The Role of International Human Resource Management

The Role of International Human Resource Management - The...

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The Role of International Human Resource Management - Part One By Dr Hilary Harris For many people international HR management (IHRM) is synonymous with expatriate management. IHRM, however, covers a far broader spectrum than just the management of expatriates. It involves the worldwide management of people. Although International HR (IHR) managers undertake the same activities as their domestically-based colleagues, the scope and complexity of these tasks will depend on the extent of internationalisation of the organisation. The Impact of Internationalisation As we move towards a more global economy, organisations are having to rethink their traditional ways of managing people. What would be normal custom and practice in one country may well be illegal in another. Routine decisions on career development, for example, can become extremely complex in an organisation working across 30 countries. How do we select our high potential employees, who makes decisions on moves, what kind of leadership are we trying to develop for our global company? In any organisation, the primary objective of the human resource management (HRM) function is to ensure that the most effective use is made of its human resources. To achieve this, HR professionals undertake a range of activities around sourcing, development, reward and performance management, HR planning, employee involvement and communications. If the organisation has a strategic HR function, these activities will support and inform organisational strategy. HR professionals are also used extensively in organisational change and development initiatives. For international organisations, these HR activities need to be co-ordinated across both the home country and different national subsidiaries and to take into account the needs of both parent country nationals (PCNs), host country nationals (HCNs) and third country nationals (TCNs). Given this broader perspective, how do managers decide on appropriate IHRM policy choices? A critical challenge for all international organisations is the need to achieve best fit in relation to the competing demands of global integration and co-ordination versus local responsiveness, the “global versus local” debate. From a business perspective, forces for global integration include operational requirements, strategic co-ordination and multinational customers. In contrast, forces for local responsiveness include highly diverse consumer requirements, tailored distribution channels and broader social and
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political constraints to market entry. From an HR perspective, there are many factors constraining the use of standardised HR practices including differing national business systems, labour laws, national HR practice, education systems and national cultural norms. Organisations may, however, still want to implement standardised HR systems globally. Their choice depends to a great degree on their stage of internationalisation and international mindset.
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