Human firms in foreign subsidiaries (such as expatriate

Human resources are the individuals who support and
manage the organization’s people an associated process. It is concerned with
the management of people in an organization, focusing on policies and on
system. Since every organization is made up of people, human resource
management is seen as a core business function essential to the organization’s
effective operation. Human resource management is the body knowledge and a set
of practices that define the nature of work and regulate the employment
relationship. It is also responsible for maximizing employees’ performances and
productivity in order to achieve their goals. Boxall, P.
(1992) defined International Human Resource Management (IHRM) as ‘concerned
with the human resource problems of multinational firms in foreign subsidiaries
(such as expatriate management) or more broadly, with the unfolding HRM issues
that are associated with the various stages of the internationalization
process. (Boxhall, P. 1992). International human resource management includes
typical human resource management functions such as staffing, recruitment,
selection, compensation, training and development, careers and dismissal done
at international level and additional activities like global skills management,
expatriate management and so forth. 

 

Staffing, recruitment and
selection

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            Recruitment refers to searching for and obtaining
potential job candidates. Selection is the process of evaluating the candidates
and deciding who should be employed for a particular job (Griffin and Pustay, 2015). The first decision for
international human resource management is where workers for the various
positions should come from. For example, Victory Recovery Resources Sdn Bhd
need to fill an executive position in a subsidiary in Indonesia, there are
three alternatives, which are a Malaysia national, an Indonesia national or a
manager from a third country. Thus, there are three main types of staffing policies
approached by internationalize firms which included ethnocentric, polycentric
and geocentric policies. In ethnocentric policy, the parent country nationals
fill the key positions; in polycentric policy, host country nationals manage
subsidiaries while headquarter positions are held by the parent country
nationals; in geocentric policy, the most competent individuals hold key
positions regardless of nationalities. For Victory Recovery Resources Sdn Bhd, the
human resources management is using ethnocentric staffing policy. For instance,
the executive positions of Victory Recovery Resources Sdn Bhd are given to
Malaysian in an office of a Malaysian company located in Vietnam and Indonesia.
The main advantage of ethnocentric policy approach is that the parent company
nationals may be the best people for the job because of special skills and
experiences. It also enable the company to ensure that the organizational
control and coordination is maintained and facilitated. In Victory Recovery
Resources Sdn Bhd, Human Resource Manager is concerning on how to ensure that those
expatriates perform as expected in the context of operation in the company. As selection
criteria for a position in a foreign subsidiary, the candidate must possess
skills and abilities necessary to the job and the skills and abilities necessary
to work in a foreign area with employees from different countries. The expatriates
chosen must have adaptability to new situations and location specific skills to
work with high proficiency in the foreign subsidiary.