PART VI
CONTEMPORARY CONCERNS
Chapter 12 Human resource management in an international context
Introduction ■ HRM role integral to strategy of organisation and so role must be proactive in the international arena. ■ Advent of globalisation brought about increased international market. ■ HRM has to ensure that training designed to distinguish between national and international human resources. ■ World class organisations continuously benchmark their: ■
products
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processes
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results.
Definition ■ Process of employing and developing people in international organisations which operate globally. ■ Applying HRM policy familiar in domestic markets to international workforce, for example: ■
employee development (ED)
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recruitment and selection
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reward and remuneration
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policies and practices.
■ Means working across national borders. ■ Includes any type of worker, for example: ■
own country national working as expatriate
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own country national working overseas for short time for specific project/s
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individual of one nationality working for organisation based in another country but who is actually working in yet another country.
■ IHRM primarily exists in multinational corporations with HRM having a wider contextual setting.
International human resource management and strategy ■ International issues must be included in organisation strategy. ■ Strategic operations decisions to be made: ■
where operational facilities are to be located
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how operations network should be managed across national boundaries
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whether operations in different countries are allowed to develop own way of doing business
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whether operations practice successful in one part of world can be transferred to another part.
■ Where organisation should be located is a strategic decision.
© Linda Maund, 2001. Introduction to Human Resource Management, Palgrave
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■ Configuration strategies: ■
home country
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regional
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globally coordinated
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combined regional and coordinated.
Different practices for different regions ■ Each organisation adopts own individual way of running business dependent upon, for example: ■
culture
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economic conditions
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tradition
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market needs
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demographic trends.
■ Successful global organisations adapt to local conditions.
Challenge of international human resource management ■ Increase in need for ability of HRM specialists and line managers to accept challenge of IHRM, because of: ■
globalisation
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workplace diversity.
■ Need to manage beyond domestic and national boundaries. ■ Demands likely to be found in: ■
managing complexity of workforce mix
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managing diversity
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communications
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finding the right calibre people.
Characteristics of international human resource management ■ Adaptation must be within cultural limits with extra care being taken, for example, when recruiting. ■ HRM specialists can take generalisations and develop them according to international situation they find themselves in. ■ IHRM must be included as part of core programmes in training and development – it is no longer an option.
Internationalism and the human resource management specialist ■ Understanding and working with diverse national practices essential for HRM specialists and line managers with international responsibilities. ■ Must know country’s arrangements in areas of, for example: ■
recruitment
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contracts of employment
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national legislation
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practice and procedures on contract termination. © Linda Maund, 2001. Introduction to Human Resource Management, Palgrave
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■ HRM professionals: ■
oversee IHRM issues
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exercise ‘due diligence’ as part of overseas acquisitions
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undertake strategic reviews of HRM policies in other countries.
■ Globalisation becoming increasingly important and causing increase in number of IHRM specialists required, because: ■
many organisations managing international workforce
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many employees employed by organisations which have overseas branches
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increase in organisations having overseas bases
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organisations conscious of need to be interdependent and global.
International dimensions and management ■ Way management carried out depends upon: ■
culture
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legislation
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economic conditions
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competition
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employee relationships
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training and development.
People and the organisation’s global environment ■ Advanced capitalist countries are in ‘post-career’ phase. ■ Organisation’s needs for workers changes very quickly and thus individuals feel insecure. ■ Advanced capitalism continuing to create more long-term unemployment with growing disparity between ‘the haves’ and ‘the have nots’. ■ Areas of concern: ■
insecure employment prospects
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deteriorating terms of employment
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weakening in the rights of employees
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often lower wages and salaries for those in lower echelons.
■ More apparent in UK than other western countries. ■ Employees of global organisations with enlightened attitudes will find retraining normal and natural. ■ Training needs to be given high priority. ■ Information technology (IT) and strategies of multinational organisations are the integration of the global capitalist economy.
Employment and development strategies ■ Essential that workers are: ■
knowledge based
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skilled
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flexible.
© Linda Maund, 2001. Introduction to Human Resource Management, Palgrave
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■ Concentration needed in: ■
strategy for centralisation
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staffing of posts in management areas
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strategy for management development.
■ Areas needing attention to deal with increasing complexity of worldwide business: ■
cultural diversity
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training
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competencies.
International recruitment ■ Some recruitment will be locally and some internationally, addressing: ■
job description
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job specification
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recruitment customs
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interviewing
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selection.
■ Imperative organisation retains solid reputation for excellent employment practices.
Transferring operations practices ■ Way businesses are run will vary from country to country. ■ Can bring difficulties; for example, working practices.
International human resource management as a career ■ Concentration on: ■
intercultural effectiveness
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interpersonal and communications ability
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language skills
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managing complexity and diversity
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flexibility
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resilience
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local country employment law and conditions
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business understanding
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understanding international business environment.
Managing expatriates ■ Need special handling – UK very successful in comparison to USA. ■ British multinationals paid special attention to: ■
recruitment and selection
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preparation of individuals for overseas placement
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individual development
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help when return to parent country. © Linda Maund, 2001. Introduction to Human Resource Management, Palgrave
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Human resource management and Europe ■ Essential individuals have thorough understanding of: ■
politics
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economics
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social policy.
■ EU playing increasing role in world affairs. ■ EU created dense network of international agreements and relationships to encourage development of cooperation, for example, with: ■
World Trade Organisation (WTO)
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quadrilateral talks (Canada, Japan, USA, EU)
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Africa, Caribbean and Pacific countries
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Asia
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China
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Latin and Central America.
■ European Social Chapter covered workplace legislation. ■ Developments made in areas of transition, for example, Poland.
Human resource management and the United States of America ■ With Japan, put HRM theories on the map. ■ Concerned with: ■
using initiative
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taking personal responsibility
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selection, recruitment, and career advancement on merit
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loyalty to parent organisation.
■ Foundations: ■
scientific management
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human relations approach
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organic theories.
■ Individualised some HRM concepts: ■
employment legislation
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cultural influences
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increase in globalisation
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growth in bureaucracy
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reduced growth in home economy.
Human resource management in the Far East and Australasia ■ Western interest in Japan came about because of close trading. ■ Key working practices: ■
employment for life/commitment
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payment by seniority
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quality
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flexibility. © Linda Maund, 2001. Introduction to Human Resource Management, Palgrave
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Human resource management in the Pacific region (excluding Japan) ■ Australia and New Zealand: ■
analysis on workplace-related activities popular.
■ Singapore and Vietnam: ■
expanding economy
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work with local partners.
Future belongs to individuals who are transculturally competent in that they can recognise, respect and reconcile differences and thus perform better.
© Linda Maund, 2001. Introduction to Human Resource Management, Palgrave