Jeffrey a mello 4e chapter 14 labor relations

Strategic HR Issues in Global • Assisting employee destined for international assignment with paperwork & minor logistics – Tactical approach • Managing “risk or failure” factor of over

GLOBAL HUMAN RESOURCE

MANAGEMENT

International Imperative

International Imperative

Why organizations expand internationally

– To capture enhanced market opportunities that foreign

countries may present

– To achieve economies of scale in production &

administration by expanding scope & volume of operations to international markets

– Keeping up with industry leaders may require organization

enter foreign markets

– Acquiring ownership of foreign-based organization or

subsidiary

Why organizations expand internationally

– To capture enhanced market opportunities that foreign

countries may present

– To achieve economies of scale in production &

administration by expanding scope & volume of operations to international markets

– Keeping up with industry leaders may require organization

enter foreign markets

– Acquiring ownership of foreign-based organization or

subsidiary

How International & Domestic HRM

Differ

How International & Domestic HRM

Differ

International HRM requires

lives

different geographic locations

heightened exposure to personal risk

International HRM requires

lives

different geographic locations

heightened exposure to personal risk

International Expansion

International Expansion

Strategies for expanding internationally

goods or services to foreign partner

– Entering into joint venture with foreign partner

in form of foreign branch or subsidiary

Strategies for expanding internationally

goods or services to foreign partner

– Entering into joint venture with foreign partner

in form of foreign branch or subsidiary

– Extent to which society is hierarchical, & how power is

distributed among its members

– Extent to which society feels comfortable with ambiguity &

values & encourages risk-taking

– Extent to which society is hierarchical, & how power is

distributed among its members

– Extent to which society feels comfortable with ambiguity &

values & encourages risk-taking

Hall’s Model of Cultural Differences

Hall’s Model of Cultural Differences

– Importance or sense of time in daily activities

• Space (distance)

– Amount of physical distance individuals attempt to maintain between

themselves & others

• Material goods

– Emphasis or inferences on possession of goods to signify power,

success & status

– Amount of physical distance individuals attempt to maintain between

themselves & others

• Material goods

– Emphasis or inferences on possession of goods to signify power,

success & status

Strategic HR Issues in Global

• Assisting employee destined for international assignment

with paperwork & minor logistics

– Tactical approach

• Managing “risk or failure” factor of overseas assignment by

providing paperwork assistance & modest amount of training

– Strategic approach

• Extensive support & coordination of international assignment

& strategized repatriation program at end of assignment

Approaches to sending employees abroad

– Administrative approach

• Assisting employee destined for international assignment

with paperwork & minor logistics– Tactical approach

• Managing “risk or failure” factor of overseas assignment by

providing paperwork assistance & modest amount of training– Strategic approach

• Extensive support & coordination of international assignment

& strategized repatriation program at end of assignment

Strategic HR Issues in Global

Assignments

Strategic HR Issues in Global

Assignments

Strategic management of global assignments

1 Establish specific purpose for assignment

2 Select appropriate employee for assignment

3 Organizational & individual purposes for assignment must

be identified & matched

4 Assess adaptability to host culture of both employee & any

family members who will be accompanying employee

5 Provide appropriate training for employee & family

members

6 Simultaneous training should be conducted for

headquarters staff

Strategic management of global assignments

1 Establish specific purpose for assignment

2 Select appropriate employee for assignment

3 Organizational & individual purposes for assignment must

be identified & matched

4 Assess adaptability to host culture of both employee & any

family members who will be accompanying employee

5 Provide appropriate training for employee & family

members

6 Simultaneous training should be conducted for

headquarters staff

Determining Expatriate

Compensation

Determining Expatriate

Compensation

– Expatriate salary based

on home country pay

– Additional expenses

associated with

relocation & assignment

– Hardship & incentives to

determine overall

reimbursement &

compensation level

– Expatriate salary based

on home country pay

– Additional expenses

associated with

relocation & assignment

– Hardship & incentives to

home adjusted upward

to account for higher cost of living Localization approach

– Salary converted to host

country’s equivalent when employee is on permanent assignment

Higher-of-home-or-host method– Employee’s salary at

home adjusted upward

to account for higher cost of living Localization approach

– Salary converted to host

country’s equivalent when employee is on permanent assignment

Four Approaches to IHRM

Four Approaches to IHRM

Make strategic decision as to level of

standardization desired across locations

Make strategic decision as to level of

standardization desired across locations

European Union

European Union

• European Union (EU) has a large number of umbrella

employment laws that provide far more worker protection than afforded in the U.S

• Employment-at-will is generally followed in the U.S., but

it is generally not allowed in the EU, where it is difficult and expensive to terminate workers

• EU workers have more generous vacation, maternity,

retirement and other benefits than U.S workers

• Work councils must approve many management actions in

several EU countries

• European Union (EU) has a large number of umbrella

employment laws that provide far more worker protection than afforded in the U.S

• Employment-at-will is generally followed in the U.S., but

it is generally not allowed in the EU, where it is difficult and expensive to terminate workers

• EU workers have more generous vacation, maternity,

retirement and other benefits than U.S workers

• Work councils must approve many management actions in

several EU countries

Mexico and Canada

Mexico and Canada

Even though Mexico and Canada are border countries, HR is carried out very differently in each country

• Much employment discrimination which would be illegal

in the United States is standard practice in Mexico

• enforcement of existing laws is also very lax

• Canada, on the other hand, is known to vigorously enforce

laws which prohibit discrimination in employment

• workers in Canada also receive far more protection that

their counterparts in the United States

Even though Mexico and Canada are border countries, HR is carried out very differently in each country

• Much employment discrimination which would be illegal

in the United States is standard practice in Mexico

• enforcement of existing laws is also very lax

• Canada, on the other hand, is known to vigorously enforce

laws which prohibit discrimination in employment

• workers in Canada also receive far more protection that

their counterparts in the United States

China

• Tremendous growth opportunities in the free market economy in

China are being capitalized on by western organizations with

significant HR challenges

• Many university graduates are not suitable for employment in global

organizations due to deficiencies in language, interpersonal skills, ability to work in teams and basic literacy

• Those who are capable of working effectively in a multinational can

command very high salaries Retention of such workers can be a

challenge, given the high demand for them

• Supervisory relations, employer prestige, development opportunities,

compensation and job title are key factors which impact retention

• Tremendous growth opportunities in the free market economy in

China are being capitalized on by western organizations with

significant HR challenges

• Many university graduates are not suitable for employment in global

organizations due to deficiencies in language, interpersonal skills,

ability to work in teams and basic literacy

• Those who are capable of working effectively in a multinational can

command very high salaries Retention of such workers can be a

challenge, given the high demand for them

• Supervisory relations, employer prestige, development opportunities,

compensation and job title are key factors which impact retention

India

• India bears some resemblance to China given the size of its population

and growing economy, however there are stark differences between China and India

• India has a significant population of citizens who are well-equipped to

work in multinationals India’s technically trained workforce is highly sought after yet demand exceeds supply, making retention a challenge

• India has an extremely complicated legal system which involves more

than 100 different noncodified and ambiguous laws related to

employment Termination of employees is difficult and many

employee benefits are legally required

• India bears some resemblance to China given the size of its population

and growing economy, however there are stark differences between China and India

• India has a significant population of citizens who are well-equipped to

work in multinationals India’s technically trained workforce is highly sought after yet demand exceeds supply, making retention a challenge

• India has an extremely complicated legal system which involves more

than 100 different noncodified and ambiguous laws related to

employment Termination of employees is difficult and many

employee benefits are legally required

Reading 14.1

In the Eye of the Beholder

Reading 14.1

In the Eye of the Beholder

Nine cultural differences

Reading 14.1

In the Eye of the Beholder

Reading 14.1

In the Eye of the Beholder

Successful global leaders were found to be

• Charismatic/value-based (able to inspire and motivate

others based on firmly held core beliefs)

• Team-oriented (able to build teams and implement

common purpose among team members)

• Participative (involve others in making and implementing

decisions)

• Humane-oriented (supportive, considerate, compassionate

and generous)

• Autonomous (independent and individualistic)

• Self-protective (ensure safety and security)

Successful global leaders were found to be

• Charismatic/value-based (able to inspire and motivate

others based on firmly held core beliefs)

• Team-oriented (able to build teams and implement

common purpose among team members)

• Participative (involve others in making and implementing

decisions)

• Humane-oriented (supportive, considerate, compassionate

and generous)

• Autonomous (independent and individualistic)

• Self-protective (ensure safety and security)

informal settings

orientation and future orientation and high on power distance

team performance with team emphasized

When in Brazil

informal settings

orientation and future orientation and high on power distance

team performance with team emphasized

imply little interest in grand visions

well-planned

When in France

non-supportive

imply little interest in grand visions

well-planned

• manager needs to be seen as deserving of leadership role and status

• very strong in-group/out-group collectivism with in-group

maintenance paramount in decision making

• group harmony important and team leader should be paternal,

autocratic yet benign

• high humane orientation invites family issues into workplace for boss’

assistance

• team expects to provide input but decision to be made by leader

• employees expect leaders to develop and communicate grand and

ambitious strategies

When In Egypt

• manager should act distinct from the team and present an image of

omnipotence

• manager needs to be seen as deserving of leadership role and status

• very strong in-group/out-group collectivism with in-group

maintenance paramount in decision making

• group harmony important and team leader should be paternal,

autocratic yet benign

• high humane orientation invites family issues into workplace for boss’

assistance

• team expects to provide input but decision to be made by leader

• employees expect leaders to develop and communicate grand and

ambitious strategies

orientation and high in-group collectivism

foundation on which business is conducted and ultimate test of effectiveness and success

community; word “self” has negative connotation

When in China

orientation and high in-group collectivism

foundation on which business is conducted and ultimate test of effectiveness and success

community; word “self” has negative connotation

  Reading 14.2 – Cross-Cultural Management and Organizational Behavior

in Africa

  Reading 14.2 – Cross-Cultural Management and Organizational Behavior

in Africa

Modern African Management Principles

•Collective Solidarity: Employee teams work most effectively, achieving cohesiveness and

solidarity, by working toward a common purpose

•Group Significance (Ubuntu): Ubuntu means that humanity is a shared value in which

personhood exists within a group context, only insofar as a person values others

•Harmony and Social Cohesion: Emphasis is placed on maintaining peace and keeping

conflict to a minimum by promoting internal, communal, and familial harmony

•Consensus: Emphasis is placed on collective decision making

•Consultation: Group participation is strongly emphasized, as are mutual understanding, joint

problem solving, and honoring the collective wisdom of all team members.

•Local Time (or “African” Time): In Africa, time standards are ambiguous, and thus require

flexibility on the part of non-African managers

•Paternal/Maternal Leadership: African firms are often structured like African families and,

therefore, organizational leaders (managers, supervisors, and owners) tend to behave with paternal (or maternal) responsibility toward their staff members

•Age and Authority: Advanced age is inherently equated with authority, business wisdom,

rank, title, and experience Thus, an older person automatically holds a certain level of

superiority, regardless of rank, title, or education.

Modern African Management Principles

•Collective Solidarity: Employee teams work most effectively, achieving cohesiveness and

solidarity, by working toward a common purpose

•Group Significance (Ubuntu): Ubuntu means that humanity is a shared value in which

personhood exists within a group context, only insofar as a person values others

•Harmony and Social Cohesion: Emphasis is placed on maintaining peace and keeping

conflict to a minimum by promoting internal, communal, and familial harmony

•Consensus: Emphasis is placed on collective decision making

•Consultation: Group participation is strongly emphasized, as are mutual understanding, joint

problem solving, and honoring the collective wisdom of all team members.

•Local Time (or “African” Time): In Africa, time standards are ambiguous, and thus require

flexibility on the part of non-African managers

•Paternal/Maternal Leadership: African firms are often structured like African families and,

therefore, organizational leaders (managers, supervisors, and owners) tend to behave with

paternal (or maternal) responsibility toward their staff members

•Age and Authority: Advanced age is inherently equated with authority, business wisdom,

rank, title, and experience Thus, an older person automatically holds a certain level of

superiority, regardless of rank, title, or education.