International And Comparative Hrm Routines Business Essay

Human source management is becoming an important concern as more and more firms functioning internationally are in need to develop an understanding on how to use competitively within an international business environment (Dowling & Welch, 2005).

As the global performing field has become more competitive, international companies are obligated to

adopt useful HRM and present more focus to their international than their home operations. Due

to the awareness of the problem, the worried HR must dwelling address the key issues like the impact of

globalization, environmental influences, cultural variations, the domestic HRM guidelines in different

countries and the global workforce involved in the action (Armstrong, 2009).

The aim of this article is to give a clear overview of the main similarities and differences between

domestic and international Individual tool management. The essay will to some extent discuss the

practice of Human reference management at home level and the factors that increase its

complexity at international level. Finally, a summary will be drawn with an research of the research




The steady development of management activity from administration of personnel to strategic

planning of human source, has given a competitive benefits to international companies.

Personnel management targeted more on administrative functions and exactly how to control the

employee alternatively than commit the worker to the business strategic planning process. But

the present Human being tool management system is set up more on the determination of the

staff and involves the staff in the proper planning and development procedure for the

organization. It also stress that organizations should think about their employees as assets than

variable costs (Armstrong, 2009, Torrington et al, 2005).

It is nearly easy to provide a specific and exact definition of Individual resource

management because of the varying and various activities it identifies. One attempt created by Storey

(1995) is "HRM is a unique approach to work and management which seeks to

achieve competitive benefit through the strategic development of a highly committed and

capable labor force using an array of social, structural and personal techniques. " Within the other

hand, Human resource management is also thought as representing two activities. You are the

generic term concerned with the key aims of human being activity, which are the staffing,

performance, change management and administrative aims, and the other activity is the

Human resource approach to carry out the actions mentioned above under the universal term one

(Torrington et al, 2005).

In order to clearly see the commonalities and differences shared by Domestic and International

human learning resource management, identifying the activities which change or advance when HR goes

International is a essential point. To this effect, a module produced by Morgan (1986) is effective. The


module reveals three proportions of International Human being reference management with various

categories of HR activities, countries engaged and employees in International activities. The first

dimension handles the jobs of Human tool management; the procurement, allocation and

utilization of HR which will go further down to detailed activities talked about earlier in this paper under

the 'general term' justification for HRM. The second dimension handles three country categories;

the web host country where in fact the subsidiary is located, home country of the company's headquarter, other

countries that are source of manpower, fund and other inputs. The 3rd dimension is

concerned with three group of employees; Host-country nationals, Parent-country nationals and

Third-country nationals. Thence, according to Morgan (1986), the". . . interplay between these three

dimensions is exactly what define international Individuals reference management" (p. 5).

At this point, it shows that the elements or issues related to International HRM practice are intricate,

higher in amount and also have broader opportunity than those found in Home HRM practice. One sensitive

issue is the staffing policy at international level. You will find three types of international managers,

depending on the nationalities, local (parent or guardian country nationals, PCN), Host country nationals (HCN),

third country nationals(TCN) and international companies would work with managers/employees choosing

from one or blending from the groupings with regards to the company's business plan, technical

competence required for the position, availability of candidates or the company's staffing policy.

Mostly international companies have three staffing policies/strategies.

- Ethnocentric strategy- This approach is when companies use parent or guardian company nationals in high

management areas. Nowadays this approach is very little used as it sometimes appears to limit the

opportunity of other nationalities.


- Polycentric strategy- This process demands the utilization of host country nationals at the subsidiaries,

while at headquarter level parent company nationals contain the high posts. Companies with

Ethnocentric strategy may change to Polycentric strategy when faced with shortcomings of qualified


- Geocentric strategy- This approach has an open door policy, welcoming competent managers

regardless of these nationality. Companies using this plan have the good thing about wide selection

and at exactly the same time create a feeling of diversity and unity among employees (David & Hugh, 2007,

Beardwell & Claydon, 2010).

In another section, the paper will discuss if the HR techniques at the home level can be

implemented at international level and would try to identify the factors that may facilitate or

hamper this technique generally.



The increasing business activity at international level has shown the value of understanding

how Multinational companies can operate proficiently and effectively in the global dimensions. In

general, International Human being resource management entails the internationalizing company in

different techniques such as diverse HR activities than within the house country, better involvement

in employees' private lives, greater risk of contact with the individual and finance engaged, more

external impact from the sponsor country and greater complexity than found at Home HRM level

(Dowling & Welch, 2005). A GLOBAL HR manager must also address the troubles due to

cross cultural variances, global competition, terminology and political dissimilarities when placed at


international level. Apart from the different strength degree of HR activities and proper coordination

of different sections, both Household and International HRM show same major activities of

HRM. Furthermore, an International People resource manager also needs to understand the amount of

'soft or hard' HRM within the home basic and international subsidiaries. Companies with Hard HRM

policy are definitely more business concentrated and apply cost minimization systems while companies that engage

the employee in participation have Delicate HRM insurance policy (Storey, 2007).

In a far more detail and recognized by a diagram Cavusgil et al. (2008, ) explain the challenges an

international manger is ". . . to ensure that the right person is in the right position at the right location

with the right pay. "(p. 549) The factors that makes this activity more difficult is its difficulty in

dealing with various aspects at international level. The diagram below details different factors to

this result.

Fig 1. Adapted from: Cavusgil et al. (2008). International business, Strategy, Management and the new actuality. P. 550 5

The above mentioned six factors will be discussed briefly below;

New human resource responsibility- Broader and diverse activities like International tax

regulation, international relocation and orientation services for expatriates and language

translation services are a few of the actions at international level.

Need for broader international perspective in compensation insurance plan- with a different mix of

international staff training a fair settlement insurance plan is one of the difficulties to be


Greater engagement in the employees personal lives- The business would have to deal with

the personal wellbeing of the expatriate or inpatriate providing out of their house country.

Their housing set up, children education, security, settlement, entertainment and so

other needs would have to be used up and assemble.

Managing the mix of expatriates versus locals- According to company's plan, subsidiaries

may be staffed with a variety of different nationalities and taking care of the balance based on the

required skill and availability of manpower is another big job in the international

employment area.

Greater risk coverage- International staffs are exposed to politics upheavals, kidnapping,

terrorism at international station and could demand compensation deals and security

arrangement. This would challenges companies fiscally and also in supervision level.

External influence of the federal government and national culture- Local employment rules,

religious and ethnical circumstances of the host country are also some factors had a need to be

considered. (Cavusgil et al. , 2008) 6

In another dimension, Dowling & Welch (2005) recognized some factors that average the difference

between International and domestic Human resource management. Relating to Dowling, these

variables are ethnic environment, the industry with which the Multinational is generally involved,

the level of reliance of the multinationals on its home country or home market and the

attitudes of senior management in international procedure. Let us discuss to what magnitude these

variables would become moderators between Home and International HRM routines.


One important varying that moderates International and Domestic Human resource management is

the kind of industry an MNC is involved with and the international competition it encounters.

Putting the business playing field in a single straight line, why don't we say we've at one end of the

continuum a multi-domestic industry and the other end a worldwide industry. The multi-domestic end

designates a business operating in various countries however the completion in that industry type is

specific to the country. While at the other end, the global industry group is about an industry that

operates in various countries but interlinked with other companies in the same group (Dowling &

Welch, 2005).

Industries that fall under the multi-domestic structure have a free of charge reign and aren't strictly

controlled by the Headquarter of the MNC. They show an extremely decentralized HR framework and play

a passive role in the transfer of HR practices outside their boarder. Samples for this category can be

distribution agents and insurance companies. The global industry presents a model whereby HR

management exchanges management practices abroad and these procedures are replicated and put in

use by the subsidiaries. Example because of this group includes commercial plane companies and

computer manufacturing companies (Dowling & Welch, 2004, Beardwell & Claydon, 2010).



The other important element in the moderating International and local Human resource

management is culture. (Dowling & Welch, 2004)

Armstrong (2009) define company culture as "the habits of beliefs, norms, values, attitudes

and assumption that may well not have been articulated but form the way in which folks in the

organization behave and get things done. " (Armstrong, 2009, p384). Hofstede in his part put culture

as "the collective coding of the mind which distinguishes the people of 1 group or

category of individuals from another" (Hofstede, 2001, p9).

Other authors also have tried to identify culture in several ways but generally it is portrayed as a

process within a social environment which supports the guidelines and regulations and the accepted

norms on how people are expected to behave. Matching to Hofstede (2001) there are five

independent measurements of culture that describe the major difference between national groups. The

first is vitality distance. It is the degree to which associates of a business below the leadership

rank accept and expect the unequal syndication of power. High electric power distance shows an autocratic

leadership while low power distance denotes a democratic practice. Uncertainty avoidance relates to

the degree where the people in a modern culture feel uncomfortable for insufficient composition and avoid

ambiguity. High uncertainty avoidance are present in countries having a strong guidelines and job scrutiny as

they stay away from uncertainties and low uncertainty avoidance is listed in countries promoting

more lax and flexible social rules and regulations. Hofstede third dimensions is the individualism

versus collectivism point. This dimension can be involved with the inclination of people's response to

identifying themselves either in much larger groups or more to themselves. High individualism is scored in

countries like the united states where people typically identify themselves in small family groupings while in low

individualistic countries people want to co-habit along and form large interpersonal groups. Masculinity


or femininity is the fourth aspect which identifies emotional roles related to both genders. It

balances the 'challenging' masculine virtue of assertion and aggressiveness with the softer 'feminine'

virtue of feeling and caring. Japan results on top of this regard while Norway is the cheapest. The fifth

dimension is the permanent versus short term orientation. This dimension handles the recognition

of position in a society and perseverance. Generally understanding the cultural norms of your foreign

country and adapting to the environment would benefit a corporation in an international level and

more notably the HR plans of an organization are mostly inspired by the social practice

surrounding the business. Human resource pursuits like hiring of personnel, promoting, rewarding

and dismissal of employees are driven and affected by the cultural practice of the coordinator country

(Dowling & Welch, 2005).

There is a school of thought that stresses the concept of Etics and Emics as an important aspect to

understanding culture in different adjustments. The Etic concept refers to the culture-common aspect

while the Emic strategy handles culture-specific principles of behavior. Understanding the

difference between your two concepts is helpful in cross-cultural business communication. To this

effect identifying which Human resource activity falls under Etic and which comes under Emic is also

crucial as it have an effect on the performance of companies outside their home country (Dowling &

Welch, 2005).

As noted earlier Emic identifies practices specific to 1 culture and are not transferrable across

cultures and Etic identifies the common practices found in several civilizations and are transferrable

across ethnicities. Other sizes of culture which could affect Human source techniques are the

political condition of the united states where MNC operate, its monetary rank and development and its

legal position. The Multinational companies need to be careful in countries with strong religious

views as they may have both civil and spiritual laws in use (Dowling & Welch, 2005).



The status of the organization's home domestic market is another moderator differentiating

International Human tool management and Local Human source of information management.

One major factor moving companies to move outside their house market is the small market demand in

their home country but also the international market might not be their marketplace for big

companies as they have got high demand in their house country. Hence, when analysing company

performance, focusing only on the international market activity might not give the true stand or rank

of an international company. Some international companies originate from small countries with

small local demand or saturated domestic market and play a major role in the international

business activity. For example ABB Company from Switzerland, INTERBREW from Belgium and we

can also point out PHILIPS Electronics originating from The Netherlands. US Conference

on Trade and Development (UNCTAD) made an total annual survey on overseas direct investment and with

some detailed research made, it published a list and it reveals that Coca cola and McDonalds are

ranked 27th and 39th respectively. As stated earlier the key reason for this example is, these big

Multinational companies have high home demand in their house country; the united states. This may

influence to some extent on their international business practice as well as deprive their managers

an international management experience (Dowling & Welch, 2004).


The last moderator provided by Dowling & Welch, (2004) is the level of orientation of senior

management. Professionals from different cultures have different perceptions for the overall

management system of a firm. Lack of understanding of competitive management skill on an

international level would lead to inability as it might fail to identify and treat the problem differently

from the local management issue. 10

Beardwell and Claydon (2000) also take notice of the value role Multinational companies play in the

world market and in regards to to the interrelation and restructuring of management concern at

international versus the national level published ' Management style, Strategies and regulations are

shaped by home based business system -the financial, institutional, legal and political platform - in

which they developed as home firms. Thus there is a prolonged 'country of origins' effect in the

behaviour of MNCs whereby the country the MNC hails from, exerts a unique influence on the

management style, specially the management of Human resource. ' (Beardwell and Claydon,

2010, p19)

On the other hand Taylor et al (1996) presents the exportive, adaptive and integrative models and

explain why the international companies choose different form of Strategic International Human

resource management. The adoptive models reveal that Human learning resource policies are designed to

match the neighborhood environment of the subsidiary. There would be less transfer of Human being resource

practices from the parent or guardian company and use differentiation as a priority point. Within the exportive

orientation the subsidiary copies Individuals resource management policies from the mother or father company.

This upholds the integration of global management system and is ethnocentric in characteristics. The

integrative orientation model is the selection of 'best HR practice' around the world which is more

liberal and flexible in allowing the subsidiary adopts local HR techniques (Beardwell and Claydon,

2010). But each orientation requires different factor based on the HR policies employed by

the parent firm.


One important point in International Individual resource management is the movements of

employees across national boundaries to foreign country tasks. These employees are


termed as Expatriates while Employees transferred from subsidiary branch into Headquarters

are referred as Inpatriates (Dowling & Welch, 2005). As the global business activity of

International companies increased, it demanded high managing system and follow up of the

subsidiaries business performance. To the result, MNC have chosen the use of Expatriates,

Parent company nationals, as a handling system by assigning them in key management

positions in the subsidiary branches of the parent or guardian company (Bartlett & Ghoshal, 1989).

The efficiency of the deployed expatriate could also rely upon the adaptability the expatriate on

his/her foreign assignment. A study conducted by Make Mendenhall and Gary Oddor in 1985

suggests that expatriate success and adjustment depend on several dimensions. The first is self-

oriented sizing, which deals with the expat personal competence and adaptability to the

foreign environment. The second aspect is the others-oriented dimensions, which consist of

relationship development and willingness to connect in mention of the reluctance to

assimilate and learn the terms of the international land. THE 3RD dimensions is the perceptual

dimension, which is concerned with the ability of expatriates to comprehend the behavior of

foreign nationals and the fourth aspect is ethnical toughness which is to evaluate how quickly

an expatriate adapts to a harsh environment (Brewster & Harris1999). Apart from parent

country nationals, Nationals from variety country and third country are also considered as

expatriates. But this newspaper will concentrate only on expatriates from parent country nationals to

discuss the primary reasons as to the reasons an MNC send a worker on a international assignment.

Expatriates are given in a foreign country as,

An agent of immediate control- The given expatriate is used to control the activities of the

subsidiary and ensure its compliance through guidance (Dowling & Welch, 2005, Bartlett

& Ghoshal, 1989)


An agent of socialization- The expatriate in question understands the companies values and

beliefs and functions as a medium to transfer these characteristics of the father or mother company to the

subsidiaries (Dowling & Welch, 2005)

As network builder- An expatriate having a knowledge pertinent to his/her job qualification

will in credited course relationship with people in various key positions and together create a network

of interdependence (Dowling & Welch, 2005)

As boundary spanner- This identifies activities performed by the expatriate, such as gathering

information that bridge interior and exterior organizational context. It might be the

expatriates' duty to promote the company account as well as gather information that could be

of use to the betterment of the business (Dowling & Welch, 2005)

As words nodes- Expatriates with foreign language history would eventually become

an asset especially when they repatriate to their home country (Dowling & Welch, 2005).

The features of using expatriates are mainly to maintain organizational control, international

work experience and follow up the fulfilment of the company's' goal by the subsidiary.

Whereas the drawback points are the condition with the adaptability of expatriates to the

foreign environment and the high cost incurred by the mother or father company to the choice and

training of expatriates (Dowling & Welch, 2005). The process of choosing the right person to the

right position is vital to the success of the oversees objective and it is to known that an

expatriates success in one environment will not imply the same expatriate will load gaps in

all circumstances (Brewster & Harris, 1999).

To this end, In order to select an expatriate for an international assignment, Dowling & Welch

(2005) have arranged six basic factors which may assist managers in the process. As an individual


Factors they may have set Technical capacity, cross cultural suitability and family requirements are

listed essential while in as situational factors country or ethnic requirements, dialect and

MNE requirements need to be analysed and considered in the selection process. In another

perspective Schneider and Barsoux (1997) list nine point they believe that are important for the

selection process. They may be interpersonal skill, linguistic capability, capacity to tolerance and cope up

with uncertainty, determination to work and live in another country, flexibility, fortitude and admiration, cultural

empathy, strong sense of personal and sense of humour. (Dowling & Welch, 2005)

In standard the degree of the selection criteria is extensive and companies need to recognize and

consider the most crucial and points important to the position to be loaded.


Various factors are talked about that differentiate International Human resource management from

Domestic human tool management. The complexity of international Man resource

management lies in the excess knowledge and obligations needed for operating at

international level, which is reflected in every the activities such as staffing, training and

development, Human learning resource planning and reimbursement and benefits. As the global market

competition boosts International companies are anticipated to be reactive, flexible and

creative of the right company strategy and Individual reference management system to be able to

survive your competition. The Globalization of world economies has forced international

companies to change and consistently change their company strategy and Human

management systems in order to survive the competition. To this, the function of Human

resource management is becoming an important subject as they have proved to be a vital point to

the success of International as well as Home companies. In this paper various perspectives

towards International Human being resource management are mentioned briefly. Writers in the field


are also quoted about how today's and future form of Human tool management is and

would be. In conclusion, the newspaper has tried to identify the main variations and similarities

between home and international Real human resource management. From your literature review

presented, different internal and exterior factors are reviewed to the complexness of

International human resource management, presented the many interpretation of HRM and

have tried showing how management and the marketplace would determine the condition of Human

resource management generally.


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