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International Human Resource Management

International Human Resource Management. Managing people in a multinational context. The Organizational Context. Chapter Objectives. We learn: Structural responses to international growth Control and coordination mechanisms, including cultural control

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International Human Resource Management

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  1. International Human Resource Management Managing people in a multinational context The Organizational Context

  2. Chapter Objectives • We learn: • Structural responses to international growth • Control and coordination mechanisms, including cultural control • Effect of responses on human resource management approaches and activities IHRM Chapter 2

  3. Figure2-1 Management demands of international growth 3 IHRM Chapter 2

  4. The path to global status Organizational structures change due to: Strain imposed by growth and geographical spread. The need for improved coordination and control across business units. The constraints imposed by host-government regulations on ownership and equity. 4 IHRM Chapter 2

  5. Figure2-2 Stages of internationalization 5 IHRM Chapter 2

  6. Figure2-3 Export department structure 6 IHRM Chapter 2

  7. Figure2-4 Sales subsidiary structure 7 IHRM Chapter 2

  8. Figure2-5 International division structure 8 IHRM Chapter 2

  9. MNEs’ two major issues of structure The extent to which key decisions are to be made at the parent-country headquarters or at the subsidiary units (centralization versus decentralization). The type or form of control exerted by the parent over the subsidiary unit. 9 IHRM Chapter 2

  10. Figure2-6a Global product division structure 10 IHRM Chapter 2

  11. Figure2-6b Global area division structure 11 IHRM Chapter 2

  12. Figure2-7 Global matrix structure 12 IHRM Chapter 2

  13. International matrix structure is difficult Matrix is all but unmanageable because of: Dual reporting, which leads to conflict and confusion. The proliferation of communication channels which creates informational logjams. Overlapping responsibilities, which produce turf battles and a loss of accountability. The barriers of distance, language, time and culture, which often make it very difficult for managers to resolve conflicts and clarify confusion. 13 IHRM Chapter 2

  14. The multi-centered networked organization Management involves less hierarchical structure and features 5 dimensions: Delegation of decision-making authority to appropriate units and levels. Geographical dispersal of key functions across units in different countries. Delayering of organizational levels. De-bureaucratization of formal procedures. Differentiation of work, responsibility and authority across the networked subsidiaries. 14 IHRM Chapter 2

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