Global Human Resource Management Slide 2 18 - 2
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Sit in
groups after the break If there are less than 3 people from your
group present, lets merge groups Slide 3 18 - 3 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. Slide 4 18 - 4
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Reminder: Optional assignment A small but not trivial part of the
grade for this class is class participation As discussed on the
first day of class, students have the option of writing a
self-evaluation of their class participation. -I may underestimate
students who participate well, but rarely Slide 5 18 - 5
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. I am
partly evaluating how engaged you are in class In the
self-evaluation, -summarize when you participated or communicated
with the professor outside class (if you have) You may also discuss
-how you prepare for class -what you did in group work -discuss the
quality of your participation/ preparation Slide 6 18 - 6
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Self-evaluations should not exceed one page If you did not
participate, simply writing that you prepared for class will not
give you credit. -But attaching materials (e.g., samples of notes
you prepared before class) may Self-evaluations are due by the last
day of class -Do not bring a self-evaluation on final exam day I
may do class participation grades before the final Slide 7 18 - 7
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Should
you write a self-evaluation? Its probably not necessary if Ive been
calling on you at least once a week Do write a self-evaluation if
-Ive only called on you 2 or 3 times -Youve prepared and raised
your hand and I have not called on you Slide 8 18 - 8
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Slide 9
18 - 9 McGraw-Hill/Irwin International Business, 6/e, 7/e Portions
2007, 2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Human Resource Management (HRM) Refers to the activities an
organization carries out to use its human resources effectively
Four major tasks of HRM -Staffing policy who will we hire?
-Management training and development -Performance appraisal How
well is each individual doing? -Compensation policy How much do we
pay each person? Slide 10 18 - 10 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved. Slide 11 18 - 11 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. International
Human Resource Management Strategic role: HRM policies should be
congruent with the firms strategy -Global standardization global
experts on efficiency -Localization need to understand radically
different cultures But even a company committed to global
standardization will have to find culturally sensitive people Task
complicated by profound differences among labor markets, legal, and
economic systems Slide 12 18 - 12 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved. Local employees usually cant do
everything a global firm needs They may have great technical skills
They have great human relations skills within their own cultures
But they dont initially understand the systems of a foreign firm
Corporate culture and institutions of the foreign firm maybe based
on the culture of the home country. -And the problem may be hard
for foreign managers to see Slide 13 18 - 13 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. International
business requires people to work outside their cultures Expatriate:
citizens of one country working in another Inpatriates: expatriates
who are citizens of a foreign country working in the home country
of their multinational employer Slide 14 18 - 14 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. Slide 15 18 - 15
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Expatriates and Cost-of-Living Indexes Higher pay for assignments
abroad Most global companies increase compensation when foreign
cost is higher They do NOT decrease compensation when foreign cost
is lower They remove the differential when the manager is
repatriated 21-1 Slide 16 18 - 16 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved. Slide 17 18 - 17 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. The Expatriate
Problem Not all good managers make good expatriates -And some who
are good contributors hate expatriate life (or have spouses who
hate it) Expatriate failure: premature return of the expatriate
manager to his/her home country Cost of failure is high: estimate =
3X the expatriates annual salary plus the cost of relocation Slide
18 18 - 18 McGraw-Hill/Irwin International Business, 6/e, 7/e
Portions 2007, 2009 The McGraw-Hill Companies, Inc., All Rights
Reserved. Reasons for Expatriate Failure US multinationals
-Inability of spouse to adjust -Managers inability to adjust -Other
family problems -Managers personal or emotional immaturity
-Inability to cope with larger overseas responsibilities Japanese
Firms -Inability to cope with larger overseas responsibilities
-Difficulties with the new environment -Personal or emotional
problems -Lack of technical competence -Inability of spouse to
adjust Slide 19 18 - 19 McGraw-Hill/Irwin International Business,
6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies, Inc., All
Rights Reserved. Expatriate Selection Reduce expatriate failure
rates by improving selection procedures -An executives domestic
performance does not (necessarily) equate to overseas performance
potential Employees need to be selected not solely on technical
expertise, but also on cross-cultural fluency Slide 20 18 - 20
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Slide 21
18 - 21 McGraw-Hill/Irwin International Business, 6/e, 7/e Portions
2007, 2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Headquarters Managers Deal at top levels in many countries -Some
have broad duties -Some are technical specialists Experience the
rigors of foreign travel 21-1 Slide 22 18 - 22 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. Slide 23 18 - 23
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Slide 24
18 - 24 McGraw-Hill/Irwin International Business, 6/e, 7/e Portions
2007, 2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
Repatriation of Expatriates A critical issue in the development of
expatriate managers is preparing for reentry to home countries
-Research shows that there are serious problems with the
repatriation process Slide 25 18 - 25 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. Slide 26 18 - 26
McGraw-Hill/Irwin International Business, 6/e, 7/e Portions 2007,
2009 The McGraw-Hill Companies, Inc., All Rights Reserved. Staffing
With Locals Locals usually cost less than do expatriates They
understand local: -Language -Management styles -Labor policies and
practices -Localized operations -May be legally required in some
cases But they dont understand the foreign companys systems -Often
they have more trouble with the foreign companys systems than
natives of the home country 21-1 Slide 27 18 - 27 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. An option:
Locally hired expatriates Much cheaper than expatriates Understand
the local culture and your home country culture But they dont
understand your business system -They may think your system is
crazy Slide 28 18 - 28 McGraw-Hill/Irwin International Business,
6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies, Inc., All
Rights Reserved. Slide 29 18 - 29 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved. Slide 30 18 - 30 McGraw-Hill/Irwin
International Business, 6/e, 7/e Portions 2007, 2009 The
McGraw-Hill Companies, Inc., All Rights Reserved. Material below
here is optional Slide 31 18 - 31 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved. Guidelines for Performance Appraisal
More weight should be given to on-site managers evaluation as they
are able to recognize the soft variables Expatriate who worked in
same location should assist home-office manager with evaluation
Slide 32 18 - 32 McGraw-Hill/Irwin International Business, 6/e, 7/e
Portions 2007, 2009 The McGraw-Hill Companies, Inc., All Rights
Reserved. Expatriate Pay Typically use balance sheet approach
-Equalizes purchasing power to maintain same standard of living
across countries -Provides financial incentives to offset
qualitative differences between assignment locations Slide 33 18 -
33 McGraw-Hill/Irwin International Business, 6/e, 7/e Portions
2007, 2009 The McGraw-Hill Companies, Inc., All Rights Reserved.
International Labor Relations Key Issue -Degree to which organized
labor can limit the choices of an international business Aims to
foster harmony and minimize conflicts between firms and organized
labor Slide 34 18 - 34 McGraw-Hill/Irwin International Business,
6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies, Inc., All
Rights Reserved. Concerns of Organized Labor Multinational can
counter union bargaining power with threats to move production to
another country Multinational will keep highly skilled tasks in its
home country and farm out only low-skilled tasks to foreign plants
-Easy to switch locations if economic conditions warrant
-Bargaining power of organized labor is reduced Attempts to import
employment practices and contractual agreements from multinationals
home country Slide 35 18 - 35 McGraw-Hill/Irwin International
Business, 6/e, 7/e Portions 2007, 2009 The McGraw-Hill Companies,
Inc., All Rights Reserved.
