Managing the Challenges of IHRM

Employee counselling

The following are some of the strategies that can be used to manage challenges of IHRM:

a) Developing an international approach

A truly international approach to human resource management must consider:

  • An explicit recognition by the parent organization that its own peculiar ways of managing human resources reflect some of the assumptions and values of its home culture.
  • An explicit recognition by the parent organization that its peculiar ways are neither universally better nor worse than others, but are different and likely to exhibit strengths and weaknesses, particularly abroad.
  • An explicit recognition by the parent organization that its foreign subsidiaries may have other preferred ways of managing people that are neither intrinsically better nor worse, but could possibly be more effective locally.
  • Willingness from headquarters not only to acknowledge cultural differences, but also to take action in order to make them discussable and therefore useable.
  • The building of a genuine belief by all parties that more creative and effective ways of managing people could be developed as a result of cross-cultural learning.

b) Think Globally and Act Locally

The cultural differences can be managed by ‘thinking globally and acting locally’. This means that an international balancing act is required, which leads to the fundamental assumption that: ‘Balancing the needs of co-ordination, control and autonomy and maintaining the appropriate balance are critical to the success of the multinational company.’ To achieve this balancing act, there are six capabilities that enable firms to integrate and concentrate international activities and also separate and adopt local activities. These are: being able to determine core activities and non-core activities; achieving consistency while allowing flexibility; building global brand equity while honoring local customs; obtaining leverage (bigger is better) while achieving focus (smaller is better); sharing learning and creating new knowledge; and engendering a global perspective while ensuring local accountability.

c) Managing Expatriates

The management of expatriates is a major factor determining success or failure in international business. Expatriates are expensive; they can cost three or four times as much as the employment of the same individual at home. They are difficult to manage because of the problems associated with adapting to and working in unfamiliar environments, concerns about their development and careers, difficulties encountered when they re-enter their parent company after an overseas assignment, and how they should be remunerated. Resourcing, recruitment and selection policies to address all these issues are required.

d) Role specifications

Role specifications should take note of the behaviours required for those who work internationally. International workers should be able to:

  • recognize the diversity of overseas countries;
  • accept differences between countries as a fact and adjust to these differences effectively;
  • tolerate and adjust to local conditions;
  • cope in the long term with a large variety of foreign contexts;
  • manage local operations and personnel abroad effectively;
  • gain acceptance as a representative of one’s company abroad obtain and interpret information about foreign national contexts (institutions, legislations, practices, market specifics, etc);
  • inform and communicate effectively with a foreign environment about the home company’s policies;
  • take into account the foreign environment when negotiating contracts and partnerships;
  • identify and accept adjustments to basic product specifications in order to meet the needs of the foreign market;
  • develop elements of a common framework for company strategies, policies and operations;
  • Accept that the practices that will operate best in an overseas environment will not necessarily be the same as the company’s ‘home’ practices.

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