The experience of expatriate failures
Lessons from earlier expatriates who were assigned jobs abroad have also had an impact
in the development of IHRM. Frustration due to the inability to cope with the demands
of a multicultural workforce and community led to many resignations and pressure for
research and training in diversity and coping strategies.
Salient features of IHRM
Torrington (1994 in Armstrong 1997), identified seven features that characterise IHRM.
- Cosmopolitan nature of the employees. That is, employees tend to be either mem-
bers of high level elite who work as coordinators or expatriates; they are constantly
on the move between one country to another. - Culture. There are major differences in their cultural backgrounds.
- Rewards. There are differences in pay and other benefits between international and
local staff. - Communication. Effective communication is maintained between the metropolitan
and peripheral offices. There is a wide use of multilingual media communication. - Consultancy as modus of operandi. In most cases, international staff are brought in
to provide local consultancy needs. - Focus on competency. There are specific efforts to develop different ranges and
levels of competence for staff in order to match global demands. - Coordination. There are strategies to bring together and closely manage different
functions across borders.
International diversity and IHRM
As was noted in the introductory part of this chapter, countries and their people are dif-
ferent. Such differences have implications on what can and cannot be done and even
how to do it in people management. For the purpose of simplicity, these diversities are
organised into three main blocks: economic, human capital, and culture (Leopold et al.
2005). These factors explain the extent to which human resource management functions
may take different forms and encounter challenges depending on the seriousness of the
impact of such factors.
Economy
The level of economic development of a particular country is determined by many fac-
tors, including the gross domestic product (GDP), the rate of inflation, the extent of in-
frastructural development (roads, electricity, telephone, railway network), the extent of
poverty in the majority of the population etc. In the 1970s and 80s, there was a strong
dichotomy between the so called developed and underdeveloped countries. The former
constituted most European countries, Russia, North America, Australia and Japan, while
the latter referred to Asian, African and Latin American countries. In the 2000s, a seri-
ous ambiguity was observed in this dichotomy. Some economic analysts were afraid to
call China, North Korea, Thailand, Malaysia and some others ‘developing countries‘
because of vast developments levels reached by such countries in the last two decades;
whereas Africa, on the other hand, continued to be seen as being deeply rooted in the
mire of poverty in various forms. Due to low levels of development, international hu-
man resource managers working in poor countries (mostly in Sub Saharan Africa and