International HRM: Western Model, Challenges and Case Studies

This report provides a comprehensive overview of International Human Resource Management (IHRM), focusing on the Western or American model. It defines the model, outlines its key features and principles, and then explores its relevance and application in various countries, highlighting the impact of different national cultural traditions on HRM practices. The report examines the challenges faced by Multinational Corporations (MNCs) in managing human resources across diverse cultural contexts, including difficulties arising from differing HRM approaches between home and host nations. It further discusses strategies for managing these differences and includes case studies, such as examples from China and Anakew, to illustrate the practical implications of IHRM principles. The report concludes with a summary of the key findings and offers insights into the complexities of managing human resources in a globalized business environment.

INTERNATIONAL
HUMAN RESOURCE
MANAGEMENT

TABLE OF CONTENTS
1 INTRODUCTION .......................................................................................................................3
2 WESTERN OR AMERICAN MODEL OF HRM.......................................................................3
Definition ...................................................................................................................................3
Key features and principles ........................................................................................................3
3 RELEVANCE IN OTHER COUNTRIES....................................................................................5
Different national cultural traditions regarding HRM ...............................................................5
Examples from case study of China ...........................................................................................6
4 CHALLENGES FOR MNC'S AND IMPLICATIONS FOR IHRM...........................................6
Definition of MNC and IHRM ...................................................................................................6
Difficulties in different cultural traditions of HRM between home and host nations ................7
How to manage these differences...............................................................................................8
Examples using case study of Anakew ....................................................................................10
5 CONCLUSION ..........................................................................................................................10
REFERENCES..............................................................................................................................12

1 INTRODUCTION
International human resource management is the set of activities which intends to manage
human resources of an organization at an international level for achieving objectives of
organization and competitive advantages over rivals on national as well as international level.
Apart from HRM functions such as recruitment, selection, performance management etc. there
are some additive activities in IHRM which includes global skills management, managing
expatriates and many more (Story and et. al., 2014). The present reports is going to cover main
aspects of Western model of HRM and its principles. It will also throw light on different national
cultural traditions in HRM.
2 WESTERN OR AMERICAN MODEL OF HRM
Definition
Western model of HRM emphasises on independence and flexible working practices
which is very formalised having a strong sense of management.
Key features and principles
The concept of HRM was firstly propounded in United States of America since 1960 and
1970. after that it has been used by all the nations around the globe with its theoretical and
practical features. The main features and principles of Westerns model of International human
resource management are describe below (Cavusgil and et. al., 2014):
 Western nations follow flat structures and leadership style which is followed is mostly
democratic style. Western countries also differ from other countries in terms of
motivation programs. They focus on individual rewards, compensation packages and
personal career development (Festing and et. al., 2013. pp.161-166.) Western nations
prefer oral and direct ways to communicate. Professionals in Western countries adopts
oral methods of communication such as face-to-face interactions, telephonic
communication, discussions which takes place in the business meetings. The direct
communication is preferred by Westerners in which active listening and effectual
feedbacks are taken (Marler, 2012. pp.6-11.).
 The human resource professionals in Western nations adopt different means of
communication i.e. oral and direct communication is preferred. At the same time, they
can also adopt direct voice and indirect voice so that the flow of information can be

stabilised. This is also essential in terms of stabilizing flexible work patterns especially in
the area of human resource management.
 Taking use of emails, networking forums and other types of management forums are
highly practised in Western nations like United Kingdom and United States
 Resolution of conflicts and dispute is one of the key aspect of human resource
management which is practised more in Western nations than other parts of the world.
 Westerners resolves conflicts through avoiding or neglecting conflicts (Collings, Wood
and Caligiuri, 2014).
 The employers in Western nations prefer more for personalised interviews. Personalised
process for selection is adopted by majority of organizations in these nations along with
evaluating capability and technical prerequisites of individual for the job (Janssens and
Steyaert, 2012. pp.61-72). Then they assess the work experience of potential employees
in a similar job.
 Recruitment process in Western nations and China: Westerns nations prefer of Internal
recruitment methods such as transfers, promotions, re-employment of old employees
while Chinese firms goes for external recruitment through advertisements, employment
exchanges, employment agencies, recommendations etc. (Armstrong and Taylor, 2014)
 Volkswagen is a German company which also operates in USA. This company operated
with different culture in both the nations. The working culture of chosen firm in Germany
is such that there are particular and constant expectations regarding each aspect of work.
Employees know what they have to do exactly and to do it in a smooth and efficient
manner (Rees and Smith, 2014). While on the other hand, the quoted organisation has a
different work culture in USA. There are less regulations and standardisation is preferred.
The firms in USA provides less security but for talented and competent employees
rewards and recognition are given.
 The procedure of selection in these countries does not includes judging a candidate
familiarity with domestic culture.
 The approach towards performance management and appraisal system is oriented towards
outcomes. It promotes increased productivity of employees and it is more focused
towards performance appraisal rather than individual appraisal. For instance, In
organizations of United States of America, employers prefer to rank pay considering it

one of the best methods of performance appraisals (Varma and Budhwar, 2013). They
think that it is the most significant way of documenting performance of employees.
 The Western nations give more time for training and development of employees.
 These countries focus on “pay for performance” which has a very moderate role.
 The practices of compensation in Westerns countries such as United States of America in
a very dominant systems which is referred as balance sheet approach. With this practice
the employers provides several incentives such as mobility premium, hardship
allowances etc. But this approach does not provides enough security to the employees
(Caligiuri, 2014. pp.63-72).
 In terms of cross-cultural diversity Western nations such as America gives importance to
punctuality and holds a belief that time is equivalent to money. The culture in these
nations encourages risk taking. The decision-making in the organizations are made very
speedily and people working there is usually very ambitious and future directed (Ehnert,
Harry and Zink, 2013). Persistence is one of the noticeable features in most of citizens in
countries like America.
 Furthermore, there is presence of individuality and high sovietism along with a
inclination towards group orientation. Communication is done in a cordial and healthy
environment in which there are small or very few arguments on the basis of formative
criticism (Altman and Baruch, 2012. pp.233-255).
3 RELEVANCE IN OTHER COUNTRIES
Different national cultural traditions regarding HRM
There are different cultural traditions in people management in different countries. If we
take Eastern and Western nations they have a very different culture and traditions which affects
their HRM practices and policies. National traditions and cultural impacts numerous aspects of
an organization's HR practices which consists of performance management and appraisal system,
strategic decision-making, leadership, managing employee relations and so on. Culture of a
country is comprising of assumptions, norms, beliefs and values which makes a key component
in the society (Francis Parkes and Reddington, 2014. pp.1327-1350). Because human and
institutional foundations are the result of cultural roots of a country, is makes a significant

influence on business operations especially in terms of the soft aspects like HRM policies.
Traditions and culture of widely impacts each thought, decision-making process, actions and
organizations. Most of the human resource management theories and practice are originally from
Western nations.
However, due to increased globalization and cross-cultural interaction showcases the
variance in cultures and therefore it is clearly visible that Westerns and other parts of the world
prefer different human resource approaches, perspectives, norms and practices. If human
resources practices in Eastern nations such as China and Japan are compared with Western
nations such as United States and United Kingdom it depicts that they are very different when
organizational structure, motivation, communication and dispute settlement are concerned. The
organizational structure, style of leadership and human resource management philosophies are
very different in these parts of the world (Marler, 2012. pp.6-11.). In China and Japan, there are
strict rules to adopt organizational hierarchy and the leaders in business enterprises follow
autocratic style of leadership. On the other hand, nations such as United States and United
Kingdom follow flat structures and leadership style which is followed is mostly democratic style
(Janssens and Steyaert, 2012. pp.61-72).
Within the China cross cultural issues take place with transnational corporations. They
are facing different types of formulating and implementing of human resources policies and
practices which affect to the Chinese. With the help of presenting different policies and practices,
Chinese companies can grow their outcomes as per the exploratory research. However, in the
Germany market globalization is increasing day by day which assist to grow operative functions
and operations in systematic way. It seems necessary to consider culture that is important factor
which influence to design and implementing HRM practices. Goal of the particular study is
examines impact of cultural dimensions. There are different types of countries which selected to
CRANET database. CRANET is demonstrates effective feature and measurement to look
towards more than 4 European countries. In Japan there is complex system which make dynamic
society for undergone nation and economic superpower. Japanese is also absorbed difference
between another nation people and domestic native. As results, their HRM practices is not
effectively creating ethnic homogeneity. Common Asian culture trends assist to make such
groups which are authorized to make salient ingredients. Collective Japanese culture divert their

outcomes and performances which shows security and welfare of people (Fong Boh, Nguyen.
and Xu, 2013. pp.29-46).
Western countries also differ from other countries in terms of motivation programs. They
focus on individual rewards, compensation packages and personal career development, other
nations such as China and Japan, emphasize on collective reward system and slow progress. The
human resource professionals in Western nations adopt different means of communication then
other countries. In nations like China and Japan, communication is often contextual and indirect
as they require to save their faces, whereas in Western nations oral and direct communication is
preferred (Baruch and et. al., 2013. pp.2369-2393). Taking use of emails, networking forums and
other types of management forums are highly practised in Western nations like United Kingdom
and United States as compared to China and Japan in which they give very high importance to
personalized relationships.
Resolution of conflicts and dispute is one of the key aspect of human resource
management which is practised more in Western nations than other parts of the world. For
instance, in nations such as China and Japan there is a tendency for harmonious and holistic
approaches towards conflict resolution. This shows that their culture is affecting their HRM
procedures and policies (Wilson, 2014). They prefer to solve disputes by accommodation and
making compromises. But Westerners resolves disputes either by avoiding or neglecting them.
Cultural tradition in USA and Germany
Germany is the centre of Europe, not only in terms of geography, but also in terms of
politics and economics. In Germany, high priority is placed on structure, privacy and punctuality
and Germans usually embrace the value of hard work. They give more consideration to their
cultural values; hence the entire country focuses on adopting Christianity. Germans also prefer
hearty cuisine and this enhances the value of traditions (Janssens and Steyaert, 2012. pp.61-72 ).
.
However, on the other hand the United States is one of the most culturally diverse
countries in the world wherein every region of the world has influenced American culture. In
America, clothing style vary according to social status, region and occupation. American fashion
is also influenced by several celebrities and this is the reason people in America chiefly focuses
on luxury lifestyle.

However, China is known for the technological development in which all the
technological products are being manufactured in such a way so that it can meet changing
requirements of customers. According to Chinese tradition, Eastern philosophy and religion
plays major role which includes cultural values like Hinduism, Taoism, Judaism and Buddhism.
This is one of the most complex parts of Asian culture which shows integration between
different cultures and the western world (Francis Parkes and Reddington, 2014. pp.1327-1350).
Examples from case study of China
In Chinese companies, HRM policies are developed which chiefly focuses on the value of
employees as they are the major resources that enhance the business capability and success
aspects. With the help of HRM policies, all the aspects of business are effectually managed.
HRM also underpins the practice of management through focusing on different strategies and
work aspects. Further, as per HRM strategies, several performance standards are being
determined which also aids in facilitating more development in the economy (Francis Parkes and
Reddington, 2014. pp.1327-1350).
Different types of cultures can be experienced through movies, soaps and documentaries
due to the increased use of information technology and globalized media. Along with this, as
more knowledge has been gained about different cultures, the growing globalization of market,
competition and organizations has resulted several people to believe that cultures are joining.
The idea of culture is profoundly rooted in past times and the scope is extending far above the
boundaries of activities in an organization. Organization are the outcomes of society and times in
which they are present (Rees and Smith, 2014). Taking the example of China, the cultural values
of Chinese organization is based on the concept of Confucianism. This can be also termed as
Confucian work dynamism. In nations which adopts this type of cultural values, they are long
term oriented and are focused towards future. They place a great value and importance to saving
and persistence. Also the cultural values of China is very holistic which is also described in
above sections. The major cultural values which dominates in China is giving importance to
seniority and human factors (Francis Parkes and Reddington, 2014. pp.1327-1350). This has
been seen that Chines cultural values are more sophisticated because they are interrelated and are
embedded in the culture of collectivism. The deeply rooted cultural values cannot be easily taken
away or washed out by culture of organization and global HR practices and policies. Chinese
organization takes into account their own cultural values when they execute global HR policies

and practices while in USA this is not preferred. The firms is USA takes into consideration all
different types of cultural values to maintain diverse work culture and create a pool of diverse
workforce (Francis Parkes and Reddington, 2014. pp.1327-1350).
The national culture in China is primarily based upon 2500 years old lessons of
Confucius and thus it revolves around groups, relationships, strict power structures and risk
avoidance. The market of China is largely dominated with state owned businesses having
hierarchical structures and employees holds expectation of guaranteed employment and benefits.
As compared to USA, it can be said that chief focus has been laid on cultural aspects
which promotes different dimensions of the country. Thus, in this respect Hofstede theory can be
applied which is based on different set of dimension. China as well as USA both have
differences on the basis of national culture and both focuses on diverse values (Francis Parkes
and Reddington, 2014. pp.1327-1350).
4 CHALLENGES FOR MNC'S AND IMPLICATIONS FOR IHRM
Definition of MNC and IHRM
A MNC is having facilities and other possession in at-least one nation other than its home nation.
These corporations have their offices and manufacturing plants in various nations and generally
they have a centralised headquarter from which they coordinates global management. They are
also known as multinational enterprise (MBE) or transnational corporation (TNC). There are
many different model of MNC which includes Centralised, Regional and Multinational. The
human resources professionals in an MNC which has several divisions or subsidiary units in
foreign nations have to meet all the basic HR responsibilities along with additional tasks which
are particularly for their own department (Armstrong and Taylor, 2014).
Difficulties in different cultural traditions of HRM between home and host nations
Due to the changes in global economic reforms and introduction of globalization,
international business is the top priority for every business firm for becoming a Multinational
corporation to have competitive benefits of the entire global market. However, with the
advantages firm have to face some major difficulties and problems also for managing business in
other nations. One of the main difficulty is environmental factors and out of this cultural
differences is also a key problems which is faced by MNC's in the host nation (Hutchings and
Michailova, 2014). The difficulty of cultural diversity in international business is the

contemporary scenario which is continuously growing along with increasing globalization
(Armstrong and Taylor, 2014).
To manage differences in traditions, religions, culture and languages in the host nation is
very tough and complicated task than home nation in a Multinational company (Collings Wood
and Caligiuri, 2014). The cultural diversity in people management and customers is not just
linked with the society but it also affects psychology and personality of stakeholders of a MNC.
To make an organizational culture which is aligned with the culture of host nation is very hard
job for any MNC due to the fact that culture of an organization is very different from the societal
culture of host nation (Armstrong and Taylor, 2014). The challenge of cross-cultural diversity
obviously increases because when a firm enter into a new market, it has to manage different
culture who may have different responses to the HRM policies and procedures. For instance, in
an Multinational company who hire employees from America and India (Armstrong and Taylor,
2014).
The American employees are more likely to grab opportunities for their own personal
development and compensation, on the other hand Indian employees will be concerned about
progress and prestige of firm and will be more loyal towards company (Harris, 2012). One of the
main problem in managing different culture and traditions is communication. For instance, Latin
American, Asian culture mostly interacts with use of facial expression and voice tone with
words, on the contrary, Germanic and English speaking culture places value to emotions and
feelings, whereas in countries such as USA and Italy they follow a stronger displaying of
emotions in business (Armstrong and Taylor, 2014).
One more difficulty is workplace etiquettes. To address in a formal manner is a big thing
when dealing are done with peers and partners who belong to other nations. Some of them prefer
title and surnames and some like taking only their first names. Asian countries like Singapore,
South Korea and China like using formal Mr. or Ms. With Surnames, on the other side, nations
such as America and Canada like to take use of first names in their formal business meetings and
dealings (Vaiman and Brewster, 2015. pp.151-164).
MNC also faces challenges in regard to operate its business in different markets and thus
varies within nations and thus faces issues in regard to operate HRM practices in business. MNC
operating in western countries also faces challenges regarding recruiting and retaining
managerial talent in order to maintain skills and thus operate business in such environment and

thus persuade skilled professionals to work in an effective way and thus enhance the business
functions (Minbaeva Mäkelä and Rabbiosi, 2012. pp.387-405). Implementing IHRM strategy
also result into facing serious challenges and thus implement the operations of firm in developed
countries and thus helps in improving firm's operations in market. HRM practices within
business in western countries considers that changes in the patterns of global staffing so that
recruiting skilled workers helps in enhancing business operations in worldwide market (Xing and
et. al., 2016 pp.28-41.).
Hofstede's cultural dimensions stated that the values which differentiates a nation's
culture with each other can be categorised in four groups in a statistical manner. These groups
are called Hofstede dimensions of national culture. The dimensions of national culture are power
distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance
index, long term orientation versus short term normative orientation, indulgence versus restraint
(Ng Lyons and Schweitzer, 2012).
In Germany, the highest score of cultural aspects lies in long term orientation which
describes how every society maintains some connections with its own past at the time of dealing
with the challenges of the present and future. However, Germany is also well represented by the
degree of interdependence which a society maintains with its members. Germany also has a high
score of masculinity which indicates that the society will be driven by competition, achievement
and success (Armstrong and Taylor, 2014).
However, comparing about the cultural values of China, the highest score has been
acquired in the realm of long term orientation which means that the culture is highly pragmatic.
This also shows an adaptability to different traditions. China has high score in power distance
which demonstrates that the society believes that inequality among people are acceptable. China
score 66 in masculinity that represents society success oriented and driven. This also states that
Chinese can sacrifice family and leisure priorities to work.
How to manage these differences
When the managers and staff of a Multinational company like GlaxoSmithKline which is
headquartered in UK slowly knows the aspects and differences between different culture and
traditions of several nations, it is their duty that they should implement strategies which remove
these differences (Truss and et. al., 2013).

It has been ascertained that Culture with Nike in the home country is healthier and is
driven by the force of righteousness. In accordance to which every employee is given their
freedom to undertake the work in accordance to their convenience. Moreover, they have also
been given the right to defend this individual freedom. However, the counter part of this attribute
in the Chinese culture is Circumspect. In connection to the same the employees in this
jurisdiction have been observed to be highly aware of all the forces which exist in the
surrounding (Armstrong and Taylor, 2014).
In addition, it has been observed that the X-factor of employees refers to the unique
mental attribute which plays an instrumental role in securing success. However, this attribute in
China means attaining expertise in a field, which is specifically derived from self-improvement
and discipline. Thus, it can be stated that American approach focuses upon being an all-rounder
and achieving competence in dealing with all the situations. On the contrary, China’s primary
focus is only on accomplishment (Armstrong and Taylor, 2014).
Some of the strategies which should be adopted by chosen multinational corporations to
manages these cross-cultural differences are stated below: Good knowledge of foreign culture: The first and foremost strategy is that the quoted
company should acknowledge and admit that there is an existences of difference in the
cultures. These differences can be in terms of perceptions, evaluations, social conditions,
interpretations etc. So these differences are to be given some names, description,
explanation and understanding (Sheng, 2016). To recognise the culture of the partner
nation is the first condition for having a mutual understanding and better cooperation.
However, this steps is not very easy and common. Respecting foreign culture: The managers and employees of cited multinational
corporation should give due respect to cultural values and traditions of foreign nation.
This means that they should agree with the differences without being judgemental. One
should not claim that their own culture is the most perfect one or better as compared or
other nation's culture. They should accept the fact that every culture is different
(Croucher and et. al., 2012. pp.605-620). Helpful steps in relationship with a foreign culture: Another way is to putting some
sincere efforts to find out a common solution, mutual understanding and simplifying the
complex and demanding procedures of behaviours in varied cultural environment

(Afiouni Ruël and Schuler, 2014). This does not mean that participating nations should
forget their culture and traditions, but it is recommending that they should take use of
their own cultural values to attain more understanding and knowledge about other
nation's culture which is not a tough job. It is sufficient enough to sacrifice anything
which is not valuable for us, but it is very precious for some other culture (Tiwari, 2013.
pp.355-360.). The key condition in this strategy is that one should have good knowledge
of partner firms and its cultural and traditional values. Ignoring cultural differences: Under this method, there is phase in which managers try
to avoid the differences. After some time it is immaterial for managers and staff as they
have developed a better understanding about each other's cultural values and traditions.
When the cultural differences are ignored in chosen multinational organisation it leads to
effective management of these differences and reduces the chances of negative
implications and grows positive affects of diverse culture (Vaiman Scullion and Collings,
2012. pp.925-941). Managing differences: This type of approach is generally used by synergistic
organisations. These firms realise influences of of cultural differences which results into
benefits as well as disadvantages. The management of these organisations has a
viewpoint that “ our ways and their ways of believing and management is different, but
nobody is superior to the other” (Cavusgil and et. al., 2014). They try to minimise
potential problems through management of affects of cultural differences rather than
minimising difference themselves. In the same manner, managers maximise potential
benefits through management of influences of cultural differences instead of avoiding
them (Reis and Baruch, 2013). The enterprises that takes use of this method provides
training to their managers and staff for recognising cultural differences and take their use
for creating benefits for organisations.
 Unified culture: MNC's should also create a balance between giving respect to all
cultures along with assuring employees of all offices are allied towards a common goal.
For this organisations can creates a community culture in all its offices. The blog of
corporation or a daily e-mail can throw light on achievements and then give the new to all
offices (DeNisi Wilson and Biteman, 2014). Online collaboration tools or social media
teams can also connect the entire staff who have diverse culture and traditions with a

single mission (Dickmann Brewster, and Sparrow, 2016). When the whole organisation
and its employees will move towards a unified culture it will also reduce chances of
conflicts and disputed which takes birth due to the cultural differences (Vaiman Scullion
and Collings, 2012. pp.925-941.
Examples using case study of Anakew
As per the case study of Anakew, Nigeria has been adopting a combination of Western
practices of HRM which influences the nation's particular factors. This is named as cross-
vergence perspectives which is prevailing in explaining human resource management practices
in Nigeria. This country is said to be as collectivist which is consistent with the principle of old
system of organisations under which responsibilities of group members are taken from activities
of group instead of particular jobs. Also teamwork is focused. The recruitment and selection
process of Nigerian organisations are a set of universal or standardised practices and local
practices. For example, standardised sources of recruiting are taken in use which consists of
screening, interviews, short-listing and tests (Anakwe, 2017). But it also takes into account the
localised practices in which advertising and community referral are take in use.
However, in this respect, Hybrid cultural values and beliefs can be adopted for the
purpose of making it more different. This can also aid in changing the value of organization
through adopting different cultural aspects. Hence, different values and traditions can be adopted
respectively. However, contrary to this, numerous changes may arise at the same time in relation
to company practices (Vaiman Scullion and Collings, 2012.pp.925-941).
5 CONCLUSION
The present study is made to highlight the Westernised model of HRM which states along
with some key characteristics such as performance management approach, training and
development in Western countries. It has been assessed that there are varied national cultural
traditions in Eastern countries such as China and Japan when compared with Western nations
such as UK and America. Furthermore, it has been analysed that there are many cross-cultural
differences which poses several challenges for Multinational corporations such as
communication and formal etiquettes. Some effective strategies are being identified in the report
for managing these differences such as ignoring them or respecting other's culture. It is
recommended that multinational corporations should try to minimise these cultural differences

by either choosing homogeneous human resource or try to socialise the whole staff into
behavioural patterns of dominating culture (Vaiman Scullion and Collings, 2012. pp.925-941).

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