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Yoginder Kataria
Brain Teaser 1
Imagine you are a Manager for a domestic company that is planning to extend its operations internationally. You are responsible for handling the CCM implications. What questions should you be asking the senior management team?
Why CCM?
Multinationals are becoming increasingly dominant. Technological changes make it easier to spread the business across the globe. Globalization.
IHRM
IHRM is Human resource management issues, functions and policies and practices that result from the strategic activities of multinational enterprises and that impact on the international concerns and goals of those enterprises.
Schuler, Dowling and De Cieri, 1993
A Model of IHRM
Host Country National (HCN): Belongs to the Country where the subsidiary is located Home Country National (HCN): Belongs to the Country where the firm has its headquarters
also might be called Parent Country National (PCN)
Third Country Nationals (TCN): Belongs to any other country and is employed by the firm
Clark, T. and Pugh, D. (2000). Similarities and differences in European conceptions of human resource management.
Evidence of Trends
Evidence that increasing responsibility is being devolved (decentralize) to the line in Europe. Recruitment and selection, health and safety, and workforce expansion/reduction would go to the line; whilst ER and training would stay with HR.
Prepare a framework to ensure global management are aware of the growing complexity of the business
Distribute and share the responsibilities for IHR
Glossary of Terms
Home country where a firm is headquartered Host country - where a subsidiary may be located Other country may be a source of labour or technology PCNs parent country nationals HCNs host country nationals TCNs third country nationals MNE multinational enterprise
IHRM
Ethnocentric (parent control) Polycentric (Keeping PCNs and HCNs separate) Regiocentric (Asia-Pacific, Eastern European regions) Geocentric (pick talent from wherever possible)
The ethnocentric HR orientation- All key positions in the host country are occupied by parent company nationals. Ensures tight control and good communication. Typically deployed during the early stages in establishing a new business presence.
The polycentric orientation- Host country nationals manage all operations in their own country. This helps avoid intercultural management conflict and also promotes the corporations image.
Four Approaches to IHRM/cont The geocentric orientation- A meritocratic approach. The best people are deployed throughout the organisation and may be sourced from any region of the world. This enables corporations to build international executive teams.
The regiocentric orientation- Results in staff being developed and deployed within specific regions of the world eg. Europe, S.E. Asia etc.
Brain Teaser 2
What are the potential disadvantages for each of these approaches?
MNE concerns & Goals Competitiveness Efficiency Local responsiveness Flexibility Learning & transfer
Endogeneous factors Structure of international operations HQ international orientation Competitive strategy Experience in managing international operations
IHRM practices
Compensation: Seniority-based, team-based vs Merit-based, individual-based Selection: De-emphasize experience? Appraisal: Low (collectivist) to High (individualistic) Training & development vs Outsourcing (e.g. US) SHRM: low cost and differentiation strategies (Asia) to no linkage (Mexico)
Von Glinow, M.A., Drost, E.A. and Teagarden, M.B. (2002). Converging on IHRM best practices: Lessons learned from a globally distributed consortium on theory and practice. Human Resource Management, 41(1), 123-140.
Thank you