Global HRM Notes

Global Human Resource Management 22MB BG HR5
GLOBAL HUMAN RESOURCE MANAGEMENT
MODULE 1: Introduction to Global HRM
Lecture Concepts:
nature and scope, domestic versus Global HRM, types of global business, Globalization and HRM, Impact of
national culture on HRM and employee management issues, multiculturalism, HRM in Cross-Border
Mergers & Acquisitions.
Practice based learning: The Role of HR Departments in MNCs – Competencies for International HR
Managers.
MODULE 2: Theoretical framework
Lecture Concepts:
Approaches to the study of GHRM –Convergence Theory, Marxist theory, cultural approach, Hofstede
model and Trompennar Model – Confucian Dynamism - Andre Lawrent, Models of International HRM
– Pooles adaptation of the Harvard Model – Brewster and Bournois Model
Practice based learning:Organizational structure and design in global organizations.
MODULE 3: International Staffing
Lecture Concepts:
policies and practices, techniques and sources of global recruitment, selection process, globalcompensation
factors, components, approaches and cultural impact on compensation
Practice based learning:
Global compensation practices and recent trends in global staffing – expatriates’ failures & their
minimization
MODULE 4: Global Management Development
Lecture Concepts:
role of expatriate training, pre- departure training, development of staff and international assignments,
Performance management – significance and concerns of performance management, setting individual
performance goals
Performance appraisal for expatriates, feedback, challenges in managing performance, country– specific
management practices.
Srinivas University Page 1

MODULE 5: Repatriation
Lecture Concepts:
Re-entry and career issues, culture shock, benefits from repatriates, challenges of re-entry,repatriation
process,

Managing repatriation, designing a successful repatriation programme
MODULE 6: Global HRM practices
Lecture Concepts:
an overview of HRM in USA, UK, Japan, West Germany, China & India, innovative
management techniques and their influences
Practice based learning: Social responsibility and global business ethics and International HRmanagers,
future of GHRM.
Reference Books:
1. Evans, Pucik & Barsoure. (2019). The Global Challenges Framework for InternationalHuman
Resource Management. Tata McGraw Hill/Irwin publisher.
2. Peter J. Dowling and Welsh. (2017). International Human Resource Management. Thomson
Publications.
3. Aswathappa, K & Sadhna Dash. (2005). International Human Resource Management.McGraw-
Hill publications.
4. Tony Edwards & Chris Rees. (2009). International Human Resource Management. Pearson
Education publications.
5. Monir H. Tayeb. (2012). International Human Resource Management. Oxford UniversityPress
publications.

MODULE 1: Introduction to Global HRM
GHRM-nature and scope, domestic versus Global HRM, types of global business, Globalization and
HRM, Impact of national culture on HRM and employee management issues, multiculturalism, HRM
in Cross-Border Mergers & Acquisitions. The Role of HR Departments in MNCs – Competencies for
International HR Managers.
Global human resource management, sometimes referred to as global HRM, is an umbrella term that
includes all aspects of an organization's HR, payroll, and talent management processes operating on a
global scale.
Global human resource management is the discipline of taking care of workforces in a public or private
company, for organisations that operate in more than one country or continent.
What are the five main functions of global HRM?

For our purposes, we'll look at the five core areas: recruiting and staffing, compensation and benefits,
training and development, talent management, safety and compliance. In large organizations, these
functions may be split.
What are the objectives of global HR?
Global HR places much emphasis on diversity, cross-cultural communication and innovation. The goals
for global HR functions vary slightly among organizations depending on the scope of their mission and
vision, but there are trends in the industry that serve as benchmarks for objective setting.
‘Global Human Resource Management’ refers to global HR management, which encompasses all the
functions and responsibilities of HR including recruitment, payroll, benefits, leave, attendance, training,
expenses, health, etc. on an international level. It is used by companies which have presence in multiple
countries and continents.
The extra functions undertaken by a global human resource management include managing and engaging
employees throughout all the branches of the company all around the world as well as establishing
common policies by taking into account the laws of the land, the local customs and the culture.
The employees from different locations would have different salary expectations and different work
timings. Similarly, the cultural differences would also dictate their expectations regarding the workplace
facilities, extra benefits provided, communication, etc. Understanding these differences and tailoring these
facilities to satisfy the employees comes under the responsibility of global human resource management.
What is the nature of global HRM?

It means supporting, managing and engaging employees around the world, deploying common policies
but also taking into account local legislation, customs and culture.
What is the nature and scope of HRM?

HRM is responsible for the entire lifecycle of an employee's term in an organization. Right from planning
their recruitment, their needs, and issues during their tenure to when the exit the company. Naturally, the
scope of Human Resource Management is wide and expansive.
What is the scope of global HRM?

Global human resource management functions include recruitment and hiring, training, skill development,
salary and benefits, and legal and personnel relations compliance. These functions are similar to those of
local human resources roles, but global HR has a worldwide perspective.
Definitions
1. Global Human Resource Management is the procurement, allocation, utilization, and

motivation of human resources in international business.
2. Broad human resource activities of procurement, allocation, and utilization of people in Global level.
⚫ The national or country categories involved.
– The host country where subsidiary country may be located.
– The home country where the firm is headquartered.
– Other countries that may be the source of labor, finance and other inputs.
⚫ The three categories of employees
– Host country nationals (HCNs)
– Parent country nationals (PCNs)
– Third country nationals (TCNs)
3. IHRM is defined as interaction between the three group of factors-Types of employees,

environment of countries, and basic HR processes.

The drivers of internationalization of business
Globalization of Markets:
It refers to the merging of national markets into one huge global marketplace. Now selling
internationally is easier due to falling barriers to cross-border trade. A company doesn’t have to
be the size of these multinational giants to facilitate and benefit from the globalization of markets.
It is important to offer a standard product to the worldwide. But very significant differences still
exist between national markets like consumer tastes, preferences, legal regulations, cultural
systems. These differences require that marketing strategies in order to match the conditions in a
country. To illustrate, Wal-Mart may still need to vary their product from country depending on
local tastes and preferences.
Globalization of Production:
It refers to the sourcing of goods and services from locations around the world to take advantage
of national differences in the cost and quality of factors of production. Theidea is to compete more
effectively offering a product with good quality and low cost. For example, Nike is considerate
one of the leading marketers of athletic shoes and apparel on the world. The company has some
overseas factories where has achieved a super production with low cost. Unfortunately, Nike has
been a target of protest and persistent accusations that its products are made in sweatshops with
poor working conditions. The company has signaled a commitment to improving working
conditions, but in spite of the fact, the attacks continue.
Falling Barriers to Trade and Investment:
The falling of barriers to international trade enables firms to view the world as their market. The
lowering of barrier to trade and investments also allows firms to base production at the optimal
location for that activity. Thus, a firm might design a product in one country, produce a component
part in two other countries, assemble the product in another country and then export the finished
product around the world. The lowering of trade barriers has facilitated the globalization of
production. The evidence also suggests that foreign direct investment is playing an increasing role
in the global economy.
Technological Innovation:
Technological changes have achieved advances in communication, information processing, and

transportation technology, including the Internet and the World Wide Web (www). The most
important innovation has been development in the microprocessors after that global
communications have been revolutionized by developments in satellite, optical fiber, and wireless
technologies, and now the Internet and the www. The rapid growth of the internet and the
associated www is the latest expression of this development. Besides, innovations have occurred
in the field of transportation technology.

The different setting of International Human Resource Management.

⚫ Stage 1: Domestic Operations
– Firms offer products or services that are designed to primarily serve consumers in
the domestic market (e.g., law firms)
⚫ Stage 2: Export Operations
– Products and services are opened up to markets in other countries, but production
facilities remain in Canada (e.g., McCain Foods).
– HRM: Provides sales force with skills and motivation to succeed in these foreign
markets.
Stage 3: Subsidiaries or Joint Ventures
⚫ Some operational facilities (e.g., parts assembly) are physically moved to other countries.
⚫ Corporate headquarters in home country has high control over foreign operations.
⚫ HRM: Provides expatriates and local employees with knowledge and skills to succeed in
the foreign country.
⚫ Stages of Internationalization
Stage 4: Multinational Operations
⚫ Much more prevalent international dispersion of production and service provision

facilities.
⚫ Decentralization of decision-making more prevalent, but ―major‖ personnel decisions still
made within home country.
⚫ Expatriates still primarily manage foreign facilities.
⚫ Stages of Internationalization
Stage 5: Transnational Operations
⚫ Little allegiance to the firm‘s country of origin.
⚫ Large-scale decentralization of decision-making.
⚫ Dominant role of expatriates is removed.
⚫ Each business unit across the globe has the freedom to make and implement its own
HRM policies and practices.
⚫ Diversity as an Organizational and HR Challenge in MNE
What is difference between domestic and global HRM?
Domestic HRM focuses on regulations and labor laws only of one particular country, the country the
company is headquartered in. On the other hand, international HRM requires companies to understand
diverse cultures, customs, and legal requirements of other countries where they are operating.
Difference between domestic and international HRM
More HR activities
International taxation, international relocation and orientation, administrative services for

expatriates, host-government relations, and language and translation services.
The need for broader perspective
1. More involvement in employee‘s personal life
2. Changes in emphasis as the workforce mix of PCNs and HCNs varies.
3. Risk exposure
4. Broader external influences- Government, State of economy, generally accepted practices

of business, Labor cost

5. Differential compensations
6. Diversity management
7. Global managers
8. Greater need for global mindset
9. Balancing contradictions and live with conflicts
10. Orientation towards continuous change
11. Ability to absorb cultural shock and attempt to minimize its severity
12. Political, economic, and social sensitivity and knowledge of many countries
13. Leadership
14. The cultural environment
The importance of cultural awareness
⚫ Culturally insensitive attitudes and behaviors stemming from ignorance or from misguided
beliefs not only are inappropriate but often cause international business failure.
Industry type
⚫ Porter- Industry in which a multinational firm is involved is of considerable importance
because patterns of international competition vary widely from one industry to another.
⚫ Multidomestic industry – Competition in each country is essentially independent of

competition in another countries – Retail, Insurance, Distribution
– Role of HR will be more of domestic in structure and orientation.
– Support primary activities in each domestic market to achieve competitive

advantage through either cost/efficiency or through product/servicedifferentiation.
⚫ Global industry- Competitive position in one country is significantly influenced by its

position in another country.
– Airlines
– PCs
– Consumer electronics

Reliance of the multinational on its home-country domestic market
A large domestic market will also influence the attitude of senior managers towards their
international activities, and will generate a large number of managers with an experience
base predominantly or exclusively domestic market experience, Size of the domestic
market. No US industry in top 15 MNC‘s with higher ratio of foreign assets to total assets
and foreign sales to total sales.
Complexity
⚫ Increasingly complex environment
⚫ Need of right people
⚫ Need of good IHRM practices
⚫ Problems
– Lack of understanding of the essential differences in managing human resources,

in foreign environments
– Certain management philosophies and techniques have proved to be successful in

the domestic environment, but often their application in a foreign environment
leads to frustration, failure and underachievement.
⚫ More complexity due to political, and economic changes.
– Gulf war, Israel war, Ukraine war
– SARS
– Regional integration
Development of IHRM:
⚫ Global competition
⚫ Growth in mergers, acquisitions and alliances
⚫ Organization restructuring
⚫ Advances in technology and telecommunication
⚫ Global competition
⚫ Levels of competition are increasing with the spread and diversity of international
business.
⚫ Issues related to business ethics and social responsibility has become major concern for
HR managers.
⚫ Growth of mergers, acquisitions, and alliances
⚫ Cross cultural issues
⚫ Work practices
⚫ Downsizing
Types of global business
What is meant by global business?

A global business is a company that operates facilities (such as factories and distribution centres)
in many countries around the world. This is different from an international business, which sells
products worldwide but has facilities only in its home country.
Types of Global Business

Global corporation: MNC (Multinational Corporation) with extensive business operations in more
than one foreign country.
Transnational Corporation: MNC (Multinational Corporation) operates worldwide on a borderless
basis.
Global Business Examples
Global businesses are companies that serve the whole country or a large region. They are
usually large, multi-national companies with a global reach. Some international business
examples include Walmart, Starbucks, and Google.
What are the three 3 types of international business?
The major types of International business include:
• Export Trade: Selling products and services to other nations.

• Import Trade: Buying goods and services from other countries.
• Entrepot Trade: Importing goods and services to re-export them to other nations.

Models of IHRM Matching Model
• Highlights the resource aspect of HRM
• Emphasize on efficient utilization of human resources to meet organizational

objectives.
• Right fit between organizational strategies, organizational structure and HRM

systems will result in success.
Harvard Model
⚫ Focuses on Human, Soft aspect of HRM
⚫ It emphasizes in employee-employer relationship
⚫ Also highlights the interests of different stakeholders of organization-shareholders,

management, employee groups, government, community, unions
⚫ How these interests can be related to objectives of management?
⚫ The model illustrates the influence of situational factors on stake-holder interests, and their
impact on human resource policy choices which are destined to deliver a raft of
predetermined human resource outcomes such as commitment, competence, congruence
and cost-effectiveness

⚫ These outcomes consequently produce long-term and sustainable benefits for the
individual, the organization and society.
⚫ This is a highly prescriptive model of HRM which emphasizes a number of presumed long-
term benefits of acting on stakeholder interests and situational factors, assuming thatthere
is a set of predetermined and ‗superior‘ human resource policy choices
⚫ The Matching and Harvard models were often compared and contrasted in terms of their
approaches to the use of human resources.
⚫ While the Matching model focuses on the strategic resource aspect of human resources,
the Harvard model emphasizes the human element in the human resource formulations.
Contextual Model
⚫ Organizations may follow a number of different means to achieve same results.
⚫ This is due to existence of linkage between external environment context-Socio- economic,

technological, political-legal and competitive, and internal organizational context-culture,
structure, leadership, task, technology, and business output.
⚫ The linkage will determine content of organization‘s HRM
⚫ 5-P Model
⚫ Links five human resource activities-philosophies, policies, programmes, practices, and

processes with strategic needs.

⚫ These activities are Interrelated
⚫ They are significant in achieving organization‘s needs.
Five P’s Model of SHRM
⚫ Philosophy
– Statements of how organization values and treats employees; essentially culture of

the organization
⚫ Policies
– Expressions of shared values and guidelines for action on employee-related

business issues
⚫ Programs
– Coordinated and strategized approaches to initiate, disseminate, and sustain

strategic organizational change efforts necessitated by strategic business needs
⚫ Practices
– HR practices motivate behaviors that allow individuals to assume roles consistent

with organization‘s strategic objectives
– Three categories of roles:
⚫ Leadership
⚫ Managerial
⚫ Operational
⚫ Processes
– Continuum of participation by all employees in specific activities to facilitate

formulation and implementation of other activities
European Model
⚫ It is based on the argument that European organizations are constrained at both

international (European Union) and national level by national culture and legislation.
⚫ They are also constrained at the organizational level by patterns of ownership and at the
HRM level by trade union involvement and consultative arrangements.
⚫ All the constraints need to be considered for forming a HR system.

Model of SHRM in Multinational Companies
⚫ Successful SHRM efforts begin with identification of strategic needs

⚫ Employee participation is critical to linking strategy and HR practices
⚫ Strategic HR depends on systematic and analytical mindset
⚫ Corporate HR departments can have impact on organization‘s efforts to launch strategic
initiatives
Evolution of MNE‘s
Three Stages of Evolution
1. Export stage
initial inquiries => firms rely on export agents
expansion of export sales
further expansion þ foreign sales branch or assembly operations (to save transport cost)
2. Foreign Production Stage
There is a limit to foreign sales (tariffs, NTBs)
DFI versus Licensing
Once the firm chooses foreign production as a method of delivering goods to foreign markets, it
must decide whether to establish a foreign production subsidiary or license the technology to a
foreign firm.
Licensing
Licensing is usually first experience (because it is easy)
e.g.: Kentucky Fried Chicken in the U.K.
it does not require any capital expenditure
it is not risky
payment = a fixed % of sales
Problem: the mother firm cannot exercise any managerial control over the licensee (it is
independent)
The licensee may transfer industrial secrets to another independent firm, thereby creating a rival.

Direct Investment
It requires the decision of top management because it is a critical step.
it is risky (lack of information) (US -> Canada)plants are established in several countries
licensing is switched from independent producers to its subsidiaries, export continues
3. Multinational Stage
The company becomes a multinational enterprise when it begins to plan, organize and coordinate
production, marketing, R&D, financing, and staffing. For each of these operations, the firm must
find the best location.
Rule of Thumb
A company whose foreign sales are 25% or more of total sales. This ratio is high for small
countries, but low for large countries, e.g. Nestle (98%: Dutch), Phillips (94%: Swiss).
Motives for Direct Foreign Investment
New MNCs do not pop up randomly in foreign nations. It is the result of conscious planning by
corporate managers. Investment flows from regions of low anticipated profits to those of high
returns.
Growth motive A company may have reached a plateau satisfying domestic demand, which is not
growing. Looking for new markets.
Protection in the importing countries
Foreign direct investment is one way to expand bypassing protective instruments in the importing
country.
European Community: imposed common external tariff against outsiders. US companies

circumvented these barriers by setting up subsidiaries.
Japanese corporations located auto assembly plants in the US, to bypass VERs.
Market competition
The most certain method of preventing actual or potential competition is to acquire foreign
businesses.
GM purchased Monarch (GM Canada) and Opel (GM Germany). It did not buy Toyota, Datsun
(Nissan) and Volkswagen. They later became competitors.

Cost reduction
United Fruit has established banana-producing facilities in Honduras.
Cheap foreign labor. Labor costs tend to differ among nations. MNCs can hold down costs by
locating part of all their productive facilities abroad. (Maquildoras)
Supplying Products to Foreign Buyers
Export versus Direct Foreign Investment
MES is the minimum rate of output at which Average Cost (AC) is minimized. If minimum
efficient scale (MES) is not achieved, then export.
Business strategies
A business strategy is the means by which it sets out to achieve its desired ends (objectives). It
can simply be described as a long-term business planning. Typically a business strategy will
cover a period of about 3-5 years (sometimes even longer).
IHRM Strategies
◼ Transnational
◼ Geographical context within which all major decision are made
◼ Transnational representation
◼ Multinational composition of the managers and executives
◼ Transnational process
◼ Firm‘s ability to include representatives and ideas from many countries
SIHRM.
Globalization is becoming more and more important to companies all over the world. A major
component of the globalization of business is the field of human resource management. A trend
over the past few years has been to identify the linkage of human resource management with
strategy not only on the national level but also on the international level. Thus, Strategic
International Human Resource Management (SIHRM) is a growing field of research for academics
and an important field of concern for practitioners in multinational corporations.

Barriers in effective global HRM
1. Political & Legal Factors:
Throughout the world, the political & legal systems are diversified. The organizations deal with
the political & legal systems that are fairly stable, particularly in the developed countries of
Europe. On the other hand, in certain other countries, there are relatively unstable political & legal
systems. The governments of certain countries face coups, corruption & dictatorial rulesthat
are all badly affecting the legal & business environment. Due to internal politics, the legal systems
in certain countries are also becoming unstable. In this way the variations in the political& legal
systems around the world become as a hurdle in the effective global human resource management.
2. Cultural factors:
Every country has its own unique culture which is slightly similar to the cultures of other countries
of the world. The global human resource management should apply such policies & procedure in
the organization which are in accordance with the local culture of the country or region. Even most
of the employees of the foreign subsidiary should be hired from the host country. There may be
certain cultural norms that are allowed in one country but are prohibitedin another country. So,
cultural factor becomes a barrier for the smooth working of the global human resource
management of any organization. Therefore the expatriates of the organization should also take
into account the cultural norms & values of the host country to some extent. The management
should make ensure that the implemented wider corporate culture is being followed in all the
subsidiaries of the globally operating organization.
3. Economic Factors:
The economic factor is also regarded as a barrier for the effective global human resource
management because there is not any single economic system operating globally. In case of the
capitalist system, the efficiency & productivity are focused by the management of the organization
by making such policies & procedures that promote efficiency. On the other system of economics,
which is the socialist, the elimination of unemployment is concentrated by the management of the
organization by sacrificing the productivity & efficiency which is definitely harmful for the
organization. So before development & implementation of any human resource policy or practice
of the management of the organization, the economic barrier of the global operations should be
properly comprehended by the organization. Moreover, the difference in thelabor costs around the
world becomes a serious problem for a global business.
4. Labor/Management Relations Factor:
The policies & procedures of the global human resource management are affected by therelations
of workers & employees with the management because the nature of these relations varies from
one country to another country of the world.

Globalization and HRM
Globalization in HRM involves adapting HR practices to suit international hiring, such as:
Managing a global workforce, Dealing with cultural differences, Adhering to diverse employment
and labor laws.
What is the impact of globalisation on human resource management?
Today, as the world becomes more connected thanks to globalisation, the duties of HRM, too, have
changed.
Explore the broad influence of globalisation on Human Resource Management (HRM) in the
interconnected world.
In the contemporary landscape of business, the term 'globalisation' has become a pervasive buzzword,
signifying the interconnectedness of our world in ways previously unimaginable.
As our planet has become increasingly connected through technology and communication, this
phenomenon has inevitably made its mark on various facets of business operations. One of the areas most
significantly impacted by globalisation is Human Resource Management (HRM).
Understanding globalisation in HRM
In essence, globalisation has transformed HRM into a dynamic and multifaceted discipline, necessitating
new approaches to effectively manage a diverse and distributed workforce. The profound influence of
globalisation is not limited to one specific aspect of HRM; instead, it permeates various dimensions,
including recruitment, talent management, employee development, and even the very nature of the
workplace itself.
The technological revolution
Technology is a cornerstone of the globalisation phenomenon, and its impact on HRM is undeniable. With
the advent of digitalisation, HR professionals are now able to leverage technology to streamline their
processes, foster cross-border collaboration, and enhance employee engagement.
Recruitment on a global scale
Recruitment, in particular, has witnessed a significant transformation. The global talent pool is now
accessible to organisations around the world, breaking down traditional barriers and facilitating the hiring
of top talent regardless of geographical location. Online platforms, video interviews, and automated
applicant tracking systems have become integral tools, reducing time-to-hire and simplifying the
recruitment process.

Managing a diverse workforce
Globalisation has also led to a more diverse workforce. Organisations today often consist of employees
from various cultural backgrounds, each bringing unique perspectives and skills to the table. Managing
this diversity effectively has become a critical aspect of HRM.
Adapting to legal and cultural differences
In the globalised world, HR professionals must navigate an intricate web of legal regulations and cultural
differences. Employment laws can vary significantly from one country to another, making compliance a
complex challenge. Cultural sensitivity and cross-cultural communication skills are crucial for
maintaining a harmonious and productive work environment.
Remote work and flexibility
The concept of work itself has been redefined in the wake of globalisation. The COVID-19 pandemic
further accelerated the adoption of remote work, making it a necessity for many organisations. This shift
has allowed companies to tap into talent from virtually anywhere in the world, leading to more flexible
and remote-friendly HR policies.
Conclusion
Globalisation has undeniably reshaped the landscape of HRM. Technology and recruitment are just two
facets of the broader impact. As businesses continue to evolve in this interconnected world, HR
professionals must adapt, embracing innovative solutions and strategies to effectively manage their
workforce.
Impact of national culture on HRM and employee management issues
National Culture shapes employee behavior, as well as their expectations of the workplace, their work
habits, relationships with other employees and superiors, attitudes toward work, manner of
communication, and so on. National culture affects not only employees but also the managers who
manage them.
Socio-cultural context
A key factor in the increasing internationalization of employment is that there are cultural
differences between nations – differences in national values and attitudes. Many of us have
stereotypes of taciturn Finns, ebullient Spaniards, work-obsessed Americans, polite Japanese,
modest Malays, etc.
These are stereotypes: even though the next Finn we meet may be loud and confident, the next
Spaniard quiet and reserved, and so on, they indicate real, general, truths. There is now plenty of
research evidence that different nationalities do have different values and that these affect the way
people organize, conduct and manage work.

An awareness of cultural differences is therefore an essential part of an international HR manager‘s

brief. The normal HR activities such as recruitment and selection, training and development,
reward and performance appraisal, may all be affected by cultural values and practices in the
respective host countries. As a result, great care must be taken when deciding whether or not to
adopt standardized HR policies and practices throughout the world.
Organizational dynamics and IHRM: Role of culture in International HRM
Cross-cultural leadership looks at differences and similarities across cultures, research intoglobal
leadership ―suggests a different way of thinking,‖ with an emphasis on managing in a global
context.
HR departments of multinational organizations invest a lot of resources and effort into selecting
and training expatriates, and most concentrate on knowledge training and behavior modification
training relevant for specific cultures, according to the report. They are guided by a cross-cultural
perspective that ―emphasizes differences and similarities of values and behaviors among
countries.‖
However, because multicultural teams operate in a global context, with people from different
nationalities working together to accomplish a global mission, ―comparisons between two
national cultures can be meaningless.‖
Country and Regional Cultures

Nation‖ is a useful:
– Definition of society
⚫ similarity among people a cause -- and effect -- of national boundaries
– Way to bound and measure culture for conduct of business
⚫ culture is a key characteristic of societ
⚫ can differ significantly across national borders
– also within national borders
⚫ laws are established along national lines
➢ Culture is both a cause and an effect of economic and political factors that vary across
national borders
Country Culture versus MNE Culture
Dimensions: When establishing an office overseas, consider cultural differences across four dimensions:
individualism/collectivism, uncertainty/avoidance, masculinity/femininity and power distance,
according to a paper on the Association to Advance College Schools of Business web site. For example,
members of high-power distance cultures, such as Malaysia, show great deference to those who outrank
them, whereas Danes, who come from a low-power culture, expect to participate actively in discussions
across all levels. Individualist cultures, such as the English, stress independence while collectivist
cultures, such as Venezuelan, stress the common good. Multinational companies should recognize that
management styles should differ across offices based on these cultural norms. When advertising a
product in a culture with a high-femininity dimension, concentrating on how it helps relationships will
be more profitable than focusing on how it helps you achieve goals.

Family Ties
Cultures also differ in their views of family and business. In the United States, a manager who
hired her brother might well be accused of unethical nepotism. However, many Latin American
cultures consider skipping over qualified relatives to hire a stranger to be silly. While a small
business that only operates in the United States might ban the hiring of relatives, a multinational
business that operates in Latin America, as well as the United States, might think twice about
adopting such a policy.
Training
Small multinational businesses must change the culture in their own U.S.-based headquarters to
be nimble enough to compete cross-culturally. One way is to adopt a training culture. Training
could include presentations on cultural differences, as well as incentives to encourage employees
to travel to countries where you have offices. Hiring a multicultural headquarters workforce also
helps expose everyone to cultural differences.
Unified Culture
Multinational companies also must strike the balance between honoring all cultures while still
ensuring employees from all offices are united toward a common mission. One way to do this is
to create a community culture across all offices. A company blog or a daily e-mail can highlight
accomplishments and give news from all offices. Online collaboration tools or social media groups
also can link employees from all cultures to common mission.
Culture and employee management issues / impact of country culture on IHRM
Managing the expatriate‘s adjustment process is a primary focus of IHRM
The difficulty of this task has increased because sales and production shifted closer to markets.
There is higher use of host country and third country management.
There is a concurrent increase in the number of inpats
Both inpats and expats can have a difficult time adapting to their new surroundings
Multi- culturalism
Multiculturalism is a term which is used to describe the social condition of diversity among a specific
population evident through various spatial formations, but particularly seen through the spatial lens of
nation states and cities.
What is multiculturalism in simple words?

Multiculturalism is a word that describes a society where many different cultures live together. It is the
simple fact of cultural diversity. In a multicultural society, there is not an official (decided by the people
in charge) culture that every person must be a part of.

What are examples of multiculturalism?

An example of a multicultural society is Canada where a large range of different ethnicities including
Chinese, Indian, and Indigenous People live, just to name a few. It is a global place where different
groups coexist together.
What are the concepts of multiculturalism?

Multiculturalism is the way in which a society deals with cultural diversity, both at the national and at
the community level. Sociologically, multiculturalism assumes that society as a whole benefits from
increased diversity through the harmonious coexistence of different cultures.
HRM in Cross-Border Mergers & Acquisitions
HRM's main objective during the integration stage is to obtain the knowledge or retain the capabilities
that motivate the acquisition. Therefore, HRM should focus on communication, staffing, compensation

structure, and organizational design and control dimensions.
What is the role of HRM in merger and acquisition?

The human resources team plays the most important role of communicating challenges with their
employees, gathering feedback and taking it to the upper management, and ensuring a smooth transition
throughout the merger or acquisition process.
What are the HR issues in merger and acquisition?

In the integration phase of mergers and acquisitions, people issues include: 1) retention of key talent;
2) communications; 3) retention of key managers; and 4) integration of corporate cultures.
How HR is key to successful mergers and acquisitions?
HR should also provide support and training to employees to help them adjust to their new roles and
responsibilities. In conclusion, HR plays a crucial role in the success of mergers and acquisitions
by facilitating communication, managing change, and integrating workforces.
ROLE OF THE HR DEPARTMENTS/PROFESSIONALS during M & A
There are many people issues on which the relative success or failure depends, particularly at the
combination or implementation stage.
Yet research indicates that only 35 per cent of senior HR executives are involved in M&A activities. At
the same time, there are many activities that are consistent with and appropriate for the HR professional’s
skills and competencies.
These include:
1. Developing key strategies for a company's M&A activities. Providing arguments for and against
merger and acquisition activity. Outlining the social costs, for successful and unsuccessful combinations.
Eighty-five per cent of HR executives say they should be involved in these activities.
2. Managing the soft due diligence activity. This can mean: ·
✓ gaining knowledge of the make-up and motivation of the two work forces; ·
✓ understanding the potential impact on the companies' multiple stakeholders, including the
employees, the communities, and the unions; ·
✓ accessing management team of the other company; · conducting analysis of its organizational
structure; ·
✓ comparing benefits, compensation policies, and labour contracts of both firm.

The Role of HR Departments in MNCs

Human Resource Management in MNCs
HRM is a strategic function concerned with recruitment, training and development, performance appraisal,
communication and labor relations. HR policies guide the various functions of HRM. The need for a particular
type of HRM is determined by the need for standardization or adaptation. Managing human resources in an
international context is more complex than in a domestic set up because of the many differences between
headquarters and the subsidiaries. The HR policies of certain companies seem to discriminate on the basis of
religion, race, caste, sex or nationality. Companies like Ford and Volvo, however, strive to maintain equality
in work and pay.
Staffing is an important aspect of HRM. The staffing policies of MNCs are determined by their approach to
globalization. MNCs with an ethnocentric approach fill all top management positions with home country
nationals to ensure that home country practices are replicated in subsidiaries. Companies that adopt a
polycentric approach to globalization, fill all senior management positions with local nationals to ensure
maximum adaptation to local conditions. Companies that adopt a geocentric approach to globalization, identify
managers irrespective of their nationality for various international assignments to ensure that best practices are
identified and replicated in all the units of the organization. Managers belonging to a particular country and
working in another country are called expatriates. The selection, training, period of stay abroad, compensation
and repatriation of expatriates are delicate issues that have to be managed by the HR department. On their
repatriation, they must be provided suitable challenging assignments that give them the autonomy they have
become accustomed to. Since maintaining expatriate managers is expensive, a company must develop local
talent.
Companies can identify and develop local talent through in-house Management Development Programs
(MDP). These programs will help improve the coordination between employees with diverse cultural,
religious and educational backgrounds. Performance appraisal is another activity where there can be
differences of opinion between headquarters and subsidiaries.
Subsidiary managers must be involved in setting of unambiguous targets and the establishment of criteria for
measuring performance. Performance Management attempts to link performance appraisal to employee
training and development, and possibly to compensation. There are three theories concerning the autonomy
of subsidiaries in decision-making.
They are: limited autonomy, variable autonomy and negotiated autonomy. According to the theory of limited
autonomy, the degree of autonomy will depend on the MNC's approach to globalization. The theory of
variable autonomy states that the degree of autonomy varies with the degree of internationalization of the
company.
Companies that adopt an export strategy can afford to have centralized decision-making, whereas strategic
business units (SBUs) will require decentralized decision-making. According to the theory of negotiated
autonomy, the degree of autonomy of a subsidiary will depend on its ability to negotiate with headquarters.
HRM plays an important role in maintaining harmonious industrial relations. Companies are often
intimidated by the strength of the union and the political support it enjoys. Certain companies like Volvo
ensure cordial relations with the labor union by actively participating in their development. But certain other
companies, like Bata have had frequent labor relations problems in India.
Competencies for International HR Managers.
The International Human Resource Manager position manages all International HR operations and is directly
responsible for foreign-based employees and expatriate HR matters. Supervisory Responsibilities: Recruits,
interviews, hires, and trains new staff for International. HR employees.
1. Communication skills
2. Administrative expertise
3. HR Management knowledge and expertise
4. HR strategy creation & execution
5. Managing priorities
6. Proactivity
7. Advising
8. Coaching
9. Recruitment and selection
10. Employee experience expertise
11. Command of technology
12. Being analytical and data-driven
13. HR reporting skills
14. Commercial awareness
15. Cultural awareness and sensitivity
16. Wellbeing evangelism
17. Active listening
18. Teamwork
***** End of Module 1*****

MODULE 2 : Theoretical Framework.

Approaches to the study of GHRM –Convergence Theory, Marxist theory, cultural approach, Hofstede
model and Trompennar Model – Confucian Dynamism - Andre Lawrent, Models of International HRM
– Pooles adaptation of the Harvard Model – Brewster and Bournois Model
Approaches to the study of GHRM Theory
Fundamentally there have been different approaches to International Human Resource Management.
• Approaches of IHRM are:
1. Ethnocentric Approach
2. Poly-centric Approach
3. Regio- centric Approach
4. Geo-Centric Approach
As with all other human resource management decisions and practices, global staffing should be linked to the
overall strategy and objectives of the multinational enterprise.
These strategies and objectives are of course influenced by and must be set with in context of the overall
global business environment.
The IHRM literature uses four terms to describe multinational enterprise approaches to managing and
staffing their subsidies.
These terms are taken from the seminal work of Howard .V.Perlmutter who claimed that it was possible to
identify among international executives three primary attitudes are -
➢ Ethnocentric approach
➢ Polycentric approach
➢ Geocentric approach
➢ Regiocentric approach

Ethnocentric approach
• Under this, parent nation employees fill all key positions in a multinational. That is key positions in
domestic and foreign operations are held by headquarters personnel. subsidiaries are managed by staff
from the home country (PCN’s)
•
There are often sound business reasons for pursuing an ethnocentric staffing policy
• A perceived lack of qualified host country nationals (HCN’S)

• A need to maintain good communication, coordination and control links with corporate headquarters.
✓ This practice was widespread at one time firms such as Procter and gamble, Philips originally
followed the ethnocentric approach.
✓ Even today in most of the Japanese and south Korean companies such as Toyota Samsung, key
positions in international operations are still held by home country nationals.

Disadvantages of ethnocentric approach
• It limits the promotion opportunities of host country nationals which may lead to reduced productivity
and increased turnover among that group.
• The parent country nationals being placed in the host country take lots of time in understanding the
local dynamics leading to faulty decisions.
Impact of approach on Staffing:
• Headquarters country personnel manage all operations.

• Home Staffing policies are replicated in countries.
• Talent skills transfer essentially one-way
b)POLYCENTRIC APPROACH
• The multinational enterprise treats each subsidiary as a distinct national entity with some decision-
making autonomy.
• Subsidiaries are usually managed by local nationals (HCN’s) and parent country nationals and are
rarely transferred to foreign subsidiary nations.
• For ex : Many US companies use home country managers to get the operations started, then hand
them over to the host country managers Hindustan Unilever ltd, the Indian subsidiary of Unilever
has locals has its chiefs.
The main advantages of a polycentric policy are
➢ Employing HCN’s eliminates language barriers avoids the adjustment problems of expatriate
managers and their families and removes the need for expensive cultural awareness training
programs.
➢ Employment of HCN’s is less expensive.
➢ Gives continuity to the management of foreign subsidiaries and avoids the turnover of key
managers.
➢ Managing local politics and administration will be very easier.
Disadvantages of polycentric approach

• Bridging the gap between host country nationals managers and parent country national managers
becomes difficult.
• It also becomes difficult to imbed the original cultural of company.
• This will not provide the opportunity to the host country employers to get exposure and experience
outside their own country.
Impact of approach on Staffing:-
• Headquarters country personnel have little impact on other countries.

• Talent acquisition policies are unique to each country.

C) GEOCENTRIC APPROACH
Multinational enterprise is taking a global approach to its operations, recognizing that each part (subsidiaries
and headquarters) makes a unique contribution with its unique competence.
This approach subscribes the view of employing the best people in key positions throughout the organization
without the consideration of any nationality.
Moreover, it helps the organization to develop core competency taking the best talents in the core team.
This approach subscribes the view of employing the best people in key positions throughout the organization
without the consideration of any nationality.
Moreover, it helps the organization to develop core competency taking the best talents in the core team.
• This is expensive in terms of the investment towards training and development of those individual.
• Benchmarking the salary with the international compensation package which is definitely more than
the salary to be given to the individual in his home country.
Impact of approach on Staffing: -

• Employees circulate throughout the global organization.
• Talent acquisition policies maximize long-term strength of the global organization.
• Talent and skills are deployed globally to achieve global goals while meeting local requirements.
D) REGIOCENTRIC APPROACH
• In Regio centric approach Operations managed regionally, communication and coordination high
within the region. Like geocentric approach, it utilizes a wider pool of managers but in a limited way.
• This approach advocates the division of operations of the multinational company on the basis of some
geographical regions and allows the transfer of employees within a particular region.
Advantages of Regio centric approach

• A major motive for using such an approach is that it allows the interaction between executives
transferred to regional areas.
• It can be a way for a multinational to move gradually from a purely ethnocentric or polycentric to a
geocentric approach.
Disadvantages of Regio centric approach

• It can produce ‘‘federalism” at a regional rather than a country basis.
• While this approach does improve career prospects at the national level, it only moves the barrier to
the regional level.
Impact of approach on Staffing

• Employees circulate within regions, with a focus on regional business results.
• Talent acquisition policies are developed and coordinated within regions.
• Talent and skills are developed within regions, with minimal inter-region transfer.

COVERGENCE AND DIVERGENCE
• According to Brewster et al (2002) the effectiveness of global HRM depends on ‘the ability
to judge the extent to which an organization should implement similar practices across the world
(convergence) or adapt them to suit local conditions (divergence)’.
• The dilemma facing all multinational corporations is that of achieving a balance between
international consistency and local autonomy.
• They have to decide on the extent to which their HR policies should either ‘converge’ worldwide to
be basically the same in each location, or ‘diverge’ to be differentiated in response to local
requirements.
FACTORS EFFECTING CONVERGENCE AND DIVERGENCE
Factors affecting the choice between convergence and divergence, Harris and Brewster (1999)
The extent to which there are well-defined local norms.

The degree to which an operating unit is embedded in the local environment.
The strength of the flow of resources – finance, information and people between the parent and
the subsidiary.
The orientation of the parent to control.
The nature of the industry – the extent to which it is primarily a domestic industry at local level.
The specific organizational competencies, including HRM, that are critical for achieving competitive
advantage in a global environment.
Marxism
Marxism is a social, economic and political philosophy that analyses the impact of the ruling class on the
laborers, leading to uneven distribution of wealth and privileges in the society. It stimulates the workers to
protest the injustice.
Marxism is a political philosophy and method of socioeconomic analysis. It uses a materialist interpretation
of historical development, better known as "historical materialism," to understand class relations and social
conflict. It also uses a dialectical perspective to view social transformation.

Karl Marx; Father of communism
Philosopher , Economist, Sociologist, Historian, and Journalist

• Born in 1818, Kingdom of Prussia-Germany Died in
1883,London - UK
• Buried in north London-UK
• Profit equals to motivation which equals to incentive to
improve.
• He wrote the Communist Manifesto in in 1848
• Marx was seeing it as equality he was saying that its
liberation to crate fair society
• Marx system is economic system base on private owner ship by production –big
• business profit
• Few people own factory ,business ,shops and other corporations
• Those corporation own by people who works for them –employees
• Marx formulate his theory –union industrial revolution
➢ People before 1700-1800 had right to own land ownership
➢ government passed numbers of Inclusion Act between 1700-1800
➢ After that people had no right to leaves on those land
➢ Many of them force to pack and move to the cities and search for jobs
➢ It was beginning to increasing the industrial production as well as factories
➢ Work was hard ,dangerous and payment was less
➢ Children often to use as cheap laborer Karl Marx became a leader because he didn’t like the way
middle and working class were treated by the bourgeoisie.
➢ They had horrible work hours, Working conditions and very low pay. It was because the bourgeoisie
wanted all the money for themselves.
➢ Marx explained how we would go from socialism, where people controlled businesses themselves
with no government interference, to capitalism where the government controlled business
➢ Since the bourgeoisie treated the people unfairly and the government would become corrupt which
would lead people to go to communism where all people were equal.
➢ But Communism has failed in the current times.
Cultural approach to IHRM

• The role of culture in International Human Resource Management (IHRM) is significant and complex
due to the diverse and global nature of international organizations.
• Culture influences various aspects of IHRM, and understanding its role is crucial for effectively
managing a multinational workforce.
• The role of culture in International Human Resource Management (IHRM) is significant and complex
due to the diverse and global nature of international organizations. Culture influences various aspects
of IHRM, and understanding its role is crucial for effectively managing a multinational workforce.
• The following points explain the key roles of culture in IHRM:
#Recruitment and #Selection: Culture plays a critical role in the recruitment and selection process
of international employees. HR professionals must consider cultural fit, language proficiency, and
cultural sensitivities when hiring employees from different countries.
#Training and #Development: Cultural differences impact training and development programs.
IHRM needs to design training that is culturally relevant, considering differences in learning styles
and preferences.

Employee #Onboarding: Culture shapes the onboarding process for international employees. It
includes orientation to the host country’s culture, local workplace customs, and the organization’s
global culture and values.
#Performance #Management: Cultural factors influence how performance is assessed and managed.
HRM practices such as performance appraisals and feedback need to be sensitive to cultural nuances.
#Compensation and #Benefits: Compensation packages and benefit structures may vary based on
cultural expectations. HR professionals must align these with local norms while maintaining equity
across global operations.
#Global #Mobility: IHRM often involves managing expatriate assignments and international
transfers. Understanding and addressing cultural challenges faced by employees and their families
during global mobility assignments is crucial.
#Diversity and #Inclusion: Culture is a key factor in promoting diversity and inclusion within a
global organization. HR practices should aim to foster an inclusive culture that values and respects
cultural differences.
Cross-Cultural #Communication: Effective communication across different cultures is vital in
IHRM. HR professionals must be skilled in bridging communication gaps and addressing potential
misunderstandings.
#Conflict Resolution: Cultural differences can lead to misunderstandings and conflicts. HRM needs
to be adept at mediating and resolving conflicts in a culturally sensitive manner.
#Organizational #Change: Culture plays a role in how employees from different cultural
backgrounds adapt to organizational changes. HR professionals need to consider the impact of
cultural differences when implementing changes.
#Ethical and #Legal Considerations: IHRM must navigate the complexities of international labor
laws and ethical standards while respecting cultural norms and values.
#Leadership and Management Styles: Leadership and management styles can vary across cultures.
HR professionals need to be aware of these differences and support leaders in adapting their styles as
needed.
Employee #Engagement and #Satisfaction: Culture has a direct impact on employee engagement
and satisfaction. HR practices should aim to create a positive and inclusive work culture that aligns
with the organization’s values.
#Knowledge Transfer and Sharing: In global organizations, knowledge transfer and sharing may be
influenced by cultural factors. HR can facilitate the exchange of knowledge and best practices across
diverse teams.
Local #Compliance: #IHRM professionals need to ensure that HR policies and practices comply
with local laws and regulations in each country of operation, considering cultural sensitivities
Hofstede model and Trompennar Model
• Hofstede's main aim was to evaluate work values, while that of Trompenaars was to inquire about
employees behaviour in both work and leisure time.
• Trompennars model is focus oriented as it tells us about what is on people's mind and in their sight.
• It describes a logical organization and framework of their behaviour which can be seen in the
dimensions like specific-diffuse, internal-external direction, universalism-particularism, and we can
see relationships in individualism-collectivism, achievement-ascription, neutral-affective.
• On the other hand, Hofstede describes about values present in people and its effect on their behaviour.
• There is also some similarities between Hofstede’s power distance and Trompenaars achievement-
ascription. One values the accepted degree of high class/low class lifestyle, while other values the

motivation of low class to move higher. Later, Hofstede added a new dimension long-term vs short-
term orientation which can be related to Trompenaars sequential-synchronic time, as both shows
attitudes toward time.
• TATA is a well-known Indian firm spread all over the world, it operates in more than 100 countries
across the world and its headquarter is in India. It serves in fields like steel, motor car, consulting
service, chemicals, communication etc. (http://www.tata.com, 2014).
• The HRM of Tata chemicals faces the problem which is linked with the Individualism-collectivism of
Hofstede as the employees, especially married are more concern about their families. Employee
engagement is very important for company, so the company has to find drivers or new ways to
manage them and make them consistent across the organization. (Nanda, 2014).
• Masculinity-femininity in Tata Motors, company says that diversity is their main objective, they want
to recruit more women employees in Tata Motor and have the most women-friendly policies in the
sector.
Confucian Dynamism
• Confucian dynamism, one of the four cultural factors of the Chinese Value Survey, is associated with
Confucian work ethics.
• Cultures with high Confucian dynamism place importance on persistence/perseverance, ordering
relationships by status and observing this order, thrift, and having a sense of shame.
• Personal steadiness and stability, protecting your face, respect for tradition, and reciprocation of
greetings, favors and gifts are considered less important.
• Hofstede added Confucian dynamism, which he calls long-term orientation (LTO), as the fifth of his
dimensions of cultural values.
• He explained that the values associated with Confucian dynamism were more future oriented,
whereas those at the other end of the scale were more past and present oriented.
• Research focusing on the relationship between Confucian dynamism and other management-related
variables is extremely limited and much less than that for Hofstede's other four value dimensions.
• The few studies done have generally focused on the positive relationship between Confucian
dynamism and national economic growth.

Confucian work dynamism-examples
• Confucian work dynamism values usually includes respect for one's

superiors, thriftiness, persistence, a sense of shame, reciprocal
courtesy, steadiness, prestige and respect for tradition
André Laurent’s Model of culture
• Emeritus Professor of Organizational Behavior at INSEAD, André Laurent’s work concentrates on

cross-cultural management.
• His research, published in numerous articles and books, investigates the impact of national cultures
on management and organizational processes. His teaching centers on cultural diversity in
multinational organizations as it affects multicultural teams, human resource management, corporate
culture and organizational change. As a consultant to major corporations around the globe, he has
worked on many projects related to the merging of organizational cultures across borders.
• Before joining INSEAD, he was on the faculty of the University of Michigan, Institute for Social
Research. Prior to that, he worked as an Industrial Psychologist for Pechiney in West Africa.
• Originally trained as a Clinical Psychologist, André holds a degree in Sociology and a Doctorate in
Psychology from the University André Laurent’s Model of culture
• of Paris-Sorbonne and an ITP degree from Harvard University.
• There is no universal definition of culture. André Laurent (1983) claimed that there are three major
layers of culture: basic assumptions and meaning; values, beliefs, and preferences; and behaviour.
• Basic assumptions and meaning include that elements of belief that are the least visible and the most
entrenched, since they deal with ingrained models of understanding, meaning and casual relationships
that have been largely shaped by historical factors and transmitted through the educational process to
the next generation.
• Religious faith and assumptions about human nature belong to this category. Values, beliefs and
preferences are the explicit expressions of what people consider as good or appropriate in one’s
personal or social life.
• Behaviour is the most visible category. It is manifested in action and can be modified through
education.
• The cultural context in which human communication occurs is perhaps the most defining influence on
human interaction.
• Culture provides the overall framework wherein humans learn to organise their thoughts, emotions,
and behaviours in relations to their environment.
• Culture is not innate. Culture is learned.
• Culture teaches an individual how to think, conditions an individual how to feel, and instructs an
individual how to act, especially how to interact with others.

Pooles adaptation of the Harvard Model
The Harvard framework for HRM
• It is an HR model that takes a more holistic approach to HR, including different levels of outcome.
• One of the most significant assignments that include the staff division in an association is human
resources management (HRM).
• An organization is just prone to accomplish its goals if their representatives are utilized successfully.
• Simultaneously, arranging how best to utilize human resources will assist an association with
achieving its targets and objectives. Human resources management has vital ramifications.
• It implies continually searching for better methods for utilizing representatives to profit the
association.
• The Harvard Model for HRM is one of the most significant HR models. It is based on the work of
Paauwe and Richardson (1997) and creates a nuance on the models above in regard to how HR
operates.
• The Harvard model for HRM is an HR strategy model comprised of five components:
• 1. The model starts, on the left, with stakeholder interest. These stakeholders include shareholders,
management, employee groups, government, and more. These interests define the model of HRM
policies.
• 2. At the same time, situational factors influence these interests. Situational factors include workforce
characteristics, unions, and all the other factors that were also listed in the8-box model.
• 3. Situational factors and stakeholder interest influence HRM policies. These include the core HR
activities, like recruitment, training, and reward systems.
• 4. When done well, strategic HRM policies lead to positive HRM outcomes. These includes retention,
cost-effectiveness, commitment, and competence.
• 5. These positive HRM outcomes lead to long-term consequences. These can be individual,
organizational, and societal.
Brewster and Bournois Model
• The model of The European Environment of HRM was first produced in 1991 by Chris Brewster and
Francois Bournois.
• In the model, HR strategy is only partly subservient to corporate strategy because HRM is influenced
by behaviour and performance from both inside and outside the organization.
• In the Brewster and Bournois model, HR strategy is only partly subservient to corporate strategy
because HRM is influenced by behaviour and performance from both inside and outside the
organization.
• The organization and its human resource strategies and practices interact with the environment and, at
the same time, are part of it.
• The model shows that HRM policy and practice are not exclusively an organization's choice but are
also influenced by the wider environment, particularly the national culture and the industry sector the
organization operates in

Organizational structure and design in global organizations.
Organizational design refers to how an organization is structured to execute its strategic plan and achieve its
goals. In practice, it's not so simple because people work together to use information, materials, systems,
processes, and each other to get human work done.
The global matrix structure might consist of product divisions intersecting with various geographical areas or
functional divisions Unlike functional, geographical, or product division structures, the matrix structure shares
joint control over firm's various functional activities.
Global Organization Design (GO) is the only management system that links all aspects of a business to
ensure: The right organization structure. The right people. The right accountabilities. The right leadership
practices.
4 Common Types of Organizational Structures

➢ Functional/Role-Based Structure. A functional—or role-based—structure is one of the most common
organizational structures. ...
➢ Product- or Market-Based Structure. ...
➢ Geographical Structure. ...
➢ Process-Based Structure.
***** End of Module2 *****

MODULE 3 : Global Recruitment & Selection Methodology
Global HR policies and practices, techniques and sources of global International staffing,
recruitment, selection process, globalcompensation factors, components, approaches and cultural impact
on compensation.
Global compensation practices and recent trends in global staffing – expatriates’ failures & their
minimization
What is global HR policies and practices?

Global HR policies should align with local labor laws, employment regulations, and other legal
requirements in each country of operation. This ensures that the organization operates within the legal
framework while providing a consistent and fair work environment.
What are the five main functions of global HRM?

For our purposes, we'll look at the five core areas: recruiting and staffing, compensation and benefits,
training and development, talent management, safety and compliance. In large organizations, these
functions may be split.
What is the role of a global HR manager?

The GHRM is responsible for supporting all senior level positions and designated departments as it
relates to HR within the organization (Employee relations; Recruitment; Performance Management; and
Talent Management/Development).
Why is Global HR Management Important?

With globalization, your HR functions will include organization goals based on diverse cultures,
working to remain compliant with a variety of employment laws depending on region, and
prioritizing learning management that aligns with global talent. Global HR management is pivotal for
organizations because it ensures you are attracting a worldwide team of innovators in a workforce that
strives to provide comprehensive, interpersonal practices.
6 Tips to Implement for a Successful Global HR Strategy

Diversifying your business process enables you to provide HR support through integrated talent
management on an international level. Appealing to multiple backgrounds of people from various
locations in global HR is challenging, and your management process relies on many success factors.
While the functionality of any human resource management operation varies, globally integrating
your HR strategies to appeal to multiple nations needs to be employee-focused.

1. Effectively manage employee compensation and benefits

Opening your operations to a global HR market often includes broadening your workers’ compensation
offerings. Managing employee benefits and international payroll with multiple currencies in payroll
processing, making advancements for the inclusion of time and attendance based on varying cultures,
and sourcing diverse HR resources are essential to a global HR compensation structure.
Different countries might pose HR issues depending on how your HR system reflects wages, taxes,
benefits, and other withholdings if you’re not adapting to the multitude of employment requirements.
2. Improve employee relations

The essence of HR support lies within employee assistance, especially when leveraging your
organization on a global HR scale. As an HR advisor, your human resource development must be
aligned with how you can meet the HR needs of a worldwide vision.
Providing self-services and HR tools that act as a resource manager for employees to utilize themselves
automatically makes their work life easier. Saas systems improve employee relations for global HR
enterprises because they can access things like HR news, employee handbooks, and other HR modules
independently.
Despite the time, space, and unique guidelines based on an employee’s region, an effective global HR
system keeps employees involved through a streamlined operation they can access wherever they are in
their workday.
3. Optimize employee development and training

Learning and development are key in international HR because it focuses on how to motivate the
individual while also enhancing corporate culture. In a managerial HR role, setting the path and leading
your team with a global mindset should be part of your business goals.
Promote the training and development of your multinational team to align with your organization’s
mission while also encouraging a collective inclusive perspective in your workforce culture. Rewarding
your global HR staff with tools for success-planning and growth will improve how you manage talent in
your network and also give you a competitive advantage knowing your organization can help
employees improve their skillset internationally.
4. Maintain legal and ethical compliance

Remaining compliant with different laws depending on employee region in global HR is not just a
proper business strategy, it’s a mandatory, ethical HR function that is most valuable to your organization.
HR personnel have a responsibility to be adaptable to labor laws across the globe, accounting for how
laws and policies differ in a global network. Avoid any grievance or having to take disciplinary action
by accommodating the safety and security of a team that has good employee relations, cultural practices,
region-based holidays, and other varying needs. Consider implementing a floating holiday policy for
international teams to create more inclusive policies.

5. Integrate HR systems and data processing

As an HR specialist with a plethora of duties, integrating a cloud-based, data-driven system for talent
management solutions in global HR can maximize your workflow while automating important
organizational goals.
Assess your organizational performance, elevate your HR information systems, maintain employee
records, and prioritize sourcing data for the advancement of your enterprise with HR systems. Make the
global HR management process easier and more efficient with technology solutions and integration tools
to optimize how you communicate with your team, streamline work without manual efforts, and conduct
a job analysis.
6. Simplify recruitment and onboarding
The recruitment process in global HR is about finding people with appropriate qualifications for
your job description on a worldwide spectrum. There are complexities in the hiring process because
certifications and educational requirements vary depending on where you are in the world. Bargaining
salaries, making job offers, and generating contracts in global HR must be done with precision to
secure employee retention is high. Onboarding will also need to include employee orientation methods
that meet the needs of global networks.
International Workforce planning and staffing: International labour market
A labor market is the relationship of communication between the suppliers and the demanders so
that they are able to do business together. The global aspect of the labor market refers to the world
and all that contribute within this measure, also known as globalization. Globalization is the
process of integrating regions through societies, political systems, economies, and culture to share
ideas between the countries.
Culturally, this is beneficial because we are learning from other countries and bridging the gap
between countries. All around, globalization is a positive action because we can learn from each
other and better our countries with other ideas and in turn work for the good of the whole world.
International labor standards refer to conventions agreed upon by international actors, resulting
from a series of value judgments, set forth to protect basic worker rights, enhance workers‘ job
security, and improve their terms of employment on a global scale. The intent of such standards,
then, is to establish a worldwide minimum level of protection from inhumane labor practices
through the adoption and implementation of said measures. From a theoretical standpoint, it has
been maintained, on ethical grounds, that there are certain basic human rights that are universal
to humankind. Thus, it is the aim of international labor standards to ensure the provision of such
rights in the workplace, such as against workplace aggression, bullying, discrimination and gender
inequality on the other hands for working diversity, workplace democracy and empowerment.
Global workforce refers to the international labor pool of workers, including those employed by
multinational companies and connected through a global system of networking and production,
immigrant workers, transient migrant workers, telecommuting workers, those in export-oriented
employment, contingent work or other precarious employment.
International Recruitment function and sourcing( sources of global International staffing)
The changing nature of mobility worldwide means that the HR function in international
organisations has to meet a series of challenges in resourcing:
It has to work within globally co-ordinated systems whilst recognising and being sensitive
to local needs.
Practitioners are looking to source talent from increasingly varied places around the world,
so integrating a diverse workforce for maximum organisational and individual performance
is crucial.
Increasingly the lines between traditional HR functions are blurred, so resourcing
specialists have to focus on management development and reward issues as well as
resourcing ones.
Merger and acquisition activity means that HR practitioners are engaged in selection of
employees in a changing environment and looking to harmonise HR practices.
HR is looking to maximise the learning opportunities given by global networks to share
best practice.
Rapidly changing business situations in volatile global markets means that HR must often
recruit, deploy, develop and shed people at great speed.
Head-hunters : Headhunting is recruiting the top management executives, who are highly skilled
and resourceful and whose contribution to the organization leads to success or these employees
are the competitive advantage of the organization.eg, those employees who are competitive
advantage of some company is offered the fancy designations and high salary package and made
to join their company this process is called headhunting. Headhunting can be done via ads, job
portals referrals etc. there are three types these are direct, indirect and third party recruitment.
"Head Hunting" is not necessarily an "HR" (human resources) job but that of a corporate recruiter.
Often referred to as headhunters, corporate recruiters (recruiters) pick up "job orders" from HR
managers of most organizations to help them fill the need of the hiring department. This helps the
HR staff in getting a person to hire much more quickly. The corporate recruiter will place the
advertisement for the job opening; perform a preliminary interview of good candidates ensuring
the resumes of people they have found are the top contenders. This saves theHR department a lot
of time and effort when trying to locate the right person.
Money – its all comes down to - usually, the "Placement Fee" or finder‘s fee is generally 30% of
the annual salary of the person recruited.
Cross-national advertising: Now world is a global village and as part of globalization, labour
migration is more common and accepted all over the world. At present many companies seek to
carry out cross border when they recruiting senior staffs. Brewster et al (2008) mentioned that
the rising apply of advertising such as targeted outdoor poster sites -airport lounges, airline
magazines and journey to work routes. Simultaneously, international, publications like as The
Economist magazines, the wall street journal's regularly represents some advertisement for high
level posts in many organizations all over the world. Although that advertising should consider
cultural differences, it may well be the case that the valuable targeting of such advertisement
ensures that they are seen more or less totally by people. They are more used to, and accepting
of,these multi-culturalmessages.
E-Recruitment : is the process of personnel recruitment using electronic resources, in particular

the internet. Companies and recruitment agents have moved much of their recruitment process
online so as to improve the speed by which candidates can be matched with live vacancies.
Using database technologies, and online job advertising boards and search engines, employers
can now fill posts in a fraction of the time previously possible. Using an online e-Recruitment
system may potentially save the employer time as usually they can rate the eCandidate and several
persons in HR independently review e Candidates.
International staffing choice
One of the major decisions for HRM when a company decides to operate overseas is how the
overseas operation will be staffed. This is the focus of this section.
Types of Staffing choices
There are three main staffing strategies a company strategy uses employees from the home country
to live and work in the country. From an entirely different country from the home country and
host country. ―These individuals are called expatriates. The second staffing strategy is a host-
country national strategy, which means to employ people who were born in the country in which
the business is operating. Finally, a third-country national strategy means to employee people
Advantages and Disadvantages of the Three Staffing Strategies" lists advantages and
disadvantages of each type of staffing strategy. Whichever strategy is chosen, communication with
the home office and strategic alignment with overseas operations need to occur for a successful
venture.
Advantages and Disadvantages of the Three Staffing Strategies
Third-Country
Home-Country National Host-Country National
National

The third-country
national may be better
Greater control of Language barrier is
equipped to bring the
organization eliminated
international perspective
Advantages to the business
Possible better Costs associated with

Managers gain experience
understanding of local hiring such as visas may
in local markets
rules and laws be less expensive than
Third-Country
Home-Country National Host-Country National National
Possible greater with home-country

understanding and nationals
implementation of business
strategy Hiring costs such as
visas are eliminated
Cultural understanding
Morale builder for

employees of host country
Adapting to foreign Host-country manager

environment may be may not understand Must consider
difficult for manager and business objectives as traditional national
family, and result in less well without proper hostilities
productivity training
The host government

Disadvantages Expatriate may not have
and/or local business
cultural sensitivity may resent hiring a
May create a perception third-country national
of ―us‖ versus ―them‖
Language barriers
Can affect motivation of
local workers
Cost of visa and hiring
factors

International recruitment and selection process
The process is extensive and involves identifying, screening, interviewing, selecting, hiring, and onboarding
international employees. Hiring from international markets differs vastly from hiring in domestic markets.
International recruiters should be well-versed with the country's labor laws before hiring individuals.
International recruitment is the process of searching, selecting, and hiring overseas employees to work in an
organization.
Technological advancements and rapid globalization have simplified global recruitment practices for
businesses. Hiring international employees physically and remotely is now easier than ever, thanks to social
media platforms and recruitment applications. In fact, most organizations are exploring cross-border talent
pools to accelerate business growth.
What is International Recruitment?
Global or international recruitment is a straightforward process of hiring employees from anywhere and
everywhere, without any geographical barriers. With the popularity of global recruitment, businesses are
switching to a mindset where the skill and expertise of potential candidates become the sole criteria for
selecting the right candidates.
Compared to domestic recruitment, global recruitment processes depend on some distinct factors. Differences
in market, language, culture, and other factors can impact the international global employment process.
For example, the recruitment process in the US is completely different from the recruitment process in Europe.
In the US, job seekers are expected to have skill-driven resumes. Factors like Date of Birth (DOB), marital
status, etc., are irrelevant here. However, for a candidate searching for jobs in Europe, adding such information
can add a competitive edge to their resumes.
Hence, an international recruiter should be well versed in the laws, compliances, and processes before
searching for candidates in the overseas market. Alternatively, international recruiters should possess in-depth
knowledge about the company’s expectations from a role and the appropriate skill sets to be possessed by
candidates.
What are the Responsibilities of an International Recruiter?
An international recruiter is a professional involved in planning and executing various steps, processes, and
sources associated with global recruitment. An international recruiter or a global recruiting agency works
independently to help organizations screen global talents.
Global recruiters have seamless access to the international talent pool, and they help enterprises select the best
talent from multiple nations. In fact, international recruiters can select talents from educational institutions
through a dedicated screening process and multiple rounds of interviews.

Some major responsibilities of global recruiters include:

Help businesses source the right candidates based on open positions.
Screen and shortlist the right candidates depending on selection criteria.
Work as an intermediary between the organization and candidate and arrange interviews between candidates
and team leads.
Design and distribute job postings across different platforms to get maximum reach.
Upskill and learn more about compliance and legislation of foreign markets and legislations.
Different approaches to multinational staffing decisions
1. Ethnocentric approach
2. Polycentric approach
3. Geocentric approach
4. Regiocentric approach
Ethnocentric Approach
Parent nation employees fill all key positions in a multinational.

Common for firms at early stages of internationalization.
Perceived lack of qualified host nation employees
Need to maintain good communication, coordination, and control links with corporate
headquarters.
Disadvantages
Limit promotional opportunities to host country nationals and may lead to lower
productivity, higher labor turnover, loss of competent people.
Parent company nationals may take more time in understanding local dynamics
Salary differences
Polycentric Approach
Employing host country nationals in the subsidiary of the MNC operating in that country and
parent country nationals will hold positions in corporate headquarters.
Advantages
No language barriers
Easy to understand local dynamics
Managing local politics and administration will be very easier
Less expensive
Disadvantages
Maintaining understanding between the corporate and subsidiary management becomes

difficult.
Difficult to imbibe original culture of the company
No opportunity for host country nationals to get exposure and experience outside their
country, which may even reduce growth opportunities.
Geocentric Approach
Employing the best people in key positions throughout the organization without the
consideration of any nationality.
Competent people need not be from host or parent country Constraints
Employment policies of different countries
Paper work involved in different nationals
Expensive
ompensation needs international benchmarking
Advantages
International core team

Best talent
Regiocentric Approach
Operation of multinational company on the basis of some geographical regions and

allows transfer of employees within the particular region.
Europe
America
South east Asia
Advantages
Allows interaction between executives transferred to the regional headquarters from the
subsidiaries and parent country nationals posted to the regional headquarters
Reflects sensitivity to local conditions
Highly effective for a MNC to move from a purely ethnocentric to geocentric approach
Drawbacks
May produce federalism at regional than a country basis

May improve career opportunities at the national level but moves the barrier only to the
regional level

Types of international assignments
Long-term temporary assignments
Long-term temporary assignments typically span one to three years, though it is not uncommon
for there to be a mechanism to extend them to up to five years or more. Most companies are
focusing on keeping long-term assignments to a five-year maximum as a cost management effort
to align with the maximum period of many tax-related totalization agreements.
Short-term temporary assignments
Short-term temporary assignments are typically 3 - 12 months in duration, though the limits may
vary by industry, with the most common variation being a six-month minimum and an 18-month
maximum. These assignments are typically designed to accomplish a specific task or goal, such as
to train local staff in a specific skill or to gain technical proficiency from local staff, to fill a
vacancy until a more permanent solution is put into place or to participate in a designated project.
Employee-requested long- and short-term assignments
The key element is the fact that the employee has not been asked to take an assignment but has
requested to do so for his/her own personal and/or professional reasons. The company may wish
to provide support for the employee during the assignment – most companies do – but at a reduced
benefit level.
Permanent international transfers
Sometimes called one-way moves or indefinite transfers, international transfers are akin to
domestic relocation, with international-related elements added in. Traditionally, international
transfers have been used when an employee fills a permanent position in the destination country.
Commuter assignments
Instead of taking a short- or long-term assignment or even an international transfer, an employee

may commute regularly between their home location and the work site in another country. Because
of the need to commute regularly, these assignments are most frequently used intra- regionally.
Commutation may be weekly or bi-weekly.
Developmental assignments
Developmental assignments address strategic needs within a company: to help an employee gain
critical skills. They are often utilized for employees identified as high-potential at any point in
their career, or they may be specific to early-career employees.
Assignments in difficult locations
Difficult locations are typically defined by living conditions that are far more challenging than
those the employee experiences in his/her home location. Housing, living standards, remoteness,
transportation options, limited education or medical facilities, and significant cultural differences
are all elements that make this assignment type different from others.
Selection criteria and techniques
1. Technical ability
2. Cross-cultural suitability
3. Family requirements
4. Country-cultural requirements
5. MNE requirements
6. Language
Technical Ability
Person‘s ability to perform the required tasks

Research has indicated that MNC‘s give highest importance to technical ans managerial
skills
Candidates past performance is checked
Cross-cultural suitability
Ability to operate in new environment

Cultural empathy, adaptability, diplomacy, language ability, positive attitude, emotional
stability and maturity are important factors
Big five model can be used to test personality
Family requirements
It ia accepted that the contribution of family especially the spouse, makes to the success
of overseas assignment
Settlement of family into new home and environment
Leaving of friends, relatives and social networks
Wellbeing of education of children
Accompanying partner‘s career
Problems of ageing parents
Country/cultural requirements
International firms may have to demonstrate that an HCN is not available before the host
government will issue the necessary work permit and entry visa for the desired PCN or
TCN
Expatriate selection may be needed when host country blocks transfers
Some countries may give work permit to expatriate only
Some regions may be considered ―hardship postings‖
MNE Requirement
Situational factors
Proportion of expatriates to local staff
Mode of operation- Joint venture
Duration and type of assignment
The amount of knowledge transfer inherent in the expatriate‘s job in foreign operation
Language
Ability to speak the local language

Important for non-English speaking countries and jobs where knowledge transfer is
critical
Common corporate language may be the selection criteria
Use of selection tests

Measurement of personal characteristics or traits.
How to measure personal traits accurately and reliably?
Personality and psychological tests
Validity of tests
Varies from country to country
Subjective nature of tests
Mendenhall and Oddou Model for selection
1. Self-oriented dimension
2. Perceptual dimension
3. Others-oriented dimension
4. Cultural-toughness dimension
Four dimensional model for selection
1. Self oriented dimension: The degree to which an expatriate expresses an adaptive concern for
self-preservation, self employment, and mental hygiene.
2. The perceptual dimension: The expertise that the expatriate possesses in accurately
understanding why host nationals behave the way they do.
Four dimensional model for selection
3. The others oriented dimension: The degree to which the expatriate is concerned about host-
national co-workers and desire to affiliate with them.

4. The cultural-toughness dimension- A mediating variable that recognizes that acculturation is

affected by the degree to which the culture of the host country is incongruent with that of the home
country.
Solutions to the dual-career challenge
Alternative assignment arrangements
• Short-term assignment
• Commuter assignment
• Other (eg. unaccompanied, virtual)
• Family-friendly policies
• Inter-company networking
• Job-hunting assistance ,Intra-company employment ,On-assignment career support
International staffing issues

1. The myth of global manager
2. Profile of an expatriate
3. Expatriate failure
4. The global manager
The myth of global manager
Myth 1: there is a universal approach to management
Myth 2: People can acquire multicultural adaptability and behaviors
Myth 3: There are common characteristics shared by successful international managers
Myth 4: There are no impediments to mobility
Expatriate failure
Definition: Premature return of an expatriate
Now recognized that under-performance during an international assignment, and retention upon
completion, should be included
➢ Cost of Expatriate failure
Direct costs of failure: airfares, associated relocation expenses, and salary and training
• Varies according to level of position concerned

• Country of destination
• Exchange rates
• Whether ‗failed‘ manager is replaced by another expatriate
Indirect costs (invisible)
• Damaged relationships with key stakeholders in the foreign location

• Negative effects on local staff
• Negative effects on expatriate concerned
• Family relationships may be affected
➢ Factors moderating expatriate performance

• Inability to adjust to the foreign culture
• Length of assignment
• Willingness to move
• Work-related factors
• Psychological contract
• Inability to adjust to the foreign culture
• Most important and consistent reason for failure
• Possible reasons
• Spouse/partner dissatisfaction
Phases of adjustment- I Phase
• Honey moon or tourist phase

• Experience a range of positive and negative emotions such as excitement, anxiety, fear of
the unknown or a sense of adventure
• Novelty wears off with time
• Realities of life come out, may result in homesickness

Phases of adjustment- II Phase
• Most critical phase and may have an impact on outcome of success or failure
• How psychological adjustment takes place
• May result in failure as an early recall
• If overcomes this phase an individual comes to the terms of demands of new environment
Phases of adjustment- III and IV Phase
• Phase of adjustment to new environment

• Healthy recovery phase
• Leads to IV phase of adjustment
The U-Curve is not normative
• The time period involved varies between individuals

• The U-Curve does not explain how and why people move through the various phases
• It may be more cyclical than a U-Curve
• Needs to consider repatriation
Length of assignment
• May have an impact on adjustment and performance

• More time to adjustment to foreign situation if assignment is for longer duration
Willingness to move
• Reluctant expatriate or accompanied by reluctant family

• Willingness may provide positive outlook
• May also depend on desirability of location
Work environment related factors
• Effective skill utilization

• Organizational commitment
• Intent to finish assignment
• Job autonomy
• Perceived level of organizational support- both from home and host unit
The employment relationship
• The nature of the employment relationship

✓ Relational: broad, open-ended and long-term obligations
✓ Transactional: specific short-term monetized obligations

• The condition of the relationship

✓ Intact: when employee considers there has been fair treatment, reciprocal trust
✓ Violated: provoked by belief organization has not fulfilled its obligations
Organizational commitment
Affective component: employee‘s attachment to, identification with and involvement in, the
organization
Continuance component: based on assessed costs associated with exiting the organization
Normative component: refers to employee‘s feelings of obligation to remain
Psychological contract
✓ Nature, location and duration of an international assignment may provoke intense,

individual reactions to perceived violations
✓ Expatriates tend to have broad, elaborate, employment relationships with greater
emphasis on relational nature
✓ Expectations and promises underpin this relationship
Interviews for international selection
There are two primary types of interviews used by companies: screening interviews, andselection
interviews. Every company‘s hiring process is different. Some companies may require only two
interviews while others may require three or more. It is also not uncommon to see a company
conduct testing (personality, skills based, aptitude, etc.) as an intermediate step in the
hiringprocess.
Here is an overview of the major types of interviews
Screening Interviews
First interview with a company will often be a screening interview. The purpose of a screening
interview is to ensure that prospective candidates meet the basic qualifications for a given
position. It may take place in person or on the telephone.
Selection Interviews
Selection interviews are typically conducted onsite at the hiring company. The purpose of a
selection interview is to determine whether a candidate will be selected for the position he or
she is interviewing for. A selection interview is typically more rigorous than a screening
interview. At this point, a company is trying to decide whether or not should either be moved to
the next step in the hiring process or an offer is going to be extended, so there will be more
scrutiny than with a screening interview.

Selection interviews can come in several forms:
Round-Robin Interview
A round-robin interview is the interview technique most commonly used by our client companies.
They will interview with multiple interviewers in succession. The key to a round- robin interview
is giving good consistent answers. Interviewers will typically meet after to discuss answers, and
will uncover any inconsistencies.
Panel Interview
A panel interview is an interview that consists of two or more interviewers. Typically, the
interviewers will both ask questions. The purpose of a panel interview is to gain multiple
perspectives on a prospective candidate. The key to a panel interview is to keep all interviewers
involved. Make eye contact with all interviewers even when answering a question for a specific
individual.
One-on-One Interview
A one-on-one interview is an interview with a single interviewer. The key to a one-on-one
interview is to build rapport with the interviewer. Smile. Be friendly. Try to match y interviewer‘s
energy level. Typically, will have a short period of time to make an impact. Know the position
and the key attributes the company is seeking, and emphasize those things.
Stress Interview
A stress interview is designed to test responses in a stressful environment. The interviewer may
try to intimidate, and the purpose is to weed out candidates who don‘t deal well with adversity.
The interviewer will make deliberate attempts to see how to handle one using methods such as
sarcasm, argumentative style questions, or long awkward silences. The key to a stress interview
is to recognize that are in a stress interview. Don‘t take it personally. Stay calm, focused, and
don‘t allow to be rushed. Ask for clarification if needed. Know how to push back. Ask an
interviewer for a couple of problems they are currently facing, and propose solutions.
Successful expatriation
The work on an international assignment usually starts long before the assignee arrives in the
host country, and even before (and after) the training proper. Following is a structured process that
includes six critical stages that can enhance the chances for a successful international
assignment and transformational experience.
Pre-program assessment and exploration. This includes An assessment of the expatriate‘s and
family members‘ background and prior international experience, understanding of the host culture,
specific goals/concerns, and personal tendencies should shape a customized expat and family
training session.
Use of cultural intelligence tools, such as Culture Wise, enables expatriates and family members
to further assess their personal tendencies against the cultural tendencies of the host country.
Further, exploration of existing online cultural information featured in such tools provides the
trainees a wealth of questions to ask during the training session

Expat and family training program. This stage is designed to increase the assignees‘ knowledge
about the host country, society, values, business culture, and day-to-day living. Completing such
training should result in significantly reduced risk of cultural misunderstandings and an enhanced
cross-cultural experience.
Host manager and team cultural briefing. This next stage is focused on the host country manager
and the team with whom the international assignee will be working, and provides insight into the
cultural values and norms of the assignee. Differences regarding communication andmanagement
style will be identified, as well as different expectations. Ideally, this is an in- person training
program, but when that is not possible, online tools can be helpful.
Project alignment meeting. After the expatriate and host organization have received critical
information, it is time for an exchange, either in person or via telephone or videoconference. A
project alignment meeting with the assignee and host manager should be held to discuss cultural
differences that might affect the success of the assignment, tools and techniques to prevent
misunderstandings, and mutual expectations of the assignee and the manager. This meeting
typically includes discussions about timelines, reporting strategies, and setting milestones.
In-country coaching. As soon as the expatriate arrives in the host country, new and unknown
situations inevitably occur. Therefore, an assignee should receive face-to-face or telephone
coaching. A coach monitors the assignee‘s process during the assignment and captures
experiences, case studies, and best practices. In some cases, a coach observes the assignee‘s
activities, such as staff meetings, virtual meetings, and other interactions between the assignee and
team members. The number of coaching sessions varies based on the assignment‘s duration and
participant‘s needs.
Knowledge management process. Systematic and ongoing capture (and dissemination) of relevant
documentation and lessons learned from an expatriate assignment is invaluable to the assignee,
future expatriates, and the organization as a whole. Knowledge management enables the
organization to avoid repetitive occurrences of known issues and over time, best practices and
effective case studies are developed.
Role of an expatriate
• Agent of direct control

• Agent of socialization
• Network builder
• Boundary spanner
• Language node
• Transfer of competence and knowledge

Female expatriation
Working and living abroad is becoming more common and takes on different forms, ranging from
the traditional expat to third-country nationals. Assignments can be long term or short term,self-
initiated or induced by an organization. Look around in your organization and people on your
work teams and you will notice there are many different nationalities in a single geography because
expatriation is not on the horizon, it is here.
Unfortunately, women are highly underrepresented in these important roles. Let us take a closer
look at the need for expatriation, the benefits awarded to organizations who deploy expatriates,
and how to include women in this workforce.
The Need for Women in Global Leadership
Changing demographics are contributing to the increased need for expats worldwide. There is a
startling workforce shortage and skills gap on the horizon. ―To sustain projected growth, the U.S.
alone needs twenty-five million more workers by 2030, Europe will need twenty-four million more
workers,‖ and by 2020, China will need to double its talent base to sustain projectedgrowth,
according to the World Economic Forum. There are three widely held reasons for the expected
workforce shortage and skills gap at a global level.
Repatriation
Repatriation is the process of returning a person to their place of origin or citizenship. This includes
the process of returning refugees or military personnel to their place of origin following a war.
Steps to reduce the loss of returning assignees

The following steps can assist organisations with the task of easing the repatriation process:
• Acknowledge the value of the returning employee both from a cost perspective as well as
gained insight and experience while abroad that is harder to measure quantitatively
• Recognise that the employee and their family may need assistance in readjusting to their home
culture
• Provide repatriation cultural training to raise awareness and provide tools for the adaptation
process
• Provide assistance for not only the returning employee but also to any partners and children so
their re-entry process is smoother
• Ensure that the employee feels they can continue to make a valuable contribution to the
organisation. Avoid a situation where the employee feels undervalued or marginalised as an
outsider.
• Provide coaching or other professional services so the employee can better integrate into their
'new-old' environment.
• Finally: Listen. Do not underestimate the frustration caused when few people show interest in
the repatriated employee's experiences, knowledge and expertise gained abroad. It may be hard
to quantify the value of sharing new experiences and new ways of looking at things, but the benefits
gained by the organisation as a whole should not be lost. After all, this is part of the reason why
the employee was on an expatriate assignment in the first place
Re-entry and career issues

• Expatriation process also includes repatriation: the activity of bringing the expatriate
back to the home country
• Re-entry presents new challenges
– May experience re-entry shock
– Some exit the company

• Preparation - developing plans for the future; gathering information about the new
position
• Physical relocation
• Transition
• Readjustment - coping with change
• Career anxiety
• No post-assignment guarantee of employment
• Loss of visibility and isolation
• Changes in the home workplace
• Work adjustment
• The employment relationship and career expectation
• Re-entry position
• Devaluing of international experience
• Coping with new role demands
• Loss of status and pay

Globalcompensation factors and components
What is global compensation?
A global compensation strategy is a business's plan to ensure its international workforce receives fair and
competitive compensation. The strategy should consider various factors, such as job role, employee location,
market competition, and local employment laws.
Elements of a global compensation strategy. There are five main elements to consider when it comes to
strategizing compensation for international employees: base pay, variable and incentive compensation,
premiums and allowances, international benefits, and training.
7 Key Components of an International Compensation
• Base salary.
• Foreign Service inducement/hardship premium:
• Allowances:
• Education Allowances for Children:
• Relocation Allowances and Moving:
• Tax Equalization Payments:
• Spouse Assistance:
What are the objectives of international compensation?
Good international compensation should: Attract talented, qualified professionals willing to commit to
international relocation. Facilitate the movement of expatriate employees. Manage a consistent and
reasonable relationship between the pay of domestic employees and foreign subsidiaries.
Approaches and cultural impact on compensation
Compensation in individualistic cultures is more oriented towards rewarding personal accomplishments

and individual satisfaction is of prime goal of compensation management. Performance related pay is more
successful in such cultures. In collectivist culture, compensation prime goal is satisfaction of group
objectives.
How does culture impact compensation?
While compensation addresses the basic needs, it is purpose, fulfillment and a feeling of community that
employees ultimately seek. So, culture prioritizing these factors compensates for lower salaries by
promoting a rewarding employee experience.
Global compensation practices

A global compensation strategy is a business's plan to ensure its international workforce receives fair and
competitive compensation. The strategy should consider various factors, such as job role, employee
location, market competition, and local employment laws.
What are the advantages of global compensation?

Some companies provide a more generous holiday schedule—an added financial value. You receive the
same yearly salary and can spend more free time on hobbies, vacation and family. If you work for a
large-scale company listed on the stock exchange, you may have the option of buying its shares.
Recent trends in global staffing
Top 10 staffing trends

• Remote work and hybrid work models. ...
• Gig economy and freelance talent. ...
• Artificial intelligence (AI) and automation. ...
• Skills-based hiring and reskilling. ...
• Diversity, Equity, and Inclusion (DEI) ...
• Data-driven decision making. ...
• Employee well-being and mental health. ...
• Employer branding and candidate experience.
Embracing Global Staffing Trends: Exploring the Future of Staffing
The global job market is undergoing a significant transformation, with businesses increasingly adopting
global staffing solutions to access talent across borders. This shift is driven by the evolving nature of
work and the rise of remote work opportunities. As organizations adapt to these trends, they must keep
pace with the changing dynamics of the global workforce. Let's explore the current global staffing trends
and how they are shaping the future of hashtag#staffing.
Remote Work Revolution:
Remote work has become a game-changer, revolutionizing the way businesses operate. With advanced
communication technologies and seamless project management systems, companies can now bridge
geographical barriers and tap into a diverse pool of talent worldwide. Remote work offers benefits such
as access to specialized skills, reduced overhead costs, and improved work-life balance. As the remote
work trend continues to gain momentum, organizations are redefining their staffing strategies to
accommodate and leverage this trans-formative shift.
Agility for Success:
Agility is a vital aspect of thriving in the modern business landscape. In response to rapidly changing
market demands, organizations are adopting agile workforce models. An agile workforce provides
flexibility and scalability, allowing companies to quickly adapt to evolving needs. By combining a vast
talent pool with streamlined on-boarding processes, businesses can access the right professionals with
minimal lead time. This strategic approach ensures that organizations can remain competitive, respond
to market shifts promptly, and drive innovation.
Cultural Diversity and Inclusion:
In today's globalized world, cultural hashtag#diversity and hashtag#inclusion and inclusion have
emerged as critical success factors. Embracing diversity brings a wealth of perspectives and fosters
innovation within organizations. To promote cultural diversity and inclusion, businesses are increasingly
adopting global staffing strategies. By seeking talent from different cultural backgrounds, organizations
can create an environment that values diversity, enhances creativity, and drives better business
outcomes. A diverse workforce allows for a broader range of ideas, promotes collaboration, and enables
companies to better understand and serve diverse markets.
Talent Acquisition and Development:
Finding and nurturing top talent is a priority for organizations across industries. To succeed in
hashtag#globalstaffing, companies are leveraging advanced technologies and data-driven approaches to
identify and recruit the right professionals. Robust talent acquisition processes ensure that organizations
can access the skills and expertise needed to meet business objectives. Furthermore, investing in talent
development through training programs and ongoing skill enhancement initiatives ensures that
professionals remain up to date with the latest industry trends. This focus on talent acquisition and
development strengthens organizations' capabilities and enhances their ability to deliver superior results.
Collaboration and Customer-Centric Approach:
Collaboration is key to achieving success in hashtag#globalstaffing. By fostering strong partnerships

and adopting a customer-centric approach, organizations can align their goals with their clients'
objectives. Open lines of communication, transparency, and proactive problem-solving contribute to
building trust and long-term relationships. When organizations collaborate effectively, they can deliver
exceptional results while adapting to clients' evolving needs.
The global staffing landscape is undergoing a transformation, driven by remote work opportunities and
the need for agility in a rapidly changing market. To succeed in this dynamic environment, organizations
must embrace hashtag#global hashtag#staffing trends. By leveraging remote work, fostering cultural
diversity, adopting agile workforce models, prioritizing talent acquisition and development, and
emphasizing collaboration and customer centricity, businesses can thrive in the evolving world of work.
As we navigate the future of staffing, let's embrace these trends to unlock the full potential of the
hashtag#global hashtag#workforce.
Expatriates’ failures &their minimization

What is an expatriate failure?

What is expatriate failure? It is a term used to encompass a range of issues that prevent return on
investment from an expatriate including early return, underperformance or adjustment problems. Rates
of expatriate failure vary significantly by both industry and destination.
Expatriate failure is often caused by lack of practical support in the host country and/or disconnection
with the home environment. It is crucial that relocation support does not end as soon as the employee
has arrived at their new destination.
What can recruiters do to minimize the failures of an expatriate

Five Ways You Can Prevent Failed Expat Assignments
• Find employees with the right soft skills. It is critical to find the right person for the job.
• Encourage a Recon Trip.
• Choosing an Employee with a Supportive Family.
• Ensure a Supportive Work Environment.
• Having Comprehensive Global Health Insurance.
6 of the most common causes of expatriate failure.

• Lack of cultural awareness.
• Poor communication.
• Insufficient preparation and training.
• Poor expatriate selection.
• Insufficient support for partners.
• Insufficient repatriation planning.
What are the strategies for improving expatriate success?

Here are some of the best strategies to improve expatriate employees' experience in 2024
• Streamline onboarding processes.
• Offer language support.
• Provide training programs.
• Enhance digital experiences.
• Ensure expat policies are up-to-date.
• Support mental health needs.
• Establish a community network.
International law (also called "employment standards") is the body of rules spanning
public and private international law which concern the rights and duties of employees,
employers,trade unions and governments in regulating the workplace. The International
Employment Organization and the World Trade Organization have been the main international
bodies involved in reform employment markets. The International Monetary Fund and the World
Bank have indirectly driven changes in employment policy by demanding structural adjustment
conditions for receiving loans or grants. Conflict of laws issues arise, determined by national
courts, when people work in more than one country, and supra-national bodies, particularly in the
law of the European Union, has a growing body of rules regarding employment rights.
Labour Clauses (Public Contracts) Convention, 1949 (No. 94) : Aims at ensuring respect
for minimum labour standards in the execution of public contracts.
Protection of Wages Convention, 1949 (No. 95) :Wages shall be paid in legal tender at
regular intervals; in cases where partial payment of wages is in kind, the value of such
allowances should be fair and reasonable. Workers shall be free to dispose of their wages
as they choose. In cases of employer insolvency, wages shall enjoy a priority in the
distribution of liquidated assets.
Minimum Wage Fixing Convention, 1970 (No. 131) :Requires ratifying states to establish
a minimum wage fixing machinery capable of determining and periodically reviewing and
adjusting minimum wage rates having the force of law.
Protection of Workers' Claims (Employer's Insolvency) Convention, 1992 (No. 173):
Provides for the protection of wage claims in insolvency and bankruptcy by means of a
privilege or through a guarantee institution.
International compensation and international assignees,
Designing and developing a better compensation package for HR professionals for the
international assignments requires knowledge of taxation, employment laws, and foreigncurrency
fluctuation by the HR professionals. Moreover, the socio-economic conditions of the country have
to be taken into consideration while developing a compensation package. It is easy to develop the
compensation package for the parent country national but difficult to manage the host and third
country nationals. When a firm develops international compensation policies, it tries to fulfills
some broad objectives:
1. The compensation policy should be in line with the structure, business needs and overall
strategy of the organization.
2. The policy should aim at attracting and retaining the best talent.
3. It should enhance employee satisfaction.
4. It should be clear in terms of understanding of the employees and also convenient to
administer.
The employee also has a number of objectives that he wishes to achieve from the compensation
policy of the firm
• Proper compensation against his/her competency and performance level.
• Substantial financial gain for his/her own comfort and for his family also.
• His/her present and future needs to be taken care of including children‘s education, medical
protection and housing facilities.
• The policy should be progressive in nature.
Forms of compensation
There are two forms of compensation provided to employees; direct and indirect. Direct forms of
compensation have a multitude of types or methods, from salaries to bonuses. Indirect
compensation is primarily the various types of benefits and long term incentives. This article is
an introduction to the terminology of compensation.
One of the forms of compensation is direct remuneration for services rendered by the employee.
The term used for this is wages. It consists of four different groups of payment from the employer
to the employee. They are salary, hourly, commission and bonus types of wages.
Salary
This type of wage is customarily a set sum of remuneration over a defined period of time. The
most traditional form is a dollar amount over a period of one year. The frequency of payment is
another part of the compensation and is based on industry standards. Most businesses pay for
services twice a month.
Most commonly used tool to pay professional or licensed employees. In general there is an
expectation from the employer of a longer term commitment from the employee for providing a
regular uninterrupted compensation.
Hourly
This is a dollar amount per hour of service to the employer, more commonly used to compensate
unskilled and skilled laborers in the workforce. This form of compensation comes with an implied
understanding that during times of slow or minimal workloads, the employee may not be used to
provide services. In effect, there is no guarantee of a regular cycle of pay.
Commission
When compensation is based on volume or some form of performance, this is known as
commission based remuneration. Other terms used include piecework or piecemeal. Many
industries used this type of remuneration to get a minimum standard of production in exchange for
compensation. It is used to shift risk from the employer to the employee. There are two methods

to calculate commission. One is based on volume of services and the other is based on sales.
Bonuses
Bonuses are used to increase performance from the employee. This is a variable type of
remuneration and is more commonly found with salaried staff to incentivize them for a particular
goal whether time or volume based. Other reasons used for bonuses are to increase or maintain
retention of certain skills or the pool of skill sets needed in the company. Sometimes bonuses are
paid when a company meets certain financial standards or goals over an extended period of time.
Bonuses are not commonly used with hourly or commission based employees due to the nature
of the type of compensation already established. However, in small businesses it is used as a
tool to incentivize these two types of remuneration to meet certain goals. The other form of
compensation is indirect in value. This includes benefits and equity based programs. In general,
these two types of indirect compensation provide value to an employee over a longer period of
time.
Benefits
This particular group is traditionally thought of in the form of insurances (health, dental, life,
disability and vision) and retirement. Very few small businesses provide benefits to their
employees due to cost involved. When small businesses begin providing benefits, they customarily
start out with retirement because of simplicity and low cost. As they grow, they add health
insurance and continue to expand the benefit package as the number of employeesincrease and
the risk of business performance decreases. Benefits allow for retention and recruitment.
Other benefits can include transportation, paid time off, vacation time, and customized incentives
(lodging, meals, phones, etc.).
Equity Based Programs

Rarely found in the small business world for several reasons. These types of indirect compensation
tie the employee to the company via ownership. Due to the complexity and the legal issues
involved, very few small businesses use this tool. This is a sophisticated method to retain key
employees.
Forms of compensation
There are two forms of compensation provided to employees; direct and indirect. Direct forms of
compensation have a multitude of types or methods, from salaries to bonuses. Indirect
compensation is primarily the various types of benefits and long term incentives. This article is
an introduction to the terminology of compensation.
One of the forms of compensation is direct remuneration for services rendered by the employee.
The term used for this is wages. It consists of four different groups of payment from the employer
to the employee. They are salary, hourly, commission and bonus types of wages.
Salary
This type of wage is customarily a set sum of remuneration over a defined period of time. The
most traditional form is a dollar amount over a period of one year. The frequency of payment is
another part of the compensation and is based on industry standards. Most businesses pay for
services twice a month.
Most commonly used tool to pay professional or licensed employees. In general there is an
expectation from the employer of a longer term commitment from the employee for providing a
regular uninterrupted compensation.
Hourly
This is a dollar amount per hour of service to the employer, more commonly used to compensate
unskilled and skilled laborers in the workforce. This form of compensation comes with an implied
understanding that during times of slow or minimal workloads, the employee may not be used to
provide services. In effect, there is no guarantee of a regular cycle of pay.
Commission
When compensation is based on volume or some form of performance, this is known as
commission based remuneration. Other terms used include piecework or piecemeal. Many
industries used this type of remuneration to get a minimum standard of production in exchange for
compensation. It is used to shift risk from the employer to the employee. There are two methods
to calculate commission. One is based on volume of services and the other is based on sales.
Bonuses
Bonuses are used to increase performance from the employee. This is a variable type of
remuneration and is more commonly found with salaried staff to incentivize them for a particular
goal whether time or volume based. Other reasons used for bonuses are to increase or maintain
retention of certain skills or the pool of skill sets needed in the company. Sometimes bonuses are
paid when a company meets certain financial standards or goals over an extended period of time.
Bonuses are not commonly used with hourly or commission based employees due to the nature
of the type of compensation already established. However, in small businesses it is used as a
tool to incentivize these two types of remuneration to meet certain goals. The other form of
compensation is indirect in value. This includes benefits and equity based programs. In general,
these two types of indirect compensation provide value to an employee over a longer period of
time.
Benefits
This particular group is traditionally thought of in the form of insurances (health, dental, life,
disability and vision) and retirement. Very few small businesses provide benefits to their
employees due to cost involved. When small businesses begin providing benefits, they customarily
start out with retirement because of simplicity and low cost. As they grow, they add health
insurance and continue to expand the benefit package as the number of employeesincrease and
the risk of business performance decreases. Benefits allow for retention and recruitment.
Other benefits can include transportation, paid time off, vacation time, and customized incentives
(lodging, meals, phones, etc.).
Equity Based Programs

Rarely found in the small business world for several reasons. These types of indirect compensation
tie the employee to the company via ownership. Due to the complexity and the legal issues
involved, very few small businesses use this tool. This is a sophisticated method to retain key
employees.
Factors that influence compensation policy
When developing international compensation policies, a firm seeks to satisfy several objectives.
1. First, the policy should be consistent with the overall strategy, structure and business needs
of the multinational.
2. Second, the policy must work to attract and retain staff in the areas where the multinational
has the greatest needs and opportunities. Hence the policy must be competitive and
recognize factors such as incentive for Foreign Service, tax equalization and
reimbursement for reasonable costs.
3. Third, the policy should facilitate the transfer of international employees in the most cost-
effective manner for the firm. Fourth, the policy must give due consideration to equity
and ease of administration.
The international employee will also have a number of objectives that need to be achieved
from the firm‘s compensation policy.
a. First, the employee will expect the policy to offer financial protection in terms of benefits,
social security and living costs in the foreign location.
b. Second, the employee will expect a foreign assignment to offer opportunities for financial
advancement through income and/or savings.
c. Third, the employee will expect issues such as housing, education of children and
recreation to be addressed in the policy. (The employee will also have expectations in terms
of career advancement and repatriation)
Key components of international compensation
International Compensation is an internal rate of return (monetary or non monetary rewards /
package) including base salary, benefits, perquisites and long term & short term incentives that

valued by employee‘s in accordance with their relative contributions to performance towards
achieving the desired goal of an organization.
The following are the major components of an international compensation package.
1. Base Salary
This term has a slightly different meaning in an international context than in a domestic one. In
the latter case, it denotes the amount of cash compensation that serves as a benchmark for other
compensation elements like bonus, social benefits. For the expatriate, it denotes the main
component of a package of allowances directly related to the base salary and the basis for in-
service benefits and pension contributions. Base salary actually forms the foundation block of the
international compensation.
2. Foreign Service Inducement Premium
This is a component of the total compensation package given to employees to encourage them to
take up foreign assignments. This is with the aim to compensate them for the possible hardships
they may face while being overseas. In this context, the definition of hardship, the eligibility
criteria for premium and the amount and timing of this payment are to be carefully considered.
Such payments are normally made in the form of a percentage of the salary and they vary
depending upon the tenure and content of the assignment. In addition, sometimes other
differentials may be considered. For instance: if a host country‘s work week is longer that of the
home country, a differential payment may be made in lieu of overtime.
3. Allowances
One of the most common kinds of allowance internationally is the Cost of Living Allowance
(COLA). It typically involves a payment to compensate for the differences in the cost of living
between the two countries resulting in an eventual difference in the expenditure made. A typical
example is to compensate for the inflation differential. COLA also includes payments for housing
and other utilities, and also personal income tax. Other major allowances that are often made are:
• Home leave allowance
• Education allowance
• Relocation allowance
• Spouse assistance (compensates for the loss of income due to spouse losing their job)
Thus, multinationals normally pay these allowances to encourage employees to take up
international assignments to make sure that they are comfortable in the host country in comparison
to the parent country.
4. Benefits
The aspect of benefits is often very complicated to deal with. For instance, pension plansnormally
differ from country to country due to difference in national practices. Thus all these and other
benefits (medical coverage, social security) are difficult to imitate across countries.
Thus, firms need to address a number of issues when considering what benefits to give and how
to give them. However, the crucial issue that remains to be dealt with is whether the expatriates
should be covered under the home country benefit programmes or the ones of the host country.

As a matter of fact, most US officials are covered by their home country benefit programmes.
Other kinds of benefits that are offered are:
• Vacation and special leaves
• Rest and rehabilitation leaves
• Emergency provisions like death or illness in the family
These benefits, however, depend on the host country regulations.
5. Incentives
In recent years some MNC have been designing special incentives programmes for keeping
expatriate motivated. In the process a growing number of firms have dropped the ongoing premium
for overseas assignment and replaced it with on time lump-sum premium. The lump- sum payment
has at least three advantages. First expatriates realize that they are paid this only once and that too
when they accept an overseas assignment. So the payment tends to retain its motivational value.
Second, costs to the company are less because there is only one payment and no future financial
commitment. This is so because incentive is separate payment, distinguishable for a regular pay
and it is more readily for saving or spending.
6. Taxes
The final component of the expatriate‘s compensation relates to taxes. MNCs generally select
one of the following approaches to handle international taxation.
1. Tax equalization: – Firm withhold an amount equal to the home country tax obligation of
the expatriate and pay all taxes in the host country.
2. Tax Protection :- The employee pays up to the amount of taxes he or she would pay on
remuneration in the home country. In such a situation, The employee is entitled to any windfall
received if total taxes are less in the foreign country then in the home country.

7. Long Term Benefits or Stock Benefits
The most common long term benefits offered to employees of MNCs are Employee Stock
Option Schemes (ESOS). Traditionally ESOS were used as means to reward top management or
key people of the MNCs. Some of the commonly used stock option schemes are:
• Employee Stock Option Plan (ESOP)- a certain nos. of shares are reserved for purchase and
issuance to key employees. Such shares serve as incentive for employees to build long term
value for the company.
• Restricted Stock Unit (RSU) – This is a plan established by a company, wherein units of stocks
are provided with restrictions on when they can be exercised. It is usually issued as partial
compensation for employees. The restrictions generally lifts in 3-5 years when the stock vests.
• Employee Stock Purchase Plan (ESPP) – This is a plan wherein the company sells shares to
its employees usually, at a discount. Importantly, the company deducts the purchase price of
these shares every month from the employee‘s salary.
Hence, the primary objective for providing stock options is to reward and improve employee‘s
performance and /or attract / retain critical talent in the Organization.
Approaches to international compensation
There are two main options in the area of international compensation – the Going Rate Approach
(also referred to as the Market Rate Approach) and the Balance Sheet Approach (sometimes known
as the Build-up Approach).
A. Going Rate Approach
For example, a Japanese bank operating in New York would need to decide whether its reference
point would be local US salaries, other Japanese competitors in New York or all foreign banks
operating in New York.
With the Going Rate Approach, if the location is in a low-pay county, the multinational usually
supplements base pay with additional benefits and payments.
The basic objective is to ‗keep the expatriate whole‘ (that is, maintaining relativity to PCN
colleagues and compensating for the costs of an international assignment) through maintenance of
home-country living standard plus a financial inducement to make the package attractive.

The key assumption of this approach is that foreign assignees should not suffer a material loss due
to their transfer, and this is accomplished through the utilization of what is generally referredto as
the
B. Balance-sheet Approach.
An assignment abroad can mean that a US expatriate is taxed both in the country of assignment
and in the USA. This dual tax cost, combined with all of the other expatriate costs, makes some
US multinationals think twice about making use of expatriates
c. Taxation
Multinationals generally select one of the following approaches to handling international taxation:
• Tax equalization – firms withhold an amount equal to the home-country tax obligation of
the PCN, and pay all taxes in the host country.
• Tax protection – The employee pays up to the amount of taxes he or she would pay on
compensation in the home country. In such a situation, the employee is entitled to any
windfall received if total taxes are less in the foreign country than in the home country.
Compensation practices across the countries
In the United States, when we think about employee compensation, we start on the most basic
level with an understanding of minimum wage laws, contractual bonus programs and vacation
policies. Outside the United
States, even these very basic compensation concepts have different meanings and requirements
that must be understood at the outset when building a global compensation strategy. First,
minimum wage. A federal minimum wage is in effect in the United States, and many states (like
California) also have state minimum wage requirements that are higher than the federal minimum
wage. Furthermore, some municipalities (like San Francisco) have local minimum wage
requirements that are even higher than the federal and state requirements.
Outside the United States, most countries also have minimum wage laws, and like the United
States, some countries may have different laws depending on the province, state or commercial
zone (e.g., China, India and the United Arab Emirates). What distinguishes minimum wage rates,
however, varies by country. For instance, in the United Kingdom, minimum wage rates depend on
the workers‘ age; in Australia, the wage rate depends on the applicable Modern Award; in France,
the rate depends on the applicable CBA.
Related to minimum wage is the concept of mandatory salary increases.

In the United States, there is no requirement to increase salaries as a matter of law outside of a
unionized environment. Outside the United
States, mandatory salary increases are common. For instance, in Egypt, salaries must be increased
7 percent annually; in Morocco, salaries are increased through an annual bonus of 5 percent to 25
percent of salary) based on seniority; in Brazil and Argentina, the CBA dictates annual mandatory
salary increases.
Second are the sometimes unexpected requirements around bonuses and profit sharing. In the
United States, again, there is no legal requirement to provide employee bonuses or profit sharing
(though, if implemented, then there are specific state and federal laws that may apply). Outside the
United States, many countries have statutorily required bonuses and profit sharing. For example,
in Brazil and Argentina, employees are entitled to a 13th month salary. In France (once there are
50 or more employees) and Mexico, employees are entitled to profit sharing. In China, Taiwan
and
Singapore, though not required, various annual bonuses are commonplace and necessary to attract
and retain talent.
Finally, vacation is not just something that we would all like to take more of. Rather, it is a key
component to employment and the cost of engaging a workforce outside the United States. While
U.S. employers are not required to provide vacation as a matter of law (though if they do, then
various laws apply), outside the United States, employees in almost every country in the world are
entitled to vacation as a matter of law, which is viewed in many countries as an important
component of workplace health and safety. For example, in Brazil, employees are entitled to up to
30 days of vacation per year; in Australia, it is about four weeks; in Argentina, it is between 14
and 35 days per year; in France, it is 30 days; and in Singapore, it depends on the type of employee.
Because vacation is a legal entitlement, and at-will employment does not apply, there are limits on
an employer‘s ability to modify vacation for its non-U.S. employees and use it as a tool to control
costs. In fact, in some jurisdictions, such as Brazil, it is not possible to reduce vacation, force usage
or cash-out, even with an employee‘s consent.
Emerging issues in compensation management :
Designing, planning and managing compensation on a global basis can be challenging

when companies expand into new markets and attempt to create consistent processes in
multiple countries.
Finding a data-privacy strategy that best meets organizational needs. One size does not
fit all. With multiple options for managing data storage and sharing, choosing one that

delivers the flexibility needed enables to remain compliant in the areas in which it
operates.
Accommodating to local cultures.
Managing environmental pay issues is another area for concern for organizations that
operate globally.
Establishment of labour standards by International Institutions
"The rules of the global economy should be aimed at improving the rights, livelihoods, security,
and opportunities of people, families and communities around the world." - World Commission
on the Social Dimension of Globalization, 2004 .
Since 1919, the International Labour Organization has maintained and developed a systemof
international labour standards aimed at promoting opportunities for women and men to obtain
decent and productive work, in conditions of freedom, equity, security and dignity. In today's
globalized economy, international labour standards are an essential component in the
international framework for ensuring that the growth of the global economy provides benefits to
all.
International labour standards are backed by a supervisory system that is unique at the international
level and that helps to ensure that countries implement the conventions they ratify. The ILO
regularly examines the application of standards in member states and points out areas where they
could be better applied. If there are any problems in the application of standards, the ILO seeks
to assist countries through social dialogue and technical assistance.
The ILO has developed various means of supervising the application of Conventions and
Recommendations in law and practice following their adoption by the International Labour
Conference and their ratification by States. ILO Supervisory system
There are two kinds of supervisory mechanism:
1. The regular system of supervision: examination of periodic reports submitted by Member

States on the measures they have taken to implement the provisions of the ratified Conventions
2. Special procedures: a representations procedure and a complaints procedure of general
application, together with a special procedure for freedom of association

The regular system for supervising the application of standards

The regular system of supervision is based on the examination by two ILO bodies of reports on
the application in law and practice sent by member States and on observations in this regard sent
by workers‘ organizations and employers‘ organizations.
1) The Committee of Experts on the Application of Conventions and Recommendations
2) The International Labour Conference‘s Tripartite Committee on the Application of

Conventions & Recommendations
Global legal and regulatory context of MNE
A multinational corporation (MNC) or multinational enterprise is an organization that owns

or controls production of goods or services in one or more countries other than their home country.
It can also be referred as an international corporation, a "transnational corporation", or a
stateless corporation.
A multinational corporation is usually a large corporation which produces or sells goods or

services in various countries.
• Importing and exporting goods and services

• Making significant investments in a foreign country
• Buying and selling licenses in foreign markets
• Engaging in contract manufacturing—permitting a local manufacturer in a foreign country to
produce their products
• Opening manufacturing facilities or assembly operations in foreign countries
Enterprises should:
1. Take fully into account established general policy objectives of the Member countries in
which they operate;
2. In particular, give due consideration to those countries' aims and priorities with regard to
economic and social progress, including industrial and regional development, the
protection of the environment and consumer interests, the creation of employment
opportunities, the promotion of innovation and the transfer of technology;
3. While observing their legal obligations concerning information, supply their entities with
supplementary information the latter may need in order to meet requests by the authorities
of the countries in which those entities are located for information relevant to the activities
of those entities, taking into account legitimate requirements of business confidentiality;
4. Favour close co-operation with the local community and business interests;

5. Allow their component entities freedom to develop their activities and to exploit their
competitive advantage in domestic and foreign markets, consistent with the need for
specialisation and sound commercial practice;
6. When filling responsible posts in each country of operation, take due account of individual
qualifications without discrimination as to nationality, subject to particular national
requirements in this respect;
7. Not render and they should not be solicited or expected to render any bribe or other
improper benefit, direct or indirect, to any public servant or holder of public office;
8. Unless legally permissible, not make contributions to candidates for public office or to
political parties or other political organisations;
9. Abstain from any improper involvement in local political activities.
International framework of Ethics and Labour standards
Ethical Framework envisions a system in which business can engage with governments, labor
unions, NGOs, consumer associations and others to create processes and credentials to further
improve the protection of workers migrating globally for work, and to reduce business and
reputational risks for firms dealing with a global labor supply. This includes Standards of Ethical
Practice (SEP) that build on established and recognized industry best practices as well as core
global labor standards. Also included are basic requirements for independent systems to verify and
certify compliance, so that any recruitment firm, employer, value chain ‗owner,‘ stakeholder or
individual migrant can confidently know whether a labor market facilitator is observing and
upholding these standards.
We hope for new, transformative, social and market demand for ethical recruitment practices
driven by employers, workers, NGOs, labor unions, consumer groups and all other engaged
stakeholders. Ethical Framework does not, and cannot, represent a total solution to forced labor
and human trafficking. But we believe it can significantly improve transparency, accountability
and the wider adoption of leading industry practices among firms that facilitate the global
movement of workers.
Key issues in International Industrial Relations
Industrial relations policies and practices of multinational firms:
Because national differences in economic, political and legal systems produce markedly different
industrial relations systems across countries, multinationals generally delegate the management
of industrial relations to their foreign subsidiaries. However, a policy of decentralization does not
keep corporate headquarters from exercising some coordination over industrial relations strategy.
Generally, corporate headquarters will become involved in or oversee labor agreements made by
foreign subsidiaries because these agreements may affect the international plans of the firm and/or
create precedents for negotiations in other countries.

Multinational headquarters involvement in industrial relations is influenced by several factors

Industrial relations policies and practices of multinational firms
The degree of inter-subsidiary production integration:
High degree of integration was found to be the most important factor leading to the centralization
of the industrial relations function within the firms studied.
Industrial relations throughout a system become of direct importance to corporate headquarters
when transnational sourcing patterns have been developed, that is, when a subsidiary in one
country relies on another foreign subsidiary as a source of components or as a user of its output.
In this context, a coordinated industrial relations policy is one of the key factors in a successful
global production strategy.
Nationality of ownership of the subsidiary:
A number of studies have revealed that US firms tend to exercise greater centralized control over
labor relations than do British or other European firms.
US firms tend to place greater emphasis on formal management controls and a close reporting
system (particularly within the area of financial control) to ensure that planning targets are met.
Foreign-owned multinationals in Britain prefer single-employer bargaining (rather than
involving an employer association), and are more likely than British firms to assert managerial
prerogative on matters of labor utilization.
Further, Hamill found US-owned subsidiaries to be much more centralized in labor relations
decision making than British-owned. Hamill attributed this difference in management procedures
to the more integrated nature of US firms, the greater divergence between British and US labor
relations systems than between British and other European systems, and the more ethnocentric
managerial style of US firms.
• International human resource management approach.

The various international human resource management approaches utilized by multinationals;
these have implications for international industrial relations.
An ethnocentric predisposition is more likely to be associated with various forms of industrial
relations conflict.
Conversely, it has been shown that more geocentric firms will bear more influence on host- country
industrial relations systems, owing to their greater propensity to participate in local events.
• MNE prior experience in industrial relations.

European firms have tended to deal with industrial unions at industry level (frequently via
employer associations) rather than at firm level.
The opposite is more typical for US firms. In the USA, employer associations have not played a
key role in the industrial relations system, and firm-based industrial relations policies are the norm.
• Subsidiary characteristics.

Research has identified a number of subsidiary characteristics to be relevant to centralization of

industrial relations.
First, subsidiaries that are formed through acquisition of well-established indigenous firms tend
to be given much more autonomy over industrial relations than are greenfield sites set up by a
multinational firm.
Second, according to Enderwick, greater intervention would be expected when the subsidiary is of
key strategic importance to the firm and the subsidiary is young.
Third, where the parent firm is a significant source of operating or investment funds for the
subsidiary, that is, where the subsidiary is more dependent on headquarters for resources, there
will tend to be increased corporate involvement in industrial relations and human resource
management.
Finally, poor subsidiary performance tends to be accompanied by increased corporate involvement

in industrial relations. Where poor performance is due to industrial relations problems,
multinationals tend to attempt to introduce parent-country industrial relations practices aimed at
reducing industrial unrest or increasing productivity.
Trade Unions and MNE’s
The International Trade Union Confederation is the world's largest trade union federation. It was
formed on November 1, 2006 out of the merger of the International Confederation of Free Trade
Unions (ICFTU) and the World Confederation of Labour (WCL). The Founding Congress of the
ITUC was held in Vienna and was preceded by the dissolution congresses of both the ICFTU and
the WCL.
The ITUC represents 176 million workers through its 328 affiliated organisations within 162
countries and territories. Sharan Burrow is the current General Secretary.
The ITUC traces its origins back to the First International (also known as the International
Workingmen's Association) and in 2014 will commemorate the 150th anniversary of the founding
of the International Working Men's Association at its own world congress to be held in Berlin .
Also in 2014, the ITUC debuted the Global Rights Index, which ranks nations on 97 metrics
pertaining to workers' rights, such as freedom from violent conditions and the right to strike and
unionize.
The ITUC‘s primary mission is the promotion and defense of workers‘ rights and interests, through
international cooperation between trade unions, global campaigning and advocacy within the
major global institutions.
Its main areas of activity include the following: trade union and human rights; economy, society
and the workplace; equality and non-discrimination; and international solidarity.

The ITUC adheres to the principles of trade union democracy and independence. It is governed by
four-yearly world congresses, a General Council and an Executive Bureau.
The ITUC regional organisations are the Asia-Pacific Regional Organisation (ITUC-AP), the
African Regional Organisation (ITUC-AF) and the American Regional Organisation (TUCA). It
cooperates with the European Trade Union Confederation, including through the Pan-European
Regional Council.
The ITUC has close relations with the Global Union Federations and the Trade Union Advisory
Committee to the OECD (TUAC). It works closely with the International Labour Organisation and
with several other UN Specialised Agencies.
Response of Trade Unions to MNE’s
Trade union leaders have long seen the growth of multinationals as a threat to the bargaining power
of labor because of the considerable power and influence of large multinational firms.
While it is recognized that multinationals are ‗neither uniformly anti-union nor omnipotent and
monolithic bureaucracies‘, their potential for lobbying power nor flexibility across national
borders creates difficulties for employees and trade unions endeavouring to develop countervailing
power.
There are several ways in which multinationals has an impact upon trade union and employee
interests. Kennedy has identified the following seven characteristics of MNEs as the source of
trade union concern about multinationals:
• Formidable financial resources.
• Alternative sources of supply.
• The ability to move production facilities to other countries.
• A remote locus of authority (i.e. the corporate head office management of a multinational
firm).
• Production facilities in many industries.
• Superior knowledge and expertise in industrial relations.
• The capacity to stage an ‗investment strike,‘ whereby the multinational refuses to invest
any additional funds in a plant, thus ensuring that the plant will become obsolete and
economically non-competitive.
Another issue reported by trade unions is their claim that they have difficulty accessing decision-
makers located outside the host country and obtaining financial information.
The response of labor unions to multinationals has been threefold: to form international trade
secretariats (ITSs), to lobby for restrictive national legislation and to try to achieve regulation of
multinationals by international organizations.
Non-Union worker representation
Trade unions are the main channel of representation of workers' interests in Polish companies.
However, the unions' increasing marginalisation and declining membership tends to hamper such
representation. This feature examines the non-union forms of company-level employee

representation in place in some types of enterprises in 2002, concluding that such channels - mainly
workers' councils and employee representation on supervisory boards - are limited in scope and
largely ineffective.
Workers' 'self-government' has a long tradition in some country. In state-owned enterprises, this is
currently governed by the 1981 Act on workers' self-government (since amended), which provides
for workers' councils with a representative function, separate from trade unions, in such enterprises
(though in no other types of organisation). According to the legislation, workers' councils have the
following rights:
• approving and amending the enterprise's annual plan;

• making proposals for investments;
• adopting the enterprise's annual report and approving its balance sheet;
• approving merging and divestment decisions;
• approving changes in the direction of the development of the enterprise;
• deciding, on the recommendation of the management, on the enterprise's works
regulations; and
• adopting resolutions on the appointment or dismissal of company directors and other
persons with managerial functions in the enterprise.

MODULE 4: Global Management Development
Role of expatriate training, pre- departure training, development of staff and international assignments,
Performance management – significance and concerns of performance management, setting individual
performance goals
Developing Global Mindset: Global Leadership
The single critical success factor in globalizing business lies with an organization‘s pool of highly
competent global leaders who have the global knowledge of production and service capabilities,
of consumer demands for products and services around the world, and who can influence others
despite diverse cultural, political and institutional backgrounds that make them think, decide,
analyze, act and communicate differently than the leader. In other words, global leaders with
―Global Mindsets‖ are the key to sustainable competitive advantage in the global economy.
best practices offers four recommendations for developing global leaders:
1. Organizations need strategic clarity about what kinds of skills a global leader needs.
2. Prospective global leaders need relevant developmental opportunities.
3. Prospective global leaders need appropriate levels of feedback, resources and support to help
them learn from the experiences they have.
4. People need international perspectives and exposure starting early in their careers to maximize
the quality of the globally competent expert pipeline.
The development of expert global leaders is complex. Their capabilities are developed over time
and build on threshold competencies that include a requisite level of inquisitiveness and openness
— natural abilities that are supported by cross-cultural knowledge — and build on a base of
business or technical skills. International experience contributes to their development as do
international management development programs and cross-cultural training programs. But these
interventions alone do not make someone an expert global leader. It takes a GlobalMindset.
Cross cultural context and international assignees:
The human resource refers to the accumulated stock of knowledge, skills, and abilities that the
individuals possess, which the firm has built over time into an identifiable expertise.
Building a team with international orientation, committed and competent people who will support
the organization‘s strategic business and enhancing core competencies of organization needs
training and development

Current scenario in international training and development
With the world-wide expansion of companies and changing technologies, Indian Organizations
have realized the importance of corporate training. Training is considered as more of retention
tool than a cost.
Today, human resource is now a source of competitive advantage for all organizations. Therefore,
the training system in Indian Industry has been changed to create a smarter workforce and yield
the best results. With increase in competition, every company wants to optimize the utilization of
its resources to yield the maximum possible results. Training is required in every field be it Sales,
Marketing, Human Resource, Relationship building, Logistics,Production, Engineering, etc. It is
now a business effective tool and is linked with the business outcome.
With increase in awareness of corporate training in Indian Industry, a gradual shift from general
to specific approach has been realized.
According to NASSCOM (National Association of Software and Services Companies), the IT

corporate training market is expected to reach Rs 600 crore in 2010 from Rs 210 Crore in 2006.
2024

In Indian market, 50% of the training company‘s revenue comes from the retail training and rest
from other segments.
On the other hand, in many organizations training is regarded as non-essential or a need based
activity. Some organizations start a training department in order to look modern. In fact, some
organizations are headed by unwanted employees rather than employees of outstanding merit.
While some organizations do not have a separate budget to hire highly qualified trainers for
training and development.
Training & development of international staff
MNCs spend substantial amount of money on training and development of employees
Cost of expatriate failure is very high which organizations cannot bear.
Selecting a right person and providing them with appropriate training before their departure as
well as on arrival in a particular country is very important
Should enable expatriates to determine in advance the appropriate cultural behaviors and
suitable ways of performing necessary tasks in the host country
Should help expatriates cope with unforeseen events in the new culture and reduce
conflict due to unexpected situations and actions
Should create realistic expectations for expatriates with respect to living and working in
the host country
Types of expatriate training
Language training
Practical assistance
Training for the training role
TCN and HCN expatriate training
Non-traditional assignments and training
Cultural awareness programs
Designed to adapt and appreciate host country culture so that expatriates can behave accordingly
or to develop coping patterns
Components of program may vary according to country of assignment, duration, purpose of

transfer and provider of programs
If expected interaction is low, degree of dissimilarities between cultures is low, training should
focus on task and job related issues and less cultural issues
Low rigor training
Short time period
Lectures and videos on local cultures
Briefings on company operations
High rigor training
Last over a month
Experiential learning
Extensive language training
Includes interactions with host country nationals
Training Methods
Reviewing available information about the host company: books, magazines, video tapes.
Conversations with host country natives.
Sensitivity training to become familiar with the customs and overcome prejudices.
Temporary assignments to encourage shared learning.
Training Rigor: Techniques and Objectives
1. Preliminary visits
2. A well planned trip for the candidate and his spouse provides a preview and allows them
to assess their suitability and interest in assignment
3. Introduce expatriate to the business context
4. Making housing and schooling decisions
5. Exposure to community
6. Language training
7. The role of English as the language of world business
8. Host country-language skills and adjustment
9. Knowledge of the corporate language
Training for training role
Need of expatriates may be due to lack of trained staff in host country

Need to train HCNs as their replacement
Ability to transfer knowledge and skills in a culturally sensitive manner should be very
important component of pre-departure training

TCN and HCN expatriate training

TCNs transferred to another country subsidiary
HCNs transferred to parent country
Provision of training for non-traditional expatriate assignments
Non traditional assignments like commuting or international business travel
HCN training :
Pre-departure training
Limited data on how effective such training is and what components are considered most
essential:
Use of mixture of methods makes evaluation of which method is most effective difficult
to isolate
Large diversity of cultures involved
What works for one may not work for another
Complex jobs in multiple cultural contexts
Sensitivity training
Sensitivity training involves such groupings as --T groups (T for training), encounter groups,
laboratory training groups, and human awareness groups are all names usually associatedwith what
is known as sensitivity training.
Sensitivity training is about making people understand about themselves and others reasonably,
which is done by developing in them social sensitivity and behavioral flexibility.
Social sensitivity in one word is empathy. It is ability of an individual to sense what

others feel and think from their own point of view.
Behavioral flexibility is ability to behave suitably in light of understanding.
Procedure of Sensitivity Training

Sensitivity Training Program requires three steps:
1. Unfreezing the old values -It requires that the trainees become aware of the inadequacy of the
old values. This can be done when the trainee faces dilemma in which his old values is not able
to provide proper guidance. The first step consists of a small procedure:
An unstructured group of 10-15 people is formed.
Unstructured group without any objective looks to the trainer for its guidance
But the trainer refuses to provide guidance and assume leadership
Soon, the trainees are motivated to resolve the uncertainty
Then, they try to form some hierarchy. Some try assume leadership role which may not
be liked by other trainees
Then, they started realizing that what they desire to do and realize the alternative ways of
dealing with the situation

2. Development of new values - With the trainer's support, trainees begin to examine their
interpersonal behavior and giving each other feedback. The reasoning of the feedbacks are
discussed which motivates trainees to experiment with range of new behaviors and values. This
process constitutes the second step in the change process of the development of these values.
3. Refreezing the new ones - This step depends upon how much opportunity the trainees get to
practice their new behaviors and values at their work place.
In one way Sensitivity training is the process of developing emotional intelligence, whichmeans
"the mental ability an individual possesses enabling him or her to be sensitive andunderstanding
to the emotions of others as well as being able to manage their own emotions and impulses".
[Emotional intelligence, according to Merriam Webster, "describes the ability, capacity, skill or,
in the case of the trait, to identify, assess, and manage the emotions of one's self, of others, and of
groups."] Emotional intelligence enable employees to act according to the situation in the
organization faced by him. It develops the ability to understand others feeling and their mental
status and interact accordingly. Conflicts and misunderstandings are mostly raised because of lack
of emotional intelligence possessed by the person which leads to breakup in perception and
relationship they main since long time in organization and effects the productivity of the
organization.
Career Development:
International assignments as a training and development tool
Expatriates are trainers

Expatriates show how systems and procedures work, ensure adoption, and monitor
performance of HCNs
International assignments a form of job rotation – management development
Components of effective pre-departure training
Cultural awareness programs
Preliminary visits
Preparing for an International Assignment
1. Social and business etiquette
2. History and folklore
3. Current affairs, including relations between the host country and the parent
4. Cultural values and priorities
5. Geography, especially its major cities
6. Sources of pride and great achievements of the culture
7. Religion and the role of religion in daily life

8. Political structure and current players
9. Practical matters such as currency, transportation, time zones, hours of business
10. The language
Repatriate training:
Coming back is a challenge. The returning family will obtain the tools and methods to readjust
effectively into the Finnish everyday life and business life. Cultural and practical changes in the
society. Major adjustments in business life
Cultural readjustment: changes in oneself and making the best of cultural readjustment Guidance
with procedures with authorities etc.
Training is designed for the relocating assignee and family. The training helps individuals and their
families adjust to the new environment and prepare for successful interaction both in daily life and
business situations in the destination country. The training consists of the followingparts:
cultural differences/culture shock, business life, daily life/city specifics. The trainingoccurs over
8-12 hours. Separate, customized children‘s and young adult program (4 hours) is also available.
Developing international staff and multinational teams
Management development-Gain of international experience, help in career progression, develop

for future international business expansion
Organizational development-Accumulation of stock of knowledge, skills and abilities upon

which organization can grow in future
Individual development
Job rotation
Management development tool
New range of jobs, tasks and challenges
Financial gain and career advancement
How international teams benefit the multinational
Fosters innovation, organizational learning and transfer of knowledge
Assists breaking down of functional and national boundaries
Encourages diverse inputs

Assists in developing broader perspectives
Develops shared values
International Cadre: Another Choice
Separate group of expatriate managers who specialize in a career of international assignments
Have permanent international assignments
Move from international assignments to international assignments
Knowledge transfer in Multinational companies
The ultimate goal of a MNC is to increase its turnover and profits worldwide. The need of
coordination among all the worldwide spread subsidiaries is thus necessary. Furthermore, in such
a global and competitive market, one of the most important things in order to earn market shares
is to stay constantly innovated.
On one hand, subsidiaries are considered to be on the frontline of the market. That means that they
are clearly exposed to the flexibility of the market such as market changes, trends and
opportunities.
On the other hand, it is strictly the task of the headquarters to grant any extent of support to
encourage autonomy and innovation.
A central issue carried out by several researches is concerning the spread of the knowledge gained
by subsidiaries through their innovation and practices.
Knowledge transfer is not solely perceived as a one-way movement of methods from HQ to foreign
subsidiaries. In fact, ―reverse knowledge transfer‖ from subsidiary to HQ is increasingly becoming
an object of research.
We believe that the knowledge achieved by subsidiaries through best practices and innovation is
fundamental for the improvement of the overall performance of the MNC.

Performance Management: Management and MNE
In global terms, performance management can be described as a process which allows an

international company or multinational enterprise (MNE) to evaluate and constantly improve
individual and corporate performance in relation to pre-set goals and targets. Furthermore,
performance appraisals are considered to be a key human resource management (HRM) activity
of performance management and can influence the implementation of business strategy within a
company.
A MNE is not uniform across all of its subsidiaries and therefore, a number of environmental
contingencies must be considered in relation to the various subsidiaries. These contingencies are
the mental distance between the parent and host country, entry modes and the role of the
subsidiaries
Performance appraisal of an expatriate is a crucial task, with the possibility of conflict between the
subsidiary manager and the headquarters. But it is up to the subsidiary managers to set precise
targets and establish clear criteria for performance measurement in order to avoid such conflict.
Furthermore, the mental distance between the parent and host country can make managing the
subsidiary a difficult task due to the cultural differences, language barriers, as well as the social
and political conditions.
It is for this reason that companies tend to hire more PCNs within subsidiaries, as they are more
able to create an informal communication network in the organisation and build social capital in
the corporation, all the while having a dual commitment to both the subsidiary and the organisation
as a whole.As a result, the PCN will further enable the subsidiary to have greater knowledge of
what is happening in the MNE. Therefore, subsidiaries will no longer exist in isolation with strong
control from headquarters, since they will experience greater integration and autonomy. However,
there is at times a conflict of interest between the headquarters and the subsidiaries which can
make managing international operations a huge challenge
Performance management of expatriates is undoubtedly more difficult than in the case of domestic
managers. The performance of an expatriate will depend on a variety of issues such as the
compensation, cultural adjustments, tasks and job roles, as well as support from headquarters and
the host environment. The expatriate will face a number of problems when they take up a jobwithin
a foreign country. For example, the tasks and job roles are often defined in the context of the
expatriate's home country and therefore they may not be able to understand their particular job role
in the foreign environment .
Furthermore, the expatriate may face difficulty in adjusting to the foreign culture, and it will be up
to the MNE to ensure that they acclimatise, as this is vital to the expatriate being able to perform
at their best in terms of the job in hand. The host environment will also pose challenges due to a
combination of several other factors such as, social, economic, legal, technological and physical
complications. Therefore, taking everything into account it is absolutely vital as well as

a crucial performance variable that a sufficient level of support is provided to the individual and
their family by both the headquarters and hosts .
Constraints in goal attainment
Constraints in goal attainment
• Unsatisfactory performance improvement:
The indicators are Employees behavior/ effort not directed towards organizational goals in
adequate monitoring of behavior to ensure that the goals are being met.
• Incorrect decisions being made:
Wrong decisions on pay raise, promotion, transfer, training, discharges and probability periods
completion results in non-motivated employees.
• Legal compliance not being met:
Due to erratic performance it lands firms in a legal battle, diverting its focus on non –
productive areas.
• Inadequate job satisfaction:
Employees tend to become emotional and frustrated if they perceive that the ratings they get
are unfair and inaccurate.
• Increased turnover of employees:
Dissatisfaction in the job sets in and one of the outcomes of the job satisfaction is increased
turnover.
• In consistency between organizational strategy and behaviour:
Performance evaluation, will being out the employee‘s behaviour lacking strategic focus - i.e.
negative consequence of the strategy.
• Inconsistency between organizational strategy and performance appraisal:
• Performance appraisal not able to identify employees with potential not rewarding to match
with performance not properly deciding employees need for development. Unsatisfactory
performance improvement:

Performance management cycle
One of the most challenging tasks of lHRM is managing the performance of a firm‘s various
international facilities. Performance management may be understood as a process that enables an
international firm to evaluate and continuously improve individuals, subsidiary unit, and corporate
performance, against clearly defined, preset goals and targets. An expatriate's
performance needs to be assessed to effect his or her promotions, assess training and development
needs, and introduce pay rises.
Performance Management of International Assignees
A CONTEXTUAL MODEL OF EXPATRIATE PERFORMANCE MANAGEMENT
Tahvanainen has taken a grounded theory approach and qualitative analysis.
Model illustrates how performance valuation is both an outcome of the company strategies and goals and an
important source of information on which other personnel-related activities, such as training and
development and performance-related payare based

Third and host country employees
Performance appraisal is a method of evaluating the behaviour of employees in the work spot,
normally including both the quantitative and qualitative aspect of job performance.
Appraisal of expatriate third and host country employees
PERFORMANCE CRITERIA
Basis for performance criteria:
1. Hard goals
2. Soft goals
3. Contextual goals
CONDUCTING OF PERFORMANCE APPRAISAL
➢ Subsidiary managers tend to assess according to subsidiary performance.
➢ Appraisal for other employees is likely to be conducted by subsidiary's chief.
➢ Multiple ra0ters are sometimes used in the domestic context.
➢ Virtual assignment situation
Appraisal of third country employees: TCN role conception

Appraisal of HCNs:
• The practice itself confronts the issue of cultural applicability

• May be necessary to use local staff and a customized form
• Level of position involved is an important consideration

HCN role conception
Issues and challenges in international performance management
1. Whole versus part
2. Non-comparable data
3. Volatility of the global environment
4. Separation by time and distance
5. Variable levels of maturity
Whole Vs Part
Good of whole Vs Subsidiary‘s short term performance
Is it a purely competitive Strategy?
Is it a joint venture to establish new market
Non-comparable data

⚫ Data from a subsidiary may neither comparable nor interpretable
⚫ Strikes
⚫ Local labor laws
⚫ Accounting standards
Volatility of the global environment
⚫ Long term goals need to be flexible due to volatility
⚫ Collapse of soviet union
⚫ Gulf war
⚫ European union
⚫ Chinese reforms
Separation by time and distance
⚫ Physical distance
⚫ Time zone differences
⚫ Frequency of contact between headquarters and local unit and cost of reporting system
⚫ Despite of e-connectivity, not effective as face-to-face
⚫ Problems may be more in underdeveloped
Control and performance management
⚫ Performance management is part of the multinational‘s control system
⚫ Performance targets, for example, are part of formal control
⚫ Performance management contributes to shaping corporate culture
Country specific performance management practices:
Based on Hofstede‘s 5 dimensional model of culture and value systems
Australia. The attributes of the institutional structure that define the Australian performance
management effort involve at least five elements.
First, is the structure of the Parliament, although often described as a Westminster parliamentary
system, the presence of a vigorous and independent upper house – the Senate – means that the
Prime
Minister is often thwarted by this element of a bicameral system. This limits the ability of this
individual to speak for the entire government.
Second, the Australian executive has to acknowledge that there are separate states, some of which
are dominated by political parties in opposition to the parties in power at the national level. There
are times when attempts to act as if the nation was a unitarysystem do not extend beyond a
rhetorical posture.
Third, despite its relatively small size, the Australian national government contains a widevariety
of programs with quite different histories, political constituencies, and problems. Attempts to treat
the entire Commonwealth government as if marched in lock step are rarely successful.
Four, as a result of fiscal and management changes over the past 25 years, a number of programs
that had been operated by public entities have been contracted out.
In these instances, while the government has the ability to establish contractual19relationships
with non-government entities, in some significant instances they have limited ability to enforce
specific performance requirements.
Finally, the Australian political party system is characterized by strong and independent political
factions. The three main political parties contain very different perspectives on a number of
policies and programs. Two of these parties have been in a long-time coalition and are now in
power.
New Zealand. There are four elements that should be emphasized to understand the institutions
and context of New Zealand‘s performance management activities.
First, the formal political system is centralized and (despite efforts at administrative
decentralization) the system is run from the national capital. Related to this is the reality that the
country is very small.
INDIA
The system of confidential reports about the performance of government servants is a means to
an end, and not an end in itself. The end or ultimate goal is to optimize the achievement of
governmental policies and programmes through optimization of the development of the
government servant. The performance of every Government servant is assessed annually through
his/her Confidential Report, which is an important document providing the basic and vital inputs
for assessing the performance of the

Government servant and his/her suitability for his/her further advancement in his/her career on
occasions like confirmation, promotion, crossing of Efficiency Bar (EB), selection for deputation,
selection for foreign assignment etc. Performance appraisal through confidential reports is tool
for human resource development in order to enable a Government servant torealize his/her
true potential. It is not a fault-finding process, but a development one.
The system of confidential reports as it exists in the Indian Civil Service is based on the old
bureaucratic pattern of the colonial days, notwithstanding the fact that with the passage of time
some significant changes have been introduced in it, some of them on the lines of modern
management thinking. However, traditionally governance structures in India are characterized by
rule based approaches. The focus of the civil services in India is on process regulation; compliance
with centrally prescribed standards and rules; in other words, how things should be done and how
inputs should be aligned. With such focus on processes, systems in government are oriented
towards input usage how much resources, staff and facilities are deployed in a scheme, programme
or project and whether such deployment is in accordance with rules and regulations. Thus, the
main performance measure is the amount of money spent and the success of the schemes,
programmes and projects is generally evaluated in terms of the inputs consumed.However, broadly
the system still operates as a tool of control and hardly of development (Gov, 2011).
In India, performance of the bureaucracy depends, to a great extent, on its relations with their
political masters; i.e. the politicians/ministers. Bureaucracy in India is accountable to the ministers
in charge of the department, but in practice, the accountability is vague and of a generalized nature.
Since there is no system of ex ante specification of accountability, therelationship between
the ministers and the bureaucrats is essentially issue-sensitive and bureaucrats deal with the
ministers as the issues present themselves. The role of the senior bureaucrat is to advise the
ministers about the long-term social pay off of any proposed policies so that these are not
determined by short-term political priorities. The accountability relationship can be anything from
all-pervasive to minimalistic and it is left to the incumbent minister to interpret it in a manner that
is most convenient to him/her. This leads to either collusiverelationship or to discord between the
two, both of which can adversely affect the performance ofthe bureaucracy.
***** End of Module 4******

MODULE 5: Repatriation
Re-entry and career issues, culture shock, benefits from repatriates, challenges of re-entry,
repatriation process, managing repatriation, designing a successful repatriation programme
International Compensation and International Employment Laws:
International law (also called "employment standards") is the body of rules spanning
public and private international law which concern the rights and duties of employees,
employers,trade unions and governments in regulating the workplace. The International
Employment Organization and the World Trade Organization have been the main international
bodies involved in reform employment markets. The International Monetary Fund and the World
Bank have indirectly driven changes in employment policy by demanding structural adjustment
conditions for receiving loans or grants. Conflict of laws issues arise, determined by national
courts, when people work in more than one country, and supra-national bodies, particularly in the
law of the European Union, has a growing body of rules regarding employment rights.
Labour Clauses (Public Contracts) Convention, 1949 (No. 94) : Aims at ensuring respect
for minimum labour standards in the execution of public contracts.
Protection of Wages Convention, 1949 (No. 95) :Wages shall be paid in legal tender at
regular intervals; in cases where partial payment of wages is in kind, the value of such
allowances should be fair and reasonable. Workers shall be free to dispose of their wages
as they choose. In cases of employer insolvency, wages shall enjoy a priority in the
distribution of liquidated assets.
Minimum Wage Fixing Convention, 1970 (No. 131) :Requires ratifying states to establish
a minimum wage fixing machinery capable of determining and periodically reviewing and
adjusting minimum wage rates having the force of law.
Protection of Workers' Claims (Employer's Insolvency) Convention, 1992 (No. 173):
Provides for the protection of wage claims in insolvency and bankruptcy by means of a
privilege or through a guarantee institution.
What do you mean by repatriation?

The act of sending or bringing someone, or sometimes money or other property, back to the country that
he, she, or it came from: Repatriation of refugees is essential to rebuilding the country. Foreign investors
face no limits on repatriation of profits.
Repatriate training
Repatriation generally refers to the termination of the overseas assignment and coming back to the home
country or to the country where the HQ is located or to the home subsidiary from where he/she was
expatriated

Repatriation Strategy:

culture shock
“Culture shock” is a normal process of adapting to a new culture. It is a time when a person becomes
aware of the differences and/or conflicts in values and customs between their home culture and the new
culture they are in. Common feelings may be anxiety, confusion, homesickness, and/or anger.
Benefits from repatriates
Repatriation advantages reconsidered

• Access to Knowledge. Ongoing access to host-unit knowledge that may benefit the individual
repatriate.
• Transfer of Knowledge. Transfer of host-unit knowledge to colleagues in the repatriate's new
position, which may benefit the organization.
How repatriates are a source of competitive advantage?
• Repatriates return with highly-relevant global knowledge, new networks that significantly enhance
their ability to get things done and connect domestic to foreign workers, a more global mindset, and
new perspectives and competencies that should make the home company more competitive.

Challenges of re-entry
Reentry involves similar challenges. Reestablishing intimacy with loved ones and bonds with children,
family, and friends can be difficult. One's previous roles in various social networks may have been clear-
cut, but now no longer are. Finding gainful employment and stable housing may be challenging.
Repatriation process
Repatriation is a process that occurs when people return to their home country after living, visiting, or
working abroad.
Repatriation is not a one-time event, but a cycle that involves four phases: preparation, physical relocation,
transition, and readjustment. Each phase has its own emotional, cultural, and professional implications for the
expatriate and their family.

Managing repatriation
Repatriation is a major issue for organizations and a fundamental part of the overall assignment process,
yet many companies neglect this process, in comparison to the effort spent on pre-assignment
preparation. Companies should regularly reevaluate mobility policies to help retain and use newly-
acquired skills and knowledge and re-integrate the assignees without any adverse effect on performance.
Tips to succeed
1. Start the process early enough. ...
2. Prepare repatriation during the assignment. ...
3. Treat repatriation like an expatriation. ...
4. Facilitate reintegration in the home country workforce. ...
5. Leverage returning assignees' knowledge. ...
6. Beware of false success.
Designing a successful repatriation programme
Elements of a successful repatriation program

1. Educate and engage others. It sounds simple, but a personal thank you and meeting with senior
leadership at the company can go a long way to making the expat feel valued and welcomed back
home. ...
2. Compensation. ...
3. Career development. ...
4. Ongoing support. ...
5. Families. ...
6. Continuous improvement.

MODULE 6
An overview of HRM in USA, UK, Japan, West Germany, China & India,
innovative management techniques and their influences. Social responsibility and global
business ethics and International HRmanagers, future of GHRM.
International Workforce
Multiculturalism describes the existence, acceptance, or promotion of multiple cultural traditions

within a single jurisdiction, usually considered in terms of the culture associated with an ethnic
group. This can happen when a jurisdiction is created or expanded by amalgamating areas with
two or more different cultures (e.g. French Canada and English Canada) or through immigration
from different jurisdictions around the world (e.g. Australia, United States, United Kingdom, and
many other countries).
Multicultural ideologies and policies vary widely,ranging from the advocacy of equal respect to
the various cultures in a society, to a policy of promoting the maintenance of cultural diversity, to
policies in which people of various ethnic and religious groups are addressed by the authorities as
defined by the group to which they belong.
Multiculturalism that promotes maintaining the distinctiveness of multiple cultures is often
contrasted to other settlement policies such associal integration, cultural assimilation and racial
segregation. Multiculturalism has been described as a "salad bowl" and "cultural mosaic".
Workplace diversity refers to the variety of differences between people in an organization.
That sounds simple, but diversity encompasses race, gender, ethnic group, age, personality,
cognitive style, tenure, organizational function, education, background and more.
Diversity not only involves how people perceive themselves, but how they perceive others. Those
perceptions affect their interactions. For a wide assortment of employees to function effectively as
an organization, human resource professionals need to deal effectively with issues such as
communication, adaptability and change. Diversity will increase significantly in the coming years.
Successful organizations recognize the need for immediate action and are ready and willing to
spend resources on managing diversity in the workplace now.
Benefits of Workplace Diversity
An organization‘s success and competitiveness depends upon its ability to embrace diversity and
realize the benefits. When organizations actively assess their handling of workplace diversity
issues, develop and implement diversity plans, multiple benefits are reported such as:

Increased adaptability
Organizations employing a diverse workforce can supply a greater variety of solutions to problems
in service, sourcing, and allocation of resources. Employees from diverse backgrounds bring
individual talents and experiences in suggesting ideas that are flexible in adapting to fluctuating
markets and customer demands.

Innovative management techniques and their influences
What are innovative management techniques?
Innovation management, or an innovation management system, is the process of managing new ideas,
from ideation to taking action and making them become a reality. This approach has four distinct
steps: Generating – Brainstorming and employee input to uncover hidden concepts.
Social responsibility and global business ethics and International HRmanagers
The ethics and corporate social responsibility discipline deals with organizational and personal values
and their expression in business decision-making and behavior. Ethics and sustainability are different
but related areas of practice that are gaining in significance for the 21st-century employer.
Future of GHRM.
What are the future challenges of international human resource management?

Differences in time and culture can bring about many international HR challenges, such as breaking
local employment laws, creating a healthy work environment, administering ethical HR policies,
managing people globally, and training international talent.
****** End of Module 6*****

Question Bank
1. Nature and scope of GHRM

2. Domestic versus Global HRM
3. Types of global business
4. Globalization and HRM
5 . Impact of national culture on HRM and employee management issues
6. Multi- culturalism
7. HRM in Cross-Border Mergers & Acquisitions
8. Explain Convergence Theory.
9. Describe Marxist theory.
10. Explain cultural approach.
11. Explain the importance of Hofstede model and Trompennar Model.
12. What is Confucian Dynamism? Explain.
13. Explain any International Model of IHRM (International HRM).
14. Describe Pooles adaptation of the Harvard Model.
15. Explain the techniques and sources of global recruitment and selection.
16. Describe the various global compensation factors, components, approaches and cultural impact on
compensation.
17. Give details about the role of expatriate training and pre- departure training.
18. Define and explain the meaning of International Performance management, sand its significance.
19. Describe the concerns/challenges of performance management and also setting individual
performance goals.
20. List and explain the benefits from repatriates to an organisation.
21. Identify and explain the various challenges of re-entry,repatriation process and culture shock.
22. Describe an overview of HRM in USA, UK, Japan, West Germany, China & India
23. Explain innovative management techniques and their influences.

Module 1
1. Explain Nature and scope of GHRM.

2. Differentiate domestic versus Global HRM.
3. Explain different types of global business.
4. Describe the relationship between Globalization and HRM.
5. Highlight the Impact of national culture on HRM and employee management issues.
6. Explain the importance of multiculturalism in Global Business.
7. Describe the importance of HRM in Cross-Border Mergers & Acquisitions.
8. Highlight the Role of HR Departments in MNCs.
9. List the Competencies for International HR Managers.
Module 2
1. Explain the various approaches to the study of GHRM.

2 . Describe the Convergence theory.
3. Explain Marxist theory.
4 . Highlight the cultural approach on GHRM.
5 . Describe Hofstede model and Trompennar Model.
6 . What is Confucian Dynamism? Explain .
7 . Emphasize on Andre Lawrent, contributions.
8. Explain different Models of International HRM.
9. Describe Pooles adaptation of the Harvard Model.
10. Explain the Brewster and Bournois Model.
11. Highlight on the Organizational structure and design in global organizations.
Module 3
1. Explain policies and practices of GHRM.

2. Describe the techniques and sources of global international staffing.
3. Explain in Detail the Global Recruitment selection process.
4. List down the global compensation factors and explain them.
5. Identify the various components of compensation and explain.
6. Enlist the various approaches of compensation.
7. Describe the cultural impact on compensation.
8. Enlist the global compensation practices.
9. Identify the recent trends in global staffing and explain.
10. What constitutes expatriates’ failures & how to minimize expatriates’ failures?

Module 4
1. Explain the role of expatriate training and pre- departure training.

2. Describe the various steps for the development of staff who are taking up international assignments.
3. How to conduct Performance appraisal for expatriates?
4. Explain how to give and receive feedback from expatriates?
5. Identify the various challenges in managing performance of expatriates and explain.
6. Identify specific management practices in various countries.
Module 5
1. What do you mean by Re-entry and career issues of expatriates?

2. What do you mean by culture shock?
3. Describe the meaning of reverse cultural shock?
4. Enlist the benefits from repatriates.
5. Identify the challenges of re-entry for expatriates.
6. Explain the repatriation process.
7. How to manage repatriation? Explain.
8. How to design a successful repatriation programme? Explain.
Module 6
1. Focus on the overview of HRM in USA, UK, Japan, West Germany, China & India.
2. Describe the innovative management techniques and their influences on Global HRM.
3. Explain the meaning of social responsibility and global business ethics.
4. Describe how International HR managers need to follow social responsibility and Global Business
Ethics.
5. Discuss on the future of GHRM.

Case study 1
Microsoft Corporation (Microsoft), the multinational computer technology company, has undergone change
management since early 2014, when Satya Nadella became CEO of the company. He was the third leader to
take the helm in the software behemoth’s 40-year history, following founder Bill Gates and Steve Ballmer.
Since its inception, Microsoft had been appreciated for its innovation and employee-friendly HR practices.
However, during the late 1990s, as the company was growing rapidly in size, some of the popular elements of
its corporate culture gave way to a rigid culture marked by unhealthy competition, bureaucracy, and a lack of
innovative thinking. When Nadella took over the reins of the company, Microsoft had fallen behind companies
such as Apple, Inc. in the mobile-phone market. Not only that, industry experts were of the opinion that, the
company had missed almost every significant technology trend of the 2000s – be it mobile phones, or search
engines, or social networking – while letting its main source of revenue, Windows, stagnate. Microsoft
generated a licensing fee for Windows on desktops and laptops sold, but consumers had started replacing PCs
with iPhones and Android devices.
Faced with the challenge of executing a strategy that would transform the company from a software behemoth
to a devices and service company, Nadella pushed for a cultural shift at Microsoft. He along with newly-
appointed Chief People Officer, Kathleen Hogan, drove change to incorporate empathy and a growth mindset
at Microsoft. This was supported through complementing HR practices. Analysts felt that a cultural shift of
such scale had never been seen before in a company the size of Microsoft, nor had they ever seen a company
that had struggled so hard recover so well.
Questions
1. Understand the issues and challenges in change management, and in managing a cultural
transformation between strategy and culture.
2. Evaluate the various aspects of Microsoft’s culture and understand how it can lead to building new
strategic capabilities and be a source of competitive advantage.
3. Understand the leadership and management style of Satya Nadella.
4. Evaluate the challenges Microsoft could face going forward and explore strategies it can adopt to
overcome them.

Case study 2
Unionization Saga at Starbucks
The case describes the unionization movement at Starbucks in the US. The case touches upon the initial
response of the company to the unionization campaign. The case also describes unionization trends in the
food & beverage industry in the US. Next, the case describes in detail the grievances of employees around
labor practices at Starbucks. The case then focuses on Starbucks’ response through its interim CEO Howard
Schultz (Schultz) who was appointed for the third time to manage the unionization efforts. In his earlier
stints, Schultz had a very clear anti-union approach and convinced the workers through various benefits to
avoid joining unions. However, workers at Starbucks United alleged that the company’s offer of enhanced
benefits was in response to the union drive.
Since the workers were not ready to trust the coffee chain’s intention unlike earlier, Laxman Narasimhan,
who joined in October 2022 and would take charge in April 2023 as CEO, would have to quickly take a
different approach to manage the situation and avoid dilution of the brand.
Questions
1. Identify the reasons employees join worker unions while employers resist them.
2. Examine the phases, challenges and norms that govern the unionization process.
3. Recognize the importance of collective bargaining.
4. Assess how company leadership needs to respond to the labor movement.

Case study 3
Air India compensation plan
The case ‘Air India’s New Compensation Plan: Can It Help Revive Employee Morale?’ describes Air India’s
new compensation plan for it’s pilots and cabin crew as part of Vihaan.AI, Air India’s five-year
transformation plan put in place after the Tata Group acquired the airline in January 2022.
The case first touches upon the company’s business revival plan. The long-term objective of Vihaan.AI was
to increase Air India’s market share to about 30 percent in the domestic market and increase the operations
on international routes.
The case then discusses the new compensation plan and allowances for flying crew, trainee pilots, first
officers, captains, senior first officers, commanders and senior commanders. The company also made
changes to the compensation structure for its cabin crew including trainee cabin crew, senior cabin crew,
executive cabin crew and permanent cabin executives.
Through the new compensation plan, Air India aimed to retain existing staff and hire new talent.
The case also focuses on the dissatisfaction over the allowances component of the revised structure. , Air
India employees alleged that the new pay structure would not lead to any effective change in their pay. The
case then focuses on Air India’s response to the representation made by the Indian Commercial Pilots
Association (ICPA) and the Indian Pilots Guild (IPG).
The case ends with Air India’s announcement of Vihaan.AI second phase of the transformation plan. At this
stage, it was important for Air India to remove the discontent among the existing employees since their
loyalty and trust was critical for the success of the Vihaan.AI transformation plan. This issue could also
snowball to the ground staff of the airline.
Issues
The case is structured to achieve the following teaching objectives:
• Understand the need to align HR policies with strategic objectives.

• Examine the role of trade unions in an organization.
• Identify the challenges that arise when implementing a new compensation plan.
• Recognize the relation between compensation and motivation.
• Describe effective handling of employee grievances.

Case study 4
Disney Parks: Aligning New-Hire Training with DEI
Abstract
The case describes Disney’s Four Keys of Safety, Courtesy, Show, and Efficiency that had formed the core
set of values for the company for over 60 years. Every aspect of training and operations was aligned to the
four keys so that it would make it easy for Cast Members to understand and evaluate what they should do in
different situations and provide the best guest service possible at all times. Next, the case describes in detail
the various employee training programs and the post-training evaluation used.
The case then looks at the various changes Disney had to make in its training programs after the addition of
the fifth (inclusion) key. To better reflect the inclusion key, the company made changes to its Disney Look
guidelines, and also put in place additional training modules on antiracism. However, its efforts to change its
culture through the company’s training programs and thereby promote an inclusive environment, earned it
criticism from various quarters, including from its own employees. The case ends with Disney’s hope that it
would continue to provide the best of its guest service by making employees active participants in the
enhanced and effective training and development programs.
Issues
• Examine the importance of educating new employees about company culture

• Recognize the need for employee cross-training in large organizations
• Describe the importance of evaluating corporate training effectiveness
• Assess the need to quickly align training programs with changes in strategic vision
• Examine how a new anti-racism training program is implemented

Case study 5
Can Google`s Overhauled Employee Performance Review System Reduce Employee Turnover?
The caselet talks about the reasons for US-based multinational technology company Google LLC bringing
about a change in its employee performance review system. The case provides a glimpse into the reasons that
led Google to drop out of the list of Best Places to Work somewhere in the mid-2010s after having been on the
list for quite a few years. The case documents how employee dissatisfaction at Google had soared further in
the post-pandemic world, leading to a rise in employee turnover. The case provides key highlights from
Google’s employee survey – The Googlegeist Survey 2021 – which revealed the various HR areas that were a
bone of contention for the company’s employees. The case then mentions the various aspects of Google’s new
employee review system called the Googler Reviews and Development (GRAD) that was launched in May
2022. Unlike the earlier system, GRAD was expected to focus on employee development, learning, and
progression throughout the year. So, can GRAD stem employee dissatisfaction at Google and once again make
it one of the most coveted companies to work for?
Issues
• Understand the issues and challenges in employee performance appraisal and performance
management.
• Recognize the objectives of performance appraisal.
• Scrutinize the HR strategy behind the implementation of a particular appraisal method.
• Analyze the performance appraisal process, especially the modern methods.
• Examine the advantages and pitfalls of a performance appraisal process.

Case study 6
Recruitment Woes at Leo Burnett
ABSTRACT
This case is about the recruitment process at Leo Burnett. Leo Burnett is one of the leading advertising
agencies worldwide and has also secured a good position in the Indian advertising industry. The case
describes in depth the recruitment process at Leo Burnett and the factors that are considered while hiring any
candidate. The case deals with the declining number of applicants at Leo Burnett for the vacancies created.
As the company was experiencing high growth, the unfilled vacancies could put additional pressure on the
existing team. Therefore, after an employee survey, the HR team identified factors that could have created
the problem. The challenge before the team was how to improve the recruitment strategy and make the
recruitment process at Leo Burnett more effective.
Issues
1. The case is structured to achieve the following teaching objectives:
2. To understand the issues and challenges in attracting talent.
3. To understand how significant the recruitment process is for talent acquisition in any firm.
4. To study and identify the factors which affect the recruitment process at Leo Burnett.
5. To explore how the recruitment process in a company can be made more effective.

Case study 7
Cultural Shift at Microsoft Corporation
Microsoft Corporation (Microsoft), the multinational computer technology company, has undergone change
management since early 2014, when Satya Nadella became CEO of the company. He was the third leader to
take the helm in the software behemoth’s 40-year history, following founder Bill Gates and Steve Ballmer.
Since its inception, Microsoft had been appreciated for its innovation and employee-friendly HR practices.
However, during the late 1990s, as the company was growing rapidly in size, some of the popular elements
of its corporate culture gave way to a rigid culture marked by unhealthy competition, bureaucracy, and a lack
of innovative thinking. When Nadella took over the reins of the company, Microsoft had fallen behind
companies such as Apple, Inc. in the mobile-phone market. Not only that, industry experts were of the
opinion that, the company had missed almost every significant technology trend of the 2000s – be it mobile
phones, or search engines, or social networking – while letting its main source of revenue, Windows,
stagnate. Microsoft generated a licensing fee for Windows on desktops and laptops sold, but consumers had
started replacing PCs with iPhones and Android devices.
Faced with the challenge of executing a strategy that would transform the company from a software
behemoth to a devices and service company, Nadella pushed for a cultural shift at Microsoft. He along with
newly-appointed Chief People Officer, Kathleen Hogan, drove change to incorporate empathy and a growth
mindset at Microsoft. This was supported through complementing HR practices. Analysts felt that a cultural
shift of such scale had never been seen before in a company the size of Microsoft, nor had they ever seen a
company that had struggled so hard recover so well.
Questions
1. Understand the issues and challenges in change management, and in managing a cultural
transformation between strategy and culture.
2. Evaluate the various aspects of Microsoft’s culture and understand how it can lead to building new
strategic capabilities and be a source of competitive advantage.
3. Understand the leadership and management style of Satya Nadella.
4. Evaluate the challenges Microsoft could face going forward, and explore strategies it can adopt to
overcome them.

Case study 8
Manpower Trimming Strategy at Wipro: Replacing Human Employees with Software Robots
Abstract
This case discusses the potential for the majority of job functions being automated by organizations in the
near future based on the growing popularity of such disruptive technology, especially in the IT industry of
India with a special focus on Wipro Computers, India’s third largest IT firm. In late 2014, the Wipro
management decided to reduce one-third of its workforce and replace them with automation solutions such as
its in-house product FixOmatic for routine non-complex tasks.
The case highlights the practical repercussions of replacing traditionally human managed jobs with Artificial
Intelligence (AI) based software robots at one of the most throbbing job destinations for Indian engineers.
Issues
1. To discuss the manpower planning process of HR managers
2. To understand the significance of automation technology for the future of work
3. To discuss the challenges for HR managers jn managing the changing nature of workforce
4. To discuss potential strategies that HR managers may opt for to reduce the career uncertainties of
employees whose jobs will be lost due to automation.

Case study 9
Siemens Designs Large-scale Rewards & Recognition Programs to Embed an Ownership Culture among
Employees
Abstract
The case ‘Siemens Designs Large-scale Rewards & Recognition Programs to Embed an Ownership Culture
among Employees’ describes the company-wide R&R program of Siemens that helped it balance its business
autonomy due to the decentralized organizational structure with higher corporate-level visibility and control
requirements. The R&R programs ‘Champions’ and ‘You Answered’ helped Siemens AG reinforce core
values such as responsibility, innovation, and excellence among employees in its business units in the US and
the UK.
The case touches upon the corporate plan ‘Vision 2020’ put in place by Siemens AG in 2015 to drive
performance through profitable growth and significant investments in innovation. The case then describes the
core values of the two R&R programs, the program objectives, the program design, and how it was
implemented and aligned to the corporate Vision 2020 are described in detail.
In January 2022, Siemens UK won the award for ‘Most Motivational Benefits’ as part of the 2021 Employee
Benefits Awards program. The case ends with Siemens AG’s further extension of the Vision 2020 to Vision
2020+.
Issues
1. Describe the need for a company-wide R&R program that aligns with the organization’s strategic and
tactical objectives.
2. Recognize the benefits of large scale peer-to peer R&R programs.
3. Examine the various steps in designing and implementing large scale R&R programs that align with
company values and improve cross-functional collaboration.

Case study 10
Workforce Diversity at Nordstrom
Nordstrom was well-known in American corporate circles for its commitment to diversity. The company not
only made a conscious effort to recruit a diverse workforce, but it also extended its diversity initiative to
outsiders who were associated with the company, through its third party diversity initiatives.
This case discusses Nordstrom's diversity initiatives. It describes how the company partnered with several
organizations to ensure that it had access to a diverse pool of candidates for its recruitment efforts. It also
provides information on the culture at and policies of Nordstrom that ensured that diversity was promoted in
all parts of the organization.
The case also discusses the ways in which Nordstrom extended its diversity initiatives to its suppliers and
consumers through some of its programs. The case concludes with a commentary on the extent to which the
diversity initiatives were successful at the company, in light of the lawsuits filed by some disabled employees
against the discrimination they faced.
Issues:
1. To understand the need for and importance of diversity in organizations

2. To study the implementation of diversity at a large American retail store
3. To analyze the extent to which diversity initiatives can be implemented at large companies.
4. To understand the challenges in implementing diversity policies at large companies, and issues
companies can expect to face when creating and maintaining an image of diversity.

Case study 11
The Yemen Crisis: Will the Conflict ever End?
The case discusses the civil war in Yemen which had started in 2014 between the Houthis (also known as
Ansar Allah, meaning ‘Champions of God’) and the Yemeni government led by then President Abdrabbuh
Mansur Hadi (Hadi). The war started after the demand by the Houthis to reduce fuel prices and the formation
of a new government failed with the Yemeni government. Consequently, the Houthis occupied the
Presidential palace forcing Hadi to step down. Hadi then fled to Aden, the temporary capital of Yemen, and
finally to Saudi Arabia. In March 2015, a Saudi-led coalition of Arab states supported by the US intelligence,
attacked the Houthis to restore the internationally recognized Yemini government. The attack led to a full-
fledged war, killing 13 civilians in Yemen, in March 2015.
The war had a devastating impact on the Yemenis as the Saudi-led coalition on one hand, and the Houthis on
the other, bombed crucial infrastructure such as farmlands, water treatment facilities, healthcare facilities
etc., creating a man-made humanitarian crisis in Yemen with people having no access to food. Over the
years, the United Nations made several to resolve the conflict but failed to negotiate with the Houthis. The
Houthis continued to launch missiles on the UAE and the Saudi Arabia as both the countries supported the
internationally recognized Yemeni government.
In April 2022, Hans Grundberg (Grundberg) United Nations Special Envoy of the Secretary-General for
Yemen, stated that the Houthis and the Yemeni government entered into a truce for two months. Under the
agreement, both the parties mutually agreed to halt offensive military operations in the country. The truce
went for six months and expired on October 2, 2022. The United Nations believed that there was some hope
to resolve the conflict in Yemen had the truce been extended, however, the Houthis demand for salaries to be
paid to their military and security personnel led to calling off the truce by both the parties.
The US Special Envoy for Yemen Tim Lenderking expressed concerns over failure by the United Nations to
extend the truce as he believed that the humanitarian situation would further worsen in Yemen and funding
was inadequate to cater to the needs of the civilians.
Going forward, the United Nations faced the challenge to reach a political settlement in Yemen. In addition
to this, according to the United Nations Office for the Coordination of Humanitarian Affairs several actions
were needed by the international community to strengthen the economy of Yemen – the worsening exchange
rate was prohibiting people from affording food since majority of the food was imported in Yemen.
Issues:The case is structured to achieve the following teaching objectives:
• Analyze the factors that lead to conflict in countries.

• Understand the impact of a conflict on the civilians and the country’s economy.
• Discuss how the international community can play a role in reaching a political settlement in conflict-
affected countries.

Case study 12
Success at What Cost? - A Case Study in Managerial Ethics & Compliance
This case study is about Super Drugz, a mid-sized pharmaceutical company in India. Initially starting off as
an entrepreneurial venture, the company had been put in the hands of a professional management group. The
new team strove to cultivate a performance culture through strong results-based controls and weeding out
non-performers.
However, a whistle-blower brought out into the open serious ethical lapses in the company. Shortly after
joining as an Area Manager in the country's North Eastern Region, the person found that the team (including
his seniors) was adopting unethical/illegal means to meet the high sales targets.
Faced with the dilemma of whether to conform to the team or comply with law, he chose the later. Now the
founder of the company had to put in place mechanisms to ensure that everyone in the company complied
with the company's code of ethics and the law of the land.
Issues:
1. Understand the issue in managerial ethics and challenges in ensuring compliance.

2. Understand the factors that influence ethical behavior.
3. Understand the mechanisms for ethical control and compliance.
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Global Human Resource Management 22MB BG HR5

GLOBAL HUMAN RESOURCE MANAGEMENT

MODULE 1: Introduction to Global HRM

MODULE 2: Theoretical framework

MODULE 3: International Staffing

MODULE 4: Global Management Development

Srinivas University Page 1

Practice based learning:

MODULE 6: Global HRM practices

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MODULE 1: Introduction to Global HRM

What are the five main functions of global HRM?

What is the nature of global HRM?

What is the nature and scope of HRM?

What is the scope of global HRM?

1. Global Human Resource Management is the procurement, allocation, utilization, and

⚫ The national or country categories involved.

– The host country where subsidiary country may be located.

– The home country where the firm is headquartered.

⚫ The three categories of employees

– Host country nationals (HCNs)

– Parent country nationals (PCNs)

– Third country nationals (TCNs)

3. IHRM is defined as interaction between the three group of factors-Types of employees,

Srinivas University Page 4

The drivers of internationalization of business

Falling Barriers to Trade and Investment:

Technological changes have achieved advances in communication, information processing, and

Srinivas University Page 5

The different setting of International Human Resource Management.

⚫ Stage 2: Export Operations

Stage 4: Multinational Operations

⚫ Much more prevalent international dispersion of production and service provision

Stage 5: Transnational Operations

⚫ Little allegiance to the firm‘s country of origin.

⚫ Large-scale decentralization of decision-making.

⚫ Dominant role of expatriates is removed.

What is difference between domestic and global HRM?

Difference between domestic and international HRM

International taxation, international relocation and orientation, administrative services for

The need for broader perspective

1. More involvement in employee‘s personal life

2. Changes in emphasis as the workforce mix of PCNs and HCNs varies.

4. Broader external influences- Government, State of economy, generally accepted practices

Srinivas University Page 7

8. Greater need for global mindset

9. Balancing contradictions and live with conflicts

10. Orientation towards continuous change

14. The cultural environment

The importance of cultural awareness

⚫ Multidomestic industry – Competition in each country is essentially independent of

– Role of HR will be more of domestic in structure and orientation.

– Support primary activities in each domestic market to achieve competitive

⚫ Global industry- Competitive position in one country is significantly influenced by its

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Reliance of the multinational on its home-country domestic market

⚫ Increasingly complex environment

⚫ Need of right people

⚫ Need of good IHRM practices