Unit 4: Global HRM
Strategic Human Resource Management notes · PTU syllabus (MBA 934-18)
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Unit summary
Global companies need HR strategies that work across countries. This unit covers the role of global HRM in MNC strategy, HR planning for global demand, global staffing approaches — polycentric, ethnocentric, geocentric and region-centric — training for a global workforce, expatriate problems and culture shock, repatriation issues and global employee relations.
After this unit you can
- Explain the role of global HRM in MNC strategy
- Plan HR for global demand and choose staffing approaches
- Plan training for a global workforce and manage expatriate problems and culture shock
- Manage repatriation and global employee relations
PTU syllabus topics
- Role of global HRM in MNC strategy
- HR planning for global demand
- global staffing approaches (polycentric, ethnocentric, geocentric, region-centric)
- training for global workforce
- expatriate problems and culture shock
- repatriation issues
- global employee relations
Ethnocentric
Parent-country nationals
Headquarters control
Polycentric
Host-country nationals
Local knowledge, lower cost
Geocentric
Best person regardless of nationality
Global talent pool
Regiocentric
Nationals of the region
Regional integration
Topic 1
Role of global HRM in MNC strategy
Multidomestic
Local responsiveness
Polycentric — local HR practices
Global
Global efficiency and standardisation
Ethnocentric — HQ practices exported
Transnational
Both efficiency and responsiveness
Geocentric — global talent and integrated practices
- Roles: global talent supply, leadership development, consistent culture and values, compliance across countries, knowledge transfer.
Topic 2
HR planning for global demand
- Forecast talent needs by country and skill; assess local labour markets, immigration rules and costs; decide the mix of PCNs, HCNs and TCNs; plan global mobility and succession; consider remote and offshore delivery centres (global capability centres in India).
Topic 3
Global staffing approaches
Ethnocentric
Key posts filled by parent-country nationals
Polycentric
Subsidiaries managed by host-country nationals, HQ by PCNs
Geocentric
Best person for the job regardless of nationality
Regiocentric
Staff moved within a region (Asia-Pacific, Europe)
| Approach | Advantages | Disadvantages |
|---|---|---|
| Ethnocentric | Control, HQ culture transferred, expertise | Limits HCN promotion, high cost, cultural misfit |
| Polycentric | Local knowledge, lower cost, no language barrier | Gap between HQ and subsidiary, limited international experience for HCNs |
| Geocentric | Global talent pool, international executive team | Costly, immigration rules, complex |
| Regiocentric | Regional integration, cultural proximity | Regional silos, HQ disconnect |
Exam tip
Link approach to company stage — early internationalisation is usually ethnocentric; mature global firms move to geocentric.
Topic 4
Training for the global workforce
- Cross-cultural training, language skills, global leadership programmes, virtual team skills, compliance and ethics training across countries, local adaptation of training content.
Topic 5
Expatriate problems and culture shock
- 1Honeymoon
Excitement about the new culture
- 2Culture shock
Frustration, confusion, homesickness
- 3Adjustment
Learning norms, building routines
- 4Mastery
Effective functioning in the new culture
- Expatriate problems: family adjustment, isolation, language barriers, different work practices, health and safety, career uncertainty.
- Remedies: careful selection, cross-cultural training, mentors, family support, regular contact with home.
Topic 6
Repatriation issues
- 1Preparation
Planning return and next role
- 2Physical relocation
Moving home and family
- 3Transition
Housing, schooling, administrative tasks
- 4Readjustment
Reverse culture shock, career adjustment
- Individual reactions: reverse culture shock, loss of status and autonomy, career anxiety (no suitable job), reduced income and lifestyle, family readjustment, feeling that international experience is undervalued.
- Consequences: many repatriates leave the firm within a few years, taking valuable knowledge with them.
Topic 7
Global employee relations
- Varying union structures and labour laws; collective bargaining at different levels; global framework agreements; ILO core labour standards (freedom of association, no forced or child labour, non-discrimination, safe and healthy work).
- MNC approach: global principles with local implementation; dialogue with works councils and unions; monitoring supply-chain labour standards.
Key terms
- Transnational strategy
- Combining global efficiency with local responsiveness
- Ethnocentric staffing
- Key posts filled by parent-country nationals
- Culture shock
- Disorientation in an unfamiliar culture
- Global capability centre
- Offshore unit providing services to a global parent
- Core labour standards
- ILO's fundamental principles at work
Quick revision
- MNC strategies and HR orientations.
- Global HR planning; GCCs.
- Ethnocentric, polycentric, geocentric, regiocentric staffing.
- Global training; culture shock U-curve; expatriate problems.
- Repatriation; global employee relations; ILO core standards.
Important exam questions
Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).
Short-answer questions
- Q1.How does a transnational strategy shape HRM?
- Q2.What is a global capability centre?
- Q3.Distinguish ethnocentric and polycentric staffing.
- Q4.Name the stages of culture shock.
- Q5.State two expatriate problems.
- Q6.Name the ILO core labour standards.
Long-answer questions
- Q1.Explain the role of global HRM in MNC strategy.
- Q2.Discuss global staffing approaches.
- Q3.Explain expatriate problems, culture shock and training for the global workforce.
- Q4.Discuss repatriation and global employee relations.
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