Exam revision Flashcards
(91 cards)
1
Q
What three broad approaches is IHRM characterised by?
A
Cross cultural management
Comparative HR and IR systems
HRM in multinational context
2
Q
What is HRM?
A
Human resource planning Staffing (recruitment, selection and placement) Performance management Training and development Compensation (remuneration) and benefits Industrial relations
3
Q
What is Morgan’s 3D model of IHRM?
A
- Broad human resource activities of procurement, allocation and utilisation
- National or country categories involved in IHRM activities
(i. e. host country where subsidiary is located, parent country where firm is headquartered, other countries that may be source of labour, finance etc) - The three categories of employees of international firm
(i. e. host, parent and third country nationals)
4
Q
What are some similarities between domestic and international HRM?
A
Both undertake HR activities, (hr planning, staffing, performance management, T&D, compensation and benefits, industrial relations)
5
Q
What is an expatriate?
A
Staff that is moved across national boundaries into various roles within international firms operations
6
Q
What are the main differences between domestic and international HRM?
A
- Staff are moved across national boundaries
- IHRM has more HR activities (international taxation, relocation and orientation, administrative services for expatriates, host government relations, language translation services)
- More involvement in employees personal lives
- Risk exposure
- Broader external influences
- Change in emphasis as workforce mix of expatriates and locals varies
- Cultural environment and differences
- Multinational industries
- Extent of reliance of multinational on home country domestic market
- Attitudes of senior market
7
Q
Why are tax equalisation policies in place for expatriates?
A
Expatriates are subject to international taxation and often have domestic and host country tax liabilities.
Tax equalisation in place to ensure no tax incentive or disincentive associated with any assignment
8
Q
What is involved in international relocation and orientation?
A
Arranging pre departure training
Providing immigration and travel details
Providing housing, shopping, medical care, recreation and school info
Finalising compensation details (delivery of salary overseas, overseas allowances, tax treatment etc)
9
Q
What are some of the things involved with risk exposure for IHRM?
A
- Extreme high costs of expatriate failure and premature return
- Terrorism attacks (need to assess areas, devise emergency procedures)
- Sickness/outbreaks (SARS etc)
10
Q
What are some of the broader external influences?
A
Government (dictating hiring policies, communism)
State of the economy
Ways of doing business in different countries (gift giving, not shaking left hand etc)
Culture
11
Q
What is culture shock?
A
Phenomenon experienced by people who move across cultures.
Shock in relations to new culture experiences that cause psychological disorientation.
12
Q
What can culture shock lead to?
A
Negative feelings about host country and longing to return home.
13
Q
What is emic-etic distinction?
A
Emic = Cultural specific aspects of concepts or behaviours Etic = Culture common aspects
14
Q
What is a multidomestic industry?
A
One in which competition in each country is essentially independent of competition in other countries.
e.g. Retail, insurance,
15
Q
What is a global industry?
A
One in which a firms competitive position in one country is significantly influenced by position in other countries.
e.g. airlines, semiconductors and copiers
16
Q
What are Laurent’s steps for IHRM?
A
Recognition by parent organisation that:
- its way of managing HR reflect some assumptions and values of home culture
- that its ways are neither universally better or worse, just different
- its foreign subsidiaries may have other preferred ways of managing people, that could be more effective locally
- Willingness from headquarters to not only acknowledge but take active steps in order to make cultural differences more usable
- Building of genuine belief of all parties involved that more creative and effective ways of managing people could be developed through cross culture learning
17
Q
What are the 4 basic elements of culture derived from Hansen?
A
Standardisation of: Communication Thought Feeling Behaviour
18
Q
What is cross cultural management studies?
A
Aims to describe and compare the working behaviour in various cultures.
19
Q
What is the aim of cross cultural management studies?
A
Aim is to include suggestions on improving interactions between members of various cultures
20
Q
What are the four underlying dimensions of country cultures identified in Hofstede’s model?
A
Power distance
Uncertainty avoidance
Femininity vs masculinity
Individualism vs collectivism
21
Q
What is the power distance dimension in Hofstede’s model?
Example
A
Expresses emotional distance between employes and superiors. High power distance = hierarchical organisation structure, low power distance = aspiring to equal power.
China has higher score than Australia. Chinese people very much respect elders and seniors in business sense.
22
Q
What is the uncertainty avoidance dimension in Hofstedes model? Examples
A
Extent to which member feel threatened by uncertain, ambiguous or unstructured situations. High UA = strict beliefs, behaviour codes and rules and regulations. Low UA = High tolerance for deviations. Example Australia has high UA, lots of laws, legislation etc. China has low
23
Q
What is femininity vs masculinity in Hofstedes model? Examples?
A
Masculinity = pursuit of financial success, heroism and strong performance
Feminine oreintation = life balance and interpersonal relationships
China slightly higher as males play a larger role then females
24
Q
What is individualism vs collectiveism in Hofstedes model?
A
The importance of personal achievements and needs against the needs of the group. In China they are under communist rule so they value group more than individual as opposed to australia
25
What are some impacts of low in group collectivism on recruitment and selection?
Individual achievements represent high importance on selection criteria
26
What are some impacts of high in group collectivism on recruitment and selection?
Emphasis in recruiting phases on team related skills rather then individual competencies
27
What are some impacts of low gender egalitarianism on training and development?
Female managers rare
28
What are some impacts of high gender egalitarianism on training and development?
Women have same chance as men
29
What are some impacts of high uncertainty avoidance on compensation?
Be risk adverse and prefer fixed compensation packages
30
What are some impacts of low uncertainty avoidance on compensation?
Risk takers and accept high income variability through performance pay
31
What are some impacts of high collectivism on task distribution?
Emphasis group work
32
What are some impacts of high individualism on task distribution?
Attribute individual responsibilities in work system
33
What are the 4 aspects of a CFA?
Political
Economical
Legal
Socio-cultural
34
What are the benefits and risks of political?
Benefits: stability of government
Risks: High/low security
35
What are the benefits and risks of economical?
Benefits: eco growth supports foreign investment and development
Risks: command market or planned mixed eco
36
What are the benefits and risks of legal?
Benefits: Promotes foreign investment
Risks: nationalisation, legal restrictions, intellectual property, copyright and corruption
37
What are the benefits and risks of socio-cultural?
Benefits: Conductive to cross culture, social development
Risks: Religious laws and different values
38
What IHRM strategies are involved with political?
HCN, PCN and TCN
39
What IHRM strategies are involved with economical?
Recruitment and Selection, performance management and training & development
40
What IHRM strategies are involved with Legal?
Compensation, expatriation and repatriation, OHS
41
What IHRM strategies are involved with socio-cultural?
Cross culture training, career development, ethics and social responsibility
42
What are the 4 categories of approaches to staffing?
Ethnocentric
Polycentric
Geocentric
Regiocentric
43
What is ethnocentric staffing?
Key positions in domestic and foreign operations held by managers from PCN (parent country nationals). Subsidiaries are managed by staff from home country
44
What are the benefits of ethnocentric staffing?
- Organisation control and coordination is maintained and facilitated
- Promising managers are given international experience
- PCN may be best people for the job because of skills and experiences
- Assurance that subsidiary will comply with MNE objectives , policies etc
45
What are the disadvantages of ethnocentric staffing?
- Promotion opportunities of HCN is limited which may lead to reduced productivity and increased turnover
- Adaptation of expatriate manager to host country often takes time which PCNs often make mistakes and poor decisions
- PCN and HCN compare compensation, income gap may be viewed as unjustified
- PCN may impose an inappropriate HQ style
46
What is polycentric staffing?
MNE treating each subsidiary as distinct national entity with some decision making autonomy. Subsidiaries are usually managed by HCNs who are seldom promoted to positions at HQ. PCNs are rarely transferred to foreign subsidiary ops.
47
What are the advantages of polycentric staffing?
- Employing HCNs eliminates language barriers, adjustment problems of expats and families, removes expensive cultural awareness trainings
- HCN employment allows MNE to take lower profile in sensitive political situations
- Employment of HCN is less expensive, no work permits etc
- Avoids turnover of key managers seen in ethnocentric approach
- Increased morale in HCN employees
48
What are the disadvantages of polycentric staffing?
- Control and coordination of HQ may be impeeded
- HCN have limited career opportunities outside subsidiary
- Hiring HCNs limits opportunities for PCNs to gain international experience
49
What is geocentric staffing?
MNE taking global approach to it's operations, recognising subsidiaries and HQ make unique contribution
50
What are the advantages to geocentric staffing?
- Enables MNE to develop international executive team
- Overcomes federation drawback of polycentric approach
- Supports cooperation and resource sharing
51
What are the disadvantages to geocentric staffing?
- Expensive to implement because of increased training and relocation
- Large number of PCN, HCN and TCN need to be sent abroad to be successful
- Require MNE to provide extensive documentation if they wish to hire foreign national instead of local (time consuming, expensive and sometimes futile)
52
What is regiocentric approach to staffing?
Reflects geographic strategy and structure of MNE. Utilises the wider pool of managers but in limited way where staff may move outside HCN but only within specific geographic region. Regional managers not promoted to HQ
53
What is the advantage to regiocentric approach?
- Interaction between managers transferred to regional hq
| - Reflects sensitivity to local conditions
54
What are the disadvantages to regiocentric approach?
- Can produce federalism
| - Moves career prospects to regional level.
55
What are some reasons for filling international assignments?
Position filling
Management development
Organisational development
56
What are some types of international assignments?
- Short term (3 months or less; trouble shooting, project supervison, short term gap measures)
- Extended (up to a year)
- Long term (1 to 5 years;
57
What is expatriate failure?
Premature return of expatriate
58
What are some causes of expatriate failure?
- Selection error
- Ineffective management policies
- Ineffective training
- Inability of expat/expat's family to adapt
59
What are the key factors in a selection criteria?
- Technical ability (individual)
- Cross cultural suitability (individual)
- Family requirements (individual)
- Country/cultural requirements (Situation)
- Language
- MNE requirements
60
What should be looked for in an assessment centre?
- Tolerance for ambiguity
- Interpersonal skills
- Empathy
- Non-judgemental
- Flexible
- Learning orientation
61
What is compensation?
Sum of direct benefits (salary, allowances, bonuses, commissions) and indirect benefits (insurance, pension plans, vacations) that employee receives from employer
62
What is compensation used for in IHRM context?
- Mechanism to develop and reinforce global corporate culture
- Primary source of corporate control
- Links outcomes with associated costs
63
What is required before making an compensation package from IHRM?
Knowledge of:
- Employment and tax laws
- Customs
- Environment and employment practices of foreign country - Familiarity with currency fluctuations
- Effect of inflation
64
What are the objectives of a compensation package?
The policy should:
- Be consistent with overall strategy, structure and business needs of MNE
- Must attract and retain staff that MNE requires
- Should facilitate the transfer of international employees in most cost effective way for firm
- Must give due consideration to equity and ease of administration
65
What does an expatriate expect from a compensation package?
- Financial protection
- Opportunities for financial advancement through income and savings
- Housing, children's education and recreation
- Career will be advanced
66
What are the 4 key components of compensation for expatriates?
1. Base salary
2. Foreign service inducement and hardship premium
3. Allowances (cost of living allowance, home, home leave, education, relocation, spouse assistance)
4. Benefits
67
What are 2 approaches to international compensation of expatriates?
Going rate approach
| Balance sheet approach
68
What is the going rate approach?
- Based on local market rates.
- Also relies on survey comparisons among HCNs, expatriates of same nationality and expatriates of all nationalities
- Base pay and benefits may be supplemented by additional payments for low pay countries
69
What are the advantages of the going rate approach?
- equality with local nationals
- simplicity
- identification with host country
- equity among different nationalities
70
What are the disadvantages of going rate approach?
- Variation between assignments for same employee
- variation between expatriates of same nationality in different countries
- potential re-entry problems
71
What is the balance sheet approach?
- Keep 'expatriate whole' through maintenance of home country living standards plus financial inducement to make package attractive.
- Links base salary for expatriates to salary structure of relevant home country
- Most common in multinational firms
72
What are the 4 approaches to the balance sheet approach?
1. Goods and services (food, personal care, clothes, transport and medic care etc)
2. Housing
3. Income Taxes
4. Reserve (contributions to savings, payments for benefits, pension, education etc)
73
What are the advantages to the balance sheet approach?
- Equity between assignments and expatriates of same nationality
- Facilitates expatriates re-entry
- easy to communicate to employeers
74
What are the disadvantages to the balance sheet approach?
- Can result in disparities between expatriates of different nationalities and expatriates and local nationals
- Can be complex to administer
75
What is a local plus approach?
Expatriate employees are paid according to prevailing salary level, structure and admin guidelines of host location PLUS expatriate type benefits such as transport assistance, housing, dependents education.
Doesn't normally include COLA, hardship allowances, home leave, cross culture training etc
76
What are 4 approaches MNEs take to taxation?
Tax equalisation (MNE withholds tax obligation and then pays all tax to head country)
Tax protection (employee pays up to amount they would pay on compensation to HC)
Adhoc (each expat handled differently)
Laissez-faire (each is on their own)
77
What is the difference between training and development?
Training aims to improve employees current work skills and bahaviour.
Development aims to increase abilities in relation to some future position or job
78
What role do expatriates have in training in development?
- Expatriates are trainers; part of knowledge transfer and expected to train & develop HCN, show hows systems work and monitor HCN performance,
-
79
What are some essential components of pre-departure training?
- Cultural awareness training
- Preliminary visits
- Language instruction
- Assistance with practical day-to-day matters
- Security briefings
80
What are the benefits of cultural awareness programs?
- Helps expatriate adapt and not feel isolated from host country
- Fosters appreciation of host country's culture so they can behave appropriately
81
How long should cultural awareness programs go for?
Depends on type of assignment, type of culture, how culturally aware expatriate is, length of stay and how much interaction there will be. The longer the stay and more interaction, the longer and more intense the training should be
82
What is Mendenhall and Oddou's model?
3 key dimensions in cross cultural training
1. Training methods
2. Levels of training rigor
3. Duration of training relative to degree of interaction and culture novelty
83
What training should be given for low interaction, high degree of similarity between countries?
```
Training less than a week
Information giving approach:
- Area or cultural briefings
- Lectures, movies, books
- Interpreters
- 'survival level' language training
```
84
What training should be given for 2-12 month stay, with interaction expected?
```
Training 1-4 weeks in length
Affective approach:
- role playing
- critical incidents
- cultural assimilator training
- Case studies
- stress reduction training
- moderate language training
```
85
What training should be given if going to novel and different host country, high interaction?
```
Training 2 months to a year
Immersion approach:
- Assessment centre
- Field experience
- Simulations
- Sensitivity training, intercultural web based workshops
- Extensive language training
```
86
What are some set backs to the Black and Mendenhalls model?
- Very time consuming
| - Expensive
87
What are some managerial outcomes of international assignments?
Individual gets experience
| MNE gets cadre of experienced international operators
88
What are some organisational development outcomes of international assignments?
MNE accumulates:
- knowledge
- abilities
- Knowledge transfer
89
What are some causes for international assignment failure?
- Spouse/partner dissatisfaction
- Poor candidate choice
- Poor job performance
- Inability to adapt
- Other family concerns
90
What are some factors influencing re-patriate adjustment?
- Career anxiety (loss of visibility and isolation, no post work guarantee, work place change)
- Work adjustment (re-entry position, employment relationship, devaluing experience)
- Coping with new role
- Loss of status and pay
- family adjustment
- social networks
- effect on partners career
91
What are some strategies for smooth re-entry?
- Pre departure briefs and what to expect on return
- Multiple career planning sessions
- Written repatriate agreements clarifying available assignments upon return
- Mentoring programs that continue after return
- Extended home visits to keep up with social, family, & organizational changes
- Reorientation programs on changes in organization
- Personalized financial & tax advice
- Providing an adjustment period upon return
- Visible & concrete expressions ofrepatriate’s value to the firm
