HRM for MBA Students

HRM for MBA Students Lecture 11 HRM in international companies

Learning outcomes • An understanding of: • the different approaches to HRM that may be possible in multinational companies (MNCs) • Hofstede’s concept of dimensions of culture and what these can tell us about managing people in the interface between national and organisational culture • the complexity inherent in selecting, preparing and supporting personnel for expatriate assignments

International human resource management (IHRM) The process of employing and developing people in international organisations which operate … globally Armstrong (2003)

Approaches to IHRM • Ethnocentric • Polycentric • Regiocentric • Geocentric Perlmutter (1969)

National cultures (Hofstede) • Basic dimensions of the differences between national cultures • Power-distance • Uncertainty avoidance • Individualism/collectivism • Masculinity/femininity (or quantity of life versus quality of life ) • Long-term versus short-term orientation • http://www.geert-hofstede.com/

Trust and leadership (Tayeb) • Trust • The level of trust in other people’s good intentions varies widely between cultures • Managers will only delegate power to subordinates whom they trust • Do they have the required knowledge and competence to do the task? • Will they put the company's interests first?

Leadership • Leadership • Preference for leadership styles varies across cultures • People in cultures which have low tolerance for ambiguity and risk-taking tend to prefer major decisions to be taken by their leaders (‘benevolent autocrats’) • Those in cultures with a higher tolerance for ambiguity prefer to participate in decisions

Selecting expatriates • Personality traits • Ability to tolerate ambiguity; behavioural flexibility; ability to be non-judgmental; level of cultural empathy and ethnocentrism • Interpersonal skills • Motivational state • Belief in mission; congruence of assignment with career path; interest in overseas experience; interest in host-country culture; willingness to learn new behaviour patterns and attitudes • Family situation • Willingness of partner to live overseas; adaptability and supportiveness of partner; stability of relationship with partner • Language skills • Host-country language ability

Expatriate re-entry • General cultural readjustment • Feelings of cultural and social loss • Children may experience difficulties in readjusting to school • There may be unexpected financial difficulties in reverting to domestic salary levels • All these can result in marital strain

Expatriate re-entry (Cont.) • Job readjustment • Returning expatriates may feel isolated from changes which have occurred during their foreign assignment • They may feel that they have fallen behind with new technology • They may feel that they have missed promotion opportunities • If they enjoyed a higher level of authority and responsibility while on their foreign assignment, they may find it difficult to go back to their former role • All these difficulties mean that many returning expatriates are vulnerable to feelings of demotivation and are more likely to accept offers from other organisations

Criteria for successful expatriate reintegration • Returning expatriates should: – perform at a level and quality expected by their managers – exhibit a reasonable level of job satisfaction with the new position – be able to use the skills developed during the foreign assignment – be able to maintain a career progression comparable to cohorts who did not go abroad – remain with the employer for a reasonable period of time after returning – avoid dysfunctional levels of stress during re-entry.

Factors for successful expatriate reintegration • The similarity of the international and domestic assignments • The amount of change in the home organisation • The nature and personality of the expatriate • The support available to the returning expatriate • The career planning system of the organisation

HRM for MBA Students