15. Managing HR Globally

Question 1

Name 2 trade agreements that facilitate global activities

Define parent-company

Define host-country

Define third-country

Define expatriates

Answer 1

NAFTA, WTO

Country in which the organization’s headquarters is

Country (other than the parent) in which an organization operates a facility

A country that is neither the parent country nor the host country (e.g. nationality of manager)

Employees assigned to work in another country

Question 2

Define international organization

Define multinational company

Define global organization

Answer 2

Sets up operations in one or more foreign countries

Builds facilities in different countries to minimize production and distribution costs

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

Question 3

Define culture

Name the 5 dimensions in Hofstede

Name 4 factors that affect HRM in international markets

Answer 3

A community’s set of shared assumptions about how the world works and what ideals are worth striving for

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

Culture, education and skill levels, economic system, political-legal system

Question 4

Give 6 criteria for selection of expatriates

Answer 4

•Competency in employee’s area of expertise
•Ability to communicate in the foreign country
•Flexibility, tolerance of ambiguity, and sensitivity to
cultural differences
•Motivation to succeed and enjoyment of challenges
•Willingness to learn the foreign country’s culture,
language, and customs
•Support from family members

Question 5

Give the 4 stages of emotion in foreign assignments

Give and define the 3 main stages in cross-cultural prep

Answer 5

Honeymoon, culture shock, recovery, adjustment

•Preparation for Departure - Language instruction and
an orientation to the foreign country’s culture
•The Assignment Itself - Combo of a formal program and mentoring to provide ongoing info about the culture
•Preparation for Return Home - Providing info about the employee’s community and home-country workplace

Question 6

Give and define 2 main factors in compensating an international workforce

What approach should orgs take to compensating expatriates?

Answer 6

• Incentive Pay - Orgs must make decisions with regard to incentive pay, such as bonuses and stock options
• Benefits - Must consider the laws of each country involved, as well as employees’ expectations and values in those countries

Balance Sheet Approach - Adjusts compensation so that it gives the same standard of living as in the home country plus extra pay for inconvenience of locating overseas

Question 7

Name the 4 components of the total pay package

Define repatriation

Give and define the 2 components of this

Answer 7

Base salary, tax equalization allowance, benefits, allowances

Preparing expatriates to return home

•Communication - Expatriate receives information and
recognizes changes at home while abroad
•Validation - Giving expatriate recognition for overseas service when this person returns home