IHRM: Organizational Performance, Training, and Expatriate Success

This essay provides a comprehensive overview of International Human Resource Management (IHRM) and its impact on organizational performance. It defines HRM and IHRM, highlighting their functions, including recruitment, training, and development. The essay examines the relationship between HRM/IHRM and organizational performance using a balanced scorecard model. It delves into the importance of training and development, using case studies of SABIC Corporation and Wal-Mart Stores to illustrate various learning theories such as reinforcement theory, learning types theory, experiential learning theory, and social learning theory. Furthermore, the essay addresses the challenges faced by expatriates, discussing reasons for expatriate failure in Eastern and Western markets and emphasizing the importance of cross-cultural training and cultural intelligence in ensuring expatriate success. The analysis underscores the critical role of IHRM in achieving competitive advantage and managing human resources effectively in multinational corporations. Desklib provides students access to similar solved assignments and resources.

International Human Resource Management 1
INTERNATIONAL HUMAN RESOURCE MANAGEMENT
BY
Name
Professor
Course
Date

International Human Resource Management 2
Introduction
Human Resource Management is an organizational function that majorly deals with managing,
recruiting, and directing workers on their roles within the organizational setup. Business
organizations tend to source HR recruitment services through companies that offer the same.
HRM ensures that business organization are adaptive, respond positively to change, are resilient,
and are customer-centered. In relation to the same, this International Human Resource
Management paper intends to define the meaning of HRM and IHRM. The activity will also
solicit organizational performances related to HRM and IHRM including contexts and case
studies that demonstrate their employment (Hair, Et al., 2018).
Human Resource Management (HRM)
As mentioned before, HRM is an organizational function that majorly deals with managing,
recruiting, and directing workers on their roles within the organizational setup. HRM entails
performance of wellness, compensations, development, benefits, safety, training, and
motivational issues (Al-Shammari and Jefri, 20014, pg. 23). HRM plays a strategic role in
improving the environment and culture of the workplace as well as managing workers.
Otherwise, effective employment of HRM ensures that the overall direction of an organization
and the objectives are achieved. In the current business world, HRM has a new role. Therefore,
business organizations tend to source HR recruitment services through companies that offer the
same. Such organizations ensure that HRM focuses on strategically utilizing the skills of workers
then evaluating the impacts of management programs on business workers. Finally, yet
importantly, HRM ensures that business organizations are adaptive, respond positively to
change, are resilient, and are customer-centered (Dorfman, Et al., 2012, pg. 510).

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International Human Resource Management (IHRM)
Unlike HRM, IHRM is defined as a set of operations that help multinational organizations
manage their human resources. Such operations also help business organizations achieve
competitive advantage and goals in the international markets. However, the typical HRM
functions like selection, recruitment, development, training, dismissal, and performance appraisal
are also part of IHRM functions. On the contrary, the difference between HRM and IHRM is that
the latter more functions such as expatriate management and skills management among others.
Therefore, IHRM is important for multinational organizations because it mainly helps in the
management of human resources, and of which include three main employee types, home
country workers, host country workers, and third country workers (Peterson, 2014, pg. 119).
Similarly, some of the roles associated with multinational companies (MNCs) include having the
resource gap between savings that are domestically mobilized and desired investment filled,
filling the trade and foreign exchange gap, as well as filling technological cum management gap
among others. On the contrary, expatriates are associated with improving marketing knowledge
in local markets, improving organizational cultures, developing talents on management, and
transferring business management knowledge in the organization among others (Soon and
Earley, 2013).
Organizational Performance
By definition, organizational performance is the determination of ways through which business
organizations achieve their goals and objectives (Hall, 2017). The figure below shows a balanced
scorecard model illustrating organization performance.

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In relation to organizational performance, HRM and IHRM have certain similar processes
including selection, recruitment, development, training, dismissal, and performance appraisal.
Regarding the relationship between HRM and IHRM, it is worth noting that such connection is
direct because both determine the existing operational strategies and performances of the firm.
Both involve selection, recruitment, development, training, dismissal, and performance appraisal
(Angelo and Michael, 2013).
Training & Development
Businesses thrive in international markets because of their competitive advantages over rivals.
One such way of developing competitive advantage is by creating a superior human resource
Company
Strategies
and Vision
Financial: (To ensure that the
organization achieves
financial growth and that
stakeholders are properly
treated financially)
Internal Organization
Processes: (All operations
to ensure that the vision
and mission of the
organization are met)
Growth & Learning: (Venturing
into new markets and offering
employee training)
Customers: (To ensure
that customers are well
treated through
provision of timely
services and quality
goods)

International Human Resource Management 5
force to rival companies. However, creation of such human resource force depends on proper
training and development. When the environment is competitive, businesses tend to develop
training programs that enhance the knowledge of their workers. In this case, therefore, we shall
consider two case studies. SABIC Corporation that mainly operates in the Middle East and Wal-
Mart Stores that has its operations mostly based in the West (Rokeach, 2013). This activity
realizes that the two corporations actively involve the participation of workers in several
development and training programs. In SABIC for instance, employees demand that the HR
Department to arrange for development and training programs every four to five months.
However, Wal-Mart Stores has its HR taskforce dictate organizational performance and general
success. In general, it is clear from both perspectives that the work force is a valuable asset
(Rokeach, 2013). Below as some of the theories that SABIC and Wal-Mart Stores employ to
emphasize on the importance of organizational development and training.
i) Reinforcement Theory
According to Wal-Mart Stores, reinforcement theory helps workers to portray continuously,
behaviors that are attached to positive results or outcomes. Otherwise, this theory is aligned to
ensuring that development and training programs get aligned to the objectives of an organization
with outcomes that are positive expected (Branine, 2011). On the contrary, SABIC also employs
this theory in that it offers rewards such as salary raises, bonuses, promotion, as well as
certificate awards after completion of training programs. Such rewards have thus generated
several positive outcomes for SABIC in the past few years. According to this theory, if the
process effective, employers are likely to show more interest in development and training
programs in the organization (Stoner, Freeman and Gilbert, 2013, pg. 8).
ii) Learning Types Theory

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This theory encourages intellectual skills learning. Wal-Mart Stores Corporation believes that
such skills are found in few individuals and thus it encourages its employees to learn this skill by
creating proper internal and external conditions. Learning categories would include verbal
information, intellectual skills, cognitive strategies, attitudes, as well as motor skills (Stoner,
Freeman, and Gilbert, 2013, pg. 8).
iii) Experiential Learning Theory
This theory helps SABIC determine the needs and wants of workers. Workers are encouraged to
undergo cognitive and experiential learning types. Afterwards, learners would be mature enough
to tackle their work issues and gain the power to grasp knowledge. Wal-Mart Stores Corporation,
on the contrary, uses this tool to help workers gain the insight of developing tests of self-
evaluation and be able to understand and control their attitudes (Thite, Adrian and Dhara, 2012,
pg. 255).
iv) Social Learning Theory
Through this theory, workers gain a social view of operation. Otherwise, SABIC Corporation
understands that the use of direct reinforcement is not effective enough in addressing or creating
perfect learning conditions in the work environment. “Direct enforcement” refers to development
and training programs used to enhance worker skills. This theory believes that such programs do
not have all the necessary mechanisms to address all types of learning since there are particular
social elements unlikely to be taught (Stoner, Freeman, and Gilbert, 2013, pg. 8). The
surrounding teaches such kinds of elements. SABIC calls it observational learning and of which
is associated with understanding alternative human behaviors. According to Wal-Mart Stores,
working environment ought to be professional and encourage workers to learn skills out of it.

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Apart from that, behavior needs to change after processes of learning (Thite, Adrian and Dhara,
2012, pg. 256).
According to one report on expatriates’ failure in the US, it was clear that the case is rampant in
western countries. By definition, expatriate failure is the premature return of managers from
oversee assignments (Geisler and Hoang, 2013, pg. 39). Therefore, the expatriates in discussion
herein are multinational managers such as those of Wal-Mart Stores and XZY Corporations sent
on international assignments. Studies show that instances of expatriate managers’ failure account
for 30% to 40% for managers assigned to assess developed markets. On the contrary, the case
may account for up to 75% for managers assigned to assess markets that are still developing.
Such rates depict that in western markets, direct failure costs runs between $300,000 and $1.5
million with the situation becoming alarming (Geisler and Hoang, 2013, pg. 41). Concisely, one
American study on the same showed that US multinational corporations experience failure that
may surmount to over $3billion annually with such losses resulting from expatriate failure being
on the rise. Such multinationals also suffer from deteriorating relationships with customers,
foreign government officials, local competitors, and other market stakeholders (Thite, Adrian
and Dhara, 2012, pg. 253). In the Eastern and Middle Eastern markets, expatiates have been
registered to return to their native countries with lost hope, low self-confidence, and self-esteem.
On the other hand, the definition provided on expatriate failure herein, is more of ineffective
since describing the same as a premature return from foreign markets gives a limited impression
of a problem that is critical to strategic management. Issues that are ignored by such a definition
include how expatriate managers work out their issues even after completing their stay or
assessment periods. Studies show that about 25% to 50% of expatriates who complete their
assignments are either marginally effective or completely ineffective. As a result, concerns

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should not revolve around premature return of expatriate managers. Rather, it should address
expatriates’ characteristics as well as how such characteristics suit success in their international
trips is as well important (George, 2016, pg. 212).
One issue that hinders IHRM operations is devising means through which expatriates can
transition smoothly to foreign markets. Therefore, a proper means of endorsing adjustments for
expatriates is by providing multinational workers with adequate training on cross-cultural
perspectives before they leave their home countries. Provision of an overview that is
comprehensive on the culture of the host country is one way of absorbing the shock that results
from the first stages of being absorbed into new cultures (Geisler and Hoang, 2013, pg. 39).
Some of the training areas are likely to include specific behavior studies, language lessons, as
well as body language among others. Apart from that, there exists a direct correlation between
adapting and creating realistic expectation when international workers provided with pre-
exposure through prior training. On the other hand, the level of accuracy of their expectations in
new markets, in turn, translate into higher adjustments in such foreign countries (Charles, 2018).
Otherwise, having considered the above-mentioned point, it is clear that managerial expatriates
are capable of enhancing their performances by developing skills of cultural intelligence by
enhancing their negotiation, decision making, and managerial responsibilities. Since expatriates
aim at developing their careers internationally, acknowledging the importance of creating
adequate and proper response towards foreign cultures or intelligence is basic having considered
that cultural intelligence supersedes cognition (Geisler and Hoang, 2013, pg. 40). Without
cultural intelligence, managers are likely to fail in grasping the particularities of host country,
which then translates to poor business management skills including the management of
stakeholders. Concerning non-managerial skills, workers without cultural intelligence are

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unlikely to adapt to adapt in their workplace environments thereby underperforming (Daniel,
2016).
With discussions from previous segments, it is assumable that cultural concepts have different
scores regarding such discussion segments. However, as processes such as developing, hiring,
and retaining expatriates continue to create growing concerns, it is important to recognize effects
of different cultures on businesses (Geisler and Hoang, 2013, pg. 38). With other factors put
aside, an organization’s national culture has a massive impact on its reaction and perception of
the world. Straight to the point, SABIC Corporation established that its Arab managers and
expatriate operating in the area of the Arab Gulf showed different satisfaction factors and work
orientation compared to those of Wal-Mart Stores Corporation working in the US. This leads to
the comparison of two market cultures in the names of Arabic and American to illustrate how
such cultural difference influence MNCs’ business decision. By examining SABIC
Corporation’s operational strategies and policies, it is clear that Arabs are collectivists. Such a
trait is associated with Arab traditions and Islamic teaching on family respect, group loyalty, and
humility when interacting with others. Such traits, in turn, influence managers and workers in
Arabic nations. On the contrary, locals in these Arabic areas are afraid of effects that expatriates
are likely to impose on their identity and culture. According to studies on the same, it would not
matter whether Arabic managers operated in foreign Arabic countries that have different cultures
because they would still follow the doctrines of Arabic culture (Trompenaars and Charles, 1998).
Therefore, it is established that Arabic cultures have participative and consultative tendencies.
For British and American managers in UAE, studies show that they have a confusing time
expecting to be questioned on the rational of their decisions and choices when that is necessarily
not the case in Arabic workplaces. Therefore, such managers tend to suffer from subjective

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issues like deteriorating relationships with other stakeholders from the native country. On the
other hand, the strategic policies of Wal-Mart Stores suggest that American managers and
expatriates believe in justice and liberty. Apart from that, the American business environment
encourages individualism. Such means that the corporations that base their operations in the
Western countries depend on individual input to ensure success. Similarly, the American
business society put a lot of focus on short-term goals to achieve short-term results. Wal-Mart
Stores for instance, uses tools that measure short-term success and evaluate the general output
from the same. Therefore, Western companies work hard on due processes (Trompenaars and
Charles, 1998).
Finally, yet importantly, it is clear that for an expatriate to be valuable in an organization, he or
she has to develop proper cross-cultural skills. Apart from that, an expatriate needs to understand
the existing difference between low and high cultural contexts alongside the dimensions that
construct help towards achieving suitable approaches of dealing with different cultures.
Achieving a different understanding to the concept of cultural outlay of foreign markets enables
expatriates to think of new approaches through which their organizations could interact with
customers and workers from diverse backgrounds. Most importantly, there are several cultural
differences solicited by comparing the business cultures of Western countries such as USA and
the Eastern ones like Saudi Arabia or UAE. The dimensions provided herein concerning the
differences between these two cultures explain why expatriates from either sides would struggle
to settle in either of the two (Thite, Adrian and Dhara, 2012, pg. 255).
Resourcing
In HRM, resourcing is more than just recruitment. Recruitment can be described as processes of
screening, attracting, and approving qualified individuals to get on-board one’s business

International Human Resource Management 11
operations. Resourcing on the other hand, is the strategic aspect of business operations including
recruitment as well as brand development. The context of brand development is broad and entails
issues associated with talent and worker management and employee offering. Therefore,
resourcing is deliberate and strategic and entails the manner in which business organizations
attract, source, train, select, retain, develop, move individuals from one organizational section to
another as well as promote organizational performance. This approach provides an
organizational mindset aimed at hiring the most suitable, valuable, and qualified recruits. On the
other hand, resourcing put more emphasis on employee retention. Looking closely at the existing
business models for resourcing, most of them look typically developed for recruitment processes.
Even though such models are okay, it is worth noting that with the current rate of business
growth and changing economies, organizations need to join to come up with new resourcing
models and approaches that will ensure value delivery. Apart from that, new resourcing models
are vital because of the existing cultural changes in foreign markets. MNCs should then be
looking for workers with talent and quality to enhance business operations and have their
strategic priorities delivered and not just the provision of quality. For MNCs therefore, a good
resourcing model is one that embraces as well as develop talent management policies and
strategies to realize success.
Resourcing is not associated with talent search forms like going hybrid, out-house, or in-house
but rather concerned with determining issues that the solicited talent ought to be doing for the
company now and in the future in relation to brand promotion. Resourcing is also associated with
determining how hired talents feel and think and how such feelings and thoughts are likely to be
congruent for the business both externally and internally. The reason behind starting MNCs is
because the company can see itself reflected internationally at whatever local context or touch

International Human Resource Management 12
point likely to exist. In most cases, basic hiring processes leave MNCs on the dark, having
forgotten the entre hiring and candidate experience process because the process focuses on time
and cost as the main factors. Resourcing should be thought about in terms of long-term business
alignment towards achieving needs, driving innovation, and ensuring that the built model is
effective and efficient. However, in relation to MNCs, resourcing is likely to be complicated and
extra procedures and processes built that actually never should have existed. MNCs should have
policies and plans that create simple workforces and thus, allowing models of resourcing to have
a seamless execution of the lain plan. Such plans should, however, be performed by MNCs yet
supported by expert centers with knowledge on how to cope with marketing intelligence trends.
Business managers also need to play part of such resourcing processes through highlighting of
their management skills. MNCs also require having strong partners when it comes to business
resourcing to enact proper management changes. Otherwise, career sites and social media
platforms are the latest employable trends for business messaging processes and of which enable
congruence and simplicity at every resourcing level in the company (Brewster, 2016, pg. 6).
In relation to resourcing and related MNC issues, associated theories have two main objectives in
this matter. One is to create more efficiency and increase worker performance while the other is
to increase employee commitment and motivation. According to resourcing theorists, employees
will work more efficiently when they are managed with the same level of efficiency. Otherwise,
efficiency is achievable through four main functionalities; organizing, planning, controlling, and
leading. Therefore, renowned resourcing theories are the universalistic, contingency,
configurational, and motivational (IDC, 2016).
i) Motivational Theories

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This theory outlines the things that have individuals motivated. As argued by the theorist,
Maslow, humans have their wants and needs hierarchically organized and illustrated into
pyramids. Regarding this theory, SABIC an MNC, realizes that its workers basic requirements
like shelter and food should be dealt with first. Therefore, it offers workers meals in workplaces
and servant quarters where they could sleep (Robert, 2017). The second tier is that of job
security, organizational relationships and mutual existence. This level explains the cultural
aspect of SABIC’s working environment. Otherwise, other aspects include provision of
recognition for outstanding jobs as well as creating self-actualization for workers. To achieve
effective resourcing, all the theory levels must be practiced to ensure that workers provide high
levels of performance (Trompenaars and Charles, 1998).
ii) Universalistic Theory
Wal-Mart Stores uses this theory to ensure best organizational practices as well as high
performances. Such is because this theory operate under simple arguments or assumptions.
According to such assumptions:
- A relationship that is linear exists between HR practices and performance of the
organization.
- Best practices could be applied universally and still be successful.
- Best measurement tools for organizational success are indicators for financial
performance such as market shares or profits.
Wal-Mart Stores’ resourcing strategies are a good indication of how the assumptions of this
universalistic theory are put into perspective. In this argument, if MNCs use the existing

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practices attached to this theory, then MNCs are likely to be successful in their resourcing
operations (Kluckhohn and Henry, 2013). Such practices include:
- Selective recruiting and Employment security
- Incentive pay and High wages
- Information sharing and Employee ownership
- Empowerment and Participation
- Job-redesign and Teams creation
- Skills development and Training
- Cross-training and Cross-utilization
- Wage compression and Symbolic egalitarianism
- Long-term perspective and promotions
- Overarching philosophy and measurement of practices
MNCs that practice this theory such as Wal-Mart Stores believe that there are practices that are
universal to every organizational HRM regardless of the geographical location of the company.
Such are also regarded as best practices of which MNCs are likely to adopt anywhere (Sharma,
Ghosh and Raj, 2015, pg. 225). This theory is also against the employment of environment,
culture, heterogeneity as well as behavior of people to determine best resourcing practices.
Otherwise, it is acceptable to recognize MNCs that go for this theory as universalists because
they assume that the ideologies proposed in this argument are 'universally’ proper in terms of
HRM resourcing. This argument helps in deducing the fact that the universalistic framing of this
theory is envisioned (Devanna, Fombrun and Tichy, 2014, pg. 44).
iii) Contingent Theory

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The developers of this argument believe that the relationship between an independent variable
and a relevant independent variable vary regarding a number of influences as company age,
company size, capital intensity, technology, unionization degree, ownership, industry sector, and
location. In this context, there exists a complex set of interactions between performance
indicators and HRM variables; contingency factors and HRM variables; as well as between
contingency factors and performance. In line with MNCs resourcing operations, this theory
describes the policies, aims, and strategies of multinational corporations. It also defines MNCs’
operations and HRM roles then determine if they are valid by relating the same to the
circumstantial events of the firm (Brewster, 2016, pg. 4). Therefore, this theory creates the urge
to achieve the best " fit" according to what a firm is as well as its needs to its:
- Level of technology and size
- Structure of operation and stakeholders
- Performance levels and external environment
- Procedures, general structure, and processes
In line with the same, this theory suggests a situational viewpoint that enable MNCs to work
through opportunities and challenging circumstances. Managers are thus obliged to act in terms
with external as well as internal environmental factors of the firm (Ganesh, Arnold and
Reynolds, 2015, pg. 71).
iv) Configurational Theory
According to the argument posted by the proponents of this theory, integrative perspectives and
concepts that are relevant in HRM practices is important. Commitment and control HR
mechanisms create better performances for the MNC. Such mechanisms could then be important

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in achieving the objectives and goals of the firm. However, this argument is a bit confusing since
its holism notion is entirely unpredictable because of the new links of uniqueness that come with
resourcing wholeness. The term ‘uniqueness” in this case, refers to the specific factors or HR
aspects employed by a unit firm or entity (Brian, Mark and David, 2013).
Conclusion
This activity has discussed in depth, vital issues in IHRM some of which are employed by MNCs
to ensure operational success (Peter, 2010, pg. 63). It is established herein that HRM is an
organizational function that majorly deals with managing, recruiting, and directing workers on
their roles within the organizational setup. It is also deduced that HRM improves environment
and culture of the workplace as well as managing workers (Cynthia, 2013). On the other hand,
this paper has discussed IHRM. First, IHRM is a set of operations that help multinational
organizations manage their human resources. Nevertheless, typical HRM functions like
selection, recruitment, development, training, dismissal, and performance appraisal are also part
of IHRM functions (Hong and Javier, 2013, pg. 25). The most important section of the
discussion revolved around the importance of IHRM to MNCs. According to the discussion,
IHRM helps MNCs to manage human resources including three main employee types, home
country workers, host country workers, and third country workers. The identified case studies
were those of SABIC Corporation and Wal-Mart Stores.
The two Corporations, SABIC and Wal-Mart Stores were significant in arguing out the
importance of training and development in the creation of competitive advantages for MNCs. As
deduced, if the environment is competitive, businesses tend to develop training programs that
enhance the knowledge of their workers (Peter, Et al., 2011, pg. 361). With SABIC Corporation
mainly operating in the Middle East and Wal-Mart Stores operating in the Western parts of the

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world, this activity determined that active involvement of workers in development and training
programs is important in creating competitive advantage. As study MNCs, Wal-Mart Stores and
SABIC have been instrumental in discussing resourcing issues as well.

International Human Resource Management 18
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