International Human Resource Management

赵艺

The aim of the essay is to have a full understanding about international human resource management，discussing HR activities，such as planning，staffing，so MNE could make effective behaviors.The whole essay pays much attention to the similarities and differences between domestic and international HRM.Then from determinants of staffing choices to find whether MNE use the same staffing approach worldwide.From the differences between global manager and global mindset，talking about effects in MNE，expatriate and HR function .

1 Similarities and differences between domestic and international HRM

Whatever domestic or international IHRM，the goal is the same--do the assignment and try to get more profit，broaden the market size，keep the continuity of the work，bring about advanced management skills and so on.Secondly，whatever each type，the company should pay certain cost.These costs not only simple traffic fees，but also training and development expense，etc.Thirdly，both of domestic and international HRM uses appropriate channel to choose suitable employees to finish the assignment.

Let us make a distinguish between domestic and international HRM.Firstly，more HR activities.HR activities includes taxation， language，relocation.Tax process for domestic HR is easy，just pays the tax and gets a salary.However，after crossing the border，it couldnt be clear whether to pay domestic，international or both. In this situation，IHRM needs to classify specific situation to prevent paying twice. Language is a another important difference.Transfer into another country，you need master basic language for use not only in work but also daily lives.For example，if an expatriate couldnt master basic local language，he would meet many problems in daily life.Whats worse，he will feel lonely gradually，this direct leads to the expatriate failure.

Secondly，more involvement in employees lives.The domestic HR pays little care to the employees personal lives，just give them salary plus some compensation.While refers to the IHRM，HR takes employees family into consideration，such as children education，spouse job，parents health，housing，medical insurance，etc.When put all these details into place would spare the employees worries，making them put all his effort into work to improve the efficiency.

Thirdly，consider the need for a broader perspective.HR manager in domestic designs a plan or compensation program just focus on domestic market. While across the world，the international human resource manager needs to design programs concerning with nationalities.Only in this way can international human resource manager achieve a balance between HCN，PCN.TCN.

Fourth，risk exposure.In domestic HRM，it often refers to market exposure.When broaden into the whole world，it concerns with not only market risk but also political risk.Countries like Iraq，Ukraine exist political risk and war risk.

These four differences have a great effect on the MNE，expatriate and HR function.To the HR department，because international HRM considers need for a broader perspective，it could coordinate relationships between PCN and HCN；motivate innovation of expatriate and realize organizational goal.

2 Determinants of staffing choices

Having understand international HRM，lets dig into the function of it. Focus on various situations， the IHRM literature uses four terms to describe MNE approaches to manage and staff their subsidiaries well.They are ethnocentric，polycentric，geocentric and regiocentric.（Peter J.Dowling International human resource management，p80））Four main types of determinants factors decide the use of each approach.They are divided into two sections-external and internal.External includes country factors，HRM practices.Internal section includes company specificties and local unit specificties.

Country factors like institutional context（Peter J.Dowling International human resource management，p87））Generally，different country has different culture.Cultural values in parent country and cultural values in host country are in a great difference.HR manager should evaluate culture toleration， discrimination before assignment.IHRM practices refer to expatriation in a broader company range，playing an vital role .

Company factors include MNE strategy and structure，the international experience，corporate governance，organizational culture.From aspect of international experience，MNE is likely to pick out expatriate who has been to other country，get international experiences.From aspect of organizational culture，its necessary to find whether multinational places a high priority on organization control so that MNE could according to different stages to choose appropriate approach.

3 Apply staffing choices determinants into four staffing approaches

MNE wont use the same staffing approach worldwide.Whats more，it may adapt different approaches in different stages or combine two approaches at the same time.Ethnocentric approach is that strategy decisions are made by headquarters personnel. In this approach，subsidies have little freedom， cant make any strategic decisions，key talent.Secondly，the adaption time for expatriate is long.Last but not least，advanced strategy in PCN wont be effective in HCN.

Polycentric approach refers that each subsidiary is given certain extent independence and decision-making power.Subsidiaries have power to make its own decisions.This approach could reduce the adjustment time for the expatriate greatly so that reduce the cost in T&D.Host country selects talent，developing its own group and forming continuity gradually.However，it lacks the communication mechanism.Additionally，it may form the “federation problem.”

Geocentric approach seems a bit broader.It recruits talent from all over the world.The standard for recruitment is ability not nationality.This approach develops a truly international team which everyone could contributed its talent to the company.It also prevents the “federation problem ”comparing to the polycentric method.However，it has a big cost to recruit and relocation.Also it sends more PCNs，TCNs，HCNs out.From the angel of cultural context，if MNE adores freedom and intelligence，then this approach is a great choice.Employees from all over the world who have specific experiences，professional knowledge are bound to broaden the market size.While if chooses ethnocentric or polycentric approach，it lacks the creative minds，innovative thinking.The angel of international experience is the same like cultural context.

The last approach is regiocentric approach.It is often used when MNE wants to have a regional structure.It recruits employees in geographical region.This approach is sensitive to local conditions.The employee is familiar with the local environment and culture so that behaviors employee make is more easily to be accepted by the locals.On the other side，it could also bring about “federation problem”.From the angel of corporate governance，taking this approach makes the MNE get benefits of gathering.Its easy for MNE to broaden the “green land”in this approach.

According to the analysis above， we come to the conclusion that each approach suits each situation.MNE need to base on its own characteristics to make correct choice.There are two tips for the MNE.Firstly，dont use the same approach all the time.With the development of industry，or the core point of strategy changes，MNE could transfer the staffing approach accordingly.Secondly，MNE could adopt two more three approaches at the same time.In this way，subsidiary not only gets the correct leading direction，but also have experienced employees to bring about new ideas.

4 Issues in staff selection

Large amounts of companies have the goal to hire and utilize people into the appropriate positions.They are eager to have a great profit or big market share whether domestic and international.This asks multinationals to do recruiting and selecting staff.During the selection process，MNE should prevent fall into four myth.After analyzing four myth，we could reasonably come to the conclusion that its very difficult to pick out a wise global manager.

Myth 1：Correct management approach can be applied into any countries.Despite this is wrong，few MNEs still transfer home-based work practices into their foreign country without enough thinking.They hold the opinion that “ A good manager in Australia is a good manager in China”.For example，when MNE adopts ethnocentric approach，its wrong to believe that all the professional management skills could be suitable for the subsidiary.

Myth 2：people could get multinational adaptability and behaviors.Some people could make wise decisions in one country，but that doesnt express he can adapt to a totally different environment.

Myth3：Successful international managers have similar characteristics.One person is more likely to achieve success when he owns superior knowledge，experiences.While this needs to be countered by other factors involved.That is，we cant just focus on just certain part，it would be better to examine the person whether he can adapt to foreign location，culture etc.For example，A is a person who is good at integrating information and getting resources.B is a person who does well in allocating person.Both of them belong to successful people.However，as an old saying goes “each has each personal special skill”.

According to the analysis above， we come to the conclusion that each approach suits each situation.

5 Global manager VS global manager

Compounding these four myths is the way where the term “global manager” is seldom used to express a person who has a “global mindset”.Global mindset is necessary but not sufficient for global manager.It is one mind which involves global intelligence，adaptability， advanced experiences and professional knowledge.people who own “global mindset” never work abroad.The difference between global manager and global mindset is that global manager not only has specific characteristics of global mindset，but also has got practical international experiences. Having a clear understanding about the difference will have a significant impact on the MNE，expatriate and HR function.

From the MNE aspect，knowing the difference between global manager and global mindset could prevent expatriate failure greatly.As if the MNE choose “global mindset”to work abroad，he may cant apply the knowledge in the real life so that leads to the EF. Based on global survey mentioned the following reasons for early return in rank：family concerns，accepted new position in the company，completed assignment early and so on

Expatriate failure causes great costs to the MNE.The costs can be divided into two categories：direct cost and indirect costs.Direct costs include airfares，relocation expenses，pre-departure training，salary，etc.Generally，higher position，higher direct cost.If expatriate failures happen，it means companys investment on the expatriate turns to the zero.Whats worse，unlike the domestic HRM，which the company could find a qualified employee immediately to replace the position to ensure the continuity of the work.The indirect costs also called invisible costs，including loss of market share，form bad effect to the local staff since morale and productivity could suffer..

From the expatriate aspect，the difference makes the expatriate know the importance of practical experiences.This asks the “global mindset”to improve its practical experience.Although “global mindset” have mastered much professional knowledge.So，if the employee wants to get a expatriate opportunity，its a good idea for him to do the pre-departure visiting to feel the culture in reality.

From the HR function，HR manager gets a standard to pick out outstanding employee who is suitable for going into another country.Additionally，it is a reminder for HR function that HR department should send employees abroad in advance frequently to prevent unexpected need，developing them into the global manager gradually.

6 Conclusion

Above all，IHRM is logic and applicable.We get familiar with IHRM through comparison between domestic and IHRM；We master four types of MNE staffing approaches through determinant factors of staffing choices；We know MNE，expatriate and HR function can make better choices according to differences between global manager and global mindset.With the strong competition among MNEs，IHRM has placed in a important position.In this way， international human resource managers need to find new tendency of IHRM，grab the opportunity in new situation to get a long-term development.

References

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2.C.AS.Bartlett&S.Ghoshal，CaliforniaManagement，Review，Vol，40，No.1（1997），pp.92-116

3.Peter J. Dowling in Management International Review （1999）

4. Michael Müller in Management International Review （1999）

5.Maike Andresen， Christian Nowak in Management for Professionals （2015）