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MODULE I
IHRM- DEFINITION
International Human Resource Management (IHRM) is the process of: acquiring, designating, and effectively using the human resources in a multinational company or organization, while trying and maintaining the balance of integration and differentiation of HR activities in the foreign locations
Other definitions..
. . . the worldwide management of people in the multinational enterprise (Poole, 1990; p1) . . .how MNCs manage their geographically dispersed workforce in order to leverage their HR resources for both local and global competitive advantage (Scullion, 2005; p5) . . . a branch of management studies that investigates the design of and effects of organizational human resource practices in crosscultural contexts (Peltonen, 2006; p523)
Purpose of IHRM
To enable the firm /, the multinational corporations (MNCs), to be a successful globally. Objectives of IHRM: Remaining competitive throughout the world Efficient Locally Responsive Flexible and adaptive Capable to transforming learning across their globally dispersed units
In Short
Points HR Activities Involvement in employees Needs Risk Exposure Cultural Environment Domestic HRM Less Less Needs is not so high Minimum Same IHRM More More Needs to cater multiple needs High Different
Senior Management
Complexity
IHRM Model
TYPES OF ORGANIZATION Domestic organizations employing foreigners Parent companies Subsidiary companies Joint ventures Other type of organizations operating in foreign countries
TYPES OF HUMAN RESOURCES Domestic human resources Parent country nationals Third country nationals Other types of foreign countries
INTERNATIONAL HR ACTIVITIES Procuring Developing Compensating Utilizing Migration Socialization services Security Repatriation Cross-cultural management
Congruence Significance
Commitment
Competence
Cost
Effectivenes s
CHALLENGE:
Rapid growth of internalization and global competition has increased the nos. and significances of MNCs resulting in the increased mobility of human resources. Increasing no. of strategic alliances and cross border mergers and acquisitions has increased the strategic implementation of IHRM as Global business.
COMMITMENT: 1. World wide recognition of management of human resources in international business and cross cultural management. 2. Business Networks and Horizontal communication and HR plays a vital role.
COST EFFECTIVENESS:
The performance of expatriates. (poor performance of expatriate may affect the market share and damage to foreign relations) Growing Importance of Expatriates in International Business.
COMPETENCE:
Global Strategy Implementation. Success or failure of international business based on effectiveness of management of HR
CONGRUENCE: Learning, knowledge acquisitions have been identified as important potential sources of comp. advantages for MNCs. This has also enhanced the role of IHRM to meet the key strategic challenge of objectives. Knowledge management is an important source of comp. advantage for MNCs, where IHRM is the key partner and plays a central role.