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HRM 3430 (82)
Chapter 11

Chapter 11 - Strategic International HR

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York University
Human Resources Management
HRM 3430
Gordon Qi Wang

Chapter 11 Dual-Career Couples Becoming a crisis in multinational human resources circles Spouses of overseas employees have their own jobs and their unwillingness to give up these jobs is an increasing impediment to mobility Key Challenges of International HR Workforce diversity o Integration and accommodation of an increased number of older workers and employees with disabilities o Gender issues o Aspects related to ethnic and cultural differences amongst employees o The complexity of the current workforce diversity will grow with each foreign market Canadian organizations decide to enter This will multiply the workforce diversity related challenges HR managers currently face o International HRM system must consider and accommodate the needs of such an increasingly diverse labour force and tailor international HR policies and practices accordingly Employment Legislation o Organizations operating across Canada have to deal with provincial and federal employment legislation o When crossing national borders, HR managers have to deal with the host country employment legislation Different public holiday Different minimum wage If country is in EU have to meet employment laws and regulations of host country and EU Role of the HR Function o Employment legislation, socio-economic and technological differences in local markets demand sophisticated IHRM systems. This requires sufficient financial and human resources and support It is critical that HR managers responsible for the development and implementation of such systems are equipped with the necessary staff and are integrated in the organizational strategic decision making process and the development of organizational goals and objectives Flexibility the ability to respond to various demands from a dynamic competitive environment o IHRM systems need to be flexible to quickly adjust their policies and practices to respond to the changes o Can obtain a high level of fit and flexibility by developing a strategic approach toward the management of international workforces Differences in social culture o Work centrality The importance of working to individuals o Life is for work, or Work is for life? Geert Hofstedes model Dimensions Definitions Power Distance Acceptance of unequal distribution of power Uncertainty Avoidance Comfortableness with uncertain situations Masculinity/Femininity Differentiation of gender roles Emphasis of individual initiative, independence, and privacy; Individualism/ Collectivism Emphasis of loyalty to a family/team and interdependence Long-term/Short-term Emphasis of future-oriented behaviours, such as Orientation planning and saving for the future Strategic International Human Resource Management Strategic international HR planning involves projecting global competence supply, forecasting global competence needs, and developing a blueprint to establish global competence pools within companies - Attracting and retaining managers who are competent to represent the company in a global arena have been rated as the most critical goals of international HRM by MNC. - International HR needs to fit with: o Internal factors firms strategies, competencies and existing HR system o External factors local economic, political, social, cultural, legal and HR systems - Some MNCs globalize HR practices issues pay systems, management development or employee communications - Other issues such as wage determination, hours of work, forms of contact and redundancy procedures are subject to local laws and convention Strategic International HRM HRM issues, functions, policies and practices that result from the strategic activities of multinational enterprises and that affect the international concerns and goals of those enterprises Fit the degree to which the needs, demands, goals, objectives and/or structure of one component are consistent with the need, demands, goals, objectives and/or structure of another component Internal fit overall corporate international strategies, type of product/service, organizational structure and cultureExternal fit local legal, political, economic and cultural factors The Domestic Stage Domestic Strategy internationalizing by exporting goods abroad as a means of seeking new markets. As this is the initial step of going international and there is no subsidiary in foreign countries, there is very little demand on the HR department to conduct its practices any differently than domestic HR practices. The Multidomestic Stage Multidomestic Strategy a strategy that concentrates on the development of foreign markets by selling to foreign nationals - Management realizes that there are many good ways to do business and that cultural sensitivity is important to be successful in the local market - Develops culturally appropriate products for local markets - IHMR system will apply an adaptive IHRM approach, adopting local HR practices in their host countrys subsidiaries o Adaptive IHRM approach HRM systems for foreign subsidiaries that will be consistent with the local economic, political and legal environment - Following the adaptive IHRM approach, a local executive is usually hired to take charge of the subsidiaries HR management o Advantages: Familiar with local issues
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