Week 12: International Human Resource Management

1. Week 12: International Human Resource Management Agenda for Today • Understand different stages of internationalizing operations • Understand the role of culture in International HR • Discuss different approaches to international staffing • Understand different reasons why expatriate assignments fail • Discuss strategies for managing International HR

2. HR and Organizational Internationalization • Stage 1: Firms’ market exclusively domestic • HR exclusively shaped by domestic forces • Stage 2: Expands to foreign countries; retains domestic production facilities • HR practices facilitate doing international business • Stage 3: Some operations moved out of country; forms subsidiaries or joint ventures • HR practices focus on development of expatriates • Stage 4: Full-fledged MNC; operations in several countries • HR decisions still centralized; manned by international personnel • Stage 5: Becomes Transnational Corporation with little allegiance to country of origin • HR decisions made by each business unit free from corporate control

3. HRM Policies and National Cultures • Geert Hofstede’s Framework: • Power Distance • Individualism/Collectivism • Uncertainty Avoidance • Masculinity/Femininity • Long-term/Short-term Orientation • The more an HRM practice contradicts the prevailing societal norms, the more likely it will fail (e.g., MBO) • Do not generalize – national cultures are not homogenous • Avoid blaming international personnel problems on cultural factors without careful study

4. Approaches to International Staffing • Ethnocentric • Top management and other key positions filled by people from home country • Polycentric • Subsidiaries managed and staffed by host country personnel • Geocentric • Best people from all over the world fill key positions

5. Selection for Different Types of Global Assignments Types of Assignments • Technical • Functional • Developmental • Strategic Personnel Selection Factors • Cultural Adjustment • Personal Characteristics • Communication Skills • Organizational and Job Requirements • Personal/Family Factors

6. Why Expatriate Assignments Fail • Career Blockage • Culture Shock • Lack of Cross-Cultural Training • Overemphasis on technical qualifications • Getting rid of troublesome employees • Family Problems • Difficulties on Return • Lack of respect for acquired skills • Loss of status • Poor planning for return position • Reverse culture shock

7. Managing International Human Resources • Selection • Emphasize cultural sensitivity as a selection criterion • Establish a selection board of expatriates • Require previous international experience • Hire foreign born employees to serve as future “expatriates” • Screen candidates’ spouses and families • Training • Information-giving approach (Less than a week or so – least effective) • Affective approach (1-4 weeks – moderately effective) • Impression approach (1-2 months – most effective) • Career Development • Position international assignment as a step to advancement • Provide support for expatriates and repatriates • Compensation