COMPONENTS OF HRM Recruitment Selection Training & Development Performance Appraisal Compensation Labor Relations

INTERNATIONAL HRM (IHRM) Basic HRM issues remain Must choose a mixture of international employees How much to adapt to local conditions?

EMPLOYEES IN MULTINATIONAL ORGANIZATIONS Host country nationals Expatriates Home country nationals Third country nationals Inpatriates

MULTINATIONAL MANAGERS Host country or expatriate?

USING HOST COUNTRY MANAGERS Do they have the expertise for the position? Can we recruit them from outside the company?

USING EXPATRIATE MANAGERS Do parent country managers have the appropriate skills? Are they willing to take expatriate assignments? Do any laws affect the assignment of expatriate managers?

IS THE EXPATRIATE WORTH IT? High cost High failure rate

EXHIBIT 11.1 PAYING FOR THE EXPATRIATE MANAGER

REASONS FOR U.S. EXPATRIATE FAILURE Spouse fails to adapt Manager fails to adapt Other problems within the family Personality of the manager Level of responsibilities

Lack of technical proficiency No motivation for assignment Reasons for expatriate failure, continued

MOTIVATIONS TO USE EXPATS Managers acquire international skills Coordinate and control operations dispersed activities Communication of local needs/strategic information to headquarters

KEY EXPATRIATE SUCCESS FACTORS Professional/technical competence Relational abilities Motivation Family situation Language skills Willingness to accept position

PRIORITY OF SUCCESS FACTORS Depends on : –assignment length –cultural distance –amount of required interaction with local people –job complexity/responsibility

EXHIBIT 11.3 SHOWS A DECISION MATRIX USED TO SET PRIORITIES OR DIFFERENT SUCCESS FACTORS DURING SELECTION

EXPATRIATE TRAINING

TRAINING RIGOR The extent of effort by trainees and trainers required to prepare the trainees for expatriate positions

LOW RIGOR TRAINING Short time period Lectures Videos on local culture Briefings on company operations company operations

HIGH RIGOR TRAINING Lasts over a month Experiential learning Extensive language training Often includes interactions with host country nationals

EXHIBIT 11.4 SHOWS VARIOUS TRAINING TECHNIQUES AND THEIR OBJECTIVES AS THE RIGOR OF THE CROSS- CULTURAL TRAINING GROWS

CHALLENGES OF EXPATRIATE PERFORMANCE APPRAISAL Unreliable data Complex and volatile environments Time differences and distance separation Local cultural situations

STEPS TO IMPROVE THE PROCESS 1. Fit the evaluation criteria to strategy. 2. Fine tune the evaluation criteria 3. Use multiple evaluators with varying periods of evaluation

EXHIBIT 11.6 Shows several sources of information a superior or the HRM professionals may use to evaluate an expatriate managers

EXPATRIATE COMPENSATION

THE BALANCE SHEET APPROACH Provides a compensation package that equates purchasing power

BALANCE SHEET COSTS Allowances for cost of living, housing, utilities, furnishing, educational expenses, medical expenses, club memberships, and car and/or driver expenses

OTHER APPROACHES Parent country wages everywhere Wean expatriates from allowances Pay based on local or regional markets Cafeteria selection of allowances Global pay systems

THE REPATRIATION PROBLEM Difficult for many organizations "Reverse culture shock" Expatriates must relearn own national and organizational culture Includes whole family

STRATEGIES FOR SUCCESSFUL REPATRIATION PROVIDE: A strategic purpose for repatriation A team to aid the expatriate Home country information sources Training and preparation for the return Support for expatriate and family

WOMEN EXPATRIATES: TWO IMPORTANT "MYTHS" Myth 1: women do not wish to take international assignments Myth 2: women will fail in international assignments because of the foreign culture's prejudices against local women

SUCCESSFUL WOMEN EXPATRIATES Foreign not female –emphasize nationality not gender The woman's advantage –strong in relational skills –wider range of interaction options

MULTINATIONAL STRATEGY AND IHRM

IHRM ORIENTATIONS Ethnocentric Polycentric Regiocentric Global

IHRM ORIENTATION AND MULTINATIONAL STRATEGY Early stages of internationalization = ethnocentric IHRM Multilocal strategies = ethnocentric or regiocentric Regional strategy = closer to the global

International strategy = ethnocentric or polycentric IHRM Transnational strategies = a global IHRM

CONCLUSIONS HRM functions IHRM challenges Expatriate managers The role of women in multinational organizations Multinational strategies and IHRM orientations