summary chapter 5,6,7

8/3/2019 Summary Chapter 5,6,7

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5Global Human Resource Planning

Human resource planning provides the essential linkbetween MNC strategy and people. involves:

- scanning the environment foropportunities and threats- taking an inventory and assessmentof the organizations current human resources- developingpolicies, plans, programs, and activities that provide the human talent to

help carry out and achieve strategic plans

- consideration about the nature of thepresent and future work demandand potentially

viable sources of labour supply

it should be responsive to both theshort-term and long-term needs and plans of the

organization and its worldwide operations

From Strategy to Decisions about Work Demand and Labour Supply

WHAT kind of human work and tasks need to be carried out

- part of the WORK DEMAND

- decisions about work organization and design

o specific coordinated and integrated tasks, responsibilities and jobs for people to

perform

WHO will do this work- SUPPLY of appropriate human resources

External Environmental Scanning

Major overarching currenttrends, influences, and developments:- globalization

- contingent work arrangements

- technological advancements

- changing demographics

- national cultureOtherimportant challenges to be assessed:

- labour market conditions and characteristics

- opportunities and restrictions presented by foreign governments or other organizations

o labour interests

o global competition

o cross-national cooperation and conflict

o impact of broad economic forces and market changes on labour supply cost-

effectiveness

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Labour Market Conditions and Characteristics

Outsourcing of manufacturing operations to countries such as China, Vietnam, Romania,

Malaysia, India, Brazil, Portugal, Mexico, and Thailand (= attractive labour markets)

- labour supply is plentiful- adequate skill level

- relatively inexpensive

India and CEE comparative advantage through technical skills and low-cost labour forces

increased demand for low-cost labour force eventually drives up the cost of labour for the

MNC

Governments and other Labor Interest Organizations

In order to prevent offshoring/outsourcing labor governments- remove tax incentives for offshore outsourcing- impede or completelyprohibitcertain kinds of work from being sourced to other

countries

o those related to key industries and national security

Host countries can:

- require that MNCs staff their local operations with targeted levels of host country

surpervisors and managers (with appropriate training)

o for optimal FDIspilloverof knowledge and skills

- placejoint venture requirements to encourage sharing of expertise- provide attractive incentives

o tax breakso exemptions from certain costly labour regulations

- require significant company payments to address the social costs of employee job

displacement (when the MNC determines to close operations)

Local labor unions, international and local NGOs can:

- place greatpressure to improve HR policies and practices related to

o labor standards

o job security

o equal opportunity

o compensation and benefits

o

skill development

Global Competition

Companies compete both at home and abroad:

- to attract and retain customers- for the human talentitself

To succeed in the increasingly competitive global arena - ability to attract and deploy:

- a motivated

- innovative- team-oriented

- cooperative

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- responsive

- flexible

- competent workforce at all levels

Critical functions of HR planning

- to continuouslyo watch the competition

o scan the environmentfor the best practices in employee recruiting, selection,

placement, work design, training and development, compensation, change and

performance management, and other HR management practices

Cross-national cooperation and conflict

Several different regional and multinational trade treaties and agreements- Organization for Economic Cooperation and Development

- The North American Free Trade Agreement

- The Association of South East Asian Nations

- European Union

Important HR planning implications of these agreements:

- joint venture formation- appropriate staffingto promote treaty country partnerships

- standardization and harmonization of acceptable HR practices

- formation andstaffing of regional headquarters and HR functions- movement of workforce operations across participating national borders to take

advantage of operational efficiencies- appropriate cross-cultural awareness skill development

- awareness about important current and changing guidelines

Other obstacles:

- conflicts between countries

o including localized and global terrorism

- ongoing trade wars and skirmishes between countries

- internal country instability and violence

o guerrilla, civil warfare and coup dtat

o social and political unrest

demand for extra surveillance, security and protective services

Job Design for meeting Global Strategy Work Demand

Job analysis process- basis upon which key employment decisions related to recruitment, selection, training,

performance appraisal, and compensation are made

- major methods :

o incumbent employee observation

o

interviewso questionnaires

o keeping a diary or log

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o expert input by experienced managers or other professionals

- results in:

o job description

listing duties, responsibilities, working conditions, supervision or

reporting arrangements, knowledge and skills required

- should be reviewed, discussed and revised regularly

Primary Factors influencing Global Work Design

Several potentially critical factors must be considered in the design of work:- cultural adaptation considerations

- regulatory influence on work design

- labor market skill levels

- available technology and infrastructure

- personal accommodation needs

Cultural Adaptation Considerations in Work Design high vs. low power distance

individualism vs. collectivism

Regulatory Influence on Work DesignDifferent governments specific restrictions about how work is organized and carried out

- employee safety

- working time and availability of overtime

- work organization for breaks for rest, prayer time

- business hours

Labor Market Skill LevelsHigh levelof knowledge and skills

- jobs with higher levels of complexity and technology

- more tasks

less educatedlabor force

- fewer tasks involved for each job

- greater number of workers might be required

Available Technology and Infrastructure- Availability and development of technology in the local area of business operations

- Surrounding infrastructure supporting business

a) technology is unavailable

o need for more employees to handle many simplified tasks

Personal Accomodation NeedsUnique circumstances of individual employees

- long commutes

- longer, but fewer work days

- telework design

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Alternative Forms of International Work Arrangements- extensive travel

- short-term foreign assignments- expatriate assignments

- inpatriate assignments

- virtual expatriate assignments

- multinational virtual teams

Extensive Travel- almost constant travelto various business locations

o regular and frequent customer contact

o active coordination of various geographically dispersed business partners

o ongoing supervision that cannot be replaced completely by virtual contacts

- can be part of :

o early and developing phase of business development

o regional assignment

Short Term Foreign Assignments (secondments)Duration: From afew months to a year

- are on the rise with increasing priorities for cost saving and localization of talent

- can provide an interesting break, challenge and professional development opportunity

Expatriate AssignmentsDurations: 3 years or longer

- need to fill a critical skills gap by transferring operating knowledge and techniquesand general management skills to the distant subsidiary

- allowing the MNC to more directly provide coordination and control- knowledge transfer

o cognitive domain concrete knowledge about procedures, techniques, and

methods for accomplishing tasks

o emotional intelligence or affective domain productive attitudes and values,

higher-level thinking, team building, and problem-solving skils

major purposes:- filling a critical skills gap with accompanying knowledge/ skill transferfor optimal

MNC control

- supporting individual learningandglobal competency developmentfor future

company leadership

- organization developmentof the host operation and MNC as a whole

Vladimir Puck

- demand-driven foreign site work

- learning-driven international assignments

Gary Oddou- 2 types of expatriates

o Those assigned to go abroad to fix a problem

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o Those identified as high potentials for the firm who are assigned abroad to

build global business competencies

Particularpurposes of organizational development served by expatriate assignments:

- effecting global workforcesocialization to common values and priorities- widespread global orientation and core competency development- development ofinformal networks- organizational learning- effectiveglobal knowledge management

D isadvantages

- expatriate assignments can be very expensive

o maintenance costs of expatriates in a host country range from three to ten times

the cost of domestic employees with similar responsibilities

- frequency of premature terminations of expatriate assignments offailure to achieve

the assignment goals- over-reliance on the use of expatriates for management and leadership responsibilities

in foreign operations can lead to limited developmentof other members of the MNCworkforce not coming from MNC headquarters overall underutilized andunderdeveloped global talent pool

- strict and exclusive use of expatriates for managing foreign operations can

significantly diminish the breadth of experience-based perspectives about foreign

markets that can be returned back to MNC headquarters

o limiting the MNCs ability to innovate and compete on a global scale

Inpatriate Assignments= a work assignment featuring the transfer of foreign managers from their host countryoperation locations to global or regional headquarters on a semipermanent or permanent basis

Major purpose:

- increase the foreign inpatriate managers understandingof company strategy, culture,

and critical operations and practices

- upon return this manager can exertgreater controlon the foreign operation

consistent with MNC headquarters

- knowledge transfer(with perhaps greater credibility as someone originating form the

host country workforce)

- enrich the MNC management team by adding a multicultural perspective to globalstrategy development

limitations and costs

- challenges of cross-cultural adjustment- premature assignment terminations- assignmentfailure to meet goals and objectives

Virtual Expatriate Assignments= assignments that combine short travel trips with virtual interaction through telephone and

cyberspace (e-mail, video teleconferencing, the Internet, company-controlled intranet sites)

- allows executives to take an assignment without subjecting them and their families tothe culture shock of a move abroad

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- expose the employee to valuable developmental global management issues, while still

permitting closer touch with the home office

Global Virtual Teams- formation and continued growth of complete or partial working arrangements known

as global or multinational virtual teams

- 3 design components

o Responsible forformulating and/or implementingdecisions that are important

to their organizations global strategy

o Use a substantial amount ofcommunications technology to support group

member interactions

o Comprise members working and living in different countries

- Knowledge-based teams

o Formed to improve organizational processes

o Develop new products

o Satisfy complex customer problems

- Distinct advantage

o Ability to perform workasynchronously

o Helping organizations bridge different time zones effectively

o Enabling teams to beproductive over more than one work period

- Enhanceflexibility and innovation capability

- Basic sociotechnical challenges in making them work effectively

o Managing conflict

Over differing cultural backgrounds

With much greater distances

Delayed or asynchronous periods of interaction

Synchronous interaction in groups

- more orderly process

- verbal and nonverbal cues help

o regulate the flow of conversation

o facilitate turn taking in discussion

o provide immediate feedback

o convey subtle meanings

A synchronous communication- typically found in multinational virtual teams

- conveyance of cues is hindered

- feedback is delayed

- interruptions or long pauses in communication often occur

Global virtual teams mustfindworkable solutions- obstacle of asynchronous communications

- temporally coordinating their interactions and flows of information

o work schedules and deadlines

o developing trust

o aligning the pace of efforts among group members

o agreeing on the time spent on particular tasks

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Sources of Global Labor Supply for Meeting Work Demand

- regular or standard employees

- non-standard or contingent employees

Regular or Standard Employeesfull-time or permanent employees

- are consideredfull members of the organization- are at the core of the organizations employment picture

- recipients of full benefits

N on-core employees- serve as layers beyond the core that provide work as needed and as afforded by the

organization

- protective bufferfor their core employee counterparts

- are thefirst ones to lose their jobs or to have their working hours diminished

3 major groups of regular employees

- parentcountry nationals (PCN)

- host-country nationals (HCN)

- third-country nationals (TCN)

Parent-Country Nationals (PCNs)

- citizens (legal residents) of the home country of the parent company, or the countrywhere the primary headquarters is located

- particular strength of a PCN as a labour source:o his/her understanding of the company culture, priorities, and strategy and what

it takes to be successful within the MNC

- particular limitations

o possible lack of familiarity with and difficulty in personally adjusting to a

foreign business location of the MNC (lack of foreign-site adaptabilitiy)

Host Country Nationals (HCNs)

= citizens or residents of a country that hosts, or provides local property and facilities, for

MNC operations abroad

Particular strengths:

- familiarity with the local culture, common business practices, and economicconditions

limitations:

- may initially lack a clear understandingof the predominant national and

organizational culture of MNC headquarters, or its business priorities, accepted and

expected business practices, and strategic mind-set

- might not share a common language with PCNs

o serious challenge to effective communications and business interactions

Third-Country Nationals (TCNs)

when staffing a foreign operation in a host country, new employees could be citizens or

residents of a different third country apart from the parent or host country- useful alternative labor source for filling work demand where the focus is on

obtaining the most cost-effective labor

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- overall regiocentric strategy

o regional employees are assigned as TCNs to nearby host country operations

disadvantages

- possible lack of understanding of the local HCN culture

- difficulties with local public sentiment and governmental obstruction

- language difficulty- may not have a clear understanding of MNC strategic priorities, accepted business

practices, organizational culture

Contingent or Non-Standard Workforce= on call employees

those who work on aflexible basis as needed

or contingent to an organizations work demand

have neither an explicit nor implicit contract for continuing employment

represent a rapidly growing source of labor for filling global work demand

Reasons for Major Growth of the Contingent Labor Sector Promoting Company Flexibility

o meet increasing global competitive demand

o economical as needed basis

o number of workers and working hours are easily adjustable

Supply Factors

o large sectors of the labor may be available to work only on a part-time basis

women (childcare, household management)

senior citizens (extra income, variety in live) Screening Function

o management may sample temporary employees through their performance

before hiring them on a regular basis

o employees get to know the organization

o may enhance the effectiveness of new standard-employee staffing decisions

Technological Change

o significant changes in technology lead to greater demand for contingent

employment arrangements because

outsourcing or reassigning work outside the company

automation of work and robotics rapid changes demand flexibility and diminish need for long-term

employment

Employment Legislation and Deregulation

o forms of employment legislation on behalf of full-time (benefits, etc)

might create an economic motive for companies to increase their use of

part-time and other non-standard employees

o deregulation

companies use more flexibility in their staffing practices

o governments actively encourage the use of non-standard employees to reduce

unemployment Worldwide Growth in Numbers of Small Businesses

o use of consultants, contractors, and special service vendors

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o no fixed costs arrangements can be terminated at the end of the contract

period

Changes in Employer-Employee Relationships and Expectations

o increased sense of employees of being their own free agents and not committed

on a long-term basis to a single employer

Changes in Employee Personal-Life Needs and Lifestyle Preferenceso dramatic increase in the number of working mothers

o rise of two-career family

demand for flexible working arrangements

Major Forms of Contingent or Non-Standard Employees

Part-Time Employees

o most common source of the growing contingent labor force

o work less on an ongoing basis

o global part-time workforce continues to be dominated numerically by women

Temporary Employeeso another major source of contingent workers

o are increasingly used to supplement the regular workforce on an ongoing basis-

depending on the workload

o often supplied by temporary services agency

o floaters

in-house company employees

typically not eligible for full company benefits

Employee Leasing

o a company might transfer all employees, a large part of the employees, or

sometimes only the employees of a separate facility or site to the payroll ofan employee-leasing firm or Professional Employer Organization (PEO)

joint-employment relationship

o the PEO then leases the workers back to the client company

saving the company on HR operational costs

can also provide positive MNC tax benefits

o disadvantages

may be hard to lease back loyalty and commitment (source of

competitive advantage)

Contracted Services

o special tasks of a non-recurring nature, requiring a high level ofindependence, professional judgement, discretion, and skill

o frequently performed on a contract basis by individuals

e.g. consultants, groups of professionals

Outsourced Services

o when a company contracts with an organization to provide the ongoing, full

managerial responsibility over a specific function

o companies must carefully address skill and language requirements, labor costs

by market, alternative talent pools, workforce training requirements, and work

design requirements

MNC Concerns Regarding Contingent Employees

heavy reliance on non-standard employees may lead to reduced job satisfaction

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o reduction of workforce loyalty, commitment, and subsequent reduced

productivity

outsourcing arrangements employees work for outsourcing service firms no direct

control

o no direct control of work quality, decreased worker commitment, loyalty, and

competence concern about customer perception of company products or services provided by offshore

employees

significant costs in image and public relations

HR Planning for the Long-Term

regularly scanning the environment forthreats and opportunities in the external labor

supply

o

related to meeting immediate and short-term work demand for carrying outMNC objectives

study external trends and conditions

o firms long-term survival and competitiveness

internally consider the MNCs organizational culture and core capabilities

Country Labor Forecasting

environmental scanning should consider

o national birthrate statistics

o health conditions and mortality

o the nature and quality of educational systems within a country

o changing demographic trends in workforce participation

clearer picture of the nature of the global labor force available

Planning for Global Capability

shared organizational core competencies and culture

workforce alignmentor shared mind-set

planHR activities and policies

plan selection, training, performance management, and remuneration practices

companies have increased their number of young managers involved in extended foreign

assignment experiences in order to develop greater company-wideglobal leadershipcapability

expatriate assignment, repatriation, placement, ongoing career development

global talent management

Global Succession Planning

effective succession planning

o minimizingdisruption and confusion

o implementingcompany strategy and achieving organizational goals

o reduce chance and uncertaintyo ensuretheavailability of senior executive leadership talent for future company

guidance

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involves

o making a projection of future needs for senior managers within the firm

o careful selection from pools of promising manager candidates

o flexible plan is formulated to ensure that successors develop the core

competencies needed

o management and HR should work collaboratively with the identified,interested high-potential individuals

o formal training, international virtual teams, short-term foreign assignments,

extended foreign assignments

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6Global Staffing

involves actively filling jobs in a timely fashion with appropriately qualified individuals

from inside or outside the MNC and consistent with the MNCs strategy ability to attract qualified workers and keep the workplace adequately staffed

o careful assessment through HR planning of external labor market conditions

and government actions

o effectiveness of the organizations overall reward system

attract and retain workers

involves:

moving employees into, throughout, and out of an organization

retainingdesirable employees

employee deployment and movement decisions and activities

o recruitmento selection

o transfer

o promotions

o layoffs

o firing

o retirement

o total compensation package and reward system

Recruitment

involves considering both internal and external sources to produce viable candidates to applyto fill a given work demand

Selection

involves gathering appropriate information and deciding from among those candidates who to

choose to fill the work demand

General Factors Affecting Global StaffingE mployee recruitment and selection decisions are influenced by

firms business strategy

stage of international developmentspecific foreign market experience

host government restrictions and incentives

host country sociocultural restrictions

plans for individual and organization development

situational factors

economic trends and conditions

nature and duration of the international work itself

MNC resources available for staffing

availability of willing and able candidates

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MNC Business StrategyStaffing should seek to fit and reinforce the purposeful direction andpriorities of the MNC

being consistent with

o ethnocentric

o polycentrico regiocentric

o geocentric

general strategic approaches in operating foreign wholly owned subsidiaries

e.g.

MNC follows astrategic alliance strategy (focusing on core competencies)

employ outsourcing

through increasing the outsourcing ofnon-core back-office operations

resort to a broader level of external partner selection in complementary alliances(international joint ventures)

Ethnocentric Approach

characterized by all or most key positions at a foreign operation being filled by parent-

country nations (PCNs)

o PCNs are often utilized in earlier stages of internationalization

optimize controlfor the purpose of transmitting company culture and

instituting and implementing company procedures and methods

o formore experienced MNCs

heavy use of PCNs for managing foreign operations due to the

perceived lack of qualified local home-country national (HCN) talent

need forstrategic controlo often in Japanese, Korean and German firms they persist with PCNs

predominating in foreign operation management

o bc of greater operational challenges posed by cultural distance or by nature of

industry

o if product complexity and/or product safety concerns are high

disadvantages and costs of ethnocentric staffing

o expatriates represent a considerable direct cost

adjustment process takes considerable time

learning curve time span of costly suboptimal performance,

mistakes, poor decisions

o limits the the promotional and developmental opportunities of HCNs

increased dissatisfaction

related costs oflower productivity

increased turnover

o significantpay gap between PCNs and HCNs

PCN based on home country rates, inducement premiums, allowances

HCN lower local rate

Polycentric Approach

similar to multidomestic strategy

o involves customizingcompany products, services, and practices to meet the

often differing market and nonmarket circumstances, needs, laws, and accepted

practices of individual countries and regions

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each major overseas subsidiary is usually somewhat independent and is typically managed

by a local HCN

major advantages

o strongfamiliarity of operation management with local social norms and

customso language fluency

o costs that are typically less than an expatriate assignment

o no foreign adjustmentproblems for an employee and any accompanying

family members

o can win thesupport and confidence of the local government and people

major disadvantage

o lack of effective flow of information andproductive interaction between MNC

headquarters and the foreign subsidiary

language and culturaldifferences

us versus themstereotypes lack of local meaningful interaction and common experience between

PCNs and HCNs

o lack ofinternational professional skill enhancementand career development

opportunities for HCNs

o suboptimalsharing of valuable knowledge and information and cross-cultural

understanding

o lack of valuableglobal competency developmentopportunities for PCN

managers and executives

lead to lower effectivenessMNC headquarters strategic

management team

Regiocentric Approach

the firms operations or particular functions are structured by multiple country areas or

major economic regions

o predominance ofHCN staffingat the local subsidiary

o former HCN managers (now TCNs) with cross-border assignments

gain useful albeit less culturally distant international career experience

but still generally limited to this regional level

little chance of promotion to the top management strategic team back at

the parent company headquarters

advantages

o may contribute to building useful international competencies

disadvantages

o risks developing multiple independent national units with little common links

and identification with MNC headquarters

o less-than-optimal exchange of knowledge and resources

Geocentric Approach

considers and selects the best talentfor important jobs throughout the world operations of

the MNC, regardless of nationality

works well where products/services involve minimal cultural differentiationo electronics, automotive industry

advantages

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o increasedglobal leadershipdevelopmentopportunities for HCN

o increased opportunities forcross-cultural learningand knowledge sharing

throughout the firm, with meaningful cross-border interactions

o greater opportunity for developing a commonMNC identity and mind-set

o a more widespread development ofkey global competencies throughout the

MNC leading to a distinct competitive advantage in human capital restrictions

o where local governments require certain levels of HCN professional and

managerial presence in their host country operations

o or place significant documentation and qualification requirements for hiring

foreign nationals

disadvantages

o prove prohibitively expensive to implement fully due to compensation

adjustment needs and relocation expenses

International Joint Ventures (IJV)

Issues of potential cross-cultural conflict, control, and temporary versus permanent (that is,

one-way) staffing assignments

major strategic mode of entry into foreign markets

advantages

o competitive advantage due to cultural diversity

broader range of perspectives for managing the IJV

o negative outcomes can be minimized by focusing more on expertise and

interpersonal skills

many MNCs now hire local talent and train them in company strategy, culture, and

procedure local in the host country or as inpatriates at MNC headquarters then place them

in key leadership positions back in the local host country IJV

Stage of International Development

Progression of businesses through various stages of international development, or

internationalization

1) export activity

2) development of foreign sales offices

3) licensing agreements

4) foreign direct investment with manufacturing facilities5) international division formation

6) multinational status

7) integrated global enterprise

some businesses bypass stagesacquisitions

joint ventures

born global new ventures

Specific Foreign Market ExperienceMNCs with little experience

o staff operations with local management

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local HCN managers

TCNs

o reluctant to hire an experienced HCN or TCN from outside the MNC

short-term hiring

full-time consultancy basis

Government Restrictions and Incentives

Safeguarding responsibility on behalf of their working citizens

require MNC to demonstrate that HCNs are not available to fill certain managerial or

technical professional positions

o entry visas and work permits to PCNs and TCNs

work permit is granted generally only for an expatriate and not for an accompanying

spouse or partner

certain number of HCNs might have to be hired at particular levels

o minimal percentage of supervisor and management level positions must be staffed byHCNs

o enforced by governments and NGOs especially in developing countries

incentives by governments to encourage MNCs foreign direct investment and significant

HCN staffing

o tax, tariff, local labor force training

Sociocultural Considerations

general social norms

women in international staffing

General Social NormsInfluence of social expectations and cultural preferences in the workplace

Consideration of such factors as

o gender

o age

o consanguinity (family ties)

o previous friendships

nepotism= hiring extended family members

Women and International StaffingCultural norms and expectations might need to be considered when making staffing-

assignment decisions about women in other countries

o especially involving work and supervisory interactions with men

women still lag significantly behindtheir male MNC expatriate counterparts

o assumption held by male managers that women have less interest than men in

obtaining international work experience (expatriate assignment) and concerns aboutsuccess potential

o even though a majority of women on expatriate assignments were successful

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advantages of women overseas

o high visibility

o not necessarily subject to the same traditional gender-based restrictions in local

business interaction

o positive self-fulfilling prophesy or halo effect

foreign business persons might expect the female expatriate to be extremelycapable and talented (as she was able to overcome all of the gender-biased

obstacles)

o social skills

building trusting relationships with employees and customers

good listening skills

less direct and confrontational communication approach

emphasis on cooperation over competition

Plans for Individual and Organizational DevelopmentImmediate stuffing decisions can be influenced by longer-range goals and objectives of the

firm related to individual employee development or the development of the organizations

capability as a whole

o selection of HCN forinpatriate assignments

reverse knowledge-transferstrategy for building greater capability at companyheadquarters

considering diverse perspectives and meeting the demands ofglobal diversity

enhancing the capability of the MNCs strategic management team in making

decisions

Situational Factors Influencing Staffing Decisions

important situational determinants of international stuffing

nature and duration of the task or work assignment

financial resources of the MNC available for staffing

availability of qualified and willing candidates

economic trends and conditions

Global Recruitment of Human Resourcesinvolves finding and encouraging qualified individuals to apply for a job opening

important areas

o geographic scope of recruitment

o internal vs externalcandidates

Geographic Scope of Recruitment

geocentric approach

o worldwide scope of sources for locating qualified potential job candidates

o searching fortop talentregardless of national pedigree

broad scope

o when particular professional skills are highly sought after but are in short supply e.g. to fill critical national nurse shortages

narrow scope

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o when recruiting for executive-level employees

o found mostly at or near company headquarters

o needed for new foreign operations that lack an MNCs proprietary knowledge and

expertise

subject to an ethnocentric staffing orientation

web-based recruiting

o low costs

o dramatic increase of the geographic area for recruitment

other costs and restrictions related to the overall staffing effort

o candidate travel for interviews

o dealing with difficult country visa and immigration policies

might minimize the geographic recruitment area

Internal versus External CandidatesSearch for candidates inside or outside the organization?

BUT many MNCs (Merck, 3M, IBM) encourage an internal recruitment promotion fromwithin

o advantages of this approach

where effective human resource information systems (HRIS) are in use

qualified candidates are easierto identify and contact

significant savings in time andfinancialresources

work performance background and development progress are

readily available of potential candidates

boost on employee morale and motivation, increasing retention and productivity

reduction in training and socialization time and costs

awareness of the unique organizational culture, priorities,procedures, and overall business practices of existing

employees

o additional advantages (Harvey and Novicevic)

internal candidates are easier to persuade to take an assignment abroad

internal candidates are familiar with the value of international career within the

organization

internal candidates are more likely to be trusted in the organization

recruiting employees from the outside benefits

o fresh new ideas and viewpoints

o

reduce training costso provide additional greatly needed human resources without overusing and

overburdening existing internal staff

o greater objectivity and flexibility in making critical decisions

disadvantages

o lack of verifiable information on the external candidates past experience

o higher recruitment costs

o little knowledge and experience regarding company culture and strategy

o lack of a history with MNC headquarters to develop trust and ongoing support

Global Recruitment Methods INTERNAL

usage of formal and informal means to search for potential employees inside the MNC

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primary internal methods

o job posting

o skills inventories

o internal network referrals

Job Posting company newsletters

bulletins

computerized intranet in-house communication systems

o include

information about the nature of the position

major qualifications required

how to apply or bid for this job opportunity

Skills Inventories

facilitate an internal search for employees with interest and requisite skills

Internal Network Referralsinformal communication

there must be an open sharing of career interest information

Global Recruitment Methods EXTERNAL

advertising

employee referrals

field recruiting

internships Internet and related software

professional recruitment firms

Advertisingdirect advertising

o can reach a large number of potential applicants in a number of ways

o should fit the local culture and regulatory conditions

o should be directed at reaching the intended audience

Employee referrals

employees are typically provided afinancial rewardand/or gift for referring a candidatewho is eventually hired

especially insmall- to medium-sized operations

tends to be very effective in attracting qualified and loyal new employees

the newly recruited employee tends to know what to expectfrom the job and the company

o decreasing the likelihood of early departure

nepotism (hiring of family members)

disadvantages

o less workforce diversity

o some countries over-reliance can lead to accusation of discrimination and costly

litigation

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Field Recruiting

professional internal recruiters are sent out into the extern environment in field recruitingactivities

o domestic or international college career centers

o company- or government-sponsored outplacement service centers

o school- or local government-sponsored career fairso meeting of professional associations

Internships

companies are increasingly working closely with domestic and international universityprograms to develop internship arrangements

o part-time basis during a school year

o full-time during a summer prior to graduation

in change for pay or academic credit

provide valuable experiential learningand resume-building experience for student recruitmenttool

o attracting very capable students

international internship

o valuable trial test of an individuals ability to adapt and adjust to a foreign work

environment

disadvantage

o might not be appropriate when employees need to be hired fairly quickly

o tend to require considerable company time in planning and supervision

The Internet and Related Softwareis reducing the cost and time neededto fill many positions

able to improve on traditionaladvertising

o targeting specialised websites

o electronic newsletters

o bulletin boards

effectivelydesignedwebsites

o realistic job and working environment previews for potential candidates

potential drawbacks of e-recruiting (by Sparrow)

o attracts too many applicants to process effectively and in a timely manner

o challenge when the recruiting company is not well known

o attracts questionable data of highly variable quality

o inherent discrimination against other qualified candidates (mostly male candidates

applying)

Professional Recruitment Firms

agencies

e.g. Adecco or Manpower

o provide temps or employees that work for the company for a limited period

executive search firms

e.g. Korn/Ferry International

o assistonly with the external recruitment of senior executives

temp-to-hire

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o provides employees from entry to middle management levels initially on a temporary

basis

o afterwards these employees are hired by the company on a regular basis when future

work demand employee fit warrant such a decision

often used as aprobationary test

Global Selection of Human Resourcesexecutive level

selection decision determines what kind of leadership is going to guide the organization

and shape its future

General Principles and Practices of Employee Selection

Triangulation

= to measure something from three different angles to achieve an accurate assessment

the more kinds of measures are used the more accuracy in predicting the future successof a candidate

if only one approach or measure is used the quality of that decision will be vulnerable tothe limitations of that particular measure

Focus on Job Relevance

Investment in Developing Interviewing Skills

employment interview is the mostfrequently used method for employee selection

it often has one of the lowest validity rates

what to avoid

o interviewer domination

o asking questions unrelated to the job

o premature judgments of the candidate

approaches

o behaviouralinterview approach

requires the candidate to describe specific experiences in the past in which he or

she demonstrated an important job-related behavior

o situationalinterview approach

requires the candidate to describe how he or she would solve a particular

problem relevant to the job

Influence of Culture on Selection Measures

differential effects of culture

nonverbal behaviour

personality tests

Selecting Employees for Foreign Assignments

Focus on the Most Important Criteria for Success

most important selection criteria depends on the nature of the international assignmento extended assignment in very different culture

candidates local language fluency

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ability to adjust

ability to relate in a sensitive way with other cultures

o shorter assignments little culturaldistance

selection criteria

o interpersonal skills

o personal intent and motivation for obtaining international work experience

o cross-cultural sensitivity

o adaptability

o tolerance for ambiguity

o overall inquisitiveness

o technical competence

Methods for Selecting Employees for a Foreign Assignment

a psychometric approach for predicting international management competencies

a experiential approach

an overall clinical risk assessment approach

Psychometric Approach

general approach usingpersonality tests

challenges

o difficulty in measuring predictive success and reliability

o questionable quality of data

Experiential Approach

emphasizes the expatriate candidates direct experience with many of the realities of thefuture assignment

3 main forms

o assessment center technique

places the candidate in various relevant situations and with common and critical

tasks that he or she likely would face in the foreign assignment

in-basket exercises

relevant job assignments

work simulation

o foreign site preview visit (familiarization trip)

more time and expense

invitation to visit the actual area of the proposed foreign assignment

o developing an internal international cadre of talent pool

significant HR planning

long time perspective

o clinical risk assessment approach

investigates candidate competencies and ability to adjust and other factors

affecting success

adaptability of the accompanying partner

dual-career difficulties

nature of supporting structure in the foreign assignment

cultural distance and technical difficulty of the assignment

accountabilities and responsibilities

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7Global Workforce Training and Development

for providing training or planning the training agenda, an awareness of important issues andpotential valuable contributions of training for various members of the global workforce is

essential for achieving long-range effectiveness and even company survival

formation of centralized corporate universities

o help to spread a common culture and values

o drive change simultaneously across the whole organization

measurable behavior

immediate learning goals

long-range learning goals

training

corresponds to efforts designed to address immediate learning needs within an

organization

development

corresponds to efforts aimed at meeting longer-range learning

objectives

commonly reserved to middle managers and higher executives

Strategic Role of Training and Development in the Global Marketplace training plays a central role in the effective implementation of organizational strategy

5 ways in which training can assist organizations in gaining competitive advantage

o Quality and Customer Satisfaction

o Decreasing Costs

o Organizational Learning and Knowledge Management

o Global Alignment

o Building Global Talent

Quality and Customer Satisfaction

reliability consistent quality performance

Decreasing Costs

satisfying customer needs at lower costs than other firms

reduce costs for the customer for products and services

o reduce rejects and unacceptable performance

o reduction of wasted time

shortened learning curve

o agility, or ability of an organization to learn and adopt to needed change

swiftly

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Organizational Learning and Knowledge Management

tacit knowledge

o capability possessed by an individual based on his or her overall level of

experience and expertiseo shared through team working arrangements

Global Alignment

various training activities and related efforts can be used to help build internal employeealignment, or a common mind-set

o brings control and consistency

o offsets the unavoidable uncertainty and rapid change

training can build a common commitmentand sense of values to guide decisions

o shared attitudes

Building Global Talent

development ofhigh-potential employees into effective managers and leaders

o think and compete effectively on a global scale

training

o developgeneral international competencies

e.g. international adjustment skills

o specific knowledge and skills

specific foreign language ability

knowledge of local laws

Fundamental Concepts and Principles for Guiding Global Training and Development

to help guide decisions regarding employee training and development

Domains of Learning

cognitive domain of learning

o most training is aimed at increasing knowledge, awareness, and understanding

o intellectualand rationalthinking processes

affective domain of learning

o deals with emotions, feelings, values, beliefs, attitudes, expectations motivation

o e.g. pre-departure training efforts (expatriates)

psychomotor domain of learning

o relates to the acquisition of new physical skills

typing, correct enunciation of previously unfamiliar and difficult vocal sounds in

a new foreign language, becoming accustomed to driving on the opposite side of

the road

o combination of the intellect, and motor coordination

o mastery tends to require significant practice

o deep level of learning over-learning

Levels of Learning within the cognitive domain

CASE

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o C = basic comprehension of a message, rule, or principle

o A = next level, involves the ability to analyze a problem situation and break it up into

an effective examination of the most important parts of the situation

o S = ability to synthesize or reassemble the parts to form a clear total picture or

diagnosis of a solution or set of alternative solutions to the problem

o E = at the deepest level of learning, pertains to evaluate the most appropriate actionto take based on existing objectives or determining the decision that would yield the

greatest value

Principles of Adult Learning

familiarity

relating to previous experience

pragmatic or problem-centered

personal influence and control

perception of self-direction, influence, and control on the learning process

values of mutual trust and respect, openness, and honesty

Sensitivity to Cross-Cultural Differences

Systems Approach

to use the training effectively and create desirable impact on employee and organizational

training

systematic, scientifically based procedure

Phase 1: Conduct Needs Assessment

whether a training need exists

careful need assessmentis important for ensuring that training is

o designed and implemented cost-effectively

o supported and reinforced by work design and supervision

the reward system

the overall workplace environment

examines at

o the organizational level

organizational performance objectives

available resources

possible supportive changes from the organizational culture and reward

system

o the job and work operations level

nature of the particular performance to be mastered

training content for new knowledge and skills

causes of performance problems (if existing)

prevailing conditions in which the work is performed

should include input from as many sources as possible

o the individual level

needs or characteristics of the trainee(s)

language skills

technical and basic skills

cultural influences

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Phase 2: Develop Training Objectives

identify what specific behaviors the intended trainees are supposed to be able to perform

expected conditions in which the behaviour is to be performed

Phase 3: Design and Develop Training

selection oftraining methodor combination of methods possibly adjustingorredesigningthe work environment

cardinal rule:

o the most cost-effective method to use depends upon the training objectives

experiential methods

o practice, role playing, international travel, work experience in foreign culture

o very effective training methods

o require expense and time

other methods

o readings

o computer-assisted mediao brief live presentations

Phase 4: Test and Revise Training Prototype

trial test of the training prior to its widespread usage

Phase 5: Implement Training

Phase 6: Evaluate Training

in terms of its effectiveness in achieving the training objectives

Training Transfer to encourage effective positive transferof the training there are several things that

managers can do before, during, and after the training takes place

before the training

o clear commitmentobtained from accepted leaders and top management for the

training

powerful influence on perception of workers

through:

adequate budget allocation for the training

supportive public statements

participating in the training themselves

clear support for the new behaviors being trained

o careful review and possible revision of pertinent company policies, procedures,

and workplace conditions

during the training

o use of practice

on-the-job training

role playing

experiential exercises

following training

o encouragement by the supervisors to use the new skills

o functional integration of other human resource activities

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performance appraisal and compensation

Training Imperatives for the Global Workforce

key imperatives for global training

o building global competencies for international professionals

o building global alignment

o pre-departure and on-site expatriate training

o special training considerations for female expatriate assignment success

o HCN training

Building Global Competencies for International Professionals

professional global competencieso e.g.

cross-cultural awareness/sensitivity

managing cross-cultural conflict

working in and managing international teams

emotional intelligence

managing tension of duality (i.e. think global, act local)

open, nonjudgmental personality

etc

KSAO knowledge, skills, abilities, and other characteristics

4 pillars of a global mindset (Stephen Rhinesmith)

o Business Acumen

working understanding of effective principles and practices of functional

disciplines

broader strategic management knowledge

o Paradox Management

appreciation and ability to make effective decisions within uncertainties and

complexities

o Self-Management

ability to monitor, care for, adapt, and renew oneself to maintain strength andvitality amid the ongoing demands of rapid change, uncertainty, complexity, and

other stressful working conditions

o Cultural Acumen

appreciation and interest in other cultures

sensitivity to and flexibility in dealing with cross-cultural differences

4 major strategies Four Ts (transfer, training, travel, teams) for development of vital

global professional competencies:

Transfer to New Assignment or Job

ongoing practice in using extended international-work-assignment transfer

as a rich experiential training ground for future leaders

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Training

more controlled, structured learningactivities with fairly limited topics and specificlearning objectives

mostformalstrategy of the four T and with the greatest focus on sharing explicitknowledge

program on a global strategy change management

managing virtual work teams

international negotiations and conflict-management skills

Travel

can provide a rich source ofexposure and experience-based knowledge about

foreign cultures and different behavioural norms

divers economic and political environments,

different and often insightful business practices

Teams

cross-functional task forces

enduring teams at middle or senior levels

fairly autonomous and self-managing virtual teams

experiences of interactions with team members of other national and cultural backgrounds

can provide a rich exchange of tacit knowledge and capability

Building Global Alignment

Externally provided controls are intended to help align the workforce with the goals andobjectives of the organization

o close supervision by expatriates

o rules

o performance-management techniques

internal cognitive alignment

o common mind-setand shared knowledge represent a unifying language that

provides alignment in thought and action, facilitating effective interactions and

collaborative synergies across the MNC

alignment of both mind and heart = normative integration or cohesion management

o through informallearning channels

Expatriate Training ConsiderationsTraining can enhance thespeed and effectiveness of expatriate adjustment and performance inthe assignment and minimize costly expatriate assignment failure

Important considerations for expatriate training:

Pre-Departure Training

provide useful information and a sense ofpersonal controlin addressing challenges

training should providepositive but realistic expectations

forms of trainingo cross-cultural awareness

o strategic training

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o job training

actual content and form of training depends on various factors:

o Job Toughness

does the new job require different working conditions, equipment, or

legal or union restrictions?

o Cultural Toughness

the degree to which the values, norms, and attitudes of the foreign

culture match the expatriates home culture

o Communication Toughness

difficulty and amount of frequency of communication involved with

HCNs and in the foreign environment

different norms and rules for written, oral, and interpersonal

communication; frequency of foreign communication required;

difficulty in learning the predominant foreign language; length of

foreign assignment; modes of communication used

Special Training Considerations for Female Expatriates

Female expatriates represent a significant butgreatly underutilized resource

Local Norms and Values Regarding WomenInformation should be provided on local norms, values, and perceptions about expected

female role behaviour and attitudes toward women managers

Attitudes and Norms Regarding Expatriate Women versus HCN WomenExpatriate women are often not held to the same gender role expectations as are women form

the local culture

Behaviors to AvoidAvoid unnecessary HCN offense with or misinterpretation of their behaviour

Networking with Successful Female Expatriates

HCN Training Considerations

Operative Level

o new employee orientation

o entry job skills

o parent company predominant language

o expatriate and home country cross-cultural awareness training

Supervisory and Middle Management

o Supervision and technical operations management

o Home country cross-cultural awareness

o Expatriate coaching

o Liaison role between parent company expatriates and lower-level HCNs

Upper Management

o Advanced technical system operations

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o Business-level (subsidiary) strategy

o Parent company (MNC) strategy

o Parent company (MNC) culture

summary chapter 5,6,7

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