Human Resource Management

Management is the art of getting things done

through people,

and things get done better with the right people.

Human Resource Management

Set of activities directed at attracting, developing, and maintaining the effective workforce necessary to achieve a firm’s objective

Planning – what people will we need?

•Job Analysis•Forecasting

•Recruiting•Selecting

Recruiting – how do we get them?

Retaining –how do we keep them?

•Wages, Salary, Benefits•Job Enrichment

Training –keep‘em up to speed?

•Training & Development•Performance Appraisals

Human Resource Management Goals

International Human Resource Management

Differences in culture, levels of economic development, and legal systems among countries make the task more complex for international HR managers.– Selecting– Training– Compensation and benefits

International Human Resource Management

Select staff from home country, host country, or third country?

International Managerial Staffing Needs

Staffing Categories– Managerial and Executive Employees

– Non-managerial Employees

Scope of Internationalization

Size of staffing tasks depends on scope of firm’s international involvement– Export department

– International division

– Global organization

Centralization versus Decentralization of Control

Centralized firms– Favor home country managers– Most common among international

division form Decentralized firms

– Favor host country managers– Most common among multidomestic

firms

Staffing Philosophy

Parent Country Nationals (PCNs) Host Country Nationals (HCNs) Third Country Nationals (TCNs)

Strategies for Staffing

Ethnocentric staffing model – PCNs in upper-level positions

Polycentric staffing model – HCNs because they know the market best

Geocentric staffing model – choose the most qualified people regardless of nationality

Necessary Skills and Abilities for International Managers

Skills and AbilitiesNecessary to DoThe Job

•Technical•Functional•Managerial

Skills and AbilitiesNecessary to WorkIn a Foreign Location

•Adaptability•Location-specific skills•Personal characteristics

Improved Chances of Succeeding inAn International Job Assignment

Recruitment

Experienced Managers – hired from within or via specialized headhunters.

Younger Managers – perhaps with specialized technical training or language skills. Can be “groomed” for foreign assignments.

Managerial Selection

Good candidates have:–Managerial competence

–Appropriate training

–Ability to adapt to new situations

Expatriate failure has a high cost!

Questions from AT&T’s Questionnaire for Screening Overseas Transferees_1

Would your spouse be interrupting a career to accompany you on an international assignment? If so, how do you think this will affect your spouse and your relationship with each other?

Do you enjoy the challenge of making your own way in new situations?

Securing a job upon reentry will be primarily your responsibility. How do you feel about networking and being your own advocate?

How able are you in initiating new social contacts Can you imagine living without a television?

Questions from AT&T’s Questionnaire for Screening Overseas Transferees_2

How important is it for you to spend significant amounts of time with people of your own ethnic, racial, religious, and national background?

As you look at your personal history, can you isolate any episodes that indicate a real interest in learning about other peoples and cultures?

Has it been your habit to vacation in foreign countries?

Do you enjoy sampling foreign cuisine? What is your tolerance for waiting for repairs?

Culture Shock

Psychological phenomenon that may lead to feelings

of fear, helplessness, irritability, and disorientation

Phases in Acculturation

Honeymoon

Disillusionment

Adaptation

Biculturalism

Honeymoon Phase

New culture seems exotic and stimulating

Excitement of working in new environment makes employee overestimate ease of adjusting

Lasts for first few days or months

Disillusionment Phase

Differences between new and old environments are blown out of proportion

Challenges of everyday living Many stay stuck in this phase

Adaptation Phase

Employee begins to understand patterns of new culture

Gains language competence Adjusts to everyday living

Biculturalism

Anxiety has ended Employee gains confidence in ability

to function productively in new culture Repatriation may be difficult

Overseas Success

Likelihood of managers being successful at overseas assignment increases if the managers– Can freely choose whether to accept or reject the

assignment– Have been given a realistic preview of the job and

assignment– Have been given a realistic expectation of what their

repatriation assignment will be– Have a mentor back home who will guard their

interests and provide support– See a clear link between the expatriate assignment and

their long-term career path

Training and Development

Assessing training needs Basic training methods

– Standardized

– Customized

Developing younger managers

Performance Appraisal Process of assessing how effectively people

are performing their jobs Purpose

– To provide feedback to individuals about how well they are doing

– To provide a basis for rewarding top performers– To identify areas in which additional training

and development may be needed– To identify problem areas that may call for a

change in assignment

Compensation Packages

Include salary and nonsalary items Determined by

– Labor market forces– Occupational status– Professional licensing requirements– Standards of living– Government regulations– Tax codes

Annual Cost of Living in Selected Locations Worldwide, 2003

Rank City Index Rank City Index

1 Tokyo, Japan 126.1 11 Shanghai, China 98.4

2 Moscow, Russia 114.5 12 St. Petersburg, Russia 97.3

3 Osaka, Japan 112.2 13 Oslo, Norway 92.7

4 Hong Kong 111.6 14 Hanoi, Vietnam 89.5

5 Beijing, China 105.1 15 Copenhagen, Denmark 89.4

6 Geneva, Switzerland 101.8 16 Ho Chi Minh City, Vietnam

88.5

7 London, UK 101.3 17 Milan, Italy 87.2

8 Seoul, South Korea 101.0 18 Shenzhen, China 86.7

9 Zurich, Switzerland 100.3 19 Guangzhou, China 86.7

10 New York City, USA 100.0 20 White Plains, NY, USA 86.2

Differential Compensation

Cost-of-living allowance Hardship premium or foreign-service

premium Tax equalization system

Labor Relations

Labor relations in a host country often reflects laws, culture, social structure, and economic conditions

Union membership may be high