Human Resource Management

Human Resource Management

What is Human Resource Management (HRM)?
Human resource management is the activities that attract, select, and manage employees. The word "human" in terms of human resource management clearly indicates that people are key resources of the firm to be actively managed and developed.

Four Main Areas
of
Human Resource Management

1. Staffing
2. Training and Development
3. Compensation and Performance Appraisal
4. Labor Relations

STAFFING

This refers to HRM activities associated with hiring employees and filling positions. Multinational enterprises have two types of employees. Host-Country Nationals (HCNs) and Expatriates (expats).

Three Primary Approaches

1) Ethnocentric approach- emphasizes the norms and practices of the parent company by relying on parent-country nationals (PCNs).
2) Polycentric approach- focuses on the norms and practices of the host country.
3) Geocentric approach- focuses on finding the most suitable manager who can be PCNs, HCNs or TCNs.

TRAINING AND DEVELOPMENT

Training is specific preparation to do a particular job and development refers to longer-term, broader preparation to improving managerial skills for a better career.

COMPENSATION AND PERFORMANCE APPRAISALS

Compensation refers to salary and benefits and performance appraisals is the evaluation of employee performance for the purpose of promotions, retention, or ending employment.

1) Compensation for expatriates
2) Compensation for HCN's
3) Performance appraisals

COMPENSATION FOR EXPATRIATES

Two Primary Approaches

1) Going Rate Approach- pays expatriates the prevailing (going) rate for comparable positions in a host country.
2) Balance Sheet Approach- which balances the cost of living differences relative to parent-country levels and adds a financial inducement to make the package attractive.

COMPENSATION FOR HOST-COUNTRY NATIONALS

At the bottom end of the compensation scale, low-level HCN's, especially those in developing countries have little bargaining power. The HCN's compare their pay to the farmhands sweating in the fields and making much less, or to the unemployed who make nothing and still have a family to feed.

PERFORMANCE APPRAISAL

Performance appraisal refers to the evaluation of employee performance for the purpose of promotion, retention, or ending employment. Performance appraisals help managers make decisions about pay and promotion, development, documentation, and subordinate expression.


LABOR RELATIONS

Labor Relations0 refers to a firm's relations with organizational labor (unions) in both home and host countries.

Managing Labor Relations at Home

A firm's key concern is to cut costs to enhance competitiveness to fight off low-cost rivals from emerging economics such as China and India.

Managing Labor Relations Abroad

MNE's prefer to deal with non-unionized workforces.

I found this information useful because I am a management major but I am interested in the Human Resource field. I have taken a class just on human resources.