Managing Global Human Resource

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Managing Global Human Resources

Types of International Business Operations

International corporation Multinational corporation Global corporation Transnational corporation

International Corporation
Domestic firm that uses its existing capabilities to move into overseas markets. e.g. Honda, P&G adapt their products but do not make changes in their normal operations

Multinational Corporation
Firm with independent business units (subsidiaries) operating in multiple countries. Ø The subsidiaries often function as autonomous units. Ø Provide goods and services to the surrounding geographical region. Ø e.g. Philips, Xerox Ø

Global Corporation
Firm that has integrated worldwide operations through a centralized home office Ø Treat the entire world as a single market and try to maximise efficiency on a global scale Ø e.g. Matsushita Ø

Transnational Corporation
Provides autonomy to independent country ops and tries to integrate through a networked structure Ø Attempts to balance local responsiveness and global scale. Ø e.g. Ford, Unilever Ø

Global HR Issues
Recruitment and Selection Ø Socialization and Training Ø Performance Management Ø Compensation Ø Repatriation Ø

Staffing Global Assignments
Types of Global Employees

HostHost-Country National (HCN)

ParentParentCountry National (PCN)

ThirdThird-Country National (TCN)

Advantages of Different Sources for Overseas Managers
HOST COUNTRY • Less Cost • Preference of host-country government • Knowledge of environment • Language facility PARENT COUNTRY • Talent available within company • Greater control • Company experience • Experience provided to corporate executives THIRD COUNTRY • Broad experience • International outlook • Multilingualism

Staffing Approaches

Ethnocentric : All key positions are filled by PCNs Ø Polycentric : HCNs are recruited to manage subsidiaries in their own countries and PCNs occupy positions at corporate HQs. Ø Global OR Geocentric: The best people are utilized for key jobs throughout the organisation

Types of International Assignments
Traditional Ø Short term assignments Ø Virtual or commuter Ø Frequent Business flyer Ø

Key Issues for Selection

Organizational requirements

Technical & Managerial skill Flexibility, risk taking, maturity, stress mgmt, coping with ambiguity Language ability Cultural empathy and adaptability; awareness and acceptance of diversity Family adaptability; career advancement concerns

Personal characteristics


Communication skills

Cultural adjustment


Personal & family factors

Expatriate Adjustment Stages

Source: GMAC Relocation Services, used with permission.

Figure 18–9

Causes of Expatriate Assignment Failure

Training for International assignments
Language Training

Key Elements Needed to Prepare Employees to Work Overseas

Cultural Training

Personal and Family Life

Three Approaches to Cross-Cultural Training
Length of Stay 1–3 yrs 2-12 months 1 month or less Length of Training 1-2 months 3-4 weeks Less than a week Training Rigor HIGH MID-LEVEL LOW

Performance Appraisal

Who Should Appraise?
evaluations v Host-country evaluations
v Home-country


Invalid performance criteria
v not

appropriate for foreign culture understand situational factors misinterpretations

Rater competence
v don’t

Rater bias
v cultural

Overcoming Appraisal Problems

Use multiple raters, 3600 process

Allow participation of ratee in process Ø Make sure that some of those raters have lived and worked in the country in which the expatriate is working. Ø Have flexibility in criteria of appraisal Ø Have a proper appraisal feedback process

Compensation in International Assignments

To be effective, an international compensation program must: v v v v v

Provide an incentive to leave the home country. Allow for maintaining a home country standard of living....
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