International context of business

IHRM

Chapter 1

International context of business

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

The following macro-level dimensions need to be understood in the context of managing human resources in international business that influence decisions of

business managers operating in international context:

Influence of globalization on international managers Role of economic development in IHRM The role of history and geography in international business Language and religion in international management Moral, ethical and social responsibility issues Political and regulatory environment

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

A. INFLUENCE OF GLOBALIZATION ON INTERNATIONAL MANAGERS

According to Punnett (2004:6), globalization is based on the following: Technological development and the resultant increase in the speed and ease in international communication and travel.

Increased awareness and travel leading to better understanding of foreign

opportunities, further propelling international trade and investment and the number of businesses operating across the border.

Integration of economies around the world.

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

B. ROLE OF ECONOMIC DEVELOPMENT IN IHRM

International firms and their managers need to understand the impact of the level of the economic development in the international business environment. There are differences in economic and living standards between the developed and the developing nations which have far reaching implication on business growth and opportunities among them. These factors also affect management, particularly in terms of peoples behavior and human resource choices.

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

C. THE ROLE OF HISTORY AND GEOGRAPHY IN INTERNATIONAL BUSINESS

Both history and geography play a significant role in the development of a nations or a civilizations culture, which ultimately leads to the distinctive, sometimes inherent, human behavior.

A multinational corporation (MNC) has to not only appreciate this fact, but also,
needs to modify its strategy, policy, etc, to extract the best performance out of a group of people, who belong to a different, historical, geographical and cultural background.

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

D. LANGUAGE AND RELIGION IN INTERNATIONAL MANAGEMENT

Language and religion are integral part of human characteristics and thus
influence peoples behavior. Many people believe that the language influences the way we think, and that the structure of language is rooted in ones culture.

Emergence of religious faith is as old as human history. Religion is,

perhaps the most significant foundation of basic norms, values and attitudes of a specific society. Religious symbols and daily rituals may also play an important role in shaping human behavior at workplace. Therefore,

while developing and designing brand name, company logo,

advertisements, the global firms should be sensitive towards the religious and cultural sentiments in their country of operation.
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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

E. MORAL, ETHICAL AND SOCIAL RESPONSIBILITY ISSUES IN INTERNATIONAL BUSINESS

Moral behavior deals with an individuals ultimate state of doctrines and religious faith. These manners are related to the individuals behavioral ends.

While morality based on individuals conceptual commitments toward the

end result, ethics is based on pragmatic collective known values by intellectual reasoning.

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

Excel Books

International context of business

F. POLITICAL AND REGULATORY ENVIRONMENT

To operate successfully in international contexts, a MNC must be familiar with the political and regulatory environment of various countries, to take appropriate decisions in terms of acceptance from the stakeholders, and also to be on the right side of the law. It is relatively easier for firms and people managing them, to make an assessment of political and regulatory factors with greater certainty in their home countries than the ones laid down in foreign counties

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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International context of business

Some of the International trade research resources on the internet are given below (table 1.1):
Website address http://www.asia.inc.com http://www.wto.int http://www.emdirectory.com Information provided Business information in Asia and articles on Asian countries. Details of trade policies of various governments. Links to sites with information about the emerging markets of Asia, Latin America, Africa and Middle East. Directory and links of Europes top companies.

http://www.europages.com

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International Human Resource Management, Dr. Nilanjan Sengupta &Dr. Mousumi S Bhattacharya

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