International recruitment have 3 important

questions

• From what countries to recruit (home, host or third)?

• What Techniques to be used when recruitment is planned out side
home country?
• Whether to centralized recruitment activities in home country or
decentralize in foreign subsidiaries?
 Core functions of international HRM

SELECTION PERFORMANCE TRAINING AND

RECRUITMENT COMPENSATION
PROCESS APPRAISAL DEVELOPMENT
• TRADITIONAL • SELECTION • OBJECTIVES • IMPORATANCE • IMPORTANCE
SOURCES PROCEDURE • METHODS OF T & D FOR • OBJECTIVES
• MODERN • SELECTION • PERFORMANE GLOBAL JOBS • COMPENSATION
TECHNIQUES APPROACHES APPRAISAL IN • NEEDS FOR IN GLOBAL
AND SOURCES • SELECTION GLOBAL TRAINING AND COMPANIES
TECHNIQUES COMPANIES DEVELOPMENT • PROFIT SHARING
FOR GLOBAL • CROSS
JOBS CULTURAL
TRADING
Core functions of international HRM

WOMEN IN INTERNATIONAL
DUAL CAREER PARTICIPATIVE
EXPATRIATES INTERNATIONAL INDUSTRIAL
GROUPS QUALITY CIRCLES MANAGEMENT
BUSINESS RELATIONS
• INTERNATIONAL
ADJUSTMENT
• DIMENSIONS OF
INTERNATIONAL
ADJUSTMENT
SOURCES OF GLOBAL RECRUITMENT
• RECRUITMENT-
• Recruitment means the searching for prospective candidates and
stimulating them to apply for jobs. First, the company can send
employees from its , which are referred to as expatriates, expats or
home country nationals.
• Second, it can recruit (natives of the host country),
• Third, it can hire who are natives of a country other than the home
country or the host country
SOURCES OF GLOBAL RECRUITMENT
• PARENT COMPANY NATIONALS- are employees who are citizens of the
country where the company’s headquarters are located. They are
normally the managers, head of subsidiary companies, technicians,
experts etc.
• They help in carrying out operations, running smoothly, provide
advice.
• Sending parent company nationals involves cost and causes ego and
cultural problems
SOURCES OF GLOBAL RECRUITMENT
2. Host country nationals- are employees of company’s subsidiary who are
citizens of the country where the subsidiary is located.
ADVANTAGES-
Familiar with native culture
Familiar with local business norms
Motivate local workers efficiently.
Familiar with local customers taste
DISADVANTAGE
• Unfamiliar with objectives, needs of headquarters.
• View the company only from local perspective
SOURCES OF GLOBAL RECRUITMENT
• THIRD COUNTRY NATIONALS
• Example: Mr. Akhil working in an American subsidiary in France, Mr
Akhil is called third party national. Thus third country national is an
employee of a company’s subsidiary located in a country, which is not
his home country.
• ADVANTAGES
1. Less cost with required expertise, skill, knowledge and foreign
language skills.
Challenging aspects
• • First, the initial cost of airfare, living expenses and transportation in
the host country.
• • The second expense incurred with bringing expatriates in to the
international operation is the training involved in making sure the
people going to the host country are familiar with, laws, rules,
culture, languages and expectations in the new country
International employee selection based on four issues in the context of
staffing global business:
• Linking staffing plans with the evolution of the MNC.
• Staffing orientation/ approach of staffing
• Managing expatriates
• Female expatriates
Linking staffing plans with the evolution of
the MNC:
• Staffing strategies differ based on the life cycle of the MNCs like:
• Setting up the host unit
• Establishing the technology team to begin core operational activities.
• Full blown operations of the host unit with significant role in
establishing global objectives and targets,
• Strong operational leadership at the unit level while globally
consolidating with parents.
GLOBAL SELECTION PROCESS- Approaches to
staffing
• • Ethnocentric policy • Polycentric policy • Geocentric policy •
Regiocentric policy
Ethnocentric policy

• Ethnocentric policy “ Home country’s culture is to be imposed on

subsidiaries” MNC’s exports its HR Policy from Home country to foreign
location. • Strategic decisions are made at headquarters • Key positions in
domestic and foreign operations are hold by headquarters’ personnel.
Three factors are to be considered in the staff:
• Should be able to adjust in family, cultures and personality problems to
avoid failure.
• To succeed, should enjoy local entertainment, develop local relationships
and communicate with locals.
• To achieve success, expatriates to have open attitude and take training
towards host – country. Under ethno centric, lines of communication are one
– directional, i.e. advice from headquarters. In fact, home country attitude
and culture dominates.
Ethnocentric approach
• This approach was followed by P&G, Philips, Toyota etc. when Dutch did this, they
were referred to as dutch mafia. This approach is used due to-
• Non-availability of qualified personnel in host countries
• To maintain unified corporate culture, Japanese follow this, P&G also followed
this
• To transfer the core competencies of the company
• DISADVANTAGEt
• When important posts of subsidiaries are filled by parent country national, staff
of host country feel frustrated
• The subsidiary may fail to understand and respond to the host country culture
due to ‘cultural myopia’. P&G suffered many failures due to this, and
subsequently started filling, senior management positions by host country
nationals. (polycentric approach)
Polycentric
Polycentric “MNC’s seeks to adapt to the local cultural needs of
subsidiaries ”
• Each subsidiary is a distinct national entity with some decision-
making autonomy
• Host-country nationals manage subsidiaries who are seldom
promoted to HQ positions
• Parent company nationals hold key headquarter positions
Advantages of Polycentric
• It eliminate the high cost of relocating expatriate manager and
families.
• Offer a great degree of autonomy in decision making to subsidiary
heads.
• Host country nationals are less expensive than parent country used
and Training Host country’s nationals results in low cost
• Better local knowledge
• Reduce personal problems
• Host country managers can protect a MNC from hostile treatment by
host Government.
POLYCENTRIC
• LIMITATIONS OF POLYCENTRIC
• This approach limits the mobility of employees among subsidiaries
and between subsidiaries and headquarters.
• Organizational culture of the parent company cant be completely
adopted in the subsidiaries.
Geocentric
• A global approach - worldwide integration • View that each part of the
organization makes a unique contribution • Nationality is ignored in favor of
ability: – Best person for the job – Color of passport does not matter when it
comes to rewards, promotion and development. Global firms follow this
approach due to following reason-
To have the most appropriate human resources
To develop the people with multiculture and meet the challenges of
cultural diversity.
To avert the problems of cultural myopia and enhance the local
responsiveness of the host country.

.
Regiocentric
• Regiocentric • Reflects a regional strategy and structure; • Regional
autonomy in decision making; • Staff move within the designated
region, rather than globally
EXPATRIATE MANAGEMENT

• OVERVIEW
• EXPATRIATE SELECTION
• EXPATRIATE TRAINING AND DEVELOPMENT
• EXPATRIATE COMPENSATION
SELECTION TECHNIQUES
The company has to measure the candidate on various variables regarding
adjustment. The variables include:
• THE INDIVIDUAL DIMENSION- this includes
1. Candidates self efficiency
2. Relational skill of the candidate
3. Perceptional skill of the candidate
4. Job skills
5. Stress reduction skills
THE NON-WORK DIMENSIONS
1. Cultural novelty
2. Host country’s religions, social, cultural, , historical adjustment of the spouse
and family members.
SELECTION TECHNIQUES
• THE JOB DIMENSION
1. Job duties, responsibilities
2. Technical competency
3. Human relation skills at the work place.
ORGANIZATIONAL CULTURAL DIMENSION
1. Culture of candidate’s previous organization in his home country
2. Candidate’s background of working in different organization with
different culture.
3. Candidate’s ability to adapt to the new organizations, work places, group
norms and expectations.
PROBLEMS WITH EXPATRIATES
• The major problem with expatriates is adjustment in the new
environment.
1. INTERNATIONAL ADJUSTMENT
2. DIMENSIONS OF INTERNATIONAL ADJUSTMENT
EXPATRIATES
• INTERNATIONAL ADJUSTMENT- is the degree to which the expatriate
feel comfortable living and working in the host culture. The expatriate
is completely new to the host country environment, social rules, etc.
psychological uncertainty is also called culture shock.
• NANCY ADLER defines culture shock as, “the frustration and confusion
that result from being bombarded by uninterpretable cues.”
• for example, USA students drink beverages in the class-room.
U- curve of cross cultural adjustment
THE ADJUSTMENT OF THE EXPATRIATE

• the adjustment of the expatriate and the accompanying family takes place
over a period of time and comprises four phases, which include the initial
period of assignment also termed the honeymoon phase, which is followed
by culture shock, adjustment, and finally, the mastery phase.
• The honeymoon phase is characterised by feelings of excitement and
curiosity which is quickly followed by feelings of frustration and
disillusionment as the reality of the relocation sets in.
• During the third stage adaptation occurs and individuals learn how to
behave in the new culture.
• The final stage, mastery, is where adjustment takes place on an
incremental bases thereby improving functioning in the new culture
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
• International adjustment has three dimensions, viz adjustment to the
overseas workplace, adjustment to interacting with host nationals,
and adjustment to the general environment.
• There are four dimensions of adjustment, individual, job, organization
culture and non-work.
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
1. INDIVIDUAL DIMENSION- these skills include cross-cultural skills.
There are three type of individual skill
a) Self-efficacy skill: should possess self-confidence, self-esteem, and
mental hygiene.
b) Stress reduction: include abilities to deal with interpersonal conflict,
financial difficulties etc.
c) Technical competence
d) Reinforcement substitution- this involves activities that bring
pleasure and happiness in home culture. The common interests
would be sports, music, art, etc.
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
2. RELATIONAL SKILLS- the skills include:
• Finding mentors-
• Willingness to communicate- not language of host country is not
necessary. Using proverbs, popular songs, jokes of the host country
is ‘conversational currency’.
• Perception skills- understanding the behavior of the host nationals,
their practices, culture etc.
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
2. JOB DIMENSION- expatriate should have required skills, knowledge,
and abilities to carry out the job successfully in host country.
These factors help/hamper the expatriate:
a) Role clarity- job duty, responsibilities etc
b) Role discretion- degree of flexibility to adapt to work place rules
and regulations, expectations, procedures etc.
c) Role novelty- degree of distinctiveness of duty, tasks etc. from
home country to host country.
d) Role conflict- occurs when expatriates start receiving conflicting
signals regarding his performance etc
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
3. ORGANIZATIONAL CULTURE DIMENSION- every organization has its
own culture with different rules, regulations, customs, traditions,
norms, expectations etc.
DIMENSIONS OF INTERNATIONAL
ADJUSTMENT
4. NON-WORK DIMENSION
a) Culture novelty- includes difference in beliefs, values, norms,
religious faith, gender roles etc.
b) Family-spouse adjustment- the employee may decide to leave the
host country before the contract expires. For eg. Some Indians
wives fail to adjust to foreign culture regarding marriage system,
and so are forced to leave the foreign job and return.
TRAINING AND DEVELOPMENT
• IMPORTANCE
1. Training leads to job knowledge and skills at all levels of the
organization.
2. Improved morale of human resources.
3. Improved profitability
4. Improved relationship between boss and subordinate
5. Improved understanding of culture of various countries.
TRAINING AND DEVELOPMENT
• NEED FOR TRAINING AND DEVELOPMENT
1. To match employee specifications with the job requirements and
organizational needs.
2. To achieve organizational viability and the transformation process.
3. To meet challenges of technological advances.
4. To understand organizational complexity.
5. To make employee familiar with the language, customs, traditions
etc.
TRAINING AND DEVELOPMENT
• CROSS CULTURAL TRAINING
• This helps expatriates to learn the cultural norms, values, aptitudes,
etc of the host country.
• Procter And Gamble trained their selected candidates for their
company in Japan regarding the Japanese culture, they hesitate to say
no and finalize most of their business deals outside the office and
restaurants in evening. The employees transferred this knowledge into
their cognitive and physical behavior.
• Indian expats in USA are given brief training regarding punctuality,
preferences and the reasons for such behavior.
Contents of the cross cultural training
1. Information of fact oriented training- provides expatriate trainee with
information and facts of the country like country’s economy, resources,
language, social groups etc.
2. Attribution training- this training provides the reason or causes for the behavior
of the people of the host country.
3. Cultural awareness training- this training is to provide the common values,
attitudes, behavior in the host country’s culture. This makes the trainee
understand how culture affects the behavior of the people of the host country.
4. Cognitive behavior modification training- this training provides the information
regarding the behavioral practices which results in getting rewards or
punishments in the host country. For example, Indian organization do not
provide rewards for hard work and sincerity, when they go to US they become
committed.
Training techniques
• Lectures
• Area briefing
• Reading material
• Video films
• Classroom language training
• Case studies
• Role plays
COMPENSATION AND BENEFITS

• COMPENSATION IN GLOBAL COMPANIES

• Compensation is the amount of remuneration paid by the employer
to the employees in return to their services and contribution to the
company.
• The two issues involved are-
• 1. national economic differences
• 2. payment practices
TYPES OF COMPENSATION
• Many MNEs apply the BALANCE SHEET COMPENSATION PLAN to
manage their expatriate accounts.
• The approach develops a salary structure that equalizes purchasing
power across countries to expatriates having the same living standard
in their foreign posting that they had at home- no matter which
country their assignments takes them.
Three common methods of B/S Compensation
1. Home-based method- Home based pay means that the assignee remains
on home country payroll for purposes of receiving base and incentive pay while
assignment allowances are delivered through either the home or host country payroll.
This method simplifies the expatriate’s eventual return.

2. Headquarters based method- this approach sets expatriates salary in terms of salary of
a comparable job in the city where the MNE has its headquarters. For example, if a
Boston headquartered MNE posted expats to its offices in London, Santiago and
Jakarta, it would give each expatriate a salary structured in terms of Boston pay rates.

3. Host based method- also called as destination pricing and localization, this method
bases and expatriate’s compensation on the prevailing pay scale in the locale of the
foreign assignment. Basically, an expat starts with a salary equivalent to that of a local
national with similar responsibilities and then adds whatever foreign-service
premiums, extra allowances, home-country benefits, and taxation compensations
were negotiated.
Allowances
International industrial relation
• IR is the complex relation among parties-
• Employees
• Employees union
• Employer
• Employers associations
• Government
• Trade y-ubub
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