Chapter 15 International Human Resource Management

The importance of global human resource management is apparent by the factors of

International Mergers and Acquisitions, Global Competition, Market Access
Opportunity, and Foreign Human Resource.

International corporations are Domestic firm that uses its existing capabilities to
move into overseas markets. Multi national corporations are firms with independent
business units operating in multiple countries. Global corporations are firms that
have integrated worldwide operations through a centralized home office. And,
Transnational corporations are firms that attempt to balance local responsiveness
and global scale via a network of specialized operating units.

International companies affect the world economy because their production and
distribution extend beyond national boundaries, making it easier to transfer
technology, they have direct investments in many countries, affecting the balance
of payments, and they have a political impact that leads to cooperation among
countries and to the breaking down of barriers of nationalism.

Issues in international HRM in helping employees adapt to a new and different

environment outside their own country consist of: relocation, orientation, objective,
and translation services.

Expatriates, or Home-country Nationals are employees from the home country who
are on international assignment. Advantages of expatriates: 1. Talent
available within the company 2. Greater control over managers, 3. Company
experience, 4. Mobility, and 5. Development opportunities for managers

Host-country Nationals are employees who are natives of the host country.
Advantages of host-country nationals are: 1. Hiring local citizens is generally
less costly than relocating expatriates. 2. Since local governments usually want
good jobs for their citizens, foreign employers may be required to hire locally. 3.
Most customers want to do business with companies they perceive to be local
versus foreign.

Third-country Nationals are employees who are natives of a country other than the
home country or the host country. Advantages of third-country nationals: 1.
Broad experience, 2. International outlook, and 3. Multilingual

Work permits or visas are government documents granting a foreign individual the
right to seek employment.

Guest Workers are foreign workers invited to perform needed labour.

Note—essential training program content to prepare employees for working
internationally are: language training, cultural training, assessing and tracking
career development, managing personal and family life, and repatriation.

Culture shock is perpetual stress experienced by people who settle overseas.

Repatriation is the process of an employee transitioning home from an international

assignment.

Home based pay and the balance-sheet approach are two types of expropriate
compensation systems.

Home-Based Pay is pay based on an expatriate’s home country’s compensation

practices and the Balance-Sheet Approach is a compensation system designed to
match the purchasing power in a person’s home country.

Hands off, Monitor, Guide and advise, and Strategic planning are HR approaches to
labour relations within international organizations.