International Human Resource Management (IHRM) is a complicated area of management that deals with managing human resources across international borders. It is the act of planning a company’s human resources (HR) policies and the principles of human resources, such as making policies and practices corresponding to the company’s global reach (Dickmann, 2021). The HRM, which deals with multinational businesses (MNCs), is essential since they compete in different distinctive and variable cultural, legal, and economic environments.
HRM serves as an international variant of Human Resource Management that, in addition to the traditional HRM issues, incorporates broader issues coming up from the complexities of global business operations. HRM is a country-specific human resource management concerned with employee management. However, IHRM extends this scope to the frame of international employee management, which includes employees from several international countries. Here, we delve deeper into the distinctions between these two domains.
Geographical Scope
HRM is mainly concerned with managing employees within the borders of a particular country. It is born of the community’s desires with integration into it, meaning that it has been molded to suit the cultural, legal, and economic circumstances. The HRM department utilizes a framework immune to the national labor market dynamic, relying on programming such as recruitment, training, and development as instruments to align individual achievements with company goals.
On the contrary, in this case, the span of IHRM is the global reach of employees of different nationalities from different countries. This involves, amongst others, managing a different set of employees, including expatriates, local hires, and third-country nationals; they are all grouped because of each group’s particular conditions and unique needs (Armstrong & Taylor, 2020). IHRM professionals are tasked with the transnational operations intricacy, balancing these against the economic and broader organizational issues while developing the tactics to manage the various cultural stakeholders’ expectations and the legal rules.
Cultural Diversity
HRM is used in highly homogeneous and cultural domains where employees’ cultural differences are less diverse than those encountered in international settings (Stone et al., 2023). It is easier to communicate and work together within one cultural framework on such occasions, where fewer distortions, misunderstandings, or conflicts are in place.
On the contrary, IHRM needs deep cultural competence and a high level of sensitivity to the cultural nuances, norms, values, and practices of different people and cultures. One of the topmost priorities should include effective management of cultural diversity, which results from the workers’ coming from a wide range of national backgrounds in a global environment. The function of international HRM should involve a design of schemes to encourage cross-cultural understanding and to foster healthy collaboration among the workers, which enables these workers to pick out the cultural variations as strengths and not as barriers.
Legal and Regulatory Compliance
A nationwide labor registry governs HRM, and the HR personnel are to guarantee the HR professional’s compliance with the labor laws and regulations in matters related to employment contracts, wages, and working conditions. The HR department is the department that first needs to comply with the law applicable to where it operates. Then, it allows the business practices to be aligned with local regulations.
On the other hand, IHRM professionals should expect to deal with the complicated issues of different sets of laws and regulations in each of the respective countries in which they operate. That is solutions to challenges, including modes of immigration to each jurisdiction, taxation, employment rights, and the labor standards where it usually thrives, will be done (Smerek et al., 2021). Compliance with HR practices becomes problematic in the face of conflicting regulations, and a company then requires harmonizing practices, which must be validated to be consistent in the country of operations.
Global Talent Recruitment and Disposition.
HR departments employ local recruitment channels to hire personnel for company positions, and as the primary talent pool, they usually draw from the local pool of the workforce (Kornau et al., 2020). The training and development of employees in the country align with the business needs by tailoring the programs based on the required building of local skills and competencies to lead the local business operations.
Different from that, IHRM taps into the global labor supply and employs individuals from diverse nationalities on expatriate posting, short-term assignments, or virtual teams. Through the process of enriching the ones with the skills and competencies who can perform well and manage peacefully in different cultural and business settings and scenarios, they will be the best candidates (Wen, 2021). IHRM practitioners must adopt plans for worldwide attraction, retention, and development of talents, given that it is vital to heighten the stream of skillful personnel to spearhead the company’s international growth and expansion.
Compensation and Benefits
HRM formulates compensation and benefits packages that reflect the local market average and follow general nationwide tendencies in a given country. Salary structures, allowances, and benefits are modified to meet the aspirations of the domestic labor pool employees and make the offerings consistent with those of other employers and legal requirements.
To facilitate employment, IHRM has to ensure that remuneration and benefits offered across various countries are just and competitive. All these usually involve applying salary, allowance, and benefits adjustments that proportionally consider the cost of living, taxation, and currency exchange rate variation (Glazyrina, 2020). The IHRM practitioners need to form global remuneration standards that satisfy the demand for conformity and, at the same, can show the elasticity to make adjustments under changing market conditions and different regulatory regulations.
Transcultural Communication and Remote Teaching Concomitant.
HRM focuses on intracultural, and with a few exceptions, conflict resolution does not pose an issue because differences are on a cultural level. Cultural conflicts are tackled with custom-made approaches to solve issues specific to the surrounding environment. These solutions stress the responsibility of all workers to maintain harmony and productivity.
In IHRM, appropriate cross-cultural communication strategies assume center stage since bridging cultural differences and minimizing divergent cultural expectations can only be adequately addressed with proper cross-cultural communication strategies in place (Duangekanong, 2020). Competency in cultural intelligence and mutual understanding of diverse employees’ communications is the foremost skill IHRM professionals must possess to foster collaboration and cooperation among staff with diverse cultural backgrounds. The conflict resolution procedures must be customizable to address the patriotic divergence. This will ensure that mutual understanding and respect are nurtured, ensuring fairness of the procedures.
Global HR Strategy and Policy Development
HRM is the managerial practice that elaborates human resources policies and strategies formulated for each organization’s specific needs in general reference to the local context (Chung et al., 2020). A set of policies and practices was developed to serve the organization’s interests and meet the compliance requirements on the ground and cultural concerns.
Correspondingly, IHRM centers on developing global HR strategies and policies, which are integrated with the leading corporate strategy where the varying needs of different countries and regions are considered (Von Glinow & Milliman, 2022). Therefore, IHRM professionals must partner with different stakeholders to form policies that balance global standards and local flexibility, maintaining close contact with the organization’s objectives and values.
To sum up, IHRM is the strategic management of human resources across national boundaries. It seeks solutions to problems related to cultural diversity, legal compliance, international talent acquisition, compensation, cross-cultural communication, and policy development. While HRM concentrates on personnel socialization within a single country, IHRM widens the scope of the implication of managing multinational employees in a broader international space.
References
Armstrong, M., & Taylor, S. (2020). Armstrong’s handbook of human resource management practice. Kogan Page Publishers. https://books.google.com/books?hl=en&lr=&id=g7zEDwAAQBAJ&oi=fnd&pg=PR3&dq=Training+and+Development+in+International+Human+Resource+Management+&ots=wMUnmFkwp-&sig=7qcGPz-GWmaIaBe2TxBOeoLB03s#v=onepage&q=Training%20and%20Development%20in%20International%20Human%20Resource%20Management&f=false
Chung, C., Brewster, C., & Bozkurt, Ö. (2020). The liability of mimicry: Implementing “global human resource management standards” in the United States and Indian subsidiaries of a South Korean multinational enterprise. Human Resource Management, 59(6), 537–553. https://onlinelibrary.wiley.com/doi/full/10.1002/hrm.22011
Dickmann, M. (2021). International human resource management–historical developments, models, policies and practices in MNCs (p. 225). Sage. https://www.torrossa.com/en/resources/an/5017880#page=244
Duangekanong, D. (2020). HRIS and IHRM strategy: A survey of international firms. Kasetsart Journal of Social Sciences, 41(3), 653-658. https://so04.tci-thaijo.org/index.php/kjss/article/view/247668
Glazyrina, M. (2020). Human Resource Management Challenges of International Business and Their Possible Solutions. https://www.theseus.fi/handle/10024/349355
Kornau, A., Frerichs, I. M., & Sieben, B. (2020). An empirical analysis of research paradigms within international human resource management: The need for more diversity. German Journal of Human Resource Management, 34(2), 148-177. https://journals.sagepub.com/doi/abs/10.1177/2397002220908035
Smerek, L., Vetráková, M., Šimočková, I., & No, M. (2021). International Human Resource Management System. UTH Radom. https://www.researchgate.net/profile/Lukas-Smerek/publication/350654148_International_Human_Resource_Management_System/links/6384ab867b0e356feb92b1c8/International-Human-Resource-Management-System.pdf
Stone, R. J., Cox, A., Gavin, M., & Carpini, J. (2023). Human resource management. John Wiley & Sons. https://books.google.com/books?hl=en&lr=&id=JS_TEAAAQBAJ&oi=fnd&pg=PR12&dq=Training+and+Development+in+International+Human+Resource+Management+&ots=rKLvotLeGz&sig=J9uhmPlL5j6p6KLZNP_sElnH2Xo#v=onepage&q=Training%20and%20Development%20in%20International%20Human%20Resource%20Management&f=false
Wen, Q. (2021). Strategic International Human Resource Management in MNEs from an Emerging Market: Case Evidence from a Chinese Multinational Construction Enterprise (Doctoral dissertation, University of Manchester). https://pure.manchester.ac.uk/ws/portalfiles/portal/234003782/FULL_TEXT.PDF
Von Glinow, M. A., & Milliman, J. (2022). Developing strategic international human resource management: prescriptions for MNC success. In Strategic Human Resource Management at Tertiary Level (pp. 103–135). River Publishers. https://www.taylorfrancis.com/chapters/edit/10.1201/9781003357223-7/developing-strategic-international-human-resource-management-prescriptions-mnc-success-mary-ann-von-glinow-john-milliman
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