LectureonInternationalHRM20070521.ppt

1、YiChi ZHANG,1,International HRM,YiChi ZHANG,YiChi ZHANG,2,Chapter objectives,Explain possible barriers to effective global human resource management. Illustrate how intercountry differences affect HRM Describe the keys to global human resource management of expatriates.,YiChi ZHANG,3,Global Human Re

2、source Management,Global Staffing Global Human Resource Development Global Compensation and Benefits Global Performance Appraisal,YiChi ZHANG,4,Types of Global Staff Members,Expatriate Employee working in a firm who is not a citizen of the country in which the firm is located but is a citizen of the

3、 country in which the organization is headquartered Host-country national Employees nationality is the same as the location of the subsidiary Third-country national Citizen of one country, working in a second country, and employed by an organization headquartered in a third country,YiChi ZHANG,5,App

4、roaches to Global Staffing,Ethnocentric staffing Companies primarily hire expatriates to staff higher-level foreign positions Polycentric staffing When more host-country nationals are used throughout the organization, from top to bottom Regiocentric staffing Regional groups of subsidiaries reflectin

5、g the organizations strategy and structure work as a unit Geocentric staffing Uses a worldwide integrated business strategy,YiChi ZHANG,6,Reasons to Hire Locals,Many people dont want to work in a foreign country, and the cost of using expatriates is usually far greater than the cost of using local w

6、orkers. Locals may view the multinational as a “better citizen” if it uses local management talent, and some governments even press for the “nativization” of local management. There may also be a fear that expatriates, knowing theyre posted to the foreign subsidiary for only a few years, may overemp

7、hasize short-term projects rather than more necessary long-term tasks.,YiChi ZHANG,7,Reasons to Use Expatriates,The major reason is usually technical competence. Multinationals also view a successful stint abroad as a required step in developing top managers. For instance, after a term abroad, the h

8、ead of General Electrics Asia-Pacific region was transferred back to a top executive position as vice chairman at GE. Control is another important reason to use expatriates.,YiChi ZHANG,8,Advantages and Disadvantages of Using Local and Expatriate Employees to Staff International Subsidiaries,Locals,

9、Advantages Lower labor costs Demonstrates trust in local citizenry Increases acceptance of the company by the local community Leads to recognition of the company as a legitimate participant in the local economy Effectively represents local considerations and constraints in the decision-making proces

10、s,Disadvantages Makes it difficult to balance local demands and global priorities Leads to postponement of difficult local decisions (such as layoffs) until they are unavoidable, when they are more difficult, costly, and painful than they would have been if implemented earlier May make it difficult

11、to recruit qualified personnel May reduce the amount of control exercised by headquarters,YiChi ZHANG,9,Advantages and Disadvantages of Using Local and Expatriate Employees to Staff International Subsidiaries (cont.),Expatriates,Advantages Cultural similarity with parent company ensures transfer of

12、business/management practices Permits closer control and coordination of international subsidiaries Gives employees a multinational orientation through experience at parent company Establishes a pool of internationally experienced executives Local talent may not yet be able to deliver as much value

13、as expatriates can,Disadvantages Creates problems of adaptability to foreign environment and culture Increases the “foreignness” of the subsidiary May involve high transfer, salary, and other costs May result in personal and family problems Has disincentive effect on local-management morale and moti

14、vation May be subject to local government restrictions,YiChi ZHANG,10,Failure Rates of International Assignments,International assignment failure can cost hundreds of thousands of dollars,YiChi ZHANG,11,Why International Assignments Fail,Personality Persons intentions Family pressures Lack of cultur

15、al skills Other non-work conditions like living and housing conditions, and health care,YiChi ZHANG,12,Illustration (1),Discovering why such assignments fail is therefore an important research task, and experts have made considerable progress. Personality is one factor. For example, in a study of 14

16、3 expatriate employees, extroverted, agreeable, and emotionally stable individuals were less likely to want to leave early. And the persons intentions are important. For example, people who want expatriate careers try harder to adjust to such a life.,YiChi ZHANG,13,Illustration (2),Non-work factors

17、like family pressures usually loom large in expatriate failures: In one study, U.S. managers listed, in descending order of importance for leaving early: inability of spouse to adjust, managers inability to adjust, other family problems, managers personal or emotional immaturity, and inability to co

18、pe with larger overseas responsibility. Managers of European firms emphasized only the inability of the managers spouse to adjust as an explanation for the expatriates failed assignment. Other studies similarly emphasize dissatisfied spouses effects on the international assignment.,YiChi ZHANG,14,Il

19、lustration (3),One expert said: The selection process is fundamentally flawed. . . . Expatriate assignments rarely fail because the person cannot accommodate to the technical demands of the job. The expatriate selections are made by line managers based on technical competence. They fail because of f

20、amily and personal issues and lack of cultural skills that havent been part of the process.,YiChi ZHANG,15,Improving Failure Rates/ Solutions,Provide realistic previews Have a careful screening process Improve orientation Provide good benefits Test employees fairly Shorten assignment length,YiChi ZH

21、ANG,16,Selecting International Managers,Test for traits that predict success in adapting to new environments Job knowledge and motivation Relational skills Flexibility and adaptability Extra-cultural openness Family situation,YiChi ZHANG,17,Important Predictors of Success,Family situation tops the l

22、ist Flexibility/adaptability screening was high on results Use paper and pencil tests like the Overseas Assignment Inventory Based on 12 years of research with more than 7,000 candidates, the test reportedly identifies the characteristics and attitudes international assignment candidates should have

23、. Previewing what changes an international assignee can expect The rule is “spell it all out” ahead of time,YiChi ZHANG,18,Structured interviews,Use of structured interviews varies widely by country,10.3%,12.1%,17.1%,22.9 %,29.2 %,33 %,34.6%,37.5%,59.1%,Can you name each country?,YiChi ZHANG,19,Illu

24、stration of last slide,10.3% in Italy 12.1% in Sweden 17.1% in Germany 22.9% in France 29.2% in Spain 33% in the United Kingdom 34.6% in the US 37.5% in Hong Kong 54.8% in Canada 59.1% in Australia,YiChi ZHANG,20,Eight Keys toGlobal HR Management of Expatriates,Global business plan must be completel

25、y understood Companys foreign service policy should be set of guidelines, not rigid rules Develop global budget process Profile candidate and his or her family Clearly state terms and conditions of global assignment Prepare expatriates and families for relocation Develop and implement continual deve

26、lopment process Prepare returning expatriates and their families,YiChi ZHANG,21,What Special Training Do Overseas Candidates Need?,Impact of cultural differences Understanding attitude formation Factual knowledge about target country Language and adjustment/adaptability skills,Level 1,Level 2,Level

27、3,Level 4,YiChi ZHANG,22,Illustration,Level 1 focuses on the impact of cultural differences, and on raising trainees awareness of such differences and their impact on business outcomes. Level 2 aims at getting participants to understand how attitudes (both negative and positive) are formed and how t

28、hey influence behavior. (For example, unfavorable stereotypes may subconsciously influence how a new manager responds to and treats his or her new foreign subordinates.) Level 3 training provides factual knowledge about the target country. Level 4 provides skill building in areas like language and a

29、djustment and adaptation skills.,YiChi ZHANG,23,Emphasis in Cross-cultural Training Programs,Expatriates must be clear about their own cultural background. Expatriates must understand the particular aspects of culture in the new work environment. Expatriates must learn to communicate accurately in t

30、he new culture.,YiChi ZHANG,24,Three Approaches to Cross-Cultural Training,Length of Stay,Length and Level of Training,1-3 years 2-12 months,Training Approach,1-2 months + High 1-4 weeks Moderate,Impression Approach Assessment center Field experiences Simulations Sensitivity training Extensive langu

31、age training Affective Approach Language training Role playing Critical incidents Cases Stress-reduction training Moderate language training,YiChi ZHANG,25,Three Approaches to Cross-Cultural Training (cont.),Length of Stay,Length and Level of Training,1 month or less,Training Approach,Less than a we

32、ek Low,Informative-Giving Approach Area briefings Cultural briefings Films/books Use of interpreters “Survival-level” language training,YiChi ZHANG,26,Training Trends,Trends in expatriate training and development: Use of continual cross-cultural training Use returning managers as resources for new a

33、ssignees Software and internet programs like Bridging Cultures for cross-cultural training,YiChi ZHANG,27,Compensation design for expatriates,Provide the expatriate with a disposable income that is equivalent to what he or she would receive at home. Provide an explicit “add-on” incentive for accepti

34、ng an international assignment. Avoid having expatriates fill the same jobs held by locals or lower-ranking jobs.,YiChi ZHANG,28,Compensation of Expatriates,Total pay packages have four components: Base salary Tax equalization allowances Benefits Other allowances: Cost-of-living Housing Education Re

35、location,YiChi ZHANG,29,What It Costs to House Expatriates Worldwide,Location,Tokyo Hong Kong Paris London Caracas Frankfurt Mexico City Rio de Janeiro Chicago,$130,020 93,110 78,495 56,797 50,884 50,691 49,287 42,015 31,783,Total Annual Housing Cost,YiChi ZHANG,30,Incentives,Foreign service premium

36、s Financial payments over and above regular base pay, typically ranging between 10% and 30% of base pay. Hardship allowances Compensate expatriates for exceptionally hard living and working conditions at certain locations. Mobility premiums Typically, lump-sum payments to reward employees for moving

37、 from one assignment to another. Non-monetary rewards Perhaps state-of-the-art training and development programs,YiChi ZHANG,31,Performance Appraisals,Who appraises the expatriate is the key Stipulate the assignments difficulty level Most would view being an expatriate manager in China more difficult than working in England. Favor the on-site ma