Global HRM includes two main components:
1. the international component:
The international component of global HRM includes dealing with personnel-related issues that are triggered when national borders are crossed. The crossing of national borders can be accomplished both by the personnel and by the company, for example, in the context of a foreign relocation.
Many issues can arise at this level.
The spectrum of issues ranges from work permits, time zones to tax aspects. In between are issues such as national labor laws, social security for international personnel assignments, or how to account for currency fluctuations and buying power.
International activity increases opportunities, but also risks. Human resources management bears a special responsibility for the well-being of personnel around the world. Risks can arise unexpectedly and HR management is required to take appropriate measures immediately.
2. intercultural component:
The intercultural component of global HRM results from the need for sustained good cooperation between cultures. The special thing about culture is that cultural value orientations, standards, symbols and practices are applied as a matter of course. Culture is like the grammar of the mother tongue. One uses it without thinking about it or constantly doubting it. On the other hand, they can be used as valuable learning impulses, open up new perspectives and lead to innovations.
The intercultural component does not only apply to activities abroad. It is also important at the local level, for example when it comes to the effective work of multicultural teams or the successful integration of foreign employees or reintegration of expats is required. Intercultural competence in HR management and in the company has become a key competence.
There are 4 approaches of global HRM
- Ethnocentric Approach
- Poly-Centric Approach
- Regino-Centric Approach
- Geo-Centric Approach
The main characteristic of international human resource management is cross-cultural management. In a global context, employees come from different culture backgrounds, resulting in cultural conflicts.