Evaluating the Need for International Human Resource Management

The internationalization of business makes International Individuals Reference Management (IHRM) a valuable tool to be able to grasp a much better idea of the globalization of business. It can help business firms and international companies to obtain concrete processes that will assist entrepreneurs to comprehend variable and distinctive institutional and social differences existing in an corporation. Briscoe and Schuler (1995) identify the concept of national identities of corporate firms as becoming obsolete thus there's a continuing need to understand the globalization procedure for businesses.

There is a big difference between management of domestic framework from global management with variance of the difficulties experienced by the management with broader opportunity of cultural dissimilarities and boundary spanning (Stahl & Bjorkman, 2006). This is actually the obstacle that business firms need to face as they endeavor in the highly internationally competitive obstacle of globalization of business. This article will discuss institutional and ethnical differences concerning IHRM and the idea because of its development and techniques in conference these different challenging ideas in human source management pertaining to internationalization of business by multi-national companies.

There are attractive differences between domestic and international real human source management. Globalization of business requires IHRM to adopt appropriate human learning resource policies and knowledge management in awareness to the cultural differences which could arise on the procedure. Thus, this essay will also deliberate the dissimilarities that will commonly influence a company's management system in alignment to what they require to be able to adjust to internationalization and globalization of business.


IHRM is a very important tool among multi-national companies (MNC) due to the globalization of business. Du Plessis, Venter, and Prabhudev (n. d. ) identify its impact in the HRM regulations, standardization process, recruitment, reimbursement and other methods involving the global workforce. While globalization is a matter of attracting foreign investment while producing international alliance to penetrate new market (Perkins & Shortland, 2006), it gives pressure for the need to organizational change. The more technical difference between local HRM and International HRM lies on the several cultures of employees of varied nationalities (Aswathappa & Dash, 2008) and IHRM thus assist in a company means of strengthening their insurance policies in HRM while defining a broader point of view of adapting external influences in the work performance of employees from various countries.

IHRM can be a route for formal and casual human resource-related methods (Ferris, Rosen, Barnum, 1995) that will help an organization improve their manager's capability to thrust towards global competitiveness by developing activities of finding the right employees, job planning, position positioning for employment, motivating development of working skills and rewarding employees for their contribution to the business. It cannot be more than overemphasize the valuable role of individual resource in virtually any organization being truly a valuable property that undertakes complex and challenging duties that may expand beyond the usual personnel management to people management (Monye, 1997). Sparrow, Brewster, and Harris (2004) signify the institutional dissimilarities among countries impacting on IHRM that are normal in the practice of lobbying and modifying to governmental activities on equivalent opportunities for legislations, and tripartite institutions with trade unions. The worthiness systems and values of employees rest on their social differences which may overlap among nationalities that happen to be among a few of the factors that the IHRM should treat. IHRM includes the international context of transnational requirements involving the activities such as recruitment, performance and compensation system, and the management of diverse workforces (Banfield and Kay, 2008). This are additional tasks to the home HRM insurance policies used to be restricted only within the spot or country which they need to broaden in order to become more competitively gain. Traditional workers management requires certain functions such as coping with recruitment, selecting, training, reimbursement, performance appraisal, and promotion processes (Tayeb, 2005). Multi-national companies need to extend their HRM procedures to expatriate employees as they adopt globalization of business and must come in terms with the implication of interacting with varied ethnic variations and legal systems to conform with. Owning a cross-cultural firm is difficult and the principal role of the IHRM is to ensure uniformity in the business (Bhattacharyya, 2010).

Schuler and Jackson (2007) see management of people from various countries to be fundamentally different owing to the variations in the educational system and the legal procedure for employment distinct from every country that influence the process of job system by multi-national companies of their workers. These dissimilarities may promote conflicting issues such as the one cited by Dickmann, Brewster, and Sparrow (2008) on multinational companies of Germany and China engaged on a jv where the anxiety relations between your expatriates and local staff concerning personnel issues finished with a sour connection between your two companies.

Based on the survey reflecting cultural differences generally in most corporations, the organized distinctions among nationalities require vitality distance, collectivism-individualism, uncertainty avoidance, and masculinity-feminity. (Hendry, 1995) This may implicate behavioral problems as culprits to ethnic variations that IHRM more often encounter that have an impact on both the managerial and non-managerial functions of employees like motivation, courage to take chances, social skills and the grade of decision making. Multinational companies need to look at globalization of business in order to target broader market. It really is a survival need in order to keep the business going and become competitive in the market.

Albrecht (2001) identifies global skills as not merely a speciality of business but must form an important part of an enterprise included throughout its businesses. She identifies how managers find this an essential force to determine good management in the individuals resource. You will find significant practices in a variety of countries as traditions in making business. In Japanese culture for instance, establishing group id is vital while in Saudi Arabia, it is not doing immediate business that can be an important initial step in conducting business but taking the necessary steps to develop acquaintance and trust. In other cultures, handshakes play female importance in making business while in some countries the practice of bowing is an indicator of good will. Professionals thus need to employ multinational skills in employing various countries as well as take up a competent IHRM system that will comply with the usual culture and legal systems involved for occupation from various countries.

Sparrow (2009) mentions there are different kinds of international employment and quoting Briscoe and Schuler as expressing that this is of international employees inside the organization continues to expand, he thereby acknowledge that the real human resource division of an organization must understand the growing numbers of expatriate career to become more effective in their regulations. Vance, Vance & Paik (2006) maintain that managers have critical responsibilities to transfer knowledge across borders through effective communication to personnel from various cultures and norms. Communication and ethnical barriers can hamper the progress of multinational companies as it may complicate human relationships of professionals and their subordinates. As Stredwick (2005) places it, no corporation, even small or local in its activities, are immune system in the international dynamics of globalization. This gives a knowledge on the concept of IHRM more valuable to various firms.

IHRM needs to address the adjustable of a reward system in the company. Incentives are means of a firm to catch the attention of a worker's focus on inspire these to work (Pattanayak, 2005). It is the contention of Brewster and Harris (1999) that both cultural and institutional differences result to the result of international compensation system. The national business system also plays a role in thought to the national education and training; employment and tenure; and countrywide cultures as those seen in Europe, Japan, and USA. IHRM usually is faced with complex issues that need to be regarded efficiently. On the list of concerns of multi-national companies need to identify are the immigration regulations as they employ the service of international employees, working permit, medical requirements, and other steps that may necessitate for job. This also requires that the business adopt in their IHRM system training for professionals to know the proper reward system to give to their import employees like the taxes requirements and communal security system procedures (Newlands and Hooper, 2009). The reward system employed through a highly effective IHRM can help the company exert better control, strategic fit and address better some cross-cultural issues affecting employees (Agmon, Drobnick, and School of Southern California. International Business Education and Research Program, 1994) and they also hire a more strict recruitment and selection procedures to qualified employees which come from various countries of different cultures and work tendencies. Sims (2002) recognizes IHRM as relating a broader point of view of engaging managers from the local head office of multi-national companies to execute activities like dealing with issues on international taxation; international relocation; orientation and administrative support to expatriate employees, training, collection of local and international applicants, and hosting governmental relationships with various countries.

The proper selection, recruitment and training methods in IHRM is highly recommended as an efficient intervening factor to the common issues confronting globalization of business that have an effect on human resource management. IHRM usually will involve the management of the recruitment process from the mother or father country of the company where its main office gets the headquarter; the number country of its subsidiary companies: and other countries where in fact the company obtains its labor force (Scullion and Collings 2006). The management needs to adopt a kind of homogeneous recruitment system to find properly skilled employees with the right social behavior in terms of their work responsibilities. This assists bring uniformity of goals and objectives within the company's human resource pushes from various countries for the labor force. While domestic individuals reference and IHRM both involve recruitment responsibilities, professionals of IHRM are viewed to require some higher amount of ethnical sensitivity (Daft, 2008) in conjunction with more efficient communication process expressing the company's goals and targets to various employees of diverse culture and work patterns.


The role of IHRM is quite broader, more complex, and challenging than local human reference management. They involve the procedure of heading beyond the most common workers management system employed in local corporation units. The role of IHRM is vital among multi-national companies where in fact the management are required to address variable concerns regarding the existing institutional and ethnic differences of employing expatriates in the company. IHRM requires internationalizing the requirements of recruitment, selection, training, compensation or pay and pay back scheme, legality of career system according to the national regulations of overseas employees, the establishment of uniform expectations and ethics, as well as the interpersonal responsibility of the business conforming to globalization standards. There can be an extra effort in the real human resource management of the corporation to extend their internal plans in conformity to the international specifications and laws of the countries where their subsidiary companies may be located. But the institutional and social differences are the common issues confronting the IHRM system of a corporation, it is a challenge that most multi-national companies ingest order to boost their competence in training their professionals and professionals in dealing this broader idea of management in the individuals resource aspect of globalization of business.

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