11 - International HRM

Question 1

Why do companies set operations overseas?

Answer 1

Companies set up operations overseas because of lower labor costs.

Question 2

What is an advantage of technology?

Answer 2

Technology makes it easier for companies to spread work around the globe.

Question 3

Global activities are simplified and encouraged by what trade agreements among nations?

Answer 3

• Increase and changes demands on HRM.
• Organizations need employees who understand customers and suppliers in foreign countries.
• Organizations need to understand laws and customs that apply to employees in other countries.

Question 4

What are expatriates?

Answer 4

Employees assigned to work in another country.

Question 5

What are the levels of global participation?

Answer 5

Domestic, international, multinational, global.

Question 6

What is an international organization?

Answer 6

Sets up one or few facilities in one or a few foreign countries.

Question 7

What is a multinational company?

Answer 7

Builds facilities in a number of different countries in an effort to minimize production and distribution costs.

Question 8

What is global organization?

Answer 8

Chooses to locate a facility based on the ability to effectively, efficiently, and flexibly produce a product or service using cultural differences as an advantage.

Question 9

What are the factors affecting HRM in international markets?

Answer 9

culture, education, economic systems, political-legal systems.

Question 10

What is Culture?

Answer 10

A community’s set of shared assumptions about how the world works and what ideals are worth striving for.
-Greatly affect country’s laws.
-Influences what people value, so it affects people’s economic systems and efforts to invest in education.
-Determines effectiveness HRM practices.

Question 11

What are Schein’s three levels of culture?

Answer 11

Surface manifestations, values, basic assumptions.

Question 12

What are Hofstede’s five dimensions of culture?

Answer 12

Individualism/collectivism, power distance, uncertainty avoidance, masculinity/femininity, long-term/short-term orientation.

Question 13

What is individualism/collectivism?

Answer 13

describes the strength of the relation between an individual and other individuals in the society.

Question 14

What is power distance?

Answer 14

concerns the way the culture deals with unequal distribution of power and defined the amount of inequality that is normal.

Question 15

What is uncertainty avoidance?

Answer 15

describes how cultures handle the fact that the future is unpredictable.

Question 16

What is masculinity/femininity?

Answer 16

The emphasis a culture places on practices or qualities that have traditionally been considered masculine or feminine.

Question 17

What is long-term/short-term orientation?

Answer 17

Suggests whether the focus of cultural values is on the future (long term) or the past and present (short term).

Question 18

What are educational and skill levels?

Answer 18

• Education and skill levels of a country’s labor force affect how and extent to which companies want to operate there.
• In countries with poorly educated population, companies will limit their activities to low-skill, low-wage jobs.

Question 19

What is economic system?

Answer 19

• In developed countries with great wealth, labor costs are relatively high, impacting compensation recruiting and selection decisions.
• Income tax differences between countries make pay structures more complicated when they cross national boundaries.

Question 20

What is political-legal system?

Answer 20

• Country’s laws often dictate requirements for HRM practices: training, compensation, hiring, firing, and layoffs.
• An organization that expands internationally must gain expertise in the host country’s legal requirements and ways of dealing with its legal system.
• Organizations will hire one or most host-country nationals to help in the process.

Question 21

What does HR planning involve?

Answer 21

HR planning involves decisions about where and how many employees are needed for each international facility.

Decisions about where to locate include considerations such as cost and availability of qualified workers which must be weighed against financial and operational requirements.

Question 22

Wha is the criteria for selection of employees for foreign assignments?

Answer 22

1. Competency in employee’s area of expertise.
2. Ability to communicate verbally and nonverbally in the foreign country.
3. Flexibility, tolerance of ambiguity, and sensitivity to cultural differences.
4. Motivation to succeed and enjoyment of challenges.
5. Willingness to learn about the foreign country’s culture, language, and customs.
6. Support from family members.

Question 23

What is cross-cultural preparation?

Answer 23

-Training to prepare employees and their family members for an assignment in a foreign country.

-Covers all three phases of an international assignment:

1. Preparation for departure
2. The assignment itself
3. Preparation for the return home

Question 24

What is the dilemma for global companies?

Answer 24

• Should pay levels and differences reflect what workers are used to in their own countries?
• Should pay levels and differences reflect the earnings of colleagues in the country of the facility, or earnings at the company headquarters?

Question 25

What must decisions about benefits take into account?

Answer 25

Decisions about benefits must take into account the laws of each country involved, as well as employees’ expectations and values in those countries.

Question 26

What are the two compensating expatriates?

Answer 26

• Balance sheet approach
• Going rate approach

Question 27

What is the balance sheet approach?

Answer 27

Adjusts manager’s compensation so that it gives the manager same standard of living as in the home country plus extra pay for inconvenience of locating overseas.

Involves an effort by the global organization to ensure that its expatriates are “made whole”.

Question 28

What is the going rate approach?

Answer 28

Based on local market rates.

Question 29

Going rate approaches relies on survey comparisons among what?

Answer 29

• Local nationals (HCNs)
• Expatriates of same nationality
• Expatriates of all nationalities

Question 30

What is compensation of going rate approach based on?

Answer 30

Compensation based on the selected survey comparison.

Question 30

What are the activities and practises of repatriation?

Answer 30

Pre-departure, during assignment, upon return.

Question 31

What is pre-departure?

Answer 31

1. sponsored assigned
2. communication protocols established
3. web and media contacts for context
4. pre-departure training and orientation

Question 32

What is during assignment?

Answer 32

1. home leave
2. work related information exchanges
3. ongoing communication with sponsor
4. systematic pre-return orientation.

Question 33

What is upon return?

Answer 33

1. new assignment
2. organisational reconnection
3. assistance with non-work factors
4. rituals or ceremonies to share experience.

Question 34

What are market pay structures?

Answer 34

Market pay structures may differ substantially across countries in terms of both pay levels and relative worth of jobs.