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Introduction to International Human Resource Management (IHRM)

Concept and Relevance of IHRM

  • Definition: International Human Resource Management (IHRM) involves managing HR issues that cross national boundaries or occur in locations outside of the company's home country headquarters.
  • Scope: It includes handling relationships between HR activities and foreign environments where organizations operate.
  • Comparative Aspect: IHRM also encompasses comparative studies of HRM practices in different countries, like skill upgrading strategies in Japan, Thailand, Austria, and Switzerland.

Expatriation and Repatriation

Expatriation:

  • Definition: An expatriate (expat) is someone living and/or working in a country other than their country of citizenship, typically for work reasons.
  • Context: Expats are employees sent by their employers to work in a foreign country.

Repatriation:

  • Definition: The process where an international assignee returns to their home country, often along with family members who accompanied them abroad.

International Recruitment Policy

International recruitment policies in organizations can be categorized into three main approaches: ethnocentrism, polycentrism, and geocentrism. Each of these approaches has its unique characteristics and implications for how businesses manage their international operations and personnel.

1. Ethnocentrism

  • Definition: Ethnocentrism in international recruitment refers to a policy where a company primarily uses employees from its home country to staff positions in its international operations.
  • Characteristics:
  • Preference for home-country nationals in key positions.
  • Centralized decision-making typically occurs at the headquarters.
  • Management styles and practices of the home country are predominant.
  • Implications:
  • Can lead to cultural myopia, limiting understanding of local markets.
  • May cause resentment among local employees in host countries.
  • Useful for ensuring alignment with home office policies and strategies.

2. Polycentrism

  • Definition: Polycentrism is an approach where a company employs local staff to manage operations in their respective countries.
  • Characteristics:
  • Emphasis on hiring host country nationals for local operations.
  • Decentralized decision-making, with more autonomy for local managers.
  • Adaptation to local cultures and business practices.
  • Implications:
  • Encourages diversity and local responsiveness.
  • Reduces the issue of cultural misunderstandings.
  • May lead to a lack of cohesion with the company’s overall strategy.

3. Geocentrism

  • Definition: Geocentrism is a balanced approach that seeks the best personnel regardless of their nationality, focusing on a global perspective.
  • Characteristics:
  • Selection of staff based on skill and suitability rather than nationality.
  • Combines centralized and decentralized decision-making.
  • Integration of global best practices with local sensitivity.
  • Implications:
  • Promotes a truly global corporate culture.
  • Enhances global coordination and integration of operations.
  • Requires a strong global HR policy to manage diverse workforce effectively.

Conclusion

Understanding the intricacies of IHRM, including the roles and management of different categories of international employees, is crucial for effectively navigating the complex dynamics of global business environments.

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