International Human Resource Management

This assignment discusses the role of the Human Resource Department in maintaining the operations of overseas organizations. It explores the factors determining the activities of international human resource department, such as political and legal factors, economic factors, and cultural adjustments. It also highlights the difference between domestic HRM and international HRM. The document type is an assignment and the type of assignment is a study material.

International Human Resource
Management
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Table of Contents
Table of Figures ..................................................................................................3
Box A...................................................................................................................4
Determining the approach of international HRM..............................................4
Political and legal factors.................................................................................4
Economic factors.............................................................................................5
Advantages and disadvantages of off-shoring for an MNE:.............................7
Cultural adjustments and importance for IHR manager:..................................7
Difference between domestic HRM and it leads to international HRM............8
Box B...................................................................................................................9
Several factors in selection of employees for expatriate assignment..............9
Use of ethnocentric approach .......................................................................12
Exploration of MNC activities and barriers to convergence...........................12
Perlmutters international staffing model:.......................................................13

Table of Figures
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Box A
Determining the approach of international HRM
As per the view of Shen and Jiang, (2015) management of overseas
employees is highly important for the functioning of an internal organization
(Alfes, 2013. ). However, there are a number of factors related to such
functioning that often emerges as challenges in operations of the overseas
organization.
This assignment discusses the role of the Human Resource Department in
maintaining the operations of such overseas organizations (Armstrong, 2011).
Besides, the assignment will also shed bright light on the factors that determines
the functions of the human resource departments in their overseas operations.
The factors determining the activities of international human resource
department:
According to Vijay kumar and et.al., (2016) the most common obstacles
that are found in International Human resource Department are adaption of the
cross-cultural activities, adaption of the differences in styles of management in
different areas or regions along with workforce or organizational values of
different areas (Armstrong, 2014). Such factors are to be discussed in this part of
the assignment. There are various type of approaches related to the international
HRM while selection and recruitment process is in process. Basically there are 3
approaches that related to the IHRM and these are; ethnocentric, polycentric,
geocentric approach affect further processing of IHRM (Alfes, 2013. ).
Political and legal factors
There is existence of variety of nature as well as stability of political
systems in different parts of the world. In some countries like United States, there
are stable political systems (Bloom & Van, 2011).
Kundu, (2015) says that it is easier to have business in certain countries
with the help of international HRM techniques. However, the conditions are not
the same in other developing or underdeveloped countries. As a result the

organizations that aim to function in countries over the national boundaries have
to go through certain adjustments in coping up with all such circumstances
prevailing in these areas (Budhar & Debrah, 2013).
As per the view of Tomazevic, Kozjek and Stare (2014) On the other
hand, there might also be changes in the political scenario with changes of prime
ministers, presidents, governors, senators, representatives, etc. Thus, this also
brings certain challenges for the organizations that have set up their businesses in
one country under a particular political scenario (Cavusgil & Knight, 2014).
However, the political scenarios in other countries might not be as stable as that
of the European countries. Therefore, issues arise in such countries giving rise to
political humdrums which severely affects the functioning of an organization's
(Firth & et, 2014). Besides, at times there are one party rule found in certain
countries that are also a matter of concern for a company to operate under such
categories.
Sparrow, Brewster and Chung (2016), have argued that this is because,
prevalence of corrupted system is found in such countries where there is one
party rule continuing years after years. At this stage it is the duty of the
international human resource department to apply their strategies to select their
actions under such circumstances (Foley & Manova, 2015). It is their duty to
decide strategically that which law to be abides by the company and which rules
or regulations can be ignored keeping the ethics in mind. Laws and rules of
equality thus vary from one country to another. Laws of sexual harassment and
discrimination over sex are highly applicable in certain countries as they are
included in the employment rules, whereas there might be no addressable of such
issues in another country laws (Budhwar and Debrah, 2013).
Economic factors
Moving on to the economic factors of an organization it should be stated
that it has few other factors dependent on the same, such as political, legal and
cultural factors. There is existence of different economic structures in different
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countries of the world. Few countries like China uses the communism as their
economic approach. However, in order to move on to other mixed economic
approach the countries may come over the practice of induction of layoffs and
unemployment to reduce employers in bloated government organizations
(Holgersson, 2016). As a result, the global companies are facing varied kind of
obstacles while extending their trade to other countries. In addition to this, global
companies also stand certain chance of availing labors at cheaper rates in these
less developed countries than in western countries (Henson, 2016).
Therefore it also opens scope for higher profit while setting up their
operations in these countries. Besides the same, there is also a chance of
economic fluctuations in these less developed countries that might prove to be
challenging in for the global organizations to function within. Adding to this,
Armstrong and Taylor, (2014) argued that there are few other factors such as
restriction on transferring of earnings and currency fluctuations. Therefore, it is
also on the human resource department of these global organizations to decide
which would be the right step for the company to flourish successfully in foreign
business (Harzing, 2010). Thus, there is a huge responsibility of human resource
department to make the best decisions for the company depending on the policies
and strategies. Moreover, there is also few responsibilities on the part of the
human resource department to formulate new strategies and policies within the
organization so that the varied possibilities and bindings of trading in different
countries can be efficiently coped up (Harzing, 2010).

Advantages and disadvantages of off-shoring for an MNE:
According to Kundu (2015), in several types of multinational enterprise,
there are many advantages and disadvantages of off-shoring likewise advantages
are economics of scale, close collaboration, favorable government policies or
more. The disadvantages of off-shoring is like increasing rate of unemployment
or cultural and social differences and major factor is that security issues of that
particular organization or management as well (Bloom & Van, 2011). The main
advantages of outsourcing is that reduces the cost of operations, improves
productivity and increasing rate of flexibility as well. Moreover, the
disadvantages of the outsourcing is directly related to the cultural and social
differences of each individual countries and communication problems are also
affected the management and increase the difficulties of IHR manager as well.
Security issues are also affect the quality of work and has great impact on
processing of the management. Outsourcing is the strategy that directly relates to
the services of another parties and affected by other agency as well (Canhilal, et
al., 2013). Outsourcing and off-shoring has the common factor of reducing the
business cost.
Cultural adjustments and importance for IHR manager:
In order to carry out operations in the country there must be a coexistence
of parity between the culture of the organization and culture of the country where
the organizations find it fit to function (Cavusgil & Knight, 2014). For example,
conflicts regarding the ethnicity or religion are usually the matter that is very
vulnerable while functioning of a global company is concerned. Therefore, there
are higher chances of conflicts within the practice of hiring employees from
different tribal backgrounds or different ethnicity.
According to Wee, Jonason and Li, (2014) The issues that might emerge
in such situations are inequality among the member of different nations working
in a particular organization. The phenomenon is commonly referred to as
dimension of power distance. In developed countries like Netherlands, Germany,
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United States, etc, there is less occurrence of such power distance (Foley &
Manova, 2015). Whereas, it countries like Indonesia, France, Russia, China, etc,
have greater existence of power distance in the country. Cultural dimension also
includes certain boundaries like coexistence do femininity and masculinity in the
organizations.
Difference between domestic HRM and it leads to international
HRM
Domestic HRM and the international HRM plays an important role in
each and every organization. As according to its name international HRM
directly related to the international and national borders or business of the
organization is directly interact with the international organizations as well (Firth
& et, 2014). International HRM has a responsibility to engage in socio-cultural
sessions and training or also there are more risks because of external factors are
involved in that particular management.
As per the view of Armstrong and Taylor, (2014) In case of domestic
HRM it is clear that management focuses on the training and development or
performance appraisal to enhance the capability and quality of the employees.
Both of the HRM strategies mainly focuses on the achievement of the
organization's goals and set objectives as well (Armstrong, 2011). While
international management deals with the personnel management who belongs to
the other countries and it also includes several functions like recruitment,
planning, training, development, compensation, appraisal or more. Budhwar and
Debrah, (2013) has contradicted that international management is also affected
by internal and external factors so that management has to plan the strategies
accordingly so that they improve their business growth.

Box B
Several factors in selection of employees for expatriate assignment
Foley and Manova, (2015) says that functioning in a global economy
produces certain challenges for an organization. These challenges are mainly
related to the decision making processes of an organization where the human
resource department has a great role to play.
This part of the assignment discusses about the factors that determines the
selection criteria of the employees who are entitled to deal with the expatriate
assignments dealt by a company (Armstrong, 2014). In order to achieve
competitive edge both the private as well as the companies functioning in the
public sector must review their processes of recruitment under this particular
head.
Cavusgil, Knight and Riesenberger, (2013) says that the present scenario
is such that taking up of expatriate assignments are not the only factor that would
lead an organization to success. In order to achieve success there must be proper
way to deal with those assignments and lead them in a proper way (Alfes,
2013. ).
Therefore, to fulfill this category a company must go through a proper
identification of employee capability and their efficiency to lead such
assignments to success (Peltokorpi and Vaara, 2014). This part of the assignment
describes the factors that should be taken into account while selecting the
employees for expatriate assignments.
Technical ability of the employee
Storey, (2014) says that first priority is given to the ability of a person to
perform and fulfill the required terms that are essential for functioning in a global
organization. Thus, managerial as well as technical skills of the employee should
be kept as the topmost criteria in employee selection.
Technical abilities of a person is fundamentally the knowledge that is
required to carry out a task in the associated with tools. The usage of business
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appraisal tools by that of a financial manager for setting up of financial
statements or setting up or balance sheets can be cited as an example It is
according to a number of researches that, a multinational organization always
prefers to put personnel’s with heavy technical skills in their list of selection
(Harzing, 2010). Such employees with sound technical skills are highly potential
to deal with the organizational expatriate process. However, evaluation of the
potential personnel can be done by examining the candidate’s records with his or
her past and present records with the supervisors. Additionally, it is believed that
the past performances of an individual hardly matters in his or her future
performance in the expatriate activities (Harzing, 2010).
Cross-cultural suitability
Cross cultural suitability of an employee is another important criterion
that is to be considered while recruiting the individual to handle the expatriate
assignments within a global organization.
Selmer and Lauring, (2015) proposes that the cross cultural suitability can
be usually understood by going through certain skills of the employee such as
language skill, his attitude towards the other cultures as well as cultural empathy,
etc. Thus, it is not at all easy to evaluate the cross cultural suitability of an
individual.
This is because, it is difficult to precisely know or understand the qualities that
must be included to understand such qualities. However, as identified by a few
experts, that in order to have successful career as an expat, it is important for an
individual to have the capability to accept the culture of their new host within the
least possible time(Foley and Manova, 2015).
Family requirements
From the perspective of international organizational function, it is highly
accomplished in the present days that the family of the expatriates plays a very
important role in overseas assignments (Cavusgil, Knight and Riesenberger,
2013). Interaction between the expatriates and their families are considered are

highly documented in the international strategies of the organizations. There are
certain responsibilities of the families that are considered highly responsible for
establishing a friendly relationship between the expatriates who are representing
an overseas organization. However, there are certain drawbacks in carrying out
these activities on the part of the spouse. There might be certain issues that affect
the presence of the spouse in different countries (Firth & et, 2014).
For example, the issues related to the education as well as the well-being
of the children come into consideration in such cases. However, while speaking
of family interactions usually the female partners are signified; however in case
of accompanying of male partners also come up with certain adjustment issues
(Holgersson, 2016).
Cultural requirements
Cavusgil, Knight and Riesenberger, (2013) has stated There might be
certain issues in engaging the spouse of an individual in working in certain other
countries. Lack of work permit of the spouse or the partners to work in other
countries is also a matter of concern for such international activities (Jiag & et.al,
2012). Therefore, it has been found that the individuals tend to cancel the
expatriate projects offered to them. Therefore, there is an emergence of issues in
these activities due to which the multinational organizations tend to appoint
assistant for this purpose.
Henson, (2016) argued that there are other ground that determines the
presence of the partners in other countries due to physical risk in war-torn zones
in certain countries (Jiag & et.al, 2012). Incorporation of the cultural issues in
this sector is also evident as the countries of Southeast Asian regions are reluctant
to select female members as assistance for official purposes. Firth and et.al.,
(2014) says that these factors become a limitation for the selection of expatriates
for multinational companies to handle the expatriate assignments.
Language ability
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As per the view of Peltokorpi and Vaara, (2014) it is important for an
expatriate individual to have a very significant language skill in order to deal
with expatriate assignments. It is highly essential for an individual to have
adequate knowledge about the language of the host countries where he or she or
the team is venturing out to have international deals with other organizations
(Cavusgil & Knight, 2014). Besides having the language skills, it is also
important to possess the aptitude towards successful communication in the
foreign languages.The family or the spouse of the individual handling the
expatriate project is also an important criterion in this sector (Klabbers, 2012).
Use of ethnocentric approach
As per the view of Cavusgil, Knight and Riesenberger, (2013) this
approach is mainly used for recruitment and selection of highly skilled
candidates for international MNC's. Moreover, international HR manager has to
be followed several steps like identifying global competitiveness and effective
culture of that particular zone while selecting and recruiting candidates for
organization as well. In addition to this, a true HR manager majorly focuses on
selecting candidates from all over the world and for some instance he focuses on
local employees rather than other employees as well (Jiag & et.al, 2012). This
process surely not considered as under discriminatory management because HR
manager has to know the criteria of recruitment and selection in International
human resource management for sure.
This ethnocentric approach states that general aim of IHRM of any recruitment
policy is to select right people for specific task and at right time as well (Storey,
2014). This approach follows a strategy that management only choose candidate
from parent country and they work for host nations. (Foley & Manova, 2015)
Exploration of MNC activities and barriers to convergence
Firth, Kirkman and Kim, (2014) says that there are several type of
MNC activities like reward strategies and practices or other policies or
more. In addition to this, if this activities increases then it leads to improve

the growth rate of related organization. The reward strategy mainly focuses
on the analyzing process of employee remuneration, compensation and
other benefits for each individual employees.
Wright and McMahan, (2011) contradict that there are several barriers
affects convergence in the form of national and international convergence.
Mainly convergence and divergence are reflect the processing of HRM in
different ways and plays vital role in international HRM practices as well
The relationship between trade union and IHRM is very complex and also
there are increasing rate of unemployment and this factor is very
challengeable for management (Storey, 2014).
Perlmutters international staffing model:
Holgersson and et.al., (2016) proposes that this is an international staffing
model which is introduced by perlmutter, this model states that 3 dimensions are
used for developing general strategies of the firm. This model is directly related
to the international business strategy and the importance of this model is that
improving general awareness and specific focus as well.
Klabbers, (2015) states that there 3 dimensions of this model are;
ethnocentric, polycentric, geocentric. Furthermore, ethnocentrism is states that
group of people and based on the attitude of each individual which is related to
the other groups. Polycentrism is the major part of this model which can be
defined as the host country orientation. In this case, it reflects host country goals
and target objectives as well. Whereas, geocentric portion is directly related to
the multinational management and this factor is connected to the international
level and upper management (Alfes, 2013. )).
CONCLUSION
As per the above study international management and domestic
management are the major part of business growth rate. International human
resource management affected by the internal and external factors because it
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(Bloom & Van, 2011) (Budhar & Debrah, 2013) deals with the several countries
across the world. Moreover, this report concluded that in national and
multinational organizations, selection and recruitment is the major part and also
play a vital role in achieving the target goals.

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