Assessing The International Human Resource Management Methods Business Essay

Assessing The International Human Resource Management Methods Business Essay Due to globalization, the economy around the world has been largely integrated. Many corporations are expanding their markets into regions or other countries they have never touched before. These corporations are experiencing an evolutionary stage: internationalization. It is clear that effective human resource management of an organization is the major competitive advantage and may even be the most important determinant of organizational performance. Thus, in order to survive in the crucial global economic market, a multinational corporation (MNC) mainly relies on the capability of its international human resource management (IHRM) during the internationalization process. In other words, it is the IHRM’s responsibility to enable the MNCs to be successful globally. Over the past several decades, practitioners and scholars have devoted great effort to explore the field of IHRM and there have developed thousands of literatures which support the notion that international human r esource management is increasingly an important topic. Most of their focus has been on IHRM issues in MNCs. Further, much of the literature deals specifically with managing expatriates (Napier, 1998).This literature review is divided into five parts. First part provides a brief introduction of the IHRM definition. In the second part, reasons for the increasing importance of IHRM are explained. Then, the author introduces strategic IHRM and an integrative framework of Strategic IHRM in MNCs Definition of International Human Resource Management (IHRM) What is IHRM? Actually, it is not easy to provide a precise definition of international human resource management (IHRM) because the responsibility of an HR manger in a multinational corporation (MNC) varies from one firm to another. Generally speaking, IHRM is the effective utilization of human resources in a corporation in an international environment. Scullion (1995: p352) defined IHRM as â€Å"the HRM issues and problems arising fro m the internationalization of business, and the HRM strategies, policies and practices which firms pursue in response to the internationalization of business†. In most studies, the term IHRM has traditionally focused on expatriation (Brewster and Harris, 1999). However, IHRM covers a far wider spectrum than expatriation management. Four major activities essentially concerned with IHRM were recruitment and selection, training and development, compensation and repatriation of expatriates (Welch, 1994). Iles (1995) also identifies four key areas in IHRM as recruitment and selection, training and development, managing multicultural teams and international diversity and performance management. From the perspective of worldwide people management, Hendry (1994) points out three main issues in IHRM: 1) expatriation management and development; 2) the management internationalization through the whole organization; 3) creating a corporate culture to internationalize the corporation to fu lfill the increasing need of inter-cultural interactions of doing business abroad and in home country. Recent definitions concern IHRM with activities of how MNCs manage their geographically decentralized employees in order to develop their HR resources for competitive advantage, both locally and globally. The role and functions of IHRM, the relationship between subsidiaries and headquarters, and the policies and practices are considered in this more strategic approach. Dowling, Schuler and Welch define IHRM as â€Å"a collection of policies and practices that a multinational enterprise uses to manage local and non-local employees it has in countries other than their home countries (Dowling et al., 1993: p2).†