Differences in Approach and Perspective between Domestic and International Human Resources

7HR007: International Human Resources-Contemporary Issues

TABLE OF CONTENTS
ACADEMIC PAPER 1....................................................................................................................3
Introduction..................................................................................................................................3
Literature review..........................................................................................................................3
Literature review..........................................................................................................................6
Remote multi cultural working .................................................................................................10
Academic sources role in future management ..........................................................................13
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................18

ACADEMIC PAPER 1
Topic: To analyze the differences in approach and perspective between Domestic and
International Human Resources
Introduction
Human resource management can be defined as the process and practices of managing
the employees of an organisation for achieving optimally higher productivity. It can be defined
as a strategic approach the is needed in the management for gaining competitive advantage,
achieve the company goals and objectives and maximisation of people performance. It involves
practices like recruitment, selection and hiring, onboarding, training and development,
compensation and performance management, succession planning, employee motivation and
retention etc (Michael, 2019). International HRM is associated with management of employees
that belong to many nations usually host country, home country and third country nationals;
while domestic HRM is concerned with managing personnel that belong only to one nation. This
academic paper will discuss two types of human resource management. International and
domestic and try to understand the approaches and perspectives of both.
Literature review
According to Fattaah, Singh and Darwish, (2020) the approaches to HRM is concerned
with management of a limited number of activities as it operates within one nation and
subsequently is affected by a limited degree of external factors. The human resource managers
present in a single nation tend to administer all HR programs, policies, employee legislations,
regulations and requirements in context to the specific country standards. In such domestic
environments, the approaches used are aimed and focussed at single cultures and country people
and the perspectives are relatively less wide. The processes of procurement, allocation and
utilisation of personnel is limited locally for gaining competitive advantage. Domestic HR tends
to deal with a less diverse workforce and the polices implemented don’t give a great emphasis on
workforce diversity and cross-cultural sensitivity. The approaches to training, compensation,
hiring is not a highly complex procedure (Fattaah, Singh and Darwish, 2020).
As per Routledge, Ariss and Sidani, (2016) international HRM is generally characterised
by high complexity, need for a broader perspective, higher involvement in the personal lives of
the employees and closely managing them. There is also a higher emphasis on the employee mix,
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change management, higher risks and more degree of impact by external environmental factors.
The global HRM addresses a broad range of activities in comparison to domestic human resource
management. At global levels, the personnel management have to deal with elements like
international taxation, coordination in terms of exchange rates and foreign currencies, global
recruitment drives and internal orientation programs that support assisting various cultures.
Routledge, Ariss and Sidani, (2016) also states that IHRM is concerned with workers that work
across nationalities and the management needs a greater level of involvement as employees
might be an expatriate and staying abroad to conduct company functions. The MNC HR manager
needs ensuring various aspects like the environment of the foreign workplaces, compensation
and benefits, cross cultural training and development through workshops especially for
expatriates. A global HRM provides greater exposure to workers due to different international
assignments and learning opportunities in comparison to local projects. Aside from this, there is
a high tendency that global HRM could face more risks and costs along with facing internal
political, economic and societal factors and implementing internal laws and regulation-based
employee policies (Routledge, Ariss and Sidani, 2016). At the same time it can be stated that
there is high exposure of risk in international HRM in contraction with domestic HRM as there
are different types of risk associated like Political, regulatory etc. Thus, such risk can lead to
serious consequences like social boycott of parent country nationals so international HR manager
needs to be very careful in taking decision related to issue of international HRM.
From the point of view of Doğru, (2019), IHRM is completely different form domestic
human resources management, as there are more varied activities that need to be performed by
HR at international level. It can be stated that international HRM has broad perspective because
it has to considered variety of factors while making decision or any issue of international HRM.
Thus, all these factors are not relevant to domestic HRM while taking decision making process.
International human resources required to be more involved in the process so that it can be
suitably placed employees in international location in which they are more familiar. Thus they
can easily complete the task in more familiar environment and contribute their best for
achievements of end goals.
Memeti, Azizi and Luma-Osman (2019), In international human resources management,
there is more emphasis in employees mix in terms of nationality of employees. Like in many
circumstances HR manager recruit employees normally from country of its origin so that
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company have favourable image in the country. Therefore this approaches resulted in increasing
proportion of local employees in organisation. So, it can be stated that international Hr manager
needs to deals with new set of social -cultural, legal and political system while handling or taking
several decision for benefits of organisation. International human resource management also
ensure that employees are are working in different parts of country needs need to provide healthy
and better environment in foreign country, compensation so that they can live better lifestyles.
On contrary, domestic HR is limitedly involved in all such activities or approaches as it need to
handle few individuals of domestic market only.
The author Tyas and Sunarto (2020), also illustrated that it does not have to change their
mind set to work but also provide them guidance, training about the way they need to complete
the task so that maximum outcome can be achieved. The main differences between domestic HR
is that it is concerned with interest of domestic employees while IHRM is concerned about
global employees that are working in several different parts of world of organisation. So, the key
differences in their perspective is that employees are selected and recruited at various
international locations. The author further also stated that it international taxation, exchange rate
coordination, foreign currencies and international orientation of employees. IHRM emphasis on
working with employees that are spread in more than one nations of particular organisation while
domestic is concerned with few individuals that belong to domestic nation only.
According to another author Benson, (2017), International human resource management
provide more learning exposure to employees as compared to local HR as more cost and risk
associated with them. International human resources needs to considered law and policies or
issue related to several countries while domestic has limited approach. IHRM needs to change its
strategy as per global business environment while domestic HR manager make strategy in
accordance with business strategy and objectives so that company can gain competitive
advantages.
As per perspective of author Trost (2020), IHRM has broad perspective as it deals with
greater scope of activities or more challenges as compared domestic HR. So, the author wants to
stay that it have more narrow approached in context of domestic human resources management.
IHRM needs to make different systems for different location as per country and local
environment so that employees can comfortably complete the their respective task.
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On the other hand as per the author Momeni and Martinsuo (2018), domestic Human
resources needs to deals with limited external factors like government regulation, laws related to
staffing etc. In domestic environment, HR manager organise several program for employees
belonging to single nationality whereas International HR take all decision related to addressing
the issue of employees that are belonging to more than one nationality.
As noted by Jovanovic and Bozilovic, (2017), human resource management have special
capabilities or characteristics to motivates or influence individuals to work hard so that company
can attained its end goals in limited time frame. Every country has its own peculiarities therefore
IHRM in terms of relation between labour and capital that directly influence business strategy.
There are many more differences among IHRM and domestic HR in terms of perspective and
approaches such as IHRM focus on numerous areas while Domestic Hr focused on limited
scope.
Murthy (2019), Multinationals company are facing lot of challenges therefore it has
become duty of Human resource manager to design appropriate strategies or steps that could be
fruitful in achieving the end goals in the best possible manner. The main task or approach of
IHRM is to resolve different problem related to organisational culture so that individuals form
different background can easily coordinated to work together as a team for desired objectives.
Many organisation are operating at international level with an objectives to earn more profit
margin by fulfilling needs of several individuals. Therefore, IHRM use different approaches to
motivates employees to develop numerous skills so that they are able to delivered qualitative
services to customers.
Aris and et.al., (2019),On the other hand domestic HR manager take few or single
approached to manager diverse individuals as they belong to similar culture, nationality etc. The
function and strategy of IHRM are impacted by foreign culture as well as laws while in context
of Domestic HRM it is not affected by all such factors thus employees can be easily influenced
to work as team for achievements of goals. So, it can be stated from the above academic paper
that there is high differences between approaches and perspective of both IHRM and domestic
HRM.
CONCLUSION
From the above literature review it can be concluded that both domestic and international
human resource perform different functions in the organisation. It can be concluded that IHRM
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