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International HRMBy:Rashmi VaishyaPGDBM-HR14

Definitions of IHRMInternational human resource management is all about the world wide management of human resources Process of sourcing, allocating, and effectively utilising their skill, knowledge, ideas, plan and perspective in responding to TQM.The process of procuring, allocating and effectively utilizing human resources in an international business is called International Human Resource Management or IHRM.International Human Resource Management is the process of sourcing, allocating and effectively utilizing human resources in a multinational organization.

Dimensions of IHRM

According to P.V. Morgan: IHRM is the interplay among 3 dimensions:HR ActivitiesTypes of employeesTypes of Countries

Purpose of IHRM Remaining competitive throughout the world Efficient Locally Responsive Flexible and adaptive Capable to transforming learning across their globally dispersed unitsObjectives of IHRMTo enable the firm /, the multinational corporations (MNCs), to be a successful globally.

Types Of International OrganisationInternational CorporationsMultinational Corporations Global CorporationsTransnational CorporationsGlobal Efficiency and Local Responsiveness of FirmsMultinationalInternationalTransnationalGlobal

Global efficiencyHighLowHighLocal responsivenessLow

International CorporationsDomestic firms that builds on its existing capabilities to penetrate overseas market. Example : Honda, General Electric, P&G

Multinational CorporationsMNCs have operating units (subsidiaries) located in foreign countries. Subsidiaries function as autonomous units Examples : Shell, Philips, Xerox

Global CorporationsMaintains control over its worldwide operations (subsidiaries) through a centralized home office.They treat the entire world as a single market Examples : Matsushita

Transnational CorporationsProvides autonomy to independent country operations but bring these operations together into an integrated whole through networked structure. They combines the local responsiveness of an MNC and the efficiency of a global corporation Examples : Ford & Unilever

Difference Between Domestic and International HRMBroadly there are two major factors therefore which differentiate domestic HRM from IHRM.1. The complexities of operating in different countries / cultures2. Employing different nationals and different categories of workers across boarder.

Dowling (1999) has argued 6 factors for differentiateA wide range of HR activitiesThe need for a broader perspectives More Involvement in employees personal life.Responsiveness to changes in staffing requirements as international strategy changes.Higher risk exposureMore external influences.

International HRMDomestic HRMDeals with a very broader perspective.Deals with a very narrow perspective(only domestic country).It considers the global laws prevailing across the world.It considers the laws prevailing in the country where companys headquarters located.More involvement in emp. Lives happensThere are standards policies for every emp. working in the country.External influences & factors affect the co..There is not much external influences affecting to the co..Workforce are from different culture work together.Workforce are from the home country works.There are risk factors involved- TerrorismA minimal of risk is involved as compared.Complexity involved in handling different people from different countries.Relatively easy to handle as people belong to same country.Attributes of sr. mgt. differs as involves dealing globally.Attributes tends to be the same.Involvement of diff. cultures affect the orgn. cultureAs emp. are of same country, adoption of culture is feasible.IHRM includes all HR functions but they are carried out differently.There is std. technique and method to carry out the HR functions in orgn..

Role of International HRMInternational human resource management is the basis of success of any global multinational organization. International HRM enhances employees effectiveness to achieve goals of the organization and meet the needs; to develop employees to assume more diverse tasks, assignments, face challenging situations and better understand the cultural variations across the nations.IHRM department deals with heterogeneous functions and has to give additional focus on various aspects, such as:More involvement in the employees personal life.Deal with different groups of employees i.e. PCN, HCN and TCN for which HR policies and practices may differ. International HR managers have to understand cultural differentiation in multicultural environment.Manage external influences, i.e host government authorities, business and other interest pressure and labour groups, etc.Lay different emphasis on management training to deal diverse workforce, their orientation and to meet international environment andProvide guidance on taxation and compensation aspects.

Main challenges in IHRMHigh failure rates of expatriation and repatriationDeployment getting the right mix of skills in the organization regardless of geographical locationKnowledge and innovation dissemination managing critical knowledge and speed of information flowTalent identification and development identify capable people who are able to function effectivelyBarriers to women in IHRMInternational ethicsLanguage (e.g. spoken, written, body)Different labour laws, political climate, stage(s) of technological advancement, values and attitudes e.g. time, achievement, risk takingRoles of religion e.g. sacred objects, prayer, taboos, holidays, etcEducational level attainedSocial organizations e.g. social institutions, authority structures, interest groups, status systems

Limitations in IHRMManagement is basically the principle based on local cultures, traditions, practices and needs of the organizational growth. It is not universal for everywhere, specially in the field of human resources management.HRM methods and systems developed by one society can not always be transferred and applied to another.HRM and industrial relations practices differ across countries as these have their historic origin in countries.Personnel management and industrial relations are embedded in societal rules, norms, values, ideologies and no MNC can afford to ignore the influence of local culture.

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