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because if the costs, time and energy are too high then the full potential of the strategy will not be realisedand Pacific Brands will loose its competitive advantage in implementing the strategy. The location of

SIHRM operations according to Schuler et al. (1993) can vary considerably across MNEs from theheadquarters to the local units.

Exogenous and Endogenous Factors

External influences such as industry competitors represent exogenous factors for Pacific Brands. PacificBrands through studying the actions of its competitors have made the decision to implement a'cost-reduction strategy' to remain competitive, and must devote more attention to SIHRM issues when their

competitors are operating more globally. It could be said that the decision to offshore to China is not withoutan element of risk, however and the level of foreign investment being injected into China, Pacific Brandsdecision is a calculated one.

Endogenous Factors are characterised as internal influences such as Pacific Brands competitive strategy. Asdiscussed the company's 'cost-reduction strategy' has been the driving influence on its decision to offshore toChina with the aim being to gain competitive advantage by lowering production costs.

Concerns and Goals

The final portion of Schuler and colleagues SIHRM integrative framework, concerns and goals, has fivecomponents which are: global competitiveness, efficiency, local responsiveness, flexibility, andorganisational learning.

Pacific Brands has adjusted its HR strategy to remain globally competitive and survive as illustrated with its

change in competitive strategy. With the change in competitive strategy, Pacific Brands have sought toincrease efficiency through economies of scale in offshoring their manufacturing to China. Due to intense

global competitiveness, Pacific Brands must ensure they utilise the most appropriate methods and processesto make and deliver their products worldwide and realise that every possible source of competitiveadvantage must be identified and utilised. Local responsiveness to laws and cultures is imperative as is the

ability to be flexible to changing conditions from technology, strategy or the competition. A major goal of MNEs should be facilitating learning and transferring this learning across units, however when pursuing a

cost-reduction strategy the MNE should implement minimal levels of employee training and development.So in the case of Pacific Brands it could be said that although transferring the learning across units is a keygoal, the level of training would be minimal.

Conclusion

From dramatic economic events that have encompassed the world leaving no nation unscathed, PacificBrands has had to adapt to the changed corporate environment by adopting a 'cost-reduction strategy' by

offshoring manufacturing operations to China. It was made aware to ensure other costs associated with theoffshoring do not impact on the competitive advantage of the 'cost-reduction strategy'.

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The implications for the HR administration of how they would implement HR policies into China concludedthat as a FIE, Pacific Brands HR policies and practices have the strong potential to 'transfer' across andwould likely be 'expected' by the Chinese entity.

When recruiting and selecting employees, preferred behaviours for employees such as predictable behaviour,short-term focus, individual activity, high concern for quantity of output/results were desirable and HR

practices that maximise efficiency by enabling management to monitor and closely control employeeactivities are essential.

A SIHRM integrative framework was discussed and it was suggested Pacific Brands needs to link its

organisational units together in a cost effective and efficient way, consider how much autonomy each unitwill have, being locally responsive and flexible, and matching and adapting HR practices to the local cultureand legal system.

Pacific Brands has made the decision to implement the 'cost-reduction strategy' to remain competitive andsurvive, but if economic conditions continue to deteriorate it could be said that it is increasingly importantthat they strategically implement their strategy in the most effective and efficient way in order for the MNEto be flexible to changing economic conditions in order to remain globally competitive.