INTERNATIONAL
HR
MANAGEMENT
GOING INTERNATIONAL
 Exporting
 Licensing
– One firm leases the right to use its intellectual property
to another firm in exchange for a fee
 Franchising
– An independent organization operates a business under
the name of another in exchange for a fee
 Foreign
Direct Investment
– Joint Ventures; strategic alliances
– Sole ownership
International Business
Strategies
 Multilocal
– Decentralized
– Collection of independently operating organizations
 Export
Market
– Parent company maintains centralized control
 Global
approach
– Hybrid combination of multilocal and export
Domestic vs. International HR
 Basic
function and objective remains the same:
procurement, allocation, and utilization of people.
 Primary difference between IHR and domestic HR
lies in the complexity of operating in different
countries with different cultures and laws.
 Degree of complexity depends on:
– Extent of cultural diversity
– Approach taken to multinational entry
– Top management attitudes (parochialism)
International HR Strategies
 Ethnocentric
– Centralized HR
– Managed by Parent Country Nationals (PCNs)
– Pay based on local market for employees; home
country for PCNs
– Training aimed at KSAs to perform the job
 Polycentric
–
–
–
–
Decentralized HR
Managed by Home Country Nationals (HCNs)
Pay based on local market
Training given added importance
International HR Strategies
 Geocentric
– Global workforce deployed throughout the world
– Positions filled by most qualified regardless of
nationality: HCNs, PCNs, or TCNs,
– Compensation based on value-added
– Training and development emphasized
 Regiocentric
Why Do International Managers
Fail?
 Does
it change the essence of HR?
 Culture Shock
 Cultural arrogance (Parochialism)
 Cultural Insensitivity
 The Key success factor?
– Cultural adaptability
CULTURAL ENVIRONMENT


Language
Communication styles
– Nonverbal
– Direct vs. Indirect
– Greeting: physical and verbal

Space
– Structural & interpersonal

Time orientation
– Punctuality
– Monochronic vs. Polychronic



Religion
Respect/formality
Consensus seeking
HOFSTEDE’S DIMENSIONS
 Individualism
vs. Collectivism
 Power Distance
 Uncertainty Avoidance
 Masculinity vs. femininity
 Long-term orientation