1. There are several similarities and difference between domestic and international human resource management. The differences and similarities attributed by these two disciplines, cuts across six key factors (Dowling, Festing and Engle 5).
These factors include; risk exposure, broader external influence, more HR activities, involvement in the employee’s personal lives, need for a broader perspective, and changes in emphasis (Dowling, Festing and Engle 6).
The international human resource differs from the domestic one in terms of taxation. Expatriates in IHRM undergo international taxation as well as domestic tax liabilities. International human resource management has increased activities such as relocation and orientation.
These activities entail pre-departure training, verification of immigration details, housing Medicare and taxation treatment. This also consumes a lot of time.
Another clear difference is that comes out is the boarder perspective. In the domestic HRM, employees work within national boundaries under uniform policies.
On the other hand, the international human resource management entails staff to operate outside their boarder perspective. The set of rules and regulation in the domestic HRM is minimal whereas, in the International HRM, the rules and regulations are numerous.
In terms of attention given to personal life, domestic HRM gives no particular attention to personal life while the international one highlights a lot of concerns on personal life.
In addition, international human resource management faces a higher risk exposure than the domestic one (Dowling, Festing and Engle 7).
In similarity, both human resource managements, employees are subjected to taxation. They both set their rules and regulations to cover taxation working rules and employees conduct.
In both human resources, management employees face risks (Dowling 29). These risks include financial consequences, and political climate in the global scene.
Moreover, external influence is vivid in both human resource management systems. Governments like interfering with the activities of the HRMs. Both HRMs provide employment opportunities to qualified individuals.
2. The impact of culture has transformed the human resources entirely. For instance, human resource practiced in one region or country, cannot be applied in any other region.
Culture also influences decision making. This has sparked different criteria in assessing performance appraisal. Behavioral criteria are widely used as opposed to results criteria (Dowling, Festing and Engle 10).
The culture of high power demands for loyalty and obedience. This is similar to parochial culture where duty and responsibility is crowned by power and authority. This culture imbalances the superior – subordinate relationship in the organization.
In summary, culture positively affects human resource practices. The organizational culture contributes to the positivity in human resource practices and enhances management over time.
The practices brought about by the organizational culture ensure basic values are shared among employees (Dowling, Festing and Engle 11).
Some of the positive influences brought about by the impact of culture are a career development, staffing and participative management.
Some organizations have developed ethical which enhances honesty and perfection in the organization. Culture plays a pivotal role in standardization of activities in an organization.
3. “Imperative for coordination” for a multinational enterprise requires that Human resource management should strive to deliver international support to the primary activities handled by the multinational.
The key role of HRM is to provide support primary activities in a multinational (Dowling, Festing and Engle 13). Most multinationals have a problem in developing coordination.
Hence the multinational have to enforce consistency in employee management at the global level. The same element should be reciprocated to the local market with regard to different cultural requirements in the society.
Since multinational firms involve in international competition, then the strategy should revolve on how to manage business abroad. Therefore, mechanism to offer support activities must integrate in the world wide linkage.
This assures that the international conception of human resource management is at par with the following steps; the human resource management resembles that at host country, the strength and weakness are similar to the parent organization.
Foreign organizations have preferred ways to handle employees. The parent organization notes the cultural difference and utilizes it. Cross cultural learning is advisable since it hasten learning. (Dowling, Festing and Engle 13)
4. Multinationals are affected by two principal issues of structure. The first is the manner in which key decisions are made at the parent country headquarters and subsidiary units.
The second issue is the mode of control applied by the parent organization over the subsidiary unit. These structural issues prompt the streamlining of product or service based global structure.
The two distinct organizational structures in the multinational are the global product division structure and global matrix structure. These two structures offer a solution to the structure issue.
In addition, they enhance multi-centered network (Dowling, Festing and Engle 31). The networked structure benefits the multinationals by having enforcing a linear delegation of decision making, as well as geographical dispersal of key functions globally.
De-layering of organizational level and differentiation of responsibilities and authority across the networked subsidiary has been enhanced.
In addition to these issues, multinational organizations also face strain brought up by geographical spread. They are also faced with the need to improve international coordination and control across the various business units (Dowling, Festing and Engle 32).
The multinationals also face a lot of constraints brought up by their host government in terms if regulations. The regulation touches on ownership and equity. These issues influence massive changes in the multinationals.
5. Despite convergence in human resource practices cultural and institutional differences are increasingly being noted (Dowling, Festing and Engle 57). They impact on human resource integration in the staffing, developing and advance beyond current status in the organization.
It brings forward implications such as extensive communications and use of negotiators. In addition, systematic partner selection is mandatory in order to attain thorough compatibility.
In another IJV development, stage cultural and institutional difference will influence learning and knowledge management process (Dowling, Festing and Engle 57).
This implies that there is a substantial need to design and policies with a local global consideration. The difference will also impact on developing integrative strategies.
The human resource systems have to be upgraded in order to initialize knowledge flow to the parent organization. This calls for establishing appropriate structure and employing the right senior managers (Dowling, Festing and Engle 57). This will improve competition in the global market.
6. There are various reasons for international assignments. Many companies are seeking international services to enhance their employees’ expatriation.
The international assignments include; long-term, short-term extended, contractual, rotational, commuter, self initiated as well as virtual transfers (Dowling, Festing and Engle 89).
The main reason for these assignments is to fill a skill gap, and enhancing organizational development. Employees assigned on international duties capitalize on the experience and skills they gain while abroad.
It also influences management development. International assignment assists in sharing of critical knowledge as well as adoption of common work (Dowling, Festing and Engle 89).
International assignments are perfect channel for competence transfer. The multinational organization deploys Staff throughout various organizations under the same network.
This ensures the primary role of compliance under the direct supervision. When one is abroad, he or she changes the career perception and willingness to focus on a profession of choice.
The main challenge is to link these assignments to organizational, career path. The exercise is a marvelous opportunity to develop managers for the organization.
The venture is proving to be a brilliant strategic instrument for a successful competition in the global market. In addition, it improves relationship with colleagues, flexibility and job simplicity. The international expatriate acts as a network builder of the organization (Dowling, Festing and Engle 90).
7. Return on investment is extremely beneficial since it enables the organization to know how to maximize on its investments. This is a crucial step in realizing geocentric orientation.
It is necessary to measure Return on Investment so as to open up for the host country network and third country network. Return on investment assists the organization to quantify costs incurred in the investment (Dowling, Festing and Engle 99).
The over all growth of the organization is also assessed. Measuring this will enable the organization to see if its repatriates have succeeded in knowledge transfer (Dowling, Festing and Engle 209).
Other benefits of measuring return on investments are to assess profitability and revenue developed by the investments. It also shades some light whether expatriates met assignments’ goals.
The return on investment calculations is directly linked to the nature and purpose of the assignment given abroad. Multinational organizations are able to increase market share in the market of venture (Dowling, Festing and Engle 98). It is a perfect tool to assess the impact of international assignment on promotions and salary increase.
There are several indicators used top calculate return on investment of international assignment. The organizations ought to check quantifiable assignment objects such as company sales within a certain period.
Other indications are the non-quantifiable assignment objectives for instance, strengthening of corporate culture and providing knowledge. All these elements are in respect to management development and organizational development.
Additionally investment indicators such as direct costs in terms of salary, taxes, housing among others can be used to measure return on investment (Dowling, Festing and Engle 99).
Administrative costs of running an international assignment programme and adjustment costs are potential indicators for return on investment.
8. Expatriates failure should be a prime concern for all multinationals. This should be a concern since these companies are investing majorly in the global market.
The financial burden is quite immense hence returns are much expected from these expatriates (Dowling, Festing and Engle 132). Expatriate failure shows the premature return as well as underachievement in the international assignment.
Multinational should be concerned since this failure might decrease the confidence of employees in the organization. It may also lower their morale and decrease their intrinsic motivation. The shame of the failure falls back to the organization.
The organization is viewed to have failed in international human resource management. The expatriate failure tarnishes the multinational image in the international market as being poor in cultural awareness (Dowling, Festing and Engle 139).
Expatriates failure questions the efficiency and productivity of both the management and the expatriates. However, companies should perceive the failure as a wakeup call in evaluating the criteria used to select expatriates.
Expatriates failure should push the multinational organization to motivate their expatriates to exert efforts to achieve excellence. Multinational should assess their expatriate frequently and recall those that are not promising. Managing the activity of the expatriate should be the main priority for the organization (Dowling 32).
9. Currently, in the multinational organization there is an increase in dual couple career. The expatriate failure may be attributed to the uncertainty experienced in dual career couples and families of the expatriates.
This process is a stressful process for the expatriates who are extremely attached to their families. The stress should be proactively handled (Dowling, Festing and Engle 198).
The best way to curb this is by introducing global mentoring programme. A social support system should be established within the organization to run this programme.
This program seeks to enhance socialization of the expatriate. The program should be able to provide some social support to the expatriate as well as the spouse. The company should also develop dual career policies.
The organization should train their expatriate to adjust to a foreign country. They should also offer relocation assistance and occasional family visits for the expatriate.
The expatriate should have an opportunity to contact family members and be up to date with developments at home. Repatriation programme should also be encouraged.
This will look at culture shock and reverse the situation (Dowling, Festing and Engle 198). For expatriates with young children, he or she will receive maximum assistance to resettle the children in school abroad.
In addition, the organization should provide cross cultural orientation to the family. The multinational should embrace family friendly policies such as job-hunting assistance, on-assignment career support, inter company networking and intra-company employment.
10. Common HRM problems include; unsatisfactory quality of products and services. Another crucial problem is a lack of management control. This is attributed to failure in achieving international assignment goals (Dowling, Festing and Engle 236).
In addition, rapid turnover is another problem in off shoring organization. High turnover is mainly experienced within local staff. Language problem also poses a formidable problem for human resource management.
As a result of these short comings, the human resource departments are refraining from getting involved in off shoring decisions and processes (Dowling, Festing and Engle 236).
Other challenges that affect Human resource management in these off shoring locations are institutional and functional divides. The difference in management activities hinders the performance of the employees.
There is also a drift difference in performance between government owned organization and non governmental ones. Hence the situation poses a difficult venture for staff to shift from either side and be efficient in productivity.
Multinational companies in China and India are focusing in low cost strategy of off shoring procurement. They should design human resource roles that seek to balance economic imperatives(Dowling, Festing and Engle 299).
This will enable the multinationals from these countries to control and standardize the social and institutional, international human resource management (Dowling, Festing and Engle 299).
This will in turn widen the range of diversity among their expatriates. In addition, the labor sourcing within the market boundaries will be enhanced.
Since most of the companies in this region have been criticized of poor employee relation and compensation, this strategy should work to reverse the perception.
Works Cited
Dowling, Peter, Marion Festing, and Allen Engle. International Human Resource Management: Managing People in a Multinational Context. 5th ed. South-Western EMEA UK: Cengage Learning, 2008. Print.
Dowling, Peter. “Completing the Puzzle: Issues in the Development of the Field of International Human Resource Management.” Management International Review 39 (1999): 27-43. Print.