Conceptualising

IHRM
International Human Resource Management
INDU-1130
Lecture 2
September, 2022
Msc Quan Hoang Nguyen Tran
Lecturer/Researcher
FPT Greenwich Hanoi
[email protected]
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  Define International Human Resource
Lecture learning Management.

outcomes  Articulate an overview of the three ‘lenses’ (or

‘approaches’) to International HRM.

 Critically describe the ‘Convergence-

Divergence’ debate within IHRM.
Module map
Topic 1:
Theoretical Topic 2: Topic 3:
approaches to Functions of Contemporary
studying IHRM issues in IHRM
IHRM
 International HRM Topics
2. Functions
1. Theory (practice)

Three
‘lenses’ of
IHRM

Convergence
/ Divergence
of HRM 3. Contemporary
Issues
What is ‘International human resource management’?
“International Human Resource Management is about
understanding, researching, applying and revising all human
resource activities in their internal and external contexts as they
impact the processes of managing human resources in
organisations throughout the global environment to enhance the
experience of multiple stakeholders.”

What does that mean?

Let’s analyse this
definition.

Schuler & Tarique, 2007: 718.

 “International Human Resource Management is about
understanding, researching, applying and revising all human
resource activities in their internal and external contexts as they
impact the processes of managing human resources in
organisations throughout the global environment to enhance the
experience of multiple stakeholders.”

1. HRM is about the research and practice of managing people

2. ‘Internal and external’ contexts refers to their organisational and
national/global contexts in which HRM takes place.
3. The goal is to understand HR processes of organisations within a
global environment.
4. Both the research and application of HRM in an international
context.
5. …And to enhance the experience of multiple stakeholders, which
includes employees, shareholders, customers, clients, and others.
Schuler & Tarique, 2007: 718.
Other authors’ definitions of IHRM:
“…the worldwide management of people in the multinational
enterprise” (Poole, 1990: 1)

??????
“…the implications that the process of internationalisation [of
organisations] has for the activities and policies of HRM” (Dowling et al,
2008: 293).
Multinational
Enterprise (MNE)
or
Multinational
Corporation (MNC)
or
Transnational
Corporation (TNC).
• A multinational corporation (MNC) is an enterprise that operates in several countries but is managed
from Home country” (Brewster, 2016: 2).
>25% of revenues from outside its home country = MNC.
Decentralised / centralised.
“Home country” culture, or “international” culture.
Uniform product offering (cost advantage) or adapted products (better market fit).

• MNE (enterprise) because not all multinationals are companies (e.g. charities, non-governmental
bodies are MNE but not MNC).

• TNC are those invested in foreign companies, centralised corporate facilities, but R&D, marketing,
investment, etc, decentralised.

• Question: Give examples about each type of enterprise.

… and the challenges to MNEs…
Cultural differences, expectations, norms etc.

Institutional differences, such as trade union membership, employment laws, and other
legal/institutional differences.

Different countries have different views of what ‘HR should do’.

(e.g. in some countries, HR is seen as ‘strategic’, in others it is
‘administrative’).
(e.g. managerial development, ‘elite recruitment’ (France), versus ‘apprentice’
concept (Germany)).
Conceptual / 1. ‘Three lenses of IRHM’
analytical
approaches IHRM.
2. Convergence-divergence
debate.
 Cultural
Three components of IHRM approaches

International Comparative
HRM (institutional)
approaches approaches
 © TravelDestination, 2020

1. Cross-cultural approach

© Telegraph, 2009 © New York Times, 2010

2. Comparative / institutional approach
3. International Human Resource Management approach

More practice-orientated – taking into account cultural norms and

institutional contexts.

Focuses on how organisations must change their HRM functions

when they “go international.”

“What do you feel you have done well or badly in your

job over the last 3 months?”
What is included in the remit of HRM varies by country:

Cranet survey on HRM policy and practice:

Swedish = “Where are the environmental questions?”

Germans = “Where are questions about work councils?”
French = “Where are questions about the relationship with wider society and corporate
responsibility?”
Japanese = “Some of these questions are too intrusive for HR to ask of the employees.”

Different countries see different aspects of HRM as important as the wellbeing of the organisation
itself. Understanding these differences using comparative methods is important for understanding
how to best manage people and organisation in the wider society in which they are a part.

Question:
1. Examine existing HRM practices in your company.
2. Which of them are the product of your country’s legal, cultural, economic or social
institutions?
Summary of conceptual framework

Cross-cultural management

• Differences between nations –values, norms, rules and the way that work is conducted
• HRM practices may be affected by cultural norms.

Comparative HRM

• The extent to which HRM differs between countries as a result of different employment systems (e.g.
employment law, trade unions, etc).
• Focus of HRM, and its purpose, is seen as different in different countries

International HRM

• The way in which countries manage their HR across multiple countries, i.e. the specific role and
organisational behaviour of MNCs / TNCs
• The strategic challenges of internationalisation (SIHRM) and 'global HRM'
Conceptual / 1. ‘Three lenses of IRHM’
analytical
approaches IHRM.
2. Convergence-divergence
debate.
A fundamental question:

To what extend do HRM “rules” or “practices”

apply in every country, and how much do we need
to take local context into account?
 Technology Differentiation

Globalisation Institutions
‘Best practice’
‘best fit’
Competition
Culture
Centralisation

Convergence Divergence
 © Wikipedia commons, 2020

Crossvergence
Geopolitics
Business ideology

Globalisation
Neoliberal capitalism

Cultural norms

Shift away from American-centric world

(Ralston, 2008)
Two approaches to IHRM...
Universalist – there is a single, coherent and ‘best practice’ to improve how
human resources can be used by an organisation.
American
Goal is to improve organisational performance / competitive advantage.
Rigorous and methodological case studies (single organisations / countries).

Contextual – Seeks to understand of why HR practices differ. Not trying to

understand the ‘best’ ways of doing HR, but how labour markets work, and
what ‘typical’ organisations are doing.
Goal is to understand messiness (workers, unions, management, laws, education system,
labour market conditions, ownership structure, government involvement, etc).
Focus on ‘organisations in society’.
Comparative analysis (multiple countries, multiple organisations).
A model of the Universalist HRM

- Careful and extensive system for recruitment and training

- Formal systems for sharing information with the individuals
who work in the organisation
- Clear job design
- Performance appraisals
- ……
… and the debate between them.
Universalists: What matters is ‘best practice’ to get the most for all stakeholders.

Contextualists: “What is best practice? Is ‘best practice’ in one country or in one

organisation the ‘best’ in other countries or organisations?”

Universalist only deals with the organisation, not the wider institutional
environment in which the organisation exists.

Most HR practice is actually about dealing with ‘local’ institutional issues, not
finding “the best way of doing HR”.
Argurments
- Performance appraisals – low level of trust? Loss of face?

- Rewards for promotions – individual level – not team level?

- Example about Universalist HRM problem: Vingroup case:
https://www.youtube.com/watch?v=a1us4y0oc10&t=5411s&ab_
channel=Tr%E1%BA%A7nL%C3%A2mT%C3%B9ng
(38:00 – 45:00)
Four different levels of IHRM

- Macro (encompassing countries, regions and industries)

- MNC (global headquarters, how MNCs from different home
countries differ in their global practices
- Unit (A subsidiary, departments, inter-organisation alliance
- Individuals (employees, teams,etc)
Questions:
- Imagine that you are a HRM in a domestically based company
that has decided to operate internationally. What questions should
you be asking?
 Today we discussed what IHRM is,
and what it does.
Summary
We looked at the three conceptual /
analytical approaches to studying
IRHM: cultural, institutional, and
IHRM in practice.

We also looked at the convergence-

divergence debate.
References
Ariss A. and Sidini Y. (2016) Comparative international human resource management: future research directions. Human
Resource Management Review 26: 352-358.

Brewster, C., Sparrow, P., Vernon, G and Houldsworth, E. (2016) International Human Resource Management (4th
Education). CIPD: London, chapter 1.

Crawley, E., Swailes, S. and Walsh, D. (2013) Introduction to International Human Resource Management. Oxford
University Press: Oxford, chapter 1.

Morley, M. and Collings, D. (2004) contemporary debates and new directions in HRM in MNCs: introduction.
International Journal of Manpower 25 (6): 487-499.

Ralston, D. (2008) The convergence perspective: Reflections and projections. The Journal of International Business
Studies 39 (1): 27-40

Schuler, R. and Tarique, I. (2007) International human resource management: a North American perspective, a thematic
update and suggestions for future research. The International Journal of Human Resource Management 18 (5): 717-744.
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Next week: Next week we will look in more
detail at the first lens of IRHM:
cultural approaches.