HRM: Global
Complete lecture & book summary
International Human Resource Management – Brewster, Sparrow, Vernon, and Houldsworth
Introduction
Chapter 1 – An introduction
Three headings of IHRM
1. Cross-cultural management
Every nation has its own unique sets of deep-lying values and beliefs, and that these are reflected
in the ways that societies operate, and in the ways that the economy operates and people work
and are managed at work
2. Comparative HRM
Focuses more specifically on the way that people work and explores the differences between
nations in the way that they manage this process; it makes more of institutional differences than
the cultural differences.
3. IHRM
Examines the way organisations manage their human resources across these different national
contexts.
Key learning points
Much of our initial understanding about IHRM was traditionally base on study of multinationals
(MNCs).
There are continental shifts occurring in the focus of this economic activity, leading to new patterns
of mobility and trade, and MNCs dominated by new mindsets and approaches.
We are also witnessing the global transfer of work – either in terms of the creation of new jobs or
through the global sourcing of certain parts of an individual’s or unit’s work. This is having a major
impact on the type of organisations and nature of work that remain viable in different parts of the
world.
HRM and context
Chapter 3 (4) – Culture and Organisation Life
Key learning points
National culture has a powerful on key organisational processes and practises – including HRM
practices, leadership, and international management teams.
Despite movements towards global convergence, there is still consistent national cultural differences
that affect approaches to broad organisational and HRM policies and practices and leadership.
The influence of culture can be seen through power and authority relationships, coping with
uncertainty and risk-taking, interpersonal trust, loyalty and commitment, motivation, control and
discipline, co-ordination and integration, communication, consultation and participation.
These organisational behaviours are a result of an individual’s psychology (itself a product of
various cultural, social, political and personal influences), their life stage and their generational
subculture.
In order to build, maintain and develop their corporate identity, MNCs need to strive for consistency
in their management of people on a worldwide basis, but in order to be effective locally, they also
need to adapt this management to the specific cultural requirements of different societies.
Cross-cultural studies generally indicate a strong connection between culture and leadership styles.
Being a good leader is not the same thing in India or China as it is in the USA.
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, Researchers have identified global leadership competencies by attempting to understand three
important aspects of organisational life; how managers demonstrate global leadership behaviours;
what being a successful member of a multicultural team involves; and what it takes to demonstrate
‘cultural intelligence’.
Research supports the argument that leadership is culturally contingent, although key
dimensions of effective leadership are consistent across societal clusters.
So, if we ask how important is culture in relation to other factors that also explain how desirable an
individual finds any particular HRM practice, it is clear that culture is a significant factor, but there
are many other individual factors (and institutional factors) that also shape the extent to which
employees will find specific HRM practices desirable or not.
Theoretical perspectives
Best fit versus best practice debate
Best practice perspective:
Existence of a set of HRM-practises that leads to superior organizational performance
Related to High Performance Work Systems:
• Ideal combination of practices
System of practices
Irrespective of people, country or business
But: huge differences among countries for example
Best fit perspective:
Importance of fit between HRM practices and internal and external context
Effect of HRM practices dependent on for example fit with organizational strategy
Fits well with context, practice can create performance
Could be multiple good practices which could be bad as well, depending on context
Is HRM moving towards a set of best practices as a result of increasing globalisation and increasing
knowledge on the effectiveness of HRM practices?
Based on developments in science, we know more about which practices work and which don’t. Have
a set of different best practices: big/small companies. Big factors will effect HRM practises, those will
remain, but will be some sort of trends in practices.
Perspectives on HRM (Martin-Alcazar et al., 2008)
Universalistic
Best fit practices:
Contingent
Add intervening variables between HRM practice/outcome, usually strategy, organisational context,
external environment, or organisational learning capability
o There is a best set of practices for a certain context
Configurational
Internal dynamics of HRM system/how different elements combined synergistically in different
patterns/bundles, representing different orientations
o Looking at the system as a whole, different combinations; relationship between the practices
Contextual
Significance of context, not merely as contingent variable but as framework for HRM decision-
making
o All you can do is focusing on context, everything should be linked to the context; complete
alignment. No one practice or contingent.
These different perspectives require different research designs and methodologies.
Universal perspective: quantitative, include as many as possible
Contextual perspective: qualitative, in-dept analysis of one particular context, only study a few
or one context rather than all context in one big pile.
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, Factors affecting IHRM policies and practices
National-level factors
- Culture, institutions and the national business system
Home (parent) country factors
- Domestic culture, legal, political and economic factors and dynamic business environment
- MNCs deeply rooted in national business systems of country of origin: ‘country of origin’
effects
Contingent factors
- Organisational age, size, structure, ownership, stage of internationalisation, life cycle stage,
trade union presence and stakeholder interests
Organisational factors
- Corporate and HRM strategies
Firm-specific factors
- Senior management’s attitudes towards internationalisation/international strategy, structure and
corporate culture of the firm; policies relating to primary HR functions and internal labour
markets.
Comparative HRM: Cranfield Network on International Human Resource Management (Cranet,
1989)
Regular international comparative survey or organisational policies and practices in HRM across
the world
Provides benchmarks for comparing Europe with developments elsewhere in the world: allows a
systematic comparative analysis of HRM trends within employing organisations
Disadvantage: questionnaire to senior HR, but how is this perceived by other employees?
factual, not perceptual
Directional convergence: HR is moving in the same direction, but are not becoming more similar,
difference stay the same.
Strategic potential of HR department
HR professionalisation (HR talent for the future)
Individualisation of employee relations
Increased information between employees
Contingent compensation systems
No convergence:
Ratio of HR employees to other (staff ratio)
Employee development
Final convergence: over time, they do move to the same end points/direction. End up in the same
position = same practices.
No final convergence of:
HR configuration
HRM practices
No evidence yet for adapting the same practices. Differences remain.
Conclusion
Universal ‘best practice’ approaches to HRM should always be considered critically – are they
appropriate for other environments?
There are aspects that are universal. Certain practices know how to do them best, but national
differences remain.
Differences are reducing, but absolutely not there yet at the national level HRM can be very
different because of cultural and institutional differences between countries. Globalisation has
certain effect; trends.
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