3. Staffing
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Transcript of 3. Staffing
Staffing
• Factors affecting approaches to staffing
• General staffing policy on key positions at headquarters
and subsidiaries
• Constraints placed by host government
The Immigration Reform and Control Act of 1986 (IRCA) bars employers from hiring individuals who are not legally entitled to work in the U.S. Employers must verify work eligibility by completing Form I-9 along with required supporting documents. IRCA also prohibits employers from discriminating in hiring, firing, recruiting, or referring on the basis of national origin or citizenship status.
H-1B workers may be employed temporarily in a specialty occupation or as a fashion model of distinguished ability. A specialty occupation requires theoretical and practical application of a body of specialized knowledge along with at least a bachelor’s degree or its equivalent. An H-1B alien may work for any petitioning U.S. employer for a maximum period of six years.
A 4 day strike and pay rises of 10-15% were part of the cost
paid by a south Korean textile firm for an incident involving
one of the expatriate managers in its Vietnamese factory. A
Vietnamese worker was confronted by his south Korean
boss. Speaking in Korean, the manager yelled at him for
being in the wrong place in the factory. As he did not
understand her, the Vietnamese did not respond. The south
Korean manager kicked and slapped him – as in south Korea
it is common for employers t0 scold or even beat employees
if they make a big mistake. Here though such behaviour
resulted in 10 of the Vietnamese co-workers retaliating in
kind. The manager was rushed to hospital and the workers
went on strike. The south Korean was subsequently
deported.
Approaches to staffing
• Staff availability
• Ethnocentric
• Polycentric
• Geocentric
• Regiocentric
IBUS 618 Dr. Yang 6
Ethnocentric
• Strategic decisions are made at headquarters;
• Limited subsidiary autonomy;
• Key positions in domestic and foreign operations
are held by headquarters’ personnel;
• PCNs manage subsidiaries.
Advantages:
• To ensure new
subsidiary complies
with overall corporate
objectives and policies
• Has the required level
of competence
• Assignments as control
Disadvantages:
• Limits the promotion
opportunities of HCNs, leading
to reduced productivity and
increased turnover
• Longer time for PCNs to adapt
to host countries, leading to
errors & poor decisions making
• High cost
Polycentric
• Each subsidiary is a distinct national entity with
some decision-making autonomy;
• HCNs manage subsidiaries who are seldom
promoted to HQ positions;
• PCNs rarely transferred to subsidiary positions.
Advantages:
• Employment of HCNs eliminates language barriers,
avoids adaptation of PCNs, reduces the need for
cultural awareness training programs
• Employment of HCNs allows a multinational company
to take a lower profile in sensitive political situations
• Employment of HCNs is less expensive
• Employment of HCNs gives continuity to the
management of foreign subsidiaries (lower turnover of
key managers)
Disadvantages:
• Difficult to bridge the gap between HCN subsidiary
managers and PCN managers at headquarters
• HCN managers have limited opportunities to gain
experience outside their own country
• PCN managers have limited opportunities to gain
international experience
• Resource allocation and strategic decision making will be
constrained when headquarter is filled only by PCNs who
have limited exposure to international assignment
• 2012, July: Indian Information Technology companies
supported nearly 2.8 lakh jobs in America in the year 2011 by
way of foreign direct investment through acquisitions of IT
companies. India invested nearly $ 5 billion in foreign direct
investment. Top Indian IT companies like TATA, HCL
technologies India's fourth largest software export, Infosys and
Wipro stepped in United States to set up their subsidiaries and
recruited American nationals from colleges and experienced
professionals who had the local knowledge and domain
expertise. local employees have the requisite knowledge and
understanding of culture, people and were in a particular
region.
IBUS 618 Dr. Yang 14
Geocentric
• A global approach - worldwide integration
• View that each part of the organization makes a
unique contribution
• Nationality is ignored in favor of ability
• Best person for the job
• Color of passport does not matter when it comes to
rewards, promotion and development
15
Advantages:
• Ability of the firm to develop an international executive team
• Overcomes the federation drawback of the polycentric approach
• Support cooperation and resource sharing across units
Disadvantage:
• Host government may use immigration controls in order to increase HCNs employment
• Expensive to implement due to increased training and relocation costs
• Large numbers of PCNs, HCNs, and TCNs need to be sent across borders
• Reduced independence of subsidiary management
Regiocentric
• Reflects a regional strategy and structure;
• Regional autonomy in decision making;
• Staff move within the designated region, rather
than globally;
• They are not normally moved to the company
headquarters.
Advantages:
• Allow interaction between executives transferred to regional headquarters from subsidiaries in the region and PCNs posted to the regional headquarters
• Provide some sensitivity to local conditions
• Help the firm to move from a purely ethnocentric or polycentric approach
Disadvantages:
• Produce federalism at a regional rather than a country basis and constrain the firm from taking a global stance
• Staff’s career advancement still limited to regional headquarters, not the parent country headquarters
Reasons for International Assignments
• Position filling,
• Skills gap, launch of new endeavor, technology transfer
• Management development
• Organizational development
• Need for control, transfer of knowledge, competence, procedures and practices into various locations
Types of International Assignments
Short term: up to 3 months
• Troubleshooting
• Project supervision
• A stopgap until a permanent arrangement is found
Extended: up to 1 year
• May involve similar activities as short-term assignments
Long term: from 1 to 5 years
• The traditional expatriate assignment
Traditional
• Filling position,
management development
• 12-36 months
• Family joins the assignee
• Formal selection
• Advantages
– Good relation, constant
monitoring
• Disadvantages
– Dual career options,
expensive, less flexibility
Short term
• Skill transfer / problem
solving
• 6-12 months
• Unaccompanied by family
• Informal, little bureaucracy
• Advantages
– Flexibility, cost effectiveness
• Disadvantages
– Poor relationship, side effects,
work permit issues
Non-standard Assignments
• Commuter assignments – weekly or bi-weekly basis
• Rotational assignments – short period followed by break in home country, oil rigs
• Contractual assignments - R & D
• Virtual assignments – manage from home, international assignment, heavy reliance on communication technologies, frequent visits to host
country but……..
The Role of an Expatriate
• Agent of direct control – Formal control, Direct supervision
• Agent of socialization – Informal control, expected behaviors
• Network builder – Developing social capital, communication,
• Boundary spanner – representatives in host country, bridge external-internal contexts
• Language node – familiar with host language
• Transfer of competence and knowledge – cross fertilization of ideas, ability and motivation of expatriate
The Role of Non-expatriates
• People who travel internationally yet are not considered expatriates as they do not relocate to another country
• IB travelers, Road warriors, Globetrotters, Frequent fliers, Flexpatriates
• Much of international business involves visits to foreign locations
• Sales staff attending trade fairs
• Periodic visits to foreign operations
Cont’d
A Glamorous Life
• International business travelers cite the positives as:
• Excitement and thrills of conducting business deals in foreign locations
• Life style (top hotels, duty-free shopping, business class travel)
• General exotic nature
Cont’d
But a High Level of Stress!
• Home and family issues
• Work arrangements
• Travel logistics
• Health concerns
• Host culture issues
Various Roles of Corporate HR
Centralized HR
Companies
Decentralized HR
Companies
Transition HR
Companies
Large well-resourced
HR departments Small HR departments
Medium-sized HR
departments
Key role: Managing all
high-grade management
positions worldwide
Key role: Managing
corporate managers
Key role: Management
and development of senior
managers and expatriates
Key activities: Planning
international assignments
and performance
management globally,
identifying high-potential
staff
Key activities:
Influencing operating
units to support
international
assignments, supporting
decentralized HR
Key activities: Persuading
divisional managers to
release key staff using
informal and subtle
methods, strategic staffing.
Source: Based on H. Scullion and K. Starkey, in Search of the Changing Role of the Corporate Human Resource Function in the International
Firms, International Journal of Human Resource Management, V 11, N 6 (2000) pp. 1061-1081.