1. Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall
Managing HR Globally
Chapter 13
Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

2. HR and the Internationalization of Business
More and more companies are doing business abroad
Globalization requires that employees who never leave the home office need to be “internationalized” to some extent
Cultural diversity must be addressed
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3. HR Challenges of International Business
Employers face political, social, legal and cultural differences among countries abroad
Effective human resource practices must be developed for each country’s local facility and for the company as a whole
Vast distances add to the challenges
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4. HR Managers Top Global Concerns
Deployment
Knowledge and innovation dissemination
Identifying and developing talent
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5. What Is International HRM?
Human resource management concepts and techniques employers use to manage the HR challenges of their international operations
Focuses on three main areas:
Management of HR in global corporations
Management of expatriate employees
Compare HRM practices in variety of countries
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6. Which Inter-Country Differences Affect HRM
Cultural factors
Economic systems
Legal and industrial relations factors
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7. Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall
Cultural Factors
Cultural differences influence HR policies and procedures that work best in a particular place
Researchers have concluded that countries different along four cultural dimensions:
Assertiveness
Future orientation
Performance orientation
Humane orientation
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8. Economic Systems Factors
From country to country, economic systems vary in the following:
Labor laws, regulations and costs
Hourly compensation and a typical work week
Vacation and benefits requirements
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9. Legal and Industrial Relations Factors
The interplay of directives and country laws means HR practices must vary from country to country
Some EU countries have minimum wages systems in place while others set national limits
The EU sets the workweek at 48 hours but most countries set it at 40 hours per week
EU countries have many levels of employee representation
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10. Improving International Assignments Through Selection
80% of Financial Times top 100 company CEOs recently had overseas assignments
Often the assignments fail due to poor expatriate entry and reentry preparation
Companies are taking steps to reduce expat problems by selecting expats more carefully, helping spouses get jobs abroad and providing more ongoing support to the expat and family
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11. When International Assignments Succeed
They focus on knowledge creation and global leadership development
They assign overseas people whose technical skills are matched or exceeded by their cross-cultural abilities
Their expatriate assignments include a deliberate repatriation process
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12. Expatriate Personality
Expats are increasingly younger and single
Tend to be extroverted, agreeable and emotionally stable individuals
Tend to have great cultural empathy
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13. International Staffing: Home or Local?
Locals are citizens of the countries where they are working
Expatriates are noncitizens of the countries in which they are working
Host country nationals are citizens of the country in which the multinational company has its headquarters (can be expatriates)
Third-country nationals are citizens of a country other than the parent or the host country
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14. International Staffing: Home or Local?, cont.
Using locals can be cost effective and help the multinational gain favor with the host country
Using expats helps multinationals meet required technical qualifications and help the multinational implement headquarters instructions and culture
A hybrid solution that utilizes both locals and expats can help smooth the multinational’s transition
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15. Pros and Cons of Offshoring
Offshoring is having local employees abroad do jobs previously done in-house
It is growing rapidly and remains controversial
Opponents cite job drain means millions of fewer white-collar jobs for Americans
Proponents cite global competitiveness and increased R&D that will increase domestic jobs
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16. Values and International Staffing Policy
Ethnocentric companies will make sure the home country’s attitudes, management style, knowledge, evaluation criteria, etc., prevail through filling key management jobs with parent-country nationals
Polycentric companies believe that only host country managers can understand the culture and behavior of the host country market and the foreign subsidiary should be managed by host-country nationals and home office with parent-country nationals
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17. Values and International Staffing Policy, cont.
Geocentric companies believe that the best manager for the firm could be located anywhere so they look at all management for potential and staff on the basis of choosing the best people for key jobs regardless of nationality
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18. Ethics and Codes of Conduct
Exporting a firm’s ethics is problematic as the code might not translate to the host-country and can be undermined by cultural norms
Lawyers recommend a company focus on creating and distributing a global code of conduct that creates standards for adhering to U.S. law that has cross-border impact
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19. Selecting International Managers
Screening and testing
Realistic previews
Adaptability screening
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20. Sending Women Managers Abroad
Women expats are underrepresented
Misconceptions about familial decisions and safety concerns add to the problem
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21. Sending Women Managers Abroad, cont.
Misperception can be short-circuited by:
Formalize a process for identifying employees willing to be expats
Train managers to understand how employees really feel about going abroad
Let successful female expats recruit prospective female expats
Provide the expat’s spouse with employment assistance
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22. Training and Maintaining International Employees, cont.
Expats can also be trained by a 4-step approach:
Level 1 focuses on the impact of cultural differences
Level 2 aims at getting participants to understand who attitudes are formed and influence behavior
Level 3 provides a factual knowledge of the target country
Level 4 provides skill building in areas like language, adjustment and adaptation skills
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23. Other Expatriate Training
Documentary programs about the country’s geography and socioeconomic/political history
Cultural assimilation to display the sorts of social and interpersonal situations expats are likely to encounter
Language training
Sensitivity training
Actual interactions with people from other countries
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24. Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall
Trends
To provide continuing, in-country, cross-cultural training during early stages of overseas assignment
Using returning managers as resources to cultivate the “global mindsets” of the home-office staff
Increased use of software and the Internet for cross-cultural training
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25. International Compensation
Balance Sheet Approach based on the following:
Income taxes
Housing
Goods and services
Discretionary expenses
Premiums
Incentives
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26. Establishing a Global Pay System
Phase I: Formulate a global compensation framework
Phase II: Organize jobs and appraisals
Phase III: Create detailed pay policies
Phase IV: Talent management framework
Phase V: Ongoing program assessment
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27. Performance Appraisal of International Managers
Stipulate the assignment’s difficulty level and adapt performance criteria to the situation
Weigh the evaluation more toward the onsite manager’s appraisal than toward the home-site manager’s
If the home-office manager does the actual written appraisal have him or her use a former expatriate from the same overseas location for advice
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28. Safety and Fair Treatment Abroad
Provide expats with training about traveling, living abroad and the place they’re going to
Tell them not to draw attention to the fact that they’re American
Have travelers arrive at airports as close to departure time as possible and wait in areas away from the main flow of traffic
Equip the expat’s car and home with adequate security systems
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29. Safety and Fair Treatment Abroad, cont.
Tell employee to vary their departure and arrival times and take different routes
Keep employees current on crime and other problems by regularly checking the State Department’s travel advisory service and consular information sheets
Advise employees to remain confident at all times
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30. Repatriation: Problems and Solutions
40-60% of expats will quit within 3 years of returning home
Formal repatriation programs are useful
Make sure the expat and family do not feel the company has left them adrift
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31. How to Implement a Global HR System
Form global HR networks
Remember that it’s more important to standardize ends and competencies than specific methods
Remember that global systems are more accepted in truly global organizations
Investigate pressures to differentiate; then determine legitimacy
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32. How to Implement a Global HR System, cont.
Remember, “You can’t communicate enough”
Dedicate adequate resources for the global HR effort
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33. Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall
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