Managing for Global

Operations

By Prof. Neeraj Mankad

Issues
Organizational
HR
Coordination
Communication and Knowledge
management

Organizational

Structure
Matrix?
Flexible?

Process global vs. multi location

Policies

Control
Ownership
HO vs. Local

Staffing
Philosophies for
`
Global Operations
Firms using an ethnocentric staffing
approach fill key managerial positions
with people from headquarters that is,
parent-country nationals (PCNs).
In a polycentric staffing approach, local
managers host-country managers
(HCNs) are hired to fill key positions in
their own country.

Advantages & Disadvantages

Ethnocentric staffing: close control, high
technical capability/experience required,
proprietary concerns.
Lack of opportunities for local mgrs,
expense, poor adaptation & lack of
expatriate effectiveness
Polycentric staffing: good for
multinational strategy, localization. Familiar
with the culture, language & local norms
Coordinating goals bet subsidiary & PC
can be difficult, local mgrs having a
potential conflicting loyalties

Staffing Philosophies for

Global Operations
In the global staffing approach, the best
managers are recruited from within or
outside of the company, regardless of
nationality.
In a regiocentric staffing approach,
recruiting is done on a regional basis
say within Latin America for a position in
Chile.

Problems with
Selection based on headquarters
Expatriation

criteria rather than assignment needs

Inadequate preparation, training, and

orientation prior to assignment

Alienation or lack of support from

headquarters

Inability to adapt to local culture and

working environment

Problems with
Expatriation
Problems with spouse and children
poor adaptation, family unhappiness
Insufficient compensation and financial
support
Poor programs for career support and
repatriation

Knowledge Management

Knowledge Management is the conscious

and active management of creating,
disseminating, evolving and applying
knowledge to strategic ends

Knowledge Management
Process
Transfer: managing the flow of existing
knowledge between parents and from the
parents to the IJV
Transformation: managing the
transformation and creation of knowledge
within the organization through its
independent activities
Harvest: Managing the flow of transformed
and newly created knowledge from the IJV
back to the parents

Knowledge Management
Process