2. © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–2 1.Explain the basic cultural and regulatory issues involved in global human resource management including outsourcing and offshoring. 2.Describe the challenges involved in staffing foreign operations, assessing needs for training and development, and designing appropriate strategies to meet those needs. 3.Discuss performance appraisals and employee compensation issues around the world, including cultural differences, cost of living, and how expatriate issues are handled. 4.Explain the interplay between international labor standards and free trade, the free trade and labor concerns presented by NAFTA, as well as the functions of labor unions.

3. Global Strategic Human Resource Management Statistical Overview of Work – Workforce participation rates for females vary greatly among countries – The types of work that people do differ considerably – Immigration laws and the ability of foreign-born individuals to work in a given country vary widely – Some countries have persistently higher rates of unemployment than others © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–3

4. Cultural Issues and Differences: Hofstede’s Dimensions of National Culture Power Distance Uncertainty Avoidance Individualism vs. Collectivism Masculinity vs. Femininity Long-Term vs. Short- Term Orientation © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–4

5. Cultural Issues and Differences: Hofstede’s Dimensions of National Culture Power Distance – The degree of equality of authority distribution in a given society and its workplaces, and employee expectations related to the same Uncertainty Avoidance – A culture’s desire for predictability, or the lack of predictability in the workplace and elsewhere Individualism vs. Collectivism – The extent people regard themselves as members of a group or collective, rather than discrete individuals © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–5

6. Cultural Issues and Differences: Hofstede’s Dimensions of National Culture Masculinity vs. Femininity – The values that are traditionally associated with one gender or the other Long-Term vs. Short-Term Orientation – The extent to which members of a given society value long-term and future planning as opposed to a more immediate short-term perspective © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–6

7. Regulatory Issues Including Immigration and Border Security Legal-political Systems and Structures Affecting the Conduct of IHRM – Job creation efforts (rates of unemployment) – Immigration and border security (mobility of the workforce) © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–7

8. Outsourcing and Offshoring Outsourcing – The process of a firm subcontracting a certain production function to a third party Offshoring – The process of transferring an organizational function to another country, regardless of whether this function is outsourced or stays within the same firm or corporation © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–8

9. Staffing Policies Staffing the Local Office (Host Country) – Availability of qualified host country nationals – Host country’s legal requirements for employment – Use of expatriates from home office – Recruitment of third country nationals Virtual Staffing – Using technology to employ foreign nationals as virtual expatriates who do not relocate to the host country © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–9

10. Expatriate Issues in Staffing Reasons to use expatriates: – Lack of qualified host country nationals – Maintenance of control of host country operations Issues arising from the use of expatriates: – Determining the appropriate length and location of an expatriate’s assignment – Failure of the expatriate to complete an assignment due to culture shock, family and/or personal issues – The reverse culture shock that expatriate employees experience upon repatriation © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–10

11. What Are Training and Development? © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–11 Providing employees with skills specific to the job they are going to be doing TrainingTraining Preparing employees for new future assignments or higher level positions DevelopmentDevelopment Needs Assessment Knowledge Skills Abilities Tasks Duties Responsibilities

12. Types of Training and Development Choosing the right type and format for training and development: – Internet-based training – In-person training and development – Individual or group-based training – Groups and organizational levels of employees to train together © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–12

13. Expatriate Needs in Training and Development Familiarity with host country standards and customs Training and preparation that fosters reasonable expectations about normal life in the host country © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–13

14. Performance Appraisal and Compensation Issues General Issues in Assessing Performance – What to assess as “performance” – How to measure performance – Who will conduct the performance appraisal ratings – How will feedback be presented Cultural Differences in Performance Appraisal – Individual appraisals versus group appraisals – When and how to provide feedback – Who will participate in the appraisal process © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–14

15. National Differences in Cost of Living and Compensation National Differences in Cost of Living – Major cities and urban areas are expensive – Assignments to underdeveloped countries can be expensive if expatriates expect to maintain their home country lifestyle National Differences in Compensation – Constant salary payments versus annual bonuses – Composition of pay packages vary in types and level of benefits provided to employees © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–15

16. Expatriate Issues in Compensation Direct Compensation Issues – Choosing to compensate expatriates using either home-country or host-country pay levels – Adjusting compensation for differences in home- country versus host-country tax obligations The Balance Sheet Approach – Involves keeping the expatriate on the home country’s salary structure (balance sheet) while providing various additional allowances so that the expatriate can maintain a home country standard of living while working elsewhere © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–16

17. International Trade, Labor Relations, and HRM The North American Agreement on Labor Cooperation (NAALC) – A special agreement outside the main NAFTA agreement which requires each NAFTA country to strongly enforce its own labor laws and regulations – Allows parties in the NAFTA countries to approach the labor department in their own country and file a formal complaint about labor standards in another NAFTA country © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–17

18. International Labor Relations Labor Union – A formal organization representing a group or groups of employees Collective Bargaining Agreement – A contract comprehensively setting forth employee terms and conditions of employment at a given workplace or group of workplaces © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–18

19. Comparative Labor Relations National Labor Relations Board (NLRB) – Oversees and regulates private sector labor relations activities Multi-employer Bargaining – Negotiations in which a number of employers jointly bargain with a given labor union Co-determination – Allocates seats for employee representatives on corporate boards of directors © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–19

20. © 2014 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.11–20 KEY TERMS outsourcing offshoring parent country nationals host country nationals third country nationals expatriates expatriate failure repatriation training development performance appraisal balance sheet approach labor union collective bargaining agreement multi-employer bargaining co-determination