Chapter 14
Human resource
management strategy
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.2
Human resource
management strategy
Objectives
Introduction
Selection and repatriation
Training and development
Compensation
Labor relations
Strategic management and IHRM strategies.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.3
Objectives
Define the term international human resource
management and discuss human resource strategies in
overseas operations.
Describe the screening and selection criteria often used in
choosing people for overseas assignments.
Relate some of the most common types of training and
development that are offered to personnel who are going
overseas.
Discuss the common elements of an international
compensation package.
Explain some of the typical labor relations practices used
in the international arena.
Describe some of the HRM strategies that are currently
receiving a great deal of attention from MNEs.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.4
Introduction
International human resource management
(IHRM): the process of selecting, training,
developing and compensating personnel in
overseas positions.
Three basic sources of personnel talent that
MNEs can tap for these positions:
Home-country nationals (expatriates)
Host-country nationals
Third-country nationals.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.5
Figure 14.1
Source: Reprinted from Columbia Journal of World Business, Summer 1973, Lawrence G. Franko, Who Manages Multinational Enterprises? page 33, Copyright 1973, with permission
from Elsevier Science
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.6
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.7
International screening
criteria and selection procedures
International screening criteria:
Adaptability
Self-reliance
Age, experience and education
Health and family status
Motivation and leadership.
Selection procedures:
Interviews (often including spouse)
Tests.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.8
Repatriation of expatriates
Reasons for repatriation:
The pre-determined time assignment is
completed.
Expatriates desire to have their children educated
in the home country.
Expatriate might be unhappy overseas.
Expatriate might have performed poorly.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.9
Readjusting
Expatriates might find it difficult to adjust back to
the home environment. A number of reasons can
be cited:
Slide 14.10
Adjustment strategies
Transition strategies are designed to help
smooth the move from foreign to domestic
assignments.
Slide 14.11
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
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Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.13
Training programs
Types of training:
Standardized training programs: generic
programs that can be used with managers
anywhere in the world.
Tailor-made training programs: designed to meet
the specific needs of the participants and typically
include a large amount of culturally based input.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
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Slide 14.15
Compensation
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.16
Slide 14.17
Slide 14.18
Figure 14.2
Source: C. Reynolds, Compensation of Overseas Personnel, in J. J. Famularo (ed.), Handbook of Human Resource Administration, 2nd ed. (New York: McGraw-Hill, 1986), p. 51.
Reproduced with permission of The McGraw-Hill Companies
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.19
Table 14.1
Source: Geoffrey W. Latta, Expatriate Incentives: Beyond Tradition, HRfocus, March 1998, p. S4. Reprinted by permission HRfocus, March 1998. 212/2440360. http://www.ioma.com
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.20
Labor relations
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.21
Figure 14.3
Slide 14.22
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.23
Industrial democracy
Industrial democracy: the legally mandated right
of employees to participate in significant
management decisions.
Forms of industrial democracy
Codetermination: a legal system that requires
workers and their managers to discuss major
strategic decisions before companies implement
the decisions.
Work councils: groups that consist of both worker
and manager representatives and are charged with
dealing with matters such as improving company
performance, working conditions and job security.
Shop floor participation.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.24
Slide 14.25
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.26
Human resource
management strategies
There are a number of human resource
management (HRM) strategies currently receiving
attention from MNEs, including:
language training
cultural adaptation
Cf. cultural assimilator
competitive compensation
specially designed HRM programs
structural empowerment
accelerated resource development
employee welfare emphasis
efficiency emphasis
long-termism.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.27
Cultural assimilators
A cultural assimilator is a programmed learning
technique that is designed to expose members of
one culture to some of the basic concepts,
attitudes, role perceptions, customs and values of
another culture.
Cultural assimilators are developed for pairs of
cultures, such as to familiarize managers from the
US with the culture in Germany.
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
Slide 14.28
Table 14.3 Cost of living in select cities (New York = 100), 2009
Source: Adapted from UBS, Price and Earnings, 2009.
E-resources: http://www.ubs.com/1/e/wealthmanagement/wealth_management_research/prices_earnings.html
Rugman and Collinson, International Business, 6th Edition, Pearson Education Limited 2013
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