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IRHR 3540 Presentation

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by

Alisdair Tulloch

on 12 September 2013

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Transcript of IRHR 3540 Presentation

Case 6: Robert Bosch GmbH
International Assignment Policy
Complexities of expatriate compensation:
Challenging locations
inflation
exchange rates
recruitment for emerging markets

BOSCH
FACTS
- Founded in 1886
- 92% owned by the charity 'Robert Bosch Stiftung'
- 8% owned by the Bosch family
- Employs over 300,000 people

An essential aspect of compensation packages is to attract and retain valuable employees


Incentives for foreign service, tax equalisation and reimbursement for reasonable costs are vital


Klaus Meler must tackle these issues in redesigning a new international assignment policy
"Expatriate compensation at Robert Bosch GmbH: Coping with modern mobility challenges."
Q4: Local Plus Approach
Thus, compensation packages must be competitive on a global scale

Emma Martin & Alisdair Tulloch
Q1: Cost of living allowance
Q5: Pros and Cons of outsourcing
Q6: Alternative Assignments
Pros

Cost benefit
Closer control
Impartiality
Constantly changing local laws and regulations
Efficiency
Cons

Cost Benefit
Poorer Cohesion
Quality Control
Communication with senior Bosch management
Organisational culture

Brock et. al., 2008
Opportunities

Availability of travel
Information Technology
Expatriates more eager
Lower costs
Fewer returns
Barriers

Requires investment
Continuity
HRM intensity of short-term relocations
Q7: Localisation Barriers
Loss of benefits/compensation
Establishing local salary and family support
Consistency from HRM in a plethora of intricate economies
Individual and/or career plans, ambitions
Cultural misalignment
Q8: Additional Foreign Assignment Allowances
REFERENCES

Samuel Aryee, S., Yue Wah Chay, Y. W., & Chew, J. 1996. An Investigation of the Willingness of Managerial Employees to Accept an Expatriate Assignment. Journal of Organizational Behavior , Vol. 17, No. 3; pp. 267-283


Dowling, P., Festing, M. & Engle, A.D. 2010. International Human Resource Management: Managing People in a Multinational Context. Andover : Cengage Learning: 4th Edition

Dowling, P., Festing, M. & Engle, A.D. 2013. International Human Resource Management: Managing People in a Multinational Context. Andover : Cengage Learning: 6th Edition


McNulty, Y. & Inkson, K., 2013. Managing Expatriates: A Return on Investment Approach. Business Expert Press

QUESTIONS?
The
End.
Advantages

Willingness to partake in foreign assignments
Increased employee satisfaction
Ability to attract more qualified/adept managers
Disadvantages

Costs
Dissatisfaction of equivalent workers in local community
Number of Bosch expatriates
Standard Home Base Index
Generous

Cost Effective Home Base Index
Familiar with sourcing cheaper local products
Does not have misguided expectations
Easily adapt to lifestyle
Q2: Cost Reduction
Top 5 Criteria
1. Base salary (71%)
2. Partner support (60%)
3. Expatriate career guarantee (58%)
4. Education (41%)
5. Location Bonus (32%)
Q2: Cost Reduction
Cost Reduction Implemented
Relocation allowance
Efficient cost of living calculations
Housing allowances
Travel expenses

Not Implemented
Cap on allowances
(McNulty & Inkson. 2013. p.49)
Q3: Cost Reduction
Advantages:
Simple to implement
Fair pay structure

Disadvantages:
Overlooks individual needs
Retention of valuable employees difficult
(McNulty & Inkson, 2013)
(Dowling, Festing & Engle, 2010)
(Dowling, Festing & Engle, 2010)
(Dowling, Festing & Engle, 2010)
Q3: Cost Reduction
The Going Rate Approach
Salary is linked to the pay structure of host country
Pay equality
Simple implementation

Global Compensation Package Approach
Focus less on “expatriate status”
Remunerating international employees Performance based
(Dowling, Festing & Engle, 2013, pg 165).
(McNulty & Inkson. 2013. Pg 53).
Q3: Cost Reduction
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