1. LECTURE BY:
MISS HAREEM SIDDIQUI
FOR MHRM (Final)

2. OBJECTIVES OF CHAPTER
 After studying this chapter, you will be enable to
understand:
International HRM
Need for IHRM
Approaches of IHRM
Differences b/w Domestic HRM and IHRM
Variables that moderate these differences
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3. INTRODUCTION TO IHRM
 More and more firms are moving outside their
domestic borders into the dynamic world of
international business.
 Hence resulting into Globalization.
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4. GLOBALIZATION
 Tendency of firms to extend their sales, ownership
and/ or manufacturing to new markets abroad.
 A process by which regional economies, societies and
culture become integrated through a global network of
communication, transportation and trade.
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5. REASONS FOR GLOBALIZATION
 Expand business
 Cut labor costs
 Forming partners
 Strengthening economy
 Be more productive
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6. NEED FOR IHRM
 As a result of Globalization or Internationalization of
firms, it has become critically important for
organizations to find and nurture the Human
resources required to implement a global strategy
successfully.
 That’s why effective HRM is essential for this purpose.
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7. APPROACHES TO DEFINE IHRM
 IHRM is characterized by 3 broad approaches:
Cross cultural management
Comparative industrial relations
HRM in Multinational firms
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8. IHRM FROM THE PERSPECTIVE OF
MNC
 IHRM is basically an interplay among 3 dimensions:
HR activities
Types of employees
Countries of operations
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9. IHRM
HR ACTIVITIES
 3 Broad HR activities include:
a) Procurement
b) Allocation
c) Utilization
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10. IHRM
COUNTRIES OF OPERATION:
a) Parent/ Home country where the firm is head
quartered.
b) Host country where the firm’s subsidiaries are
located.
c) Third country where the firm is neither
headquartered nor subsidiaries are located. May be
used as a source of labor.
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11. IHRM
TYPES OF EMPLOYEES:
a) Host Country Nationals (HCNs)
b) Parent Country Nationals (PCNs)
c) Third Country Nationals (TCNs)
d) Expatriates
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12. EXPATRIATE
 An employee who is working and temporarily residing
in a foreign country. OR
 Employees who are transferred out of their home base
into some other area of firm’s international operations
for the sake of completing a particular assignment.
 Also called as International assignees.
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13. DIFFERENCES B/W DOMESTIC &
IHRM
 Differences can be attributed to 6 factors:
1. More HR activities
2. Need for a broader perspective
3. More involvement in employees’ personal lives
4. Changes in emphasis as the workforce mix of
expatriates and locals varies.
5. Risk exposure
6. More external influences
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14. 1.MORE HR ACTIVITIES
 International Taxation
 International Relocation and orientation
 Administrative services for expatriates
 Host government relationships
 Language translation services
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15. 2. NEED FOR BROADER
PERSPECTIVE
 IHR managers have to design and administer programs
for more than one national group of employees. So
they have to take broader view of issues.
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16. 3. MORE INVOLVEMENT IN
EMPLOYEES’ PERSONAL LIVES
 Helping expatriates and their families in:
Housing arrangements
Adjusting with new culture
Health care
Cost of living
Compensation details
Schooling arrangements, etc.
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17. 4. CHANGES IN EMPHASIS OF
WORKFORCE
 As the firm hires different category of employees like
HCNs, PCNs, etc, the emphasis on the HR activities
also change.
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18. 5. RISK EXPOSURE
 More risk involved in IHRM.
Human and financial failure
Expatriate failure
Terrorism
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19. 6. MORE EXTERNAL INFLUENCES
 Type of government
 state of economy
 General practices of doing business of the host
country
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20. VARIABLES THAT MODERATE
DIFFERENCES
 Complexities involved in operating in different
countries.
 The cultural environment
 The industry type
 Reliance of the MNC on its home country domestic
market
 Attitude of senior management.
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