1. Staffing and Training for Global Operations
Chapter 9

2. Human Resource Management
Appraising
Training
Compensating
Hiring

3. International HRM
The management of human resources in global corporations
The management of expatriate employee
The comparison of human resource management practices in different countries

4. Factors Influencing Staffing: Company
Ownership of Foreign Subsidiaries
Technology
Market Influences
Organizational Structure
Commitment to International Business
Style of Management

5. Factors Influencing Staffing: Individuals
Qualifications and Experience
Record of Previous Performance
Commitment to International Business
Suitability for International Business
Family Commitment

6. Factors Influencing Staffing: Host-Country
Level of Economic and Technological Development
Political Stability
Control of Foreign Investment
Availability of Qualified Personnel
Sociocultural Setting
Geographical Location

7. Factors Differing IHRM from HRM
Different Labor Markets
International Mobility Problems
National Management Styles and Practices
National Orientations
Strategy and Control

8. Types of Staffing Policy: The Ethnocentric Approach
All key management positions are filled by parent-country nationals (PCNs).
Overcomes lack of qualified managers in host country.
Maintain a unified corporate culture.
Helps transfer core competencies.
Produces resentment in host country.
Can lead to cultural myopia.

9. Types of Staffing Policy: The Polycentric Approach
Host-country nationals (HCNs) manage subsidiaries, while parent-country nationals occupy key positions at headquarters.
Alleviates cultural myopia.
Inexpensive to implement.
Limits career mobility.
Isolates headquarters from foreign subsidiaries.

10. Types of Staffing Policy: The Global Approach
Seeks the best people for key jobs throughout the organization, regardless of nationality.
Greater pool of qualified candidates.
Uses human resources efficiently.
Helps build strong culture and informal management network.
Immigration policies may limit implementation.
Expensive.

11. Maintaining a Globalization Momentum Through a Global Staffing Policy (Exhibit 9-1)
Top management
commitment B a r
ier s
Search for global
operators
Staff transfers
Int’l team
Global
staffing
policy
Globalization
Momentum
Momentum
Maintained
Staff availability
Time and cost constraints
Host government requirements
HRM policies

12. Recruitment and Selection: Classifying Employees
Parent Country National (PCN): The employee’s nationality is the same as the organization’s
Host Country National (HCN):The employee’s nationality is the same as the location of the subsidiary
Third Country National (TCN): The employee’s nationality is neither that of the organization nor that of the location of the subsidiary

13. Recruitment and Selection
College Recruitment
Management Inventories
Adaptability Assessment

14. SELECTION CRITERIA FOR INTERNATIONAL ASSIGNMENTS
Spouses and Dependents
Independence and Self-Reliance
Adaptability to Cultural Change
Leadership Ability
Communication
Skills
Technical
Competence
SELECTION CRITERIA FOR INTERNATIONAL ASSIGNMENTS
Age, Experience, and Education
Motivation for a Foreign Assignment
Physical and Emotional Health

15. The Compensation Issue
The major reason for the decline in the number of expatriates in recent years is because of the large expenses involved

16. Compensation: Expatriate
MNEs must pay enough to attract people to move but must not overpay
Cost of living
Job-status payment
Foreign-service premiums and hardship allowances
Complications of nationality differences

17. Components of an Expatriate Compensation Package
Salary
Home rate/home currency
Local rate/local currency
Salary adjustments or promotions – home or local standard
Bonus – home or local currency, home or local standard
Stock options
Inducement payment/hardship premium – percentage of salary or lump sum payment, home/local currency
Currency protection – discretion or split basis
Global salary and performance structures

18. Components of an Expatriate Compensation Package (contd.)
Taxation
Tax protection
Tax equalization
Other services
Benefits
Home-country program
Local program
Social Security program

19. Components of an Expatriate Compensation Package (contd.)
Allowances
Cost-of-living allowances
Housing standard
Education
Relocation
Perquisites
Home leave
Shipping and storage

20. Cost of Living In Select Cities
Tokyo
Hong Kong
London
Moscow
New York
Sao Paulo
Athens
Mexico City
Prague
Delhi

21. Common Elements in an Expatriate Compensation Package
1. In the US this was around $175,000 for upper-middle managers in the late-1990’s
2. Extra vacation time, paid airfare for annual visit home, emergency leave….
3. Cost-of-living, relocation, housing, education, and hardship
4. Two tax bills, from the host country and the U.S.
5. One-time, lump sum premium.

22. Compensation: Labor Importance of Differences Fringe Benefits
MNEs may need to pay more than local companies to entice workers from existing jobs
Fringe Benefits
Fringe benefits vary substantially among countries
Job-Security Benefits
Liability for Injuries
How to Compare
Labor-Cost Dynamics

23. Cross-Cultural Training: Purposes
Encourage sensitivity
Increase the cross-cultural skills
Promote awareness of underlying values of a culture
Reduce culture shock
Build rapport, trust, and confidence
Improve managerial effectiveness
Improve customer and employee relationships

24. Training
Cultural Training seeks to foster an appreciation of the host country’s culture.
Language Training helps build rapport with local employees and improve manager’s effectiveness.
Practical Training is aimed at helping the expatriate manager and the family ease themselves into day-to-day life in the host country.

25. Training Techniques (as classified by Tung)
Area studies, that is, documentary programs about the country’s geography, economics, sociopolitical history, and so forth
Culture assimilators, which expose trainees to the kinds of situations they are likely to encounter that are critical to successful interactions
Language training
Sensitivity training
Field experiences – exposure to people from other cultures within the trainee’s own country.

26. Cross-Cultural Training Rigor: Low
Technique: Lectures, videotapes, reading background material.
Objectives: Provide background information on host country business and national culture, basic information on company operation.

27. Cross-Cultural Training Rigor
Technique: Intercultural experiential learning exercises, role playing, simulations, case studies, survival language training.
Objectives: Build general and specific knowledge of host country culture, reduce enthocentrism.

28. Cross-Cultural Training Rigor: High
Technique: Field trips to host country, meeting with managers experienced in host country, meeting with host country national, intensive language training.
Objectives: Develop comfort with host country national culture, business culture, and social institutions.

29. Training Program Design Process
Strategic Goals
Goals of Training
Delivery System
Methodologies
Needs Analysis
Syllabus
Materials Design
Resource Analysis
Past Evaluation
Program Implementation
Evaluation