Transcript Chapter 18

CHAPTER 18
HUMAN RESOURCE
MANAGEMENT
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Copyright © 2011 John Wiley & Sons
Chapter 18
Learning
Objectives
1. Assess the effects of culture on
managers and management policies
2. Examine the sources, qualifications,
and compensation of international
managers
3. Illustrate the different roles of labor
in international markets, especially
that of labor participation in
management
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Human Resource Objectives
 Recruitment and retention of a workforce
 Increase effectiveness of workforce
 Activities and skills needed to meet objectives:
Personnel Planning
and Staffing
Personnel Training
Compensation
According to
Effectiveness
Understanding of
Labor-Management
Relations
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Early Stages of Internationalization
 Primary need is for an export manager
 Marketing or sales manager of the firm typically is
responsible for beginning export activities
 Will usually hire an export manager from outside
rather than promote from within

Knowledge of the product or industry is less important than
international experience
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Advanced Stages of
Internationalization
 Overseas assignment categories:
CEO
Functional
Heads
TroubleShooters
White- or
Blue-Collar
Workers
 Ability to attract talent around the world can be a
competitive advantage
 Company needs:
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A network of global specialists to work together
To develop clear career paths for oversees managers
To coordinate and leverage resources across borders
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Japanese Firms Seeks
Outside Leadership
Japanese firms tend to be very insular, and executives typically stick
with one company for life and bosses are promoted from within. In
June 2010, U-Shin, a mid-sized maker of car parts, began looking
outside for a new president. The company is looking for a young,
English-speaking boss to replace its current president who has been in
place for over 30 years. U-Shin is also taking the highly unusual step of
running newspaper advertisements to attract candidates.
U-Shin's atypical move suggests that the need to break with tradition
and internationalize management is beginning to be recognized down
at the level of medium-sized business, the heart of Japanese industry.
Source: http://www.economist.com/blogs/asiaview/2010/07/japanese_corporate_culture?fsrc=scn/fb/wl/bl/openingup
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Interfirm Cooperative Ventures
 New Management Challenge
 Global competition is forging new cooperative ties
between firms from different countries
 Tasks needed:
 Assign and motivate people so venture will meet goals
 Strategic management of human resources
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Sources for Management Recruitment
 Sources for recruiting include:
Within
the
Company
Other
Product
or Region
Group
External
Talent
Local
Managers
Expats
 Criteria for deciding between expatriates and
local managers


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Availability and quality of talent pool
Corporate policies
Environmental constants on the legal, cultural, and economic
fronts
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Recruitment During the
Internationalization Process
 During the export stage, outside expertise is
sought at first, but the firm then begins to
develop its own personnel for international
operations
 When international operations are expanded, a
recruitment dilemma may occur when dealing
with internal recruitment of young managers
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Selection Criteria for Overseas
Assignments
 The role of factual cultural knowledge, or knowledge
obtainable from specific country studies, has been widely
debated
 Area expertise includes a knowledge of the basic systems in
the region or market for which the manager will be
responsible
 The oversees manager must progress from factual
knowledge to interpretive cultural knowledge, which
is an acquired ability to understand and appreciate the
nuances of foreign cultural traits and patterns
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Criteria for Selecting Managers for
Overseas Assignment
Competence
Adaptability
•Technical
knowledge
•Leadership
Ability
•Experience, Past
Performance
•Area Expertise
•Language
• Interest in Overseas
Work
• Relational Abilities
• Cultural Empathy
• Appreciation of New
Management Styles
• Appreciation of
Environmental
Constraints
• Adaptability of
Family
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Personal
Characteristics
• Age
• Education
• Sex
• Health
• Marital Relations
• Social
Acceptability
Czinkota: International Business, 8e
Focus on Culture: The GLOW
Network at Siemens
Siemens has embraced diversity as a fundamental
perspective for its business objectives. As part of
the company’s four-prong diversity initiative,
Siemens has launched the Global Leadership
Organization of Women (GLOW). Created to
proactively recruit and retain highly qualified
women, GLOW is a network dedicated to enlarging
the contribution of women to Siemens’s business.
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The Selection and Orientation
Challenge
 Adaptability screening usually involves
interviewing both the overseas candidate and the
candidate’s family to determine how well they are
likely to adapt to another culture
 An orientation program facilitates new workers
with their roles and prepares them for overseas
assignments
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Culture Shock
 Pronounced reactions to the psychological disorientation
when spending an extended time in a new environment
 Stages include:
Initial
Euphoria
Irritation/
Hostility
Adjustment
Re-Entry
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 Enjoying the novelty, largely from the perspective of a
spectator
 Experiencing cultural differences
 Adapting to the situation
 Biculturalism or cases of “going native” are possible
 Returning home to face a possibly changed home
environment
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Psychological and Physical
Symptoms of Culture Shock
Culture shock is a condition that affects expats when they move
overseas. Here's how to recognize the physical and psychological
symptoms of culture shock.
Psychosocial Symptoms:
• Sadness and loneliness
• Homesickness
• Idealizing the home culture
Physical Symptoms
• Fatigue and malaise
• Generalized aches and pains
• Increase in illness or accidents
Source: http://workabroadtravel.suite101.com/article.cfm/psychological-and-physical-symptoms-of-culture-shock
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Repatriation
 Returning home may invoke mixed feelings
 Reverse cultural shock may emerge
 Find a place in corporate hierarchy
 Family must give up their special status
 Four step process for repatriation planning:
 Assessment of foreign assignments in terms of environmental
constraints and corporate objectives
 Preparation of the individual for an oversees assignment
 Communication during the tour on developments at
headquarters
 Reorientation upon reentry
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Compensation
 A firm’s expatriate compensation program has to be
effective in the following areas:


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Home-country salary
Assignment-location costs
Home-country equivalent purchasing power
 Compensation of the manager overseas can be
divided into two general categories:
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Base-salary allowances
Salary-related allowances
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Base Salary and
Non-Salary-Related Allowances
Base Salary Allowances
Non-Salary-Related
Allowances
• Depends on qualifications,
responsibilities, and duties
• Cost of Living Allowance
(COLA)
• Foreign Service Premium
• Hardship Allowance
• Housing Allowance
• Tax-equalization Plan
• Relocation allowance
• Mobility allowance
• Home sale or rental protection,
household storage or shipment
• Automobile protection
• Travel expenses
• Temporary living expenses
• Education allowance
• Medical expenses
• Home leave
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Labor Participation in Decision Making
 Rights of information, consultation, and
codetermination develop on three levels:
The shop-floor level, or direct involvement
 The management level, or through representative bodies
 The board level
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 Self management – Independent decision making
 Codetermination – Employees are represented on
supervisory boards to facilitate communication and
collaboration
 Works Council – Workers and managers who
participate in decisions affecting them
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Improvement of Quality of Work Life
 Efforts to improve personal and professional
development:
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Team building is aimed at enhancing the cohesiveness of a
department
Quality circles are groups of workers who meet regularly to
discuss issues related to productivity
Work scheduling involves preparing schedules of when and
how long workers are at the workplace
Flextime allows workers to determine their own starting and
ending times
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The Role of Labor Unions
 Role varies from country to country
 Investment decisions can be guided by union
considerations
 Union challenges due to internationalization:
Power of
the Firm to
Move
Production
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More
Difficult to
get
Financial
Data
Insufficient
Attention
to Local
Issues
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Difficulty
in being
Heard by
Decision
Makers
Czinkota: International Business, 8e
Labor Union Puts
GM French Factory Plan in Doubt
In July 2010, a plan to maintain operations at a General Motors plant
in eastern France was in doubt after a labor union refused to sign a
deal to freeze salaries and cut working days.
Three other unions agreed to the deal after more than 1,000 of 1,150
workers voted to accept conditions set by the Detroit-based carmaker
to keep the plant open.
General Motors had said it needed all four unions to agree for it to
complete the repurchase of a plant it put up for sale in 2008 to help
raise cash and avoid bankruptcy at the height of the financial crisis.
Source: http://www.ibtimes.com/contents/20100723/labor-union-puts-gm-french-factory-plan-doubt.htm
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Focus on Ethics: Labor Unions
Attack Nestlé in Russia
Workers at a Nestlé factory in the Ural city of Perm
came to the Russian capital to complain about
management’s refusal to engage in negotiations to
increase real wages. Despite the public protests,
Nestlé refused to meet the workers’ demands,
stating that wages are “above the industry average
in the city”. In June 2008, Nestlé agreed to
formally recognize the union’s fundamental right to
negotiate wages.
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Human Resource Policies
 Anticipate the demand for various skills and have
programs to ensure availability of employees when
needed
 HR Strategies:
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Often workers are imported when there is a shortage
Sometimes the company must bring the local labor force up to a
desired level of competency
 Compensation packages are shaped by:
Culture
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Legislation
Collective
Bargaining
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Taxation
Characteristics of the
Job
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