Introduction:

The Enduring Context of

IHRM
By, Priya Unadkat

The General Field of HR

HRM refers to activities undertaken by an organization

to effectively utilise its human resources
Major Functions and Activities

Human resource planning

Staffing Recruitment, Selection, Placement
Performance management
Training and development
Compensation (remuneration) and benefits
Industrial relations

A Model of IHRM (Morgan)

O
T
H
E
R

H
O
M
E

Source of raw
material

TCN

Head
Quarter

PCN
H
O
S
T

Subsidiary

HCN

 As per Morgan,
IHRM is the interplay between three categories : HR
activities, Types of employees and countries of
operation.

What is an expatriate?
Ex Patria : Out of Country
An employee who is working and temporarily residing
in a foreign country
International assignees
Inpatriate
Transpatriate
Global flow of HR

International Assignments Create Expatriates

Differences between Domestic HRM and

IHRM

More HR activities
The need for a broader perspective
More involvement in employees personal lives
Changes in emphasis as the workforce mix of
expatriates and locals varies
Risk exposure
Broader external influences

Contd
More HR activities
Tax equalization
Relocation & orientation
Administrative services
Host government relation
Language translation
The need for a broader perspective
More than one national group
Policies for PCNs, HCNs, TCNs

Contd
More involvement in employees personal lives
Schooling, housing
Banking, investment
Recreational program

Changes in emphasis as the workforce mix of expatriates and

locals varies
As operations matures
Local staff availability
Taxation, relocation, orientation
Staffing, training & development

Contd
Risk exposure
Expatriate failure
Under performance
Higher cost of failure direct & indirect
Terrorism

Broader external influences

Type of government
Developed / developing country

Labour availability, labour policies

Variables that differentiate

Domestic & IHRM

Variables that differentiate

Domestic & IHRM

Recruit staffs from family members who

may not have required working competence
could be seen as a good example in
Indonesia to satisfy local expectations.
However, in the western people's view, this
could be seen as nepotism.

 Not always a conscious effect

Culture shock
Cultural awareness
E.g.
Individualistic Collective
Vacation
Hand movement
..\..\..\Extra\2. Hand Gestures around the World.mp4
Hofstedes cultural framework

Power distance
Individualism Vs Collectivism
Masculinity Vs Femininity
Uncertainty avoidance
Long term Vs Short term orientation

..\..\..\Extra\Videos\Map The World - Hofstede's 5

Cultural Dimensions visualized on a world map.mp4

 Power distance
Degree to which people accept that power in the
organization is distributed unequally
High power distance
(Large power inequalities)
Malaysia

Low Power distance

(Equality & opportunity)
US

Contd
Individualism Vs Collectivism
Individualism
Degree to which people prefer to act as individual
rather than group - US
Collectivism
Tight social frame work where people expect to be
in group where they can be look after and protected.

Contd
Masculinity Vs Femininity
Masculinity
Favors traditional masculine role as power, achievement,
control. Separate roles to men and women with men
dominating - US

Femininity
Little difference between men and women. Treat women as
equal to men.

Contd
Uncertainty avoidance
Degree to which people prefer structured over
unstructured situations.
High uncertainty avoidance
(Anxiety about uncertainty,
uses rules and laws to
reduce uncertainty)

Low uncertainty avoidance

(Accepting uncertainty,
less rule oriented, take
risk and accept change)
US

Contd
Long term Vs Short term orientation
Long term
Look to the future, value thrift (saving), persistence
and tradition. Asian countries
Short term
Value here and now, accept change easily, dont see
commitment as obstacle to change - US

Japan

France

Germany

China

UK

Singapore

Thailand

Variables that differentiate

Domestic & IHRM

 International competition
Multi-domestic
Industry

Independent
to countries

Insurance
Retail
Domestically oriented

Global
Industry

Influenced
By countries

Airlines
Domestically
and Global

Variables that differentiate

Domestic & IHRM

 Domestic market Vs Foreign market

Size
Availability of resources

Variables that differentiate

Domestic & IHRM

Barriers to effective global HRM

Variations Social, Political, Economical
Perception for HR
Attitude & actions of HQ towards HR

Resistance to change
Cultural differences in learning & teaching style
Instructional style

Used in US
Not credible in Japan

Strategic view of IHRM

External factors
Industry chs
Country chs

Internal factors
MNE structure
MNE strategy
Experience in
international operations
International orientation

SHRM
HR functions and
practices

MNE concerns and goals

Competitiveness
Efficiency
Flexibility

(De Cieri & P.J. Dowling)

Factors that Influence the Global Work

Environment
Chinese multinationals
Bharti Airtel's acquisition
Zain Africa
Internet