makes them a government service.
15-52
Summary (continued)
• The organization must prepare the manager selected
for an overseas assignment.
• Cross-cultural training for the assignment as well as
preparation for repatriation after the assignment are
critical success factors.
• Communication of changes at home and validation of
a job well done abroad help the expatriate through
the repatriation process.
15-53