HRM AND GLOBAL

ECONOMY
SUBMITTED BY- RUHI
CHOPRA(6918)
AASTHA JAIN(6923)
SUBMITTED TO MR. GREWAL

Defination of global human resource

management
It refers to the activities an
organization carries out to use its
human resources effectively.
These activities include:
i. Determine firms HR strategy
ii. Staffing
iii. Performance Evaluation
iv. Management Development
v. Compensation
vi. Labour relations

How different is Global

HRM?
Several key factors make Global HRM
different from domestic
management:
i. Different labour markets
ii. Mobility problems: legal, economic,
cultural barriers
iii. Different management styles
iv. Varied compensation practices
v. Labour laws.

Staffing Policy
Staffing policy is concerned with the
selection of employees for
particular jobs.
i.

Selecting individuals who have the

skill to do a particular job.
ii. Tool for developing and promoting
the desired corporate culture
(norms & value system) of the firm.

Types of Global Staff Members

Expatriate - Employee working in a firm who is not
a citizen of the country in which the firm is located
but is a citizen of the country in which the
organization is headquartered.

Host-country national

- Employees nationality

is the same as the location of the subsidiary.

Third-country national

- Citizen of one country,

working in a second country, and employed by an

organization headquartered in a third country.

Types of staffing policies

There are four types of staffing policies
in IB:
i. Ethno centric approach
ii. Poly centric approach
iii. Geo centric approach
iv. Regio centric approach

Ethno Centric
Domestic firm produces products in
the domestic country and exports to
various foreign countries.

Country
A

Country 2

Poly Centric
The Company establishes a foreign
subsidiary company and
decentralises all operations and
delegates decision-making and policy
making authority to its executives.
Thus subsidiary is managed and
operated based on the
Fir
environmental
condition
in
the
host
Countr
m
yA
Country 2
country.

Regio centric
The foreign subsidiary company
produces in the host country and
exports to the neighbouring
countries of the host country.

Geo centric
The company establishes various
companies in various countries,
draws various inputs from different
countries and sells the products in
various global markets.

Expatriate Managers

Expatriates are citizens of one

country, who are working in another
country.
Inpatriates is a subset of
expatriates who are citizens of a
foreign country, working in the
home country of their multinational
employer. (e.g., citizen of India, who
moves to U.S to work for Microsoft)

Expatriate selection
Four dimensions that predict success in a foreign posting:
Self orientation self esteem, self confidence, mental
well being, adapt their interest in food, sports, music
and hobbies.
Others orientation ability to interact with host
countrys nationals, relationship development and
willingness to communicate by learning local
language.
Perceptual ability to understand the particular
behaviour of people in host countries, empathise.
Cultural toughness relationship between country of
assignment and how well an expatriate adjusts

II.

Training and Management

Development

the next step is training the manager to do the

specific job.
a broader concept, it is intended to develop a
managers skills over her career in the firm, e.g.,
sending managers on various foreign postings over
years to build her cross cultural sensitivity and
experience.
To enhance management and leadership skills of
executives.
MDP have a strategic purpose, and helps reinforce
desired culture of the firm by creating an informal
network.

Types of training
i.

Cultural training understanding the culture

of host country, enhance effectiveness,
familiarization trip before formal transfer.
ii. Language training managers ability to
interact, help build rapport and improve
managers effectiveness.
iii. Practical training adjust to day to day life
in host country, establish a routine,
successful adaptation, support network of
friends

Performance Appraisal
These are the systems used to
evaluate the performance of
managers against some criteria, that
the firm judges to be important for
the implementation of strategy and
attainment of competitive
advantage.
2 groups evaluate the performance
of Expatriates, - Host country
managers and home country

Compensation
National differences in
compensation
Payments according to global
standards or country specific
standards.
Issues in compensation practices:
i. How compensation should be
adjusted to reflect national
differences in economic
circumstances and practices?
ii. How should the expatriate

Expatriate Pay
Acc. To Balance Sheet Approach, it
equalizes purchasing power across
countries so employees can enjoy
the same living standard in their
foreign posting, as the enjoyed at
home.
It also provides financial incentives
to offset qualitative differences
between assignment locations.

Thankyou