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International HRM

International HRM (Global HRM):

International Human Resource Management (IHRM) can be defined as

a set of activities targeting human resource management at the
international level. It strives to meet organizational objectives and
achieve competitive advantage over competitors at national and
international level.
IHRM comprises of typical HRM functions such as recruitment,
selection, training and development, performance appraisal and
dismissal done at the international level and additional exercises such
as global skills management, expatriate management and so on.
IHRM is concerned with handling the human resources at
Multinational Companies (MNCs) and it includes managing three types
of employees −
● Home country employees − Employees residing in the home
country of the company where the corporate headquarter is
situated, for example, an Indian working in India for some
company whose headquarters are in India itself.

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● Host country employees − Employees residing in the nation in

which the subsidiary is located, for example, an Indian working as
an NRI in some foreign country.
● Third country employees − These are the employees who are not
from home country or host country but are employed at the
additional or corporate headquarters.

IHRM vs. HRM

There are many similarities between HRM at the national as well as

international level. However, let us have a look at the differences
between them with the help of points given below −
● Domestic HRM takes place at the national level, that is, within a
country and IHRM takes place at the international level, that is, in
between two or more than two countries.
● Domestic HRM is bothered about managing employees belonging
to one nation and IHRM is bothered about managing employees
belonging to the home country and host country as well as third
country employees.
● Domestic HRM is concerned with managing a limited number of
HRM activities at the national level and IHRM is concerned with
managing additional activities such as expatriate management.
● Domestic HRM is less complicated due to less imprint from the
external environment. IHRM is comparatively more complicated,
as it is deeply affected by external factors such as cultural
distance and institutional factors.

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Objectives of IHRM:
1. It enhances to develop managerial skills, organisational knowledge
and technical abilities of HR managers and employees;
2. To develop more and better handle of global business operations;
3. To manage and secure the performance, compensation and career
path of employees;
4. To manage and organise cross cultural counselling and language
training programme;
5. To develop more feasible understanding of work practices at global
levels;
6. To raise and develop better and new performance management of
human resources;
7. To get more and more opportunities within global HR scenario;
8. To develop better and competitive HR strategies in global
competitive scenario;
9. To reduce the cultural differences as amicable for the cultural
environment.

Model of IHRM:

P.V. Morgan explained the three-dimensional model of IHRM, it

includes:

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a) Human resource activities

b) Types of employees, and
c) Countries.

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Approaches to IHRM:

There are mainly four IHRM approaches. These include:

a) Ethnocentric approach
b) Polycentric approach
c) Geocentric approach, and
d) Region-centric approach.

a. Ethnocentric:
Refers to an approach in which all strategic decisions are made at
headquarters and foreign subsidiaries are endowed with very little
autonomy. PCNs or expatriates occupy key positions at headquarters as
well as in subsidiaries. They control all the critical areas of operation,
such as finance, production, and quality. McDonald’s is an organization
that follows the ethnocentric approach.
b. Polycentric:
Refers to an approach in which MNCs treat each foreign subsidiary as a
distinct entity. Therefore, each foreign subsidiary is provided with little
autonomy to make its own decisions. The MNCs, which follow a
polycentric approach, recruit HCNs in their foreign subsidiaries. The
staff at headquarters comprises PCNs because HCNs are rarely
promoted to key positions at the headquarters.
c. Geocentric:

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Refers to an approach in which the focus is on staffing the best

employee for a particular position. The geocentric approach is based on
an integrated global philosophy. The MNCs following the geocentric
approach may recruit PCNs, HCNs, or TCNs for any position in the
headquarters or subsidiaries. The nationality of the candidate is not the
key to staffing because the MNCs focus on the ability of the candidate.
d. Regiocentric:
Regiocentric Orientation is an approach adopted by a firm wherein it
adopts a marketing strategy across a group of countries, which have
been grouped on the basis of their market characteristics; i.e., the
market characteristics of these countries would be more or less similar.

An expatriate is an employee who is working and temporarily residing

in a foreign country.

These employees are often referred to as international assignees. MNEs

operating across international borders will encounter staffing issues
that may not be evident in the domestic environment.

Expatriates
Expatriates are employees of organizations in one country who are
assigned to work in other countries on long- or short-term business
projects.
They help their companies establish operations in other countries,
enter overseas markets or transfer skills and knowledge to their
companies’ business partners.
The experience helps organizations develop their management skills
base and their ability to succeed in a global marketplace.

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Role of Expatriates:
The role of an expatriate is very vital. There are various expectations
from him as he’s transferred from one location to another country.
The roles are as follows: -
1) Expatriates as an Agent of Direct Control: The use of staff transfers
can be regarded as a bureaucratic control mechanism, where the
primary role is that of ensuring compliance through direct supervision.
2) Expatriates as an Agent of Socialization: This role is related to the
use of corporate culture as an informal control mechanism. There is an
implicit expectation that expatriates assist in the transfer of shared
values and beliefs. Attempts to instill corporate values and norms
ritualized in the form of certain expected behaviours often have
negative results at the subsidiary level.
3) Expatriates as Network Builders: International assignments are
viewed as a way of developing social capital by fostering interpersonal
linkages that can be used for informal control and communication
purposes.
4) Expatriates as Transfer of Competence and Knowledge: International
Assignments assist in knowledge sharing and competence transfer, and
encourage adoption of common work practices, aspects of which may
comprise elements of corporate culture. Staff in the various
organizational units may be exposed to different viewpoints and
perspectives that will shape their behaviour and may reinforce their
feeling of belonging.
5) Expatriates as Boundary Spanners: Boundary spanning refers to
activities, such as gathering information, that bridge internal and
external organizational contexts. Expatriates are considered boundary

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spanners because they can collect host country information, act as

representatives of their firms in the host country, and can influence
agents. For example, attending a social function at a foreign embassy
can provide the expatriate with an opportunity to network, gather
market intelligence and promote the firm’s profile at a high level.
6) Expatriates as Language Nodes: Many multinational firms operate
through language standardization – or a common corporate language,
usually English.
Repatriation Process:
Repatriation is a process of returning back from a international
assignment to a home country after completing the assignment or
some other issues.

1° Preparation: In the first stage the plans for the future are
developed. Here, the expatriate may collect information about the new
position that he/she will cover in the head-quarter.

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2° Physical relocations: After the decisions of the plans for the future,
it skips to this step. It deals with the removal of personal effects,
breaking ties with colleagues and friends, and traveling to the home
country. It is easy to understand that is a tricky stage, because some of
the challenges affecting the repatriates stem from the operations
described, if they are not supported by a comprehensive and efficient
relocation program promoted by the organization.
3° Transition: In the third stage the company sets a temporary
accommodation where it is needed, with the relative arrangements for
the family (house and school), and performs necessary administrative
tasks.
4° Readjustments: In the last step the company has to face the reverse
cultural shocks and expatriates’ career demands that occur with the
reentry in the home organization. Those challenges depend heavily on
how the countries’ cultures differ among them (if they are too
culturally dissimilar, the repatriation process will be more difficult). The
process will be even harder if the expatriate has experienced a
successful environment in the host culture.

Hofstede’s Cultural Dimensions Theory:

Hofstede’s Cultural Dimensions Theory, developed by Geert Hofstede, is a framework
used to understand the differences in culture across countries and to discern the ways
that business is done across different cultures. In other words, the framework is used
to distinguish between different national cultures, the dimensions of culture, and
assess their impact on a business setting.

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Hofstede identified six categories that define culture:

1. Power Distance Index

2. Collectivism vs. Individualism
3. Uncertainty Avoidance Index
4. Femininity vs. Masculinity
5. Short-Term vs. Long-Term Orientation
6. Restraint vs. Indulgence
Power Distance Index
The power distance index considers the extent to which inequality and
power are tolerated. In this dimension, inequality and power are
viewed from the viewpoint of the followers – the lower level.

● High power distance index indicates that a culture accepts

inequity and power differences, encourages bureaucracy, and
shows high respect for rank and authority.
● Low power distance index indicates that a culture
encourages organizational structures that are flat and feature

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decentralized decision-making responsibility, participative style of

management, and place emphasis on power distribution.

Individualism vs. Collectivism

The individualism vs. collectivism dimension considers the degree to
which societies are integrated into groups and their perceived
obligations and dependence on groups.

● Individualism indicates that there is a greater importance placed

on attaining personal goals. A person’s self-image in this category
is defined as “I.”
● Collectivism indicates that there is a greater importance placed on
the goals and well-being of the group. A person’s self-image in
this category is defined as “We”.

Uncertainty Avoidance Index

The uncertainty avoidance index considers the extent to which
uncertainty and ambiguity are tolerated. This dimension considers how
unknown situations and unexpected events are dealt with.

● A high uncertainty avoidance index indicates a low tolerance for

uncertainty, ambiguity, and risk-taking. The unknown is minimized
through strict rules, regulations, etc.
● A low uncertainty avoidance index indicates a high tolerance for
uncertainty, ambiguity, and risk-taking. The unknown is more
openly accepted, and there are lax rules, regulations, etc.

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Masculinity vs. Femininity

The masculinity vs. femininity dimension is also referred to as “tough
vs. tender,” and considers the preference of society for achievement,
attitude towards sexuality equality, behavior, etc.

● Masculinity comes with the following characteristics: distinct

gender roles, assertive, and concentrated on material
achievements and wealth-building.
● Femininity comes with the following characteristics: fluid gender
roles, modest, nurturing, and concerned with the quality of life.

Long-Term Orientation vs. Short-Term Orientation

The long-term orientation vs. short-term orientation dimension
considers the extent to which society views its time horizon.

● Long-term orientation shows focus on the future and involves

delaying short-term success or gratification in order to achieve
long-term success. Long-term orientation emphasizes persistence,
perseverance, and long-term growth.
● Short-term orientation shows focus on the near future, involves
delivering short-term success or gratification, and places a
stronger emphasis on the present than the future. Short-term
orientation emphasizes quick results and respect for tradition.

Indulgence vs. Restraint

The indulgence vs. restraint dimension considers the extent and
tendency for a society to fulfill its desires. In other words, this
dimension revolves around how societies can control their impulses
and desires.

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● Indulgence indicates that a society allows relatively free

gratification related to enjoying life and having fun.
● Restraint indicates that a society suppresses gratification of needs
and regulates it through social norms.

Country Comparisons: Hofstede Insights

Hofstede Insights is a great resource to understand the impact of
culture on work and life.

Green HRM

Green Human Resource Management (GHRM):

GHRM is the integration of environmental management into human

resources management.

Green Human Resources Management (GHRM) can be defined as a set

of policies, practices, and systems that stimulate the green behavior of
a company’s employees in order to create an environmentally sensitive,
resource-efficient, and socially responsible organization.

The term green HRM is mostly used to refer to the contribution of HRM
policies and practices towards the broader corporate environmental
agenda.

The growing role of sustainable development in the development of a

modern company’s competitive edge leads to the popularization of the
question of how to incorporate ecological practices into the area of

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human resource policy – which is often referred to as Green Human

Resources Management (HRM).”

Strategic Aspect of Green HRM

a. “The Green products/services Portfolio” including waste and

pollution management, resource replacement, sustainable design,
and adaptive reuse.
b. “The Green Workforce” including Human Resource strategies,
culture, recruiting and retention, training, career path
development, and diversity.
c. “The Green Workplace,” including global locations, physical
plants, ergonomics, virtual workplaces, green buildings,
environmental discharge, waste and energy, use, and source.
d. “The Green Function/Process Model,” including sustainability
applied to traditional functions, enterprise-wide green process
modeling to incorporate green practices and sustainable-
management.
e. “Green Management and Governance Principles,” including board
and management accountability, sustainability test, compliance,
incentives, ethics, reporting, and assurance.
Green HR Policies

There is no doubt that organizations are the main cause of

environmental problems. They should, therefore, play a large role in
addressing environmental management issues. Bebbington (2001) has
identified a wide range of GHRM practices.

Green HR Policies are;

● Sourcing and acquisition of human resources.

● Green recruitment, and selection.

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● Orientation.
● Learning and development.
● Green performance management.
● Green compensation and reward management.

Sourcing and acquisition of human resources

As higher-level executives have more responsibility for green initiatives,

green targets should be included in the managerial job description. As
the requirement of employees, environmental consciousness can be
included in the competency model of the organization.

Green recruitment and selection

Company websites can be used to invite applicants to apply for vacant

positions. Resumes can be submitted online to reduce wastage of
printed materials.

Companies can also use web portals for onboarding documentation like
offer letters, credentials, and testimonials regarding qualifications and
experiences and acceptance letters of selected applicants.

Orientation

The employee induction program should be planned in such a way-as to

enable the induction of new employees into a culture of green
consciousness.

Employers should highlight the concern for green issues of employees

like their health, safety, and green working conditions in the orientation
program.

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Learning and development

Learning, training, and development policies can include programs,

workshops, and sessions to facilitate employees for improving and
acquiring knowledge in environment management, green skills,
and attitudes.

For future talented green managers, job rotation in the green

assignment should become an important part of their career
development plan.

Green performance management

The goal of the Performance management (PM) system in green

management is to measure ecological performance standards through
different departments of the organization and achieve useful
information on the green performance of managers. Green
performance indicators should be included in the PM system.

Green PM systems can be successfully initiated through developing

performance indicators for each risk area in environmental awareness
and instruction.

It is important to communicate green schemes to all levels of staff.

Managers/ employees can set green targets and responsibilities.

Green compensation and reward management

The compensation package should be adapted to reward green skills

acquisition and achievement by employees.

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Monetary, non monetary, and recognition based environmental reward

systems and monthly managerial bonuses can be provided based on
performance outcomes in environmental balance.

Carbon emission standards and regeneration sources of energy are the

key consideration for executive payment as an appreciation of green
efforts. Employees meeting green goals can be rewarded.

Green HRM Practices

1. Encouraging employees, through training and compensation, is to

find ways to reduce the use of environmentally damaging
chemicals in their products.
2. Assisting employees in identifying ways to recycle products that
can be used for playgrounds for children who don’t have access to
healthy places to play.
3. Designing a company’s HRM system is to reflect equity,
development, and wellbeing, thus contributing to the long-term
health and sustainability of both internal (employees) and
external communities.
4. Emphasizing long-term employment security is to avoid disruption
for employees, their families, and their communities.
5. Use of job portals of companies for recruitment and custom of
telephone, internet, and video interviews, which can lessen the
travel requirements of the candidate and affect the reduction in
paperwork.
6. Green rewards to employees can be provided by companies in the
arrangement of the nature-friendly workplace and lifestyle
benefits through providing carbon credit equalizers, free bicycles,
and pollution-free vehicles for transportation to the workplace to
engage employees in the green agenda.

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7. Talented, skilled, and experienced employees are environmentally

conscious now, and they always look for self-actualization to be
committed to their work. Green HR can create this commitment
by following green values and practices.
8. Green actions can occur with minimum use of paper and printed
materials in recruitment, training and development, and
performance appraisal.
9. A company can create a green business environment by reducing
the use of printed materials, increased recycling, using eco-
friendly grocery and lunch bags, and prohibiting the use of bottled
water, plastic in the workplace.
10. Luminous light bulbs and other energy-saving green devices
can be used in the workplace.
11. Companies can inspire their employees to change their
travel and transportation ways through reducing official car trips,
using public transport for business travel, carpooling, providing
interest-free loans to purchase hybrid cars, and cycling or walking
to work.
12. Conduct business meetings and conferences through the
internet, telephone, and video conferencing wherever possible to
reduce business travel.
13. Provide flexible work opportunities to employees in telework or
work from home by using emails and company portals through intranet
and internet.

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