You are on page 1of 28

International Management, 8e (Deresky)

Chapter 9 Staffing, Training, and Compensation for Global Operations

1) ________ is increasingly being recognized as a major determinant of success or failure in


international business.
A) International human resource management
B) Procurement of raw materials from abroad
C) Outsourcing
D) Insourcing
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 1

2) Which of the following should ideally dictate the organizational structure and staffing needs of
the firm?
A) the firm's customers
B) the size of the firm
C) the firm's strategy
D) the firm's short-term objectives
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 1

3) In addition to the global war for talent, there are considerable strategic competitive challenges
for firms. Which of the following is one such challenge?
A) increasing talent in order to lower the costs of operations
B) relocating operations around the world
C) obtaining competent talent at higher wages than competitors
D) obtaining talent using a regiocentric approach
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

1
Copyright © 2014 Pearson Education, Inc.
4) ________ are employees assigned to a country other than their own.
A) Host-country nationals
B) Inpatriates
C) Third-country nationals
D) Expatriates
Answer: D
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

5) Fred Sanders, an American, works as a manager at his firm's headquarters in New York. He
recently learned that he has been assigned to manage the firm's subsidiary office in Tokyo, and
he will be relocating to Japan within the next six weeks. Which of the following staffing
approaches is being employed in this scenario?
A) polycentric staffing approach
B) regiocentric staffing approach
C) global staffing approach
D) ethnocentric staffing approach
Answer: D
Diff: 2
Chapter: 9
Skill: Application
Objective: 2

6) Kelly Roberts, an American, is a senior manager at her firm's headquarters in New York. Kelly
is a(n) ________.
A) expatriate
B) parent-country national
C) host-country national
D) third-country national
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

2
Copyright © 2014 Pearson Education, Inc.
7) A(n) ________ policy is likely to be used where a company notes the inadequacy of local
managerial skills and determines a high need to maintain close communication and coordination
with headquarters.
A) global
B) regiocentric
C) polycentric
D) ethnocentric
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

8) ________ are familiar with company goals, products, technology, policies, and procedures;
they know how to get things accomplished through headquarters.
A) Expatriates
B) Parent-country nationals
C) Third-country nationals
D) Host-country nationals
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

9) When the company is at the internationalization stage of strategic expansion and has a
centralized structure, it will likely use a(n) ________ staffing approach to fill key managerial
positions with PCNs.
A) polycentric
B) regiocentric
C) global
D) ethnocentric
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

3
Copyright © 2014 Pearson Education, Inc.
10) ________ are usually preferable when a high level of technical capability is required and
maintenance of close control is desired.
A) Parent-country nationals
B) Host-country nationals
C) Expatriates
D) Third-country nationals
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

11) ________ are the most preferred staffing choice for a foreign subsidiary where proprietary
technology is used extensively.
A) Expatriates
B) Host-country nationals
C) Third-country nationals
D) Parent-country nationals
Answer: D
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

12) Which of the following is a disadvantage of the ethnocentric staffing approach?


A) increased opportunities or development for local managers at the expense of PCNs
B) low adaptation of expatriates in the parent country
C) lack of managerial effectiveness of PCNs in foreign countries
D) lack of managerial effectiveness of PCNs in the parent country
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

13) ________ staffing approach serves to perpetuate particular personnel selections and other
decision-making processes because the same types of people are making the same types of
decisions.
A) Global
B) Ethnocentric
C) Polycentric
D) Regiocentric
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

4
Copyright © 2014 Pearson Education, Inc.
14) Local managers are hired to fill key positions in their own country under the ________.
A) global staffing approach
B) polycentric staffing approach
C) ethnocentric staffing approach
D) xenocentric staffing approach
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

15) A(n) ________ staffing approach is more likely to be effective when implementing a
multinational strategy.
A) ethnocentric
B) polycentric
C) regional
D) local
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

16) Which staffing approach will most likely be effective when implementing a global strategy
of "acting local"?
A) polycentric
B) talent-intensive
C) ethnocentric
D) cost-intensive
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

17) Which of the following is an advantage of the polycentric staffing approach?


A) Home-country managers gain valuable overseas management experience.
B) Coordination between the subsidiary and the parent company is simplified.
C) Local managers tend to be instrumental in staving off or more effectively dealing with
problems in sensitive political situations.
D) The local managers have no conflicting loyalties.
Answer: C
Diff: 3
Chapter: 9
Skill: Concept
Objective: 2

5
Copyright © 2014 Pearson Education, Inc.
18) Felix Department Store has over 900 stores in the U.S. and over 300 stores in Mexico and
Canada. Felix has been particularly successful in Mexico, and the firm's executives believe Felix
should expand into other Latin American countries. As a result, plans are underway for the
construction of a new Felix store in Managua, Nicaragua. The construction, once started, is
expected to be completed within a year, so staff selection needs to begin soon. Felix's executives
are considering the idea of using parent-country nationals to manage the new store in Nicaragua.

Which of the following, if true, best supports the argument that parent-country nationals should
manage the Felix store in Managua, Nicaragua?
A) Felix encourages employees to participate in community outreach programs.
B) The top management of Felix is unlikely to endorse the recruitment of cheap, incompetent
workers.
C) Felix wants to maintain close control of the Nicaragua store for at least three years.
D) Felix's managers in Nicaragua will choose what items to stock based on local needs and
customs.
Answer: C
Diff: 3
Chapter: 9
Skill: Critical Thinking
Objective: 2
AACSB: Reflective thinking skills

19) Felix Department Store has over 900 stores in the U.S. and over 300 stores in Mexico and
Canada. Felix has been particularly successful in Mexico, and the firm's executives believe Felix
should expand into other Latin American countries. As a result, plans are underway for the
construction of a new Felix store in Managua, Nicaragua. The construction, once started, is
expected to be completed within a year, so staff selection needs to begin soon. Felix's executives
are considering the idea of using parent-country nationals to manage the new store in Nicaragua.

Which of the following, if true, undermines the argument that parent-country nationals should
manage the Felix store in Nicaragua?
A) Felix is implementing a strategy of global expansion by acting local.
B) Decision-making authority stems primarily from Felix's top management housed in the
company's headquarter in the U.S.
C) The top management of Felix is in favor of closely monitoring all of the company's
subsidiaries.
D) Felix's HR department recently developed a new expatriation policy.
Answer: A
Diff: 3
Chapter: 9
Skill: Critical Thinking
Objective: 2
AACSB: Reflective thinking skills

6
Copyright © 2014 Pearson Education, Inc.
20) In which of the following staffing approaches, are the best managers recruited from within or
outside of the company, regardless of nationality?
A) geocentric staffing approach
B) global staffing approach
C) ethnocentric staffing approach
D) polycentric staffing approach
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

21) A global staffing policy ________.


A) avoids recruiting third-country nationals
B) relies primarily on local managers to fill key managerial positions abroad
C) is overly in favor of filling key managerial positions with people from headquarters
D) provides a greater pool of qualified and willing applicants from which to choose
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

22) Who, among the following, when used to manage subsidiaries, usually brings more cultural
flexibility and adaptability to a situation?
A) parent-country nationals
B) home-country nationals
C) managers with minimal global exposure
D) third-country nationals
Answer: D
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

23) ________, when placed in key positions, are perceived by employees as acceptable
compromises between headquarters and local managers.
A) Repatriates
B) Parent-country nationals
C) Home-country nationals
D) Third-country nationals
Answer: D
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

7
Copyright © 2014 Pearson Education, Inc.
24) Given the generally accepted consensus that staffing, along with structure and systems, must
"fit" the desired strategy, firms desiring a truly worldwide posture should adopt a(n) ________.
A) global staffing approach
B) geocentric staffing approach
C) regiocentric staffing approach
D) ethnocentric staffing approach
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

25) Which of the following terms is increasingly replacing the term "expatriate" due to the global
staffing approach?
A) repatriate
B) global manager
C) transpatriate
D) line manager
Answer: C
Diff: 1
Chapter: 9
Skill: Concept
Objective: 3

26) Which of the following is true with regard to the global staffing approach?
A) As a rule, companies keen on "acting local" adopt a global staffing approach.
B) In the global staffing approach, key managerial positions are generally filled with people from
headquarters––that is, parent-country nationals.
C) In a global staffing approach, local managers––that is, host-country nationals––are hired to
fill key positions in their own country.
D) Recruiting third-country nationals is a common aspect of the global staffing strategy.
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

27) Which of the following is NOT a barrier for maintaining globalization momentum?
A) time and cost constraints
B) conflicting host government requirements
C) the scarce availability of staff
D) having an international team
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 3

8
Copyright © 2014 Pearson Education, Inc.
28) Recruiting managers from Latin America for a position in Brazil is an example of ________.
A) global staffing approach
B) ethnocentric staffing approach
C) regiocentric staffing approach
D) polycentric staffing approach
Answer: C
Diff: 2
Chapter: 9
Skill: Application
Objective: 2

29) Which of the following will most likely produce a specific mix of parent-country nationals,
home-country nationals, and third-country nationals, according to the needs of the company?
A) ethnocentric staffing approaches
B) polycentric staffing approaches
C) local staffing approaches
D) regiocentric staffing approaches
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

30) More recently, a staffing option known as ________ has been utilized to provide a linking
pin between the company's headquarters and local host subsidiaries.
A) expatriates
B) inpatriates
C) transpatriates
D) migrants
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

31) ________ staffing approach usually results in a higher level of authority and decision making
at headquarters compared to the polycentric approach.
A) Ethnocentric
B) Global
C) Geocentric
D) Regiocentric
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

9
Copyright © 2014 Pearson Education, Inc.
32) ________ are managers with global experience who are transferred to the organization's
headquarters country, so their overseas business and cultural experience and contacts can
facilitate interactions among the country's far-flung operations.
A) Inpatriates
B) Third-country nationals
C) Host-country nationals
D) Repatriates
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

33) Which of the following is an advantage of the staffing approach that employs parent-country
nationals as top managers?
A) maintenance of close control over subsidiaries
B) less-costly transferees
C) facilitation of global multicultural teams
D) high effectiveness of expatriates in foreign countries
Answer: A
Diff: 3
Chapter: 9
Skill: Concept
Objective: 2

34) Most MNCs tend to start their operations in a particular region by selecting primarily from
their own pool of managers. Over time, and with increasing internationalization, they tend to
move to a predominantly polycentric or regiocentric policy because of ________.
A) the lack of governmental support for hiring locals
B) the inefficiencies of expatriate managers
C) the poor performance of subsidiaries
D) the greater costs of expatriate staffing
Answer: D
Diff: 3
Chapter: 9
Skill: Concept
Objective: 2

10
Copyright © 2014 Pearson Education, Inc.
35) Historically, personnel directors selected potential expatriates on the basis of a candidate's
________.
A) interpersonal skills
B) adaptation capabilities
C) cross-cultural awareness
D) domestic track records
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

36) According to Mansour Javidan, which of the following is NOT a global mind-set attribute
that a successful expatriates possesses?
A) cognitive complexity
B) psychological capital
C) autocratic leadership qualities
D) ability to build trusting relationships with local stakeholders
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

37) According to Mansour Javidan, the ability to function successfully in the host country
through internal acceptance of different cultures and a strong desire to learn from new
experiences is termed ________.
A) cognitive complexity
B) psychological capital
C) social capital
D) intellectual capital
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

38) According to Tye and Chen, which of the following characteristics has the greatest predictive
value of determining expatriate success?
A) gender
B) stress tolerance
C) international experiences
D) domestic work experience
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4
11
Copyright © 2014 Pearson Education, Inc.
39) ________ has been found to be the most frequently cited reason for expatriate failure in U.S.
and European companies.
A) The inability of the spouse to adjust
B) Lack of quality training
C) Inadequate foreign language skills
D) Subculture shock
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

40) Which of the following is the LEAST critical area of expatriate preparation?
A) cultural training
B) language instruction
C) technical training
D) familiarity with everyday matters
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

41) ________ is the first stage in a comprehensive plan for developing expatriates.
A) Assessing development and support needs
B) Integration of the value added to the firm
C) Development of a contract
D) Problem recognition
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

42) Which of the following is the final stage of the IHRM process that is used to maximize the
effectiveness of expatriate assignments?
A) selection of expatriate
B) debriefing expatriate and family to improve IHRM process
C) development of contract
D) assessment of development and support needs
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

12
Copyright © 2014 Pearson Education, Inc.
43) The goal of cross-cultural training is to ease the expatriate's adjustment to the new
environment by reducing ________.
A) culture shock
B) power distance
C) social distance
D) cultural diversity
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

44) A state of disorientation and anxiety that results from not knowing how to behave in an
unfamiliar culture is called ________.
A) culture shock
B) enculturation
C) cultural contingency
D) acculturation
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

45) According to Oberg, which of the following is the first stage of culture shock?
A) irritation and hostility
B) biculturalism
C) honeymoon
D) gradual adjustment
Answer: C
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

46) According to Oberg, which of the following is the final stage of culture shock?
A) honeymoon
B) biculturalism
C) gradual adjustment
D) irritation and hostility
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

13
Copyright © 2014 Pearson Education, Inc.
47) As described by Oberg, which of the following is most likely a characteristic of the irritation
and hostility stage of culture shock?
A) excitement
B) homesickness
C) appreciation of local practices
D) positive attitudes and expectations
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

48) As described by Oberg, in the ________ stage of culture shock the expatriate and his or her
family members come to understand and predict patterns of behavior, use the language, deal with
daily activities, and accept their new life.
A) honeymoon
B) biculturalism
C) gradual adjustment
D) irritation and hostility
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

49) As described by Oberg, ________ refers to the stage in culture shock in which the manager
and family members grow to accept and appreciate local people and practices, and are able to
function effectively in two cultures.
A) gradual adjustment
B) honeymoon
C) biculturalism
D) irritation and hostility
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

14
Copyright © 2014 Pearson Education, Inc.
50) Which of the following most likely occurs when a manager is transferred to another part of
the country where there are significant cultural differences?
A) subculture shock
B) culture shock
C) expatriation
D) repatriation
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

51) Joan Kerry, an American national, worked as a senior manager in her firm's headquarters in
New Jersey. When her firm opened a new office in San Francisco, she was transferred to
California. Soon, she started feeling like an immigrant in her own country owing to the
differences in attitudes and lifestyle between New Jersey and California. Joan is most likely
experiencing ________.
A) segregation
B) subculture shock
C) social distance
D) power distance
Answer: B
Diff: 2
Chapter: 9
Skill: Application
Objective: 4
AACSB: Analytic skills

52) According to Tung, which of the following refers to a training technique where the trainees
are acquainted with documentary programs about the country's geography, economics,
sociopolitical history, and so forth?
A) field experiences
B) sensitivity training
C) language training
D) area studies
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

15
Copyright © 2014 Pearson Education, Inc.
53) According to Tung, the ________ training technique exposes trainees to the kinds of
situations they are likely to encounter, which are critical to successful interactions.
A) area studies
B) field experiences
C) language trainings
D) culture assimilators
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

54) Simon Parker, an American, works with a Houston-based MNC, Orpheus Inc. When he was
sent to Africa to manage his company's newly-opened facility in Lagos, Nigeria, Simon was
placed with Mr. Adeyami and his family as part of a familiarization program. Orpheus paid for
this field experience known as ________.
A) repatriation
B) language training
C) host-family surrogate
D) immersion group analytics
Answer: C
Diff: 2
Chapter: 9
Skill: Application
Objective: 4
AACSB: Analytic skills

55) In the global stage of a firm's globalization, ________.


A) training is focused on local culture and interpersonal skills
B) the need for training is virtually nonexistent
C) host-country nationals are trained to understand parent-country products and policies
D) the need for training is high
Answer: D
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

16
Copyright © 2014 Pearson Education, Inc.
56) Training for host-country nationals during the export stage of globalization will most likely
focus on ________.
A) parent-country products
B) global conduct policies
C) product and service systems
D) production and service procedures
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 5

57) An appropriate compensation and benefits package is most likely to ________.


A) increase the rate of attrition significantly
B) motivate employees
C) lower the overall organizational efficiency in the short-term
D) lower the importance of training
Answer: B
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

58) Which of the following is a factor that facilitates integration of expatriate staff with local
staff?
A) withholding useful information
B) having a headquarters mentality
C) speaking the local language
D) demonstrating autocratic behavior
Answer: C
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

59) Which of the following factors will hinder the integration of expatriate staff with local staff?
A) knowledge sharing
B) headquarters mentality
C) overseas experience
D) cultural flexibility
Answer: B
Diff: 3
Chapter: 9
Skill: Concept
Objective: 5

17
Copyright © 2014 Pearson Education, Inc.
60) Which of the following methods is used by many firms to reduce the overall costs of
expatriate assignments?
A) extending the expatriate's tour
B) encouraging expatriates to visit their home country frequently
C) standardizing global compensation
D) implementing global benefits policies
Answer: A
Diff: 3
Chapter: 9
Skill: Concept
Objective: 5

61) The concept of "keeping the expatriate whole" in terms of compensation most likely means
ensuring that the expatriate's ________.
A) family is prepared for the overseas assignment
B) health insurance coverage is globally accepted
C) foreign and domestic taxes are paid in a timely manner
D) standard of living is at par with that of colleagues at home
Answer: D
Diff: 3
Chapter: 9
Skill: Concept
Objective: 5

62) The ________ is often used to equalize the standard of living between the host country and
the home country, and to add some compensation for inconvenience or qualitative loss.
A) localization approach
B) balance sheet approach
C) relocation strategy
D) going-rate approach
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 5

63) Which of the following can be termed as a benefit in the context of expatriate compensation?
A) relocation expenses
B) cost-of-living adjustments
C) health insurance
D) private education for children
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 5

18
Copyright © 2014 Pearson Education, Inc.
64) Relocation expense is an example of a(n) ________.
A) salary
B) tax
C) allowance
D) benefit
Answer: C
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

65) The ________ pays the expatriate the going rate for similar positions in the host country, plus
whatever allowances and benefits for the assignment that the manager negotiates.
A) localization approach
B) privatization approach
C) balance sheet approach
D) home-based approach
Answer: A
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

66) With the increasing number of companies that operate around the world and assign and move
personnel from one country to another, ________ has become exceedingly complex.
A) employing third-country nationals
B) designing equitable pay scales
C) employing local talent
D) convincing employees to take up foreign assignments
Answer: B
Diff: 2
Chapter: 9
Skill: Concept
Objective: 5

67) Which of the following refers to a core concept of the Toyota Way?
A) low emphasis on organizational learning
B) ownership of problems and visibility
C) hiding problems and difficulties from authorities
D) high emphasis on individual achievement
Answer: B
Diff: 3
Chapter: 9
Skill: Concept
Objective: 5

19
Copyright © 2014 Pearson Education, Inc.
68) Managerial training in ________ is particularly critical for firms in new economy and
emerging markets.
A) information and communication technologies
B) branding
C) sales and marketing
D) nano technology
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 5

69) Which of the following refers to a training priority for e-business development?
A) addressing security and privacy concerns
B) training personnel in soft skills
C) training personnel in talent management
D) devising a sustainable revenue model
Answer: A
Diff: 2
Chapter: 9
Skill: Concept
Objective: 6

70) Which of the following is true with regard to training and compensating host-country
nationals?
A) HCNs are rarely offered training in global business and Internet technology within their home
corporations.
B) The traditional lifetime employment and guaranteed tidy pension of the East are being
increasingly adopted by the West.
C) Many multinationals wish to train their employees to bridge the divide between the firm's
successful corporate culture and practices, and the local culture and work practices.
D) In contemporary times, MNCs rarely have a global pay strategy in place.
Answer: C
Diff: 2
Chapter: 9
Skill: Concept
Objective: 6

71) The need to outsource employees is a complex issue for international human resource (IHR)
managers as they seek to support strategic mandates.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 1

20
Copyright © 2014 Pearson Education, Inc.
72) International human resource management is a vital component of implementing global
strategy.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 1

73) Building global corporate cultures and staffing organizations with global leaders are some of
the major challenges faced by the HR function in the global arena.
Answer: TRUE
Diff: 2
Chapter: 9
Skill: Concept
Objective: 1

74) Host-country nationals are employees assigned to key positions in countries other than their
own.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

75) When a company is at the internationalization stage of strategic expansion, and has a
centralized structure, it will likely use a polycentric staffing approach to fill key managerial
positions.
Answer: FALSE
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

76) Companies using an ethnocentric staffing approach, avoid using parent-country nationals to
fill in key managerial positions.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

77) An ethnocentric recruiting approach enables a company to take advantage of its worldwide
pool of management skill.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2
21
Copyright © 2014 Pearson Education, Inc.
78) With a polycentric staffing approach, host-country nationals are hired to fill key positions in
their own country.
Answer: TRUE
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

79) Host-country nationals are more likely to be accepted by people both inside and outside the
subsidiary, and they provide role models for other upwardly mobile personnel.
Answer: TRUE
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

80) Local managers are, by and large, ineffective in dealing with problems in sensitive political
situations.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

81) One disadvantage of a polycentric staffing policy is the difficulty of coordinating activities
and goals between the subsidiary and the parent company, including the potentially conflicting
loyalties of the local manager.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

82) In the global staffing approach, the best managers are recruited from within or outside of the
company, regardless of nationality.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

22
Copyright © 2014 Pearson Education, Inc.
83) In a polycentric staffing approach, recruiting is done on a regional basis and can produce a
specific mix of PCNs, HCNs, and TCNs, according to the needs of the company or the product
strategy.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

84) Inpatriates are managers with global experience who are transferred to the organization's
headquarters country, so their overseas business and cultural experience and contacts can
facilitate interactions among the country's far-flung operations.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

85) Local managers can provide communication of strategic goals and change processes, and
provide continuity among revolving expatriates and host nationals.
Answer: FALSE
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

86) Inpatriate managers can facilitate multicultural management teams in global organizations.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

87) Alienation or lack of support from headquarters is one of the major causes of expatriate
failure.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4

88) Enculturation refers to a state of disorientation and anxiety about not knowing how to behave
in an unfamiliar culture.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 4
23
Copyright © 2014 Pearson Education, Inc.
89) To ensure that expatriates do not lose out through their overseas assignment, the going-rate
approach is often used to equalize the standard of living between the host country and the home
country.
Answer: FALSE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

90) Many multinationals, in particular "chains," wish to train their local managers and workers to
bridge the divide between the firm's successful corporate culture and practices, and the local
culture and work practices.
Answer: TRUE
Diff: 1
Chapter: 9
Skill: Concept
Objective: 5

91) Briefly discuss the interdependence of strategy, structure, and staffing.


Answer: The interdependence of strategy, structure, and staffing is particularly worth noting.
Ideally, the desired strategy of the firm should dictate the organizational structure and staffing
modes considered most effective for implementing that strategy. In reality, however, there is
usually considerable interdependence among those functions. Existing structural constraints
often affect strategic decisions; similarly, staffing constraints or unique sets of competencies in
management come into play in organizational and sometimes strategic decisions. It is thus
important to achieve a system of fits, among those variables, that facilitates strategic
implementation.
Diff: 2
Chapter: 9
Skill: Concept
Objective: 1

24
Copyright © 2014 Pearson Education, Inc.
92) Briefly define the ethnocentric, polycentric, regiocentric, and global staffing approaches.
Answer: Ethnocentric staffing approach is used to fill key managerial positions with people
from the headquarters––that is, parent-country nationals (PCNs).
With a polycentric staffing approach, local managers––host-country nationals (HCNs)––are hired
to fill key positions in their own country. This approach is more likely to be effective when
implementing a multinational strategy.
In a regiocentric staffing approach, recruiting is done on a regional basis––say, within Latin
America for a position in Chile. This staffing approach can produce a specific mix of PCNs,
HCNs, and TCNs, according to the needs of the company or the product strategy.
In the global staffing approach, the best managers are recruited from within or outside of the
company, regardless of nationality. This practice––recruiting third country nationals (TCNs)––
has been used for some time by many European multinationals.
Diff: 1
Chapter: 9
Skill: Concept
Objective: 2

93) What are the advantages of the global staffing approach?


Answer: A global staffing approach has several important advantages. First, this policy provides
a greater pool of qualified and willing applicants from which to choose, which in time results in
further development of a global executive cadre.
Second, where third country nationals are used to manage subsidiaries, they usually bring more
cultural flexibility and adaptability to a situation, as well as bilingual or multilingual skills, than
parent-country nationals, especially if they are from a similar cultural background as the host-
country coworkers and are accustomed to moving around.
Third, it can be more cost-effective to transfer and pay managers from some countries than from
others because their pay scale and benefits packages are lower. Indeed, those firms with a truly
global staffing orientation are phasing out the entire ethnocentric concept of a home or host
country.
Overall, firms still tend to use expatriates in key positions in host countries that have a less
familiar culture and also in less-developed economies.
Diff: 2
Chapter: 9
Skill: Concept
Objective: 2

25
Copyright © 2014 Pearson Education, Inc.
94) Why do most firms shift from ethnocentric staffing to polycentric or regiocentric staffing
methods?
Answer: Most MNCs tend to start their operations in a particular region by selecting primarily
from their own pool of managers. Over time, and with increasing internationalization, they tend
to move to a predominantly polycentric or regiocentric policy because of (1) increasing pressure
(explicit or implicit) from local governments to hire locals (or sometimes legal restraints on the
use of expatriates) and (2) the greater costs of expatriate staffing, particularly when the company
has to pay taxes for the parent-company employee in both countries. In addition, in recent years,
MNCs have noted an improvement in the level of managerial and technical competence in many
countries, negating the chief reason for using a primarily ethnocentric policy in the past.
Diff: 3
Chapter: 9
Skill: Concept
Objective: 2

95) What are the major causes of expatriate failure?


Answer: The following is a synthesis of the factors frequently mentioned by researchers and
firms as the major causes of expatriate failure:
1. Selection based on headquarters criteria rather than assignment needs
2. Inadequate preparation, training, and orientation prior to assignment
3. Alienation or lack of support from headquarters
4. Inability to adapt to local culture and working environment
5. Problems with spouse and children––poor adaptation, family unhappiness
6. Insufficient compensation and financial support
7. Poor programs for career support and repatriation
Diff: 3
Chapter: 9
Skill: Concept
Objective: 4

96) What is the difference between culture shock and subculture shock?
Answer: Culture shock is a state of disorientation and anxiety about not knowing how to behave
in an unfamiliar culture. It occurs when the individual first begins working in a new culture.
Subculture shock occurs when a manager is transferred to another part of the country where there
are perceived cultural differences between majority and minority cultures. The shock comes from
feeling like an "immigrant" in one's own country and being unprepared for such differences.
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

26
Copyright © 2014 Pearson Education, Inc.
97) What are the different stages of culture shock as described by Oberg?
Answer: Culture shock usually progresses through four stages, as described by Oberg: (1)
honeymoon, when positive attitudes and expectations, excitement, and a tourist feeling prevail
(which may last up to several weeks); (2) irritation and hostility, the crisis stage when cultural
differences result in problems at work, at home, and in daily living––expatriates and family
members feel homesick and disoriented, lashing out at everyone (many never get past this stage);
(3) gradual adjustment, a period of recovery in which the "patient" gradually becomes able to
understand and predict patterns of behavior, use the language, deal with daily activities, and the
family starts to accept their new life; and (4) biculturalism, the stage in which the manager and
family members grow to accept and appreciate local people and practices, and are able to
function effectively in two cultures.
Diff: 3
Chapter: 9
Skill: Concept
Objective: 4

98) What are the factors that facilitate and hinder the integration of expatriate staff with local
staff?
Answer: Factors that facilitate integration of expatriate staff with local staff are:
1. Relationship-building
2. Speaking the local language
3. Knowledge sharing
4. Cultural adaptability/flexibility
5. Respect
6. Overseas experience
7. Develop local value-added from venture
8. Encourage local innovation

Factors that hinder integration of expatriate staff with local staff are:
1. Not using team concept
2. Not learning local language
3. Withholding useful information
4. Spouse and family problems in adjusting
5. Superior and autocratic behavior
6. Limited time in assignment
7. Headquarters mentality
8. Dominate from head office
Diff: 2
Chapter: 9
Skill: Concept
Objective: 4

27
Copyright © 2014 Pearson Education, Inc.
99) Why is expatriate compensation complicated? What are some of the universal best practices
regarding employee compensation?
Answer: Designing and maintaining an appropriate compensation package is more complex than
it would seem because of the need to consider and reconcile parent- and host-country financial,
legal, and customary practices. The problem is that although little variation in typical executive
salaries at
the level of base compensation exists around the world, a wide variation in net spendable income
is often present. Universal best practices include the idea that there should be a reduced emphasis
on seniority and that benefits should comprise an important part of a compensation package.
Diff: 3
Chapter: 9
Skill: Concept
Objective: 4

100) Describe Tung's five training techniques for assisting expatriates in the adjustment process.
How can training be integrated with global orientation?
Answer: Many training techniques are available to assist overseas assignees in the adjustment
process. These techniques are classified by Tung as: (1) area studies, that is, documentary
programs about the country's geography, economics, sociopolitical history, and so forth; (2)
culture assimilators, who expose trainees to the kinds of situations they are likely to encounter
that are critical to successful interactions; (3) language training; (4) sensitivity training; and (5)
field experiences––exposure to people from other cultures within the trainee's own country.
It is important to remember that training programs, like staffing approaches, should be designed
with the company's strategy in mind. Although it is probably impractical to break down those
programs into a lot of variations, it is feasible to at least consider the relative level or stage of
globalization that the firm has reached, because obvious major differences would be
appropriate––for example, from the initial export stage to the full global stage. It is noteworthy,
for example, that the training of host-country nationals for a global firm has a considerably
higher level of scope and rigor than that for the other stages, and borders on the standards for the
firm's expatriates.
As a further area for managerial preparation for global orientation––in addition to training plans
for expatriates and for HCNs separately––there is a particular need to anticipate potential
problems with the interaction of expatriates and local staff. In a study of expatriates and local
staff (inpatriates) in Central and Eastern European joint ventures and subsidiaries, Peterson found
that managers reported a number of behaviors by expatriates that helped them to integrate with
local staff, but also some that were hindrances. Clearly, this kind of feedback from MNC
managers in the field can provide the basis for expatriate training and also help HCNs to
anticipate and work with the expatriates in order to meet joint strategic objectives.
Diff: 3
Chapter: 9
Skill: Synthesis
Objective: 5
AACSB: Analytic skills

28
Copyright © 2014 Pearson Education, Inc.