Micro Issues In International Management - International Management - Lecture Slides, Slides of International Management

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Micro Issues In International

Management

Human Resource (Capital) Management, Motivation and Leadership

Micro Issues

• At the heart of a manager’s challenge is getting

people to perform effectively and efficiently daily.

• The concern here is to find out what motivates

people to work. At the local level a manager needs

to know about the differences in the larger

environment that elicit and maintain behavior that

leads to high employee productivity.

• Micro issues are influenced by some of the

previously discussed Macro variables. We will look

at specifically Motivation, Leadership and HRM

Factors that make HRM different in the international arena, cont.

• Differences in national orientations
• Controlling HR functions more difficult due to distance and diversity
• Moderating influence of technology on labor mobility

Generic approaches to managing HR function by MNCs

• Ethnocentric
• HR functions follow home country practice, e.g..

recruiting and selecting PCN as managers

• May be appropriate when there is lack of local

knowledge or as a control mechanism

• Host countries and HCN tend not to like approach
• Limits the opportunities for HCN and PCN may find

it costly to adapt

Generic approaches to managing HR function by MNCs

• Geocentric
• Using the best HR practice without much regard to country of origin
• Selecting and recruiting the best and most qualified worker
• Not as appealing to host countries
• Highly centralized organization and thus implementation can be difficult and expensive

Selected HR functions and peculiar international HR issues

• Recruiting and selection (Staffing)
• Technical competence
• Adaptation to a different culture, language etc..
• Motivation - congruency with career path
• Family situation (#1 reason for expatriate managers’ failure in US MNCs

Compensation

• as remuneration for work Vs. pay as incentive to

take overseas assignment

• Relative cost of labor is a dynamic issue since it is

tied to productivity and exchange rate.

• Cost of living adjustments
• Intra-company equity in pay, especially with HCN
• Choice of currency
• Differences in terms of pay, fringe benefits, job

security etc..

Repatriation issues

• Socio-cultural adjustment - reverse culture shock
• Derailment from career path
• Compensation issues when repatriated

Principles of Effective International HR

• Rigorous recruitment and selection procedures; training and development at all levels, developmental appraisal and performance- linked pay.
• Flexible job design, reduced organizational hierarchies; team working; empowerment and two way communications were common features.

Principles of Effective International HR

• Though knowledge capture and dissemination provokes a centralizing tendency, it was clear that organizations are trying to focus on local knowledge and ensuring there is not an HQ-centric view of the world.
• The effectiveness of international HR is contingent upon the leveraging of human, social, organizational capitals at all levels and sections of the global business.

Principles of Effective International HR

• More than any other factor, the ability of the firm to derive value from either leading or innovative HR practices are determined by the role, strength and quality of the organization's leadership. Leadership capability therefore, is central to the effective management of human capital.

Some Motivation Theories

• Older Theories of Motivation
  • Maslow’s Hierarchy of Needs
  • McGregor’s Theory X and Y
  • Herzberg’s Hygiene and Motivation Factors Newer Theories McClelland Need Theory (Ach, power,aff.) Expectancy Theory (effort /perform /reward) Valence Reinforcement theory.

Understanding Culture

• A disappointed salesman of Coca-Cola returned from his assignment to Saudi Arabia. A friend asked, "Why weren't you successful with the Saudis?" The salesman explained, "When I got posted, I was very confident that I would make a good sales pitch. But I had a problem. I didn't know how to speak Arabic. So I planned to convey the message through three posters

• First poster : A man lying in the hot desert sand totally exhausted and fainting. Second poster : The man is drinking Coca-Cola. Third poster : Our man is now totally refreshed. And then these posters were pasted all over the place. "Terrific! That should have worked!" said the friend. "The hell it should have!" said the salesman. "No one told me they read from right to left!"