Topic 3.3 – International HRM

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Content 

  1. Hofstede’s cultural dimensions theory 
  2. International HRM

 1. Hofstede’s cultural dimensions theory 

Hofstede’s cultural dimensions theory is a framework for cross-cultural communication, developed by Geert Hofstede. It shows the effects of a society’s culture on the values of its members, and how these values relate to behaviour, using a structure derived from factor analysis. [Wikipedia]

cultural dimentions hofstede

Hofstede’s dimensions defined ->  

Dimensions of national cultures:

106 Best hofstede images in 2020 | Intercultural communication ...

dimentions culturalMore information about Spain  https://www.hofstede-insights.com/country-comparison/spain/ 

Hofstede’s dimensions and HRM

This theory can be specifically useful for International HRM considering that it is dealing with people from different cultural backgrounds. Going globally influence on the HRM. Organizing work internationally depends a lot on the region company enter.

For Example, International Training programs (Personal Selling Tips, from Brussels to Bangkok) says: “Information-oriented cultures such as Germany may also allow for greater use of expatriates. However, relationship-oriented countries such as Japan will require the most complete local knowledge possessed only by natives.” Marketing experts agree about Japan: “Personal selling, as a rule, has to be localized for even the most global of corporations and industries.”

Example, Hofstede’s dimensions – business example

HRm and Power distanceHRm and individualism

HRM and masculinity

HRm and Long-term orientation

2. International HRM

Main related concepts:

International company structure:

  • Parent country
  • Foreign country
  • HQ – headquarter

On fig. 17.2 – 17.8 are some examples of the International Organizational structures variations. 

Export departments

international division structure

global functional divisional structure

global product structure

global geographic structure

global matrix structure

transnational netwrok structure

International Recruitment approaches:

    • Ethnocentric staffing means the company hire management (employees) that is of the same nationality of the parent company.
    • The polycentric approach means the company is limited to hiring in a foreign country only (local employees).
    • The geocentric approach means that the company adopts the strategy of recruiting the most suitable persons for the positions available irrespective of their nationalities.

International Personnel is recruited from three sources:

  • expatriates:
    • (+) better know company and product (specifically if technical), can add a prestige ad they are not locals, Good communications with headquarters’ personnel.
    • (-) the high cost, cultural and legal barriers, high qualified not willing to go abroad for an extended period, not locals
  • local nationals:
    • (+): Low barriers, Cost benefits, Cultural knowledge
    • (-): low level of communication with headquarter
  • third-country nationals (TCNs) – expatriates from their own countries working for a foreign company in a third country (a German working in Argentina for a U.S. company).

International Compensation:

Allowances are an inevitable feature of international compensation. 

Examples: 

  • Housing allowance (ex. rent)
  • Relocation allowance (ex. flight tickets)
  • Education allowance (ex. Language courses)
  • Spouse assistance (ex. provide work to husband/wife)

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