Introduction: The enduring context of IHRM

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Chapter 1

• IntroductionThe enduring context of IHRM

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Chapter objectives

• In this introductory chapter, we establish the
• scope of the textbook. We
• define key terms in international human resource
  management (IHRM)
• outline the differences between domestic and
  international human resource management and the
  variables that moderate these differences
• (cont.)

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Chapter objectives (cont.)

• discuss trends and challenges in the global work
  environment and the enduring context in which
  IHRM functions and activities are conducted
  including the way in which forces for change
  affect the operations of the internationalizing
  firm and have consequences for the management of
  people in the multinational context.

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Figure 1-1 Inter-relationships between
approaches in the field
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Figure 2-1 A model of IHRM
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HR activities slide 1

• Human resource planning
• Staffing
• Recruitment
• Selection
• Placement
• Training and development

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HR activities slide 2

• Compensation (remuneration) and benefits
• Industrial relations

Figure 2-2 Stages of internationalization
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What is an expatriate?

• An employee who is working and temporarily
  residing in a foreign country
• Some firms prefer to use the term international
  assignees
• Expatriates are PCNs from the parent country
  operations, TCNs transferred to either HQ or
  another subsidiary, and HCNs transferred into the
  parent country

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Figure 1-3 International assignments create
expatriates
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Differences between domestic and international HRM

• More HR activities
• The need for a broader perspective
• More involvement in employees personal lives
• Changes in emphasis as the workforce mix of
  expatriates and locals varies
• Risk exposure
• Broader external influences

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Figure 1-4 Variables that moderate differences
between domestic and international HRM
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The top ten multinationals

• Rio Tinto (UK/Australia)
• Thomson Corporation (Canada)
• ABB (Switzerland)
• Nestlé (Switzerland)
• British American Tobacco (UK)

• 6. Electrolux (Sweden)
• 7. Interbrew (Belgium)
• 8. Anglo American (UK)
• 9. AstraZeneca (UK)
• 10. Philips Electronics (The Netherlands)

UNCTAD Index of Transnationality
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Figure 1-5 Factors influencing the global work
environment
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Forces for change

• Global competition
• Growth in mergers, acquisitions and alliances
• Organization restructuring
• Advances in technology and telecommunication

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Impacts on multinational management

• Need for flexibility
• Local responsiveness
• Knowledge sharing
• Transfer of competence

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Managerial responses

• Developing a global mindset
• More weighting on informal control mechanisms
• Fostering horizontal communication
• Using cross-border and virtual teams
• Using international assignments

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Chapter summary

• This chapter has established the scope of this
• book. We have
• Defined international HRM and the term
  expatriate.
• Discussed the differences between domestic and
  international HRM looking at six factors more
  HR activities, the need for a broader
  perspective, more involvement in employees
  personal lives, changes in emphasis as the
  workforce mix of expatriates and locals varies,
  risk exposure and more external influences.
• (cont.)

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Chapter summary (cont.)

• Examined what we have called the enduring context
  of IHRM. The focus is on the current global work
  environment, looking at the forces for change
  that have prompted managerial responses that have
  implications for the way in which people are
  being managed in multinationals at the turn of
  the 21st century. However, we have made a brief
  comparison with the situation that confronted a
  14th-century merchant as a way of drawing out
  some of the constants in international business.

This treatment has enabled us to provide an
overview of the field of IHRM and establish how
the general environment affects IHRM. The next
chapter examines the organizational context where
we explore how IHRM activities are determined by,
and influence, various internal changes as the
firm internationalizes.