Writing in the mid-1980s on the state of the field of International Human Resource Management (IHRM), Laurent (1986) concluded that "the challenge faced by the infant field of international human resource management is to solve a multidimensional puzzle located at the crossroad of national and organizational cultures" (p. 101). The aim of this paper is to examine developments in the field of IHRM and to see if any progress has been made towards completing the puzzle noted by Laurent. In doing so this paper will draw on work which has been completed over the last ten years with a number of colleagues - initially with Randall Schuler (New York University) and more recently with Helen De Cieri (University of Melbourne), Denice Welch (Norwegian School of Management), Marion Festing and Wolfgang Weber (University of Paderborn).(1) Specifically, three issues are examined: first, the various approaches which have been taken to the study of IHRM; second, the variables which moderate differences between domestic and international HRM; and third, recent work which examines the topic of strategic human resource management in multinational enterprises (MNEs).
Approaches to International HRM
The field of international HRM has been characterized by three broad approaches.(2) Early work in this field emphasized a cross-cultural management approach and examines human behavior within organizations from an international perspective (Adler 1997, Phatak 1997). A second approach developed from the comparative industrial relations and HRM literature seeks to describe, compare and analyze HRM systems in various countries (see for example, Brewster/Hegewisch 1994). A third approach seeks to focus on aspects of HRM in multinational firms (see for example, Dowling/Welch/Schuler 1999).
The approach taken by the author and his colleagues reflects the third approach and our objective has been to explore the implications that the process of internationalization has for the activities and policies of HRM. In particular, we are interested in how HRM is practised in multinationals.
Each approach takes a somewhat different view of IHRM and in my view it is essential to identify the approach which a researcher is taking to the subject as the approach taken influences what is defined as IHRM. One only has to look at the diversity in the program at the various International HRM conferences to see that there are multiple definitions of what constitutes international HRM.
Defining International HRM from the Perspective of a Multinational Firm
Before offering a definition of international HRM, we should first define the general field of HRM. Typically, HRM refers to those activities undertaken by an organization to effectively utilize its human resources. These activities would include at least the following:
* Human resource planning
* Performance management
* Training and development
* Compensation and Benefits
* Labor relations
We can now consider the question of which activities change when HRM goes international. A paper by Morgan (1986) on the development of international HRM is helpful in considering this question. He presents a model of international HRM [ILLUSTRATION FOR FIGURE 1 OMITTED] that consists of three dimensions:
1. The three broad human resource activities of procurement, allocation, and utilization. (These three broad activities can be easily expanded into the six HR activities listed above).
2. The three national or country categories involved in international HRM activities: (1) the host-country where a subsidiary may be located, (2) the home-country where the firm is headquartered, and (3) "other" countries that may be the source of labor or finance.
3. The three types of employees of an international firm: (1) host-country nationals (HCNs), (2) parent-country nationals (PCNs), and (3) third-country nationals (TCNs). …