International Human Resources Management

Staffing of International Business


Human Resources Planning

is the process of forecasting a MNC’s

future demand and supply of the right type
of people in the right number
 The

HRP process is linked to the business facilitates the realization of the

plan of the MNC

organization’s objective


5.Unique issues in managing International HRP 1. Identify top management talent early Identifying critical success factors for future international managers Providing developmental opportunities Tracking and maintaining commitments to individuals in their international career paths Tying strategic business plans to HRP and vice-versa Dealing with multiple business units while attempting to achieve globally and regionally focused strategies 3 . 4. 6. 2. 3.

Issues in staffing global businesses Linkage between staffing and growth of MNC Staffing orientatio n Staffing MNC’s Managing expatriate s Female expatriate s 4 .

and micromanaged closely by the parent company. literally handpicke d •Focused Staffing challenges • Top and Senior management positions is the focus Usually an ethnocentri c or a geocentric approach • Pace is slow. multiple interviewing round • expensive as it might involve travel to parent country for final interview and discussions Staffing impetus Hiring headcoun ts Normally 5-20 Staffing Approach Linkage between staffing and growth of MNC Role of Parent MNC Closely and carefully monitored by the parent MNC. • Usually work with a retainership arrangement with a international staffing company • Key positions could be out rightly assigned to parent company personnel 5 .Staffing MNC’s Stage in Host Unit’s life cycle Setting up the host unit (0 to 912months) • Extremely critical phase in the subsidiary’s evolution • time consuming.

• building a preferred employer brand. • Selection criteria focus on very high quality technical competency levels • Common vendor linkages with Placement Consultants and RPOs. • careful screening to ensure top quality hires Staffing impetus Hiring headco unts 20-200 Staffing Approach •Poly centric approach is preferred as the unit sets up its own operational unit • Processes emulate from local market to get access to local talent Linkage between staffing and growth of MNC Role of Parent MNC Role of Parent unit is somewhat reduced as the responsibility of the newly structured unit takes place.5 years) • Apply stringent hiring techniques. • offering high-end compensation to attract the desired talent. •Unit staffing challenges are stepped up. 6 .Staffing MNC’s Stage in Host Unit’s life cycle Establishing the technology team to begin core operations activities (6months – 1.

1000 Depending upon nature of the business. • Moderated compensation. • Newer linkages& with third party like Colleges. • Creating a branding on vocational campuses 7 . • Focus on Global Framework for hiring using global selection tests • Leaving rest to the unit Mangers. Staffing impetus Hiring headcounts Varies between 200. vocational Institutes and training Institutions and fresher hiring Polycentric approach as achievement of unit objectives becomes significantly self contained. Staffing Approach Linkage between staffing and growth of MNC Role of Parent MNC • Role of parent country is minimal. • Numbers become a critical success determinant for recruitment • Competencies receive reduces focus as in house skill development initiatives are established. • Increased staffing challenges as hiring targets get aggressive.Staffing MNC’s Stage in Host Unit’s life cycle Full blown operations of the host unit with significant role in establishing global objectives and targets (1.5 -3yrs) • Using multiple sourcing vendors and methods.

taking • Could get decisions to in to optimize global geocentric operating approach as costs. labor costs provide the competitive advantage for the achievement of global objectives.Staffing MNC’s Stage in Host Unit’s life cycle Strong Operational leadership at the unit level while globally consolidating with Parent Staffing impetus Hiring headcounts Hiring head count are steeper between 2001000 depending upon nature of the business. • Referral hiring • Establishing long term liaisons with educational training institutions Role of Parent unit is at a strategic level. Linkage between staffing and growth of MNC Role of Parent MNC • Move to Volume hiring as units global contributions are clear. 8 . Staffing Approach • Distinctly polycentric approach.

political and legal environment Lower cost of staffing Effective localization of the subsidiary's operations Communication challenges in dealing with parent country personnel Challenges in effective control and coordination over sub’s operations Lack of parent company nationals to gain international and cross cultural 9 exposure . socio-economic. objectives and know how /technology Ensures control and coordination with HQ Staffing orientatio n Disadvantages Lack of localization of response to host country demands and needs Lack of knowledge of local culture and work methods Polycentricism Host country nationals HCNs are employed to staff all positions Familiarity with business practices.Staffing MNC’s Orientation Ethnocentricism Approach Parent company/ country nationals PCNs are employed at all senior and key positions. Local employees fill only lower level and supporting jobs Advantages Transfer of parent company goals.

could be a third country national Advantages Globally competent personnel Exposure to global best practices 10 .. Hiring the best person for the job…. Focus building a center of excellence at a global level.Staffing MNC’s Orientation Geocentricism Staffing orientatio n Disadvantages Lack of sensitivity to all cultures Tendency to run the subsidiary as a independent unit Approach The multinationals TCNs runs the subsidiary as a independent entity.

benefits of a expat vs. mulitfucntionalist. Willingness Explore citizens of the world and not of one country Possess appropriate (technical/technological) skills for the position overseas Family background Local Cost laws of host country that determine expats posting differentials vs.Staffing MNC’s own country of origin. With Managing expatriates An expatriate is an individual who works anywhere but not in his or her increasing globalization more and more employees work overseas and have expats on their payroll. Recruiting expats success depends on identifying potential expats: and passion for working on overseas assignment multiculturist. a HCN 11 . multilinguist. background.

IBM and Samsung have seen the number of expats in their Indian subsidiaries swell.Expats in India  Market leaders like Nokia. LG.  Nokia has nearly 100 Finns at key positions in India. .125 Chinese working at their offices in India.  Samsung has 25 Koreans  LG has 30 Koreans  Maruti has 15 Japanese  Huawie has approx. Suzuki.

cultural. beliefs. technological and economic factors. Technical Competencies : ability to work independently with minimal dependence on parent company for day to day activities 2. Family situation : ability of the family to cope with relocation and living in a new country with its social and cultural differences 13 . rules and norms. team members and clients/customers in a third country with its nationals as well as with the parent company nationals. superiors. Ability to cope with Environmental variables : awareness and ability to cope with the demands of the political-legal. customs and social as well as corporate etiquette 4. Knowledgeable about the host country nationals attitudes. Relational Skills : ability to interact effectively with peers. 3.Selection criteria for international staffing Managing expatriates 1.

Worldwide survey of International Assignment Policies and Practices .Regional Selection Criteria: Some Realities* Asia Pacific Europe & the Middle East The Americans Japan Most Important Criteria II Most Important Criteria Least Important Criteria II Least Important Criteria Skills or Competencies Job Performance Marital Status Skills or Competencies Job Performance Marital Status Skills or Competencies Job Performance Marital Status Job Performance Job Level Projected assignment cost for the Individual Marital Status Language ability Projected assignment cost for the Individual Language ability * ORC Worldwide 2002 .

Mendenhall and Oddou Four Dimensional Framework for expat selection : Managing expatriates Self Orientation •Self confidence •Self esteem •Mental hygiene Others Orientations •Expats ability to interact with host citizens •Build close relationships •Acculturate more easily in over Perceptual Dimension •Ability to understand and appreciate why foreign nationals behave the way they do •Ability to make correct attributions about the reasons or causes of host nationals behavior Cultural Toughness Dimension •How culturally different is the host country from the expat’s own country determines the degree of cultural toughness •The lesser the difference the lower is the cultural toughness 15 .

Romen’s Model on five predictors for a successful international assignment : Job Factors Technical Skills Managing expatriates Relational Dimension Tolerance for Ambiguity Behavioral flexibility Nonjudgementalism Cultural empathy and low ethocentricism Interpersonal skills Motivational State Belief in the mission Congruence with career path Interest in overseas experience Interest in specific host country culture Willingness to acquire new patterns of behavior and attitudes Family Situation Willingness of spouse to live abroad Adaptive and supportive spouse Stable marriage Language Skills Host country language Non-verbal communication Familiarity with host country and HQ operations Managerial skills Administrative competency 16 .

Expatriate Failure &Causes for Expatriate failure  It means that the assignee returns to the home country or resigns from the job before the international assignment is completed.  Globally.  Many of the US based MNCs. the expat failure rate varies between 25% and 40% and differs from country to country. have 10% to 40% failure rates. .  Its less than 5% in Japanese and European organisations.

Reasons for Expatriate Failure( in descending order of importance)  US Organisations Inability of spouse to adjust Managers inability to adjust Other family reasons Managers personal or emotional maturity Inability to cope with larger international responsibilities. Difficulties with new environment Personal or emotional problems Lack of technical competence Inability of spouse to adjust .  Japanese Organisations Inability to cope with larger international responsibilities.

Causes for Expatriate failure EFR : Expat Failure Rate The three stages of expat adjustment on a new international assignment: High Tourist/ Honeymoon Stage Managing expatriates The Culture Shock Cycle Mood Adapting or Adjustment Stage Disillusionmen t Stage Low Months in a new culture 19 .

Design a job that maximizes role clarity. Use discerning measures for selection of international employees and their companion 3. Educate native and foreign employees in intercultural communication competencies 4. Create open. frequent communication with the home organization to dispel feelings of abandonment and to ensure a favorable position upon returning 7. Provide opportunity for language lessons 5. Create opportunities for positive social interactions in order to communicate and become better acquainted with host 20 country members and with host country . minimizes role conflict and compensates for role novelty with proper selection if a candidate with a high level of international experience 2. Provide a technical assistant to help with the details of starting life in a different culture 6.Managing Expat Failure Managing expatriates 1.

Staffing MNC’s Female expatriates Several reasons account for minimal presence of females in foreign assignments :  Lack of Motivation: there is a perceived lack of motivation for female employees to relocate internationally  Stereotyping : common impression that women are best fit to work in their own countries  Capabilities : include skills and rescission to cope with stress while they score well on all of the critical competencies and score particularly high on relational skills  Organizational Process : include the diversity orientation of the organization. superior-subordinate relationship and home country selection processes for international assignments  Host Country limitations : certain countries do not encourage women expats  Family constraints : is a common delimiter 21 .

Staffing MNC’s Advantages of Female expatriates:    Female expatriates  Good Relational Skills Rarity of women expats make them unique Shortage of competent managers. more in the pool helps Female Role Models will facilitate more female managers entering the pool 22 .

Recent trends in International staffing Work Force Diversity Dual Career Couples Offshoring International Staffing Recruiting sources Backgrou nd Checks 23 .

Recent trends in International staffing Work Force Diversity Diversity is a key metric on which organizations measure themselves  Diversity implies a workforce mix with fair representation of gender. cash cost. ethnicities and races  Organizations have diversity policies that drive focused hiring to ensure the desired workforce blend  Diversity costs money. however organizations remain committed to it year after year  24 . opportunity cost and a heightened exposure to business risk.

Recent trends in International staffing Offshoring Outsourcing of non-core standardized services is the new facet of globalization  The spurt in hiring to staff these new-order companies in the emerging and the developing countries has hugely contributed to the revenue and growth of these countries  On the other hand the outsourcing country. stands to loose jobs to low cost and high skills countries making it ‘outplacement and retrenchment a core activity  25 . usually in the developed economies.

Recent trends in International staffing Background Checks   Background checks are carried out to verify personal. it is a core responsibility of the staffing team to ensure that the employee being on-boarded is 26 cleared from all sides . professional and other mandated information related to safe employment of candidates Priced by quantum/scope of the personal and professional level of check that is being carried out.

Recent trends in International staffing Recruiting sources    Increasing demand for resources has driven widespread innovation in sourcing Job portals and employee referrals are among the newer and more common sources Focus on hiring at entry level and then grooming employees for growth is a also gaining popularity as another high retention sourcing strategy 27 .

Recent trends in International staffing Dual Career Couples Managing dual career couples  Find a job for the trailing spouse  Commute/remote assignments  Sabbaticals  Intra-company employment  On assignment career support 28 .

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