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In this introductory chapter, we establish the scope of the textbook:

Define key terms in IHRM

Outline the differences between domestic HRM and IHRMIdentify the variables that moderate these differences

And discuss trends and challenges in the global work

environment and the enduring context in which IHRM functions

and activities are conducted, including the way in which forces

for change affect the operations of the internationalizing firm andhave consequences for the management of people in the

multinational context.

Chapter Objectives

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Cross-cultural management

Examine human behavior within organizations from an

international perspective Comparative HRM and Industrial Relations

Seeks to describe, compare and analyze HRM systems and

IR in different countries

HRM in multinational firms

Explore how HRM is practiced in multinationals

Three Approaches to IHRM

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Interrelationships between Approaches to the Field

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Major Functions and Activities

Human resource planning

Staffing Recruitment

Selection

Placement

Performance management

Training and development Compensation (remuneration) and benefits

Industrial relations

The General Field of HR

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Types of employees

Within and cross-cultural workforce diversity Coordination

Communication

Human resource activities

Procurement

Allocation

Utilization of human resources

Nation/country categories where firms expand and operate

Host country

Parent country

Third country

What does IHRM add into the Traditional Framework

of HRM?

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A Model of IHRM

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An employee who is working and temporarily residing in a

foreign country

Some firms prefer to use the term international assignees Expatriates are PCNs from the parent country operations,

TCNs transferred to either HQ or another subsidiary, and

HCNs transferred into the parent country

Global flow of HR

What is an expatriate?

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International Assignments Create Expatriates:

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More HR activities

The need for a broader perspective

More involvement in employees personal lives Changes in emphasis as the workforce mix of expatriates and

locals varies

Risk exposure

Broader external influences

Differences between Domestic HRM and IHRM

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Variables that Moderate Differences between

Domestic HR and IHRM

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1. Rio Tinto (UK/Australia)

2. Thomson Corporation (Canada)

3. ABB (Switzerland)4. Nestl (Switzerland)

5. British American Tobacco (UK)

6. Electrolux (Sweden)

7. Interbrew (Belgium)

8. Anglo American (UK)

9. AstraZeneca (UK)

10. Philips Electronics (The Netherlands)Source: UNCTAD Index of

Transnationality

The Top Ten Multinationals

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Global competition

Growth in mergers, acquisitions and alliances

Organization restructuring Advances in technology and telecommunication

Forces for Change

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Need for flexibility

Local responsiveness

Knowledge sharing Transfer of competence

Impacts on Multinational Management

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Developing a global mindset

More weighting on informal control mechanisms

Fostering horizontal communication Using cross-border and virtual teams

Using international assignments

Managerial Responses

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Factors that Influence the Global Work Environment

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We have established the scope of the textbook:

Defined IHRM and the term expatriate.

Discussed major differences between domestic HRM and IHRM looking at six factors:

More HR activities

Need for a broader perspective

More involvement in employees personal lives

Changes in emphasis as the workforce mix of expatriatesand locals varies,

Risk exposure and

More external influences

Chapter Summary (cont.)

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Examined the enduring context of IHRM. The focus is on the

current global work environment, looking at forces for change,

requirement for MNE and managerial responses that haveimplications for the way in which people are being managed in

multinationals at the turn of the 21st century.

This treatment has enabled us to provide an overview of thefield of IHRM and to establish how the general environment

affects IHRM. The next chapter examines the organizational context where

we explore how IHRM activities are determined by, andinfluence various internal changes as the firminternationalizes.

Chapter Summary (cont.)