Bài giảng International Business - Chapter twenty: Human Resource Management

Human Resource ManagementMcGraw-Hill/IrwinInternational Business, 11/eCopyright © 2008 The McGraw-Hill Companies, Inc. All rights reserved.chapter twentyLearning ObjectivesDiscuss the importance of creating a company “global mindset”Explain the relationship between competitive strategies (international, multidomestic, regional, and transnational) and international HR management approaches (ethnocentric, polycentric, regiocentric, and global)Compare home country, host country, and third country nationals as IC executivesExplain the difficulties of finding qualified executives for international companies (ICs) and the importance of foreign language knowledge3Learning ObjectivesExplain what an expatriate is and the challenges of and opportunities of an expat positionDiscuss the increasing importance of accommodating the trailing spouse of an expatriate executiveIdentify some of the complications of compensation packages for expatriate executives4The Global MindsetExpatriateA person living outside citizenship countryGlobal Mind-setA mind-set that combines an openness to and an awareness of diversity across markets and cultures with a propensity and ability to synthesize across this diversity5International HRM ApproachesEthnocentric Hiring and promoting employees on the basis of parent company’s home country frame of referencePolycentricHiring and promoting employees on the basis of specific local context of the subsidiary 6International HRM ApproachesRegiocentricHiring and promoting employees on the basis of the specific regional context of the subsidiary GeocentricHiring and promoting employees on the basis of ability and experience without considering race or citizenship7Strategic Approach, Organizational Concerns, and the International Human Resource Management Approach to Be Used8Recruitment, Selection and TrainingParent Country National (PCNs) or Home Country NationalStudy of language and cultureHost Country National (HCN)Hired in the host countryThird Country National9Recruitment, Selection and TrainingThird Country National (TCN)May accept lower wages and benefits than will employees from the home countryMay also come from a culture similar to that of the host countryMay have worked for another unit of the IC and be familiar with policies, procedures and peopleCommon approach in developing countriesMay not be welcome by host countryMay come from an international agencyGreater use as companies take geocentric view10ExpatriatesFamilyNine of ten expatriate failures family-relatedUnhappy spouses major reason for early returnCompany losing a “million-dollar corporate-training investment” in executive11Language TrainingLanguage TrapInternational business person speaks only home languageEnglish language has become lingua franca Chinese new “hot” language to know 12Expatriate ServicesHealth care programs to assist companies and expatriates with Claims administrationLanguageTranslationsCurrency conversionsService standardizationwww.ExpatExpert.comwww.branchor.com 13Expatriate ServicesBanking servicesOnline, 24-hour assistanceTrainingCulture and languageHouse hunting, utilities hook up, grocery and hardware shopping, long-distance care for relatives, schools, organizations, and cultural items14CompensationSalariesPaying home country nationals the same salaries as their domestic counterparts permits worldwide consistencybonusesIncreasing use of third country nationals- often treated like PCNsTrend to pay HCNs same base15Total compensation Costs for Sending an Expatriate American Manager to Russia16AllowancesHousing AllowancePermits executive to live at same standard as at homeCost-of-Living AllowanceBased on differences in price of food, utilities, transportation, entertainment, clothing, personal services, and medical expenses as compared to homeAllowances for Tax DifferentialsEnsures expatriates will not have less after-tax pay at home17AllowancesEducation AllowancesInsures children receive education equal to that at homeMoving and Orientation AllowancesHousehold effects and language instruction18Ranking of 50 Cities from Most to Least Expensive, 200619BonusesBonusesExpatriate employee compensation payments in addition to base salary and allowances because of hardship, inconvenience, or dangerBonuses includeOverseas premiumsContract termination paymentsHome leave reimbursement20Compensation PackagesFor expatriate employees, packages incorporate many types of payments or reimbursements and must take into consideration exchange rates and inflation21Hardship Differential Pay Premiums for Selected Cities and Countries, 200622Compensation Packages Can Be ComplicatedAllowances and percentage of base salary are usually paid in host country currencyPercentage usually 65 to 75 percent, with remainder banked where employee directsWhat Exchange Rate?Must be chosenMore difficult in countries with exchange controls and nonconvertible currencies23Compensation of Third Country NationalsTrend toward applying the same compensation plan to third country nationals as home country expatriatesProblems can arise inThe calculation of income tax differential when American expatriate compared with expatriate from another countryHome leave bonus24International StatusEntitles expatriate employee to allowances and bonuses applicable to the place of residence and employmentPerksCompensate executives while minimizing taxesPrivate pension planRetirement paymentLife InsuranceHidden slush funds (can be illegal)Club membershipCompany houseForeign affiliate directorship25