HR for Intl Business
Human Resource considerations for International Business Management
updated 2016 Apr 14th
see also
. This page used in the following courses taught by Prof. Richardson
IBM 600
including material from Chpt 16
Global Human Resource Management
Global Business Today
Hill, McKaig ... and Richardson
.... online learning centre of the publisher
2nd Edition 3rd Edition 4th Edition
INTRODUCTION Why have Human Resource considerations become so important in International Business Management?

The environments within which international business is carried out in the first decade of the new millenium is increasingly competitive.

  • The technological environment is such that technology supremacy is fleeting and since it does not last long - cannot be considered a strong advantage of a company.
  • The economic environment is effected by too many uncontrollable factors which means a stable economic situation is less certain. The economy can be effected negatively by things which large companies and federal governments have no control over.
  • The political environment responds to the socio-cultural environment - which in many countries, is undergoing the stresses of large immigration movements and cultural and religious frictions. Very few regions of the world are free of conflict so no place has a distinctively advantageous political environment
  • The geographic environment, long affected by rampant pollution, deforestation, greenhouses gases from autos and factories, acid rain from coal fired generators, declining water reserves etc. etc. has seen a bit of Mother Nature fighting back in 2003-2008 with some spectacular events such as a massive tidal wave, numerous destructive tornadoes, larger and more frequent hurricanes, volcanoes, mudslides, sandstorms, drought and crop failures an so on. As a consequence of the changes to and changes by the geographic environment, almost everyplace on the planet has had to endure weather that has negatively effected business and agricultural productivity.
The one area in which companies can become more competitive is having the best people and having those people serve their customers in the best way.

Therefore one of the key things for companies in the "new new" economy is to focus on the people in the company, and the customers they serve - ergo, Human Resource Management has become a "big issue" for international business.


.dd Prof. Chris Bovaird (UTSC), very experienced in international business management issues, commenting on the importance of "having the best people" to allow a company to have a competitive advantage in the second decade of the new millenium.

Bovaird explains that for economies where the majority of the business is the provision of services, "the one single key differentiator for corporations over the next generation or two will the ability to attract and retain clever, innovative, flexible, willing, intelligent people - people will be the outstanding resource which will make the west succeed"


KEY POINTS Although Dilbert has many jokes about Catbert, the "Evil H.R. Director", fact is, morale of employees is increasingly important, especially in international business,
(see )

since companies are more and more challenged to cut expenses, and the # 1 expense cut is staff cuts - meaning, more productivity out of fewer people.

The way to get more productivity is partly by enhancing morale.



Chpt 16
Expatriate Managers (expats)

simply defined as a citizen of one country working abroad in another country

Another slang expression often used is "the expat community" to describe a group of foreign country nationals, most often educated executives with good jobs, benefits and privelages, who can sometimes be seen by the local population as behaving in a way that is "elite".


Chpt 16
Types of Staffing policies
  • Ethnocentric Staffing Policy
    • when the company sends people from the country of the home company, overseas
    • all senior managers are people who are "parent-company nationals"
    • eg. a Korean company operating in Canada like Hankook Tires, all executives are Koreans from Korea
    • not such a popular policy among large multi-nationals in Y2K and beyond
      • can lead to resentment among motivated and educated local managers
      • can effect high staff turnover among junior managers
  • Polycentric Staffing Policy
    • when the company allows local staff to rise to the executive level and be managers
    • like Doug Wilson, President and C.O.O. of SONY Canada
    • host country managers less likely to make mistakes arising from cultural understandings
    • cheaper than expatriate managers
    • negatives - creates a gap between head office and regional offices
  • Geocentric Staffing Policy
    • when the company uses staff in foreign operations - no matter what country they come from
    • expensive to implement
    • inreased training and relocation costs
Global HR Challenges

Things that make it difficult for companies to manage Human Resources situations in other countries.

    o Compensation varies
    o Labour Laws
    o Social-Cultural Environment

Social-Cultural Environment
    o Language issues
    o Religious practices
             - Christmas ? New Years ? Canada Day
                      + Chinese New Year
                      + Ramadan
                      + Jewish High Holidays
    o Gender issues
    o Vacations and holidays
Social-Cultural Environment
Social-Cultural Environment
  • effects Canadian managers operating Canadian companies overseas
  • effects Canadian managers operating in large "multi-cultural" cities in Canada
  • effects Foreign Company managers operating Foreign Companiesin Canada
Canadian managers operating Canadian companies overseas
    • Canadian managers of "european background"
    • Canadian managers who's background matches the region in which the company operates
        • eg. Canadian IT company using Chinese-Canadian managers in China
Canadian managers operating in large "multi-cultural" cities in Canada
  • Canadian managers operating in large "multi-cultural" cities in Canada 
      • Canadian managers who's background matches the workers in the company
          • eg. Canadian ISP company using Canadian-Desi for call centre employees from from India, Pakistan, Bagladesh and Sri Lanka
    Foreign Company managers operating Foreign Companies in Canada
      • Foreign Company managers using English to manage Canadians of European Background
      • Foreign Company managers communicating and managing employees in Canada, who do not have English as a first language
          • eg. Japanese auto executives managing employes of South-Asian heritage
    Social-Cultural Environment - "Managing Diversity"

    "Programs or corporate environments that value multiculturalism must answer hard questions about managing diversity."

    Promoting Diversity
    - equal treatment ?
    - or differential treatment? 

    Antidiscrimination laws in Canada and other OECD countries require that employers do not treat applicants for jobs, and employees, differently.

    Treating people "equally" can be both a positive and negative for ethnic minorities and those who laud and "celebrate diversity".

    For example - If we treated people "equally", we'd have just one written drivers test - in English
    Social-Cultural Environment - "Managing Diversity"

    "On the other hand, treating people differently often creates resentment and erodes morale with perceptions of preferential treatment."

    Some employees resent other employees who gets special consideration for holidays, or prayer times, or special food considerations.

    "Other questions to be answered are: Will the company emphasize commonalities or differences in facilitating a multicultural environment? Should the successful diverse workplace recognize differentiated applicants as equals or some as unequals? How does the company achieve candor in breaking down stereotypes and insensitivity towards women and minority groups?"

    How do you make decisions about managing situations where it might be considered "favourtism" to make allowances or considerations for a special category of "diversity"?

    • If 9 students in a class of 35 ask for the exam to be on a different day 

    • - do you?
    • What if it is 4, how about 2?
    m This web site discusses HRM issues specific to the Asia Pacific region. 

    There are a number of good articles available herein which would be useful for you to read.

    Student Kenny K. in MGTC46 at UTSC in mid-March 2011 emailed to say

    Hi Professor Richardson,

    I was reading the section on your website concerning the importance of  morale and it really got me thinking about my past experiences. I for  one can definitely agree that high morale in a team environment is 
    vital to success. 

    Kenny adds
    This past year I was the Curriculum Manager for LIVE Conference 2010 and there were times when the morale of our team was very low. 

    During this time team members were constantly bickering with each other, efficiency was at an all time low and nobody was motivated to do anything! This was a very big problem since it was crunch time and the conference was quickly approaching. Eventually once the problem was sorted out, you could just feel a different vibe throughout the whole team. When morale was high, we all worked harder and just simply cared more. Just wanted to share my thoughts regarding  this topic, and how morale is not only important in a workplace, but across all aspects of life as well.

    WTGR replies 
    Great Kenny - and I think this would also be a great thing to mention during the end of a job interview when they ask you "do you have anything else to add", because it demonstrates your strength of character



    permission to quote Jeff Hays received by email 2012 Dec 4 and copy put in the permissions binder


      Prof. W. Tim G. Richardson ©