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LECTURE BY:
MISS HAREEM SIDDIQUI
INTERNATIONAL
STAFFING
 The decision of international staffing in
MNC depends on following factors:
 General staffing policy on key positions in
HQ and subsidiary.
 The ability of organization to attract the right
candidate.
 The constraints placed by the host
government on hiring policies.
2INTERNATIONAL STAFFING
APPROACHES TO
INTERNATIONAL STAFFING
 4 approaches:
 Ethnocentric approach
 Polycentric approach
 Regiocentric approach
 Geocentric approach
3INTERNATIONAL STAFFING
ETHNOCENTRIC
APPROACH
 Results in the staffing of key positions in
the MNC by PCNs.
 MOTTO this works in my country,
so it must work in all other
countries.
4INTERNATIONAL STAFFING
ETHNOCENTRIC
APPROACH
REASONS:
 Lack of qualified HCNs particularly senior
management talent.
 A desire to maintain good communication,
coordination, tighter control and a unified
corporate culture linked with corporate HQ.
 A desire to transfer parent firm’s core
competencies to a foreign subsidiary more
expeditiously.
5INTERNATIONAL STAFFING
ETHNOCENTRIC
APPROACH
ADVANTAGES:
 Organizational control and coordination is
maintained and facilitated.
 Promising managers are given
international experience.
 Assure that subsidiary will comply with
company objectives.
6INTERNATIONAL STAFFING
ETHNOCENTRIC
APPROACH
DISADVANTAGES:
 Limits the promotion opportunities of HCNs
which may lead to reduced productivity and
increased turnover among that group.
 The adaptation of expatriate managers to
new environment takes time during which
these expatriates make poor decisions.
 Income packages of expatriates are 4
times higher than locals.
7INTERNATIONAL STAFFING
POLYCENTRIC
APPROACH
 The MNC with this approach staff its
foreign subsidiaries with HCNs and its
home office with PCNs.
 MOTTO When in Rome, do
as the Romans do.
8INTERNATIONAL STAFFING
POLYCENTRIC
APPROACH
ADVANTAGES:
 Eliminates language barriers.
 Avoids adjustment problems of expatriates
and their families and removes the need for
cultural awareness training.
 Less expensive.
 Gives continuity to the management of
foreign subsidiaries, thus reduces turnover.
9INTERNATIONAL STAFFING
POLYCENTRIC
APPROACH
DISADVANTAGES:
 The gap between HQ and subsidiaries
increased which becomes difficult to be
managed.
 Limited career opportunities for HCN and
PCN managers.
10INTERNATIONAL STAFFING
GEOCENTRIC APPROACH
 This approach utilizes the best people
for key jobs through out the
organization, regardless of nationality.
11INTERNATIONAL STAFFING
GEOCENTRIC APPROACH
REASONS:
 Highly competent employees are available
not only at HQs but also in subsidiaries.
 International experience is a condition for
success in top positions.
 Managers with high potential are constantly
ready to be transferred from one country to
another.
12INTERNATIONAL STAFFING
GEOCENTRIC APPROACH
ADVANTAGES:
 Enables an MNC to develop an
international executive team.
 Overcome the federation drawback of
polycentric approach.
13INTERNATIONAL STAFFING
GEOCENTRIC APPROACH
DISADVANTAGES:
 Host govt. pressurizes MNC to employ high
number of HCNs.
 Expensive to implement because of
training and relocation expense.
 Time consuming.
 Requires more centralized control of
staffing.
14INTERNATIONAL STAFFING
REGIOCENTRIC
APPROACH
 Refers to the functional rationalization
on a more than one country basis.
 Regionally oriented approach where an
MNC divide its operations into
geographical regions and transfer staff
within those regions.
15INTERNATIONAL STAFFING
REGIOCENTRIC
APPROACH
ADVANTAGES:
 Allows interaction between executives
transferred to regional HQs.
 A step for MNC to move from purely poly or
ethnocentric or geocentric approach.
16INTERNATIONAL STAFFING
REGIOCENTRIC
APPROACH
DISADVANTAGES:
 It provides federalism at regional basis
rather than country basis. This serves as a
barrier in taking a global stance.
 Limits career progression opportunities to
the regional level.
17INTERNATIONAL STAFFING
ISSUES IN STAFF
SELECTION
 Expatriate selection
 Selection criteria
 Use of selection tests
 Other factors in expat selection
18INTERNATIONAL STAFFING
EXPATRIATE SELECTION
 The major challenge in international
staffing is Expatriate selection.
 Incase of expat selection, main issue is
the Expatriate Failure.
19INTERNATIONAL STAFFING
EXPATRIATE FAILURE
 The premature return of an expatriate
before completion of assignment is
referred to as Expatriate Failure.
 It incurs direct as well as indirect cost
on the organization.
20INTERNATIONAL STAFFING
EXPATRIATE FAILURE
 DIRECT COST:
 Airfares
 Associated relocation expenses
 Salary
 Training
21INTERNATIONAL STAFFING
EXPATRIATE FAILURE
 INDIRECT COST:
Affecting organization
 Loss of market share
 Difficulties in dealing with the host govt.
officials.
Affecting Expats
 Loss of self esteem
 Loss of self confidence
 Loss of prestige among peers
 Reduced motivation
 Loss of promotional opportunities
22INTERNATIONAL STAFFING
EXPATRIATE FAILURE
REASONS:
 Spouse/partner dissatisfaction
 Family concerns
 Ability to adapt
 Wrong Candidate selection
 Job fails to meet expectations
 Job performance
 Quality of life
 Remuneration dissatisfaction
23INTERNATIONAL STAFFING
SELECTION CRITERIA
 Technical ability
 Cross cultural suitability
 Family requirements
 Country cultural requirements
 Language
24INTERNATIONAL STAFFING
USE OF SELECTION
TESTS
 Personality tests
 Psychological tests
25INTERNATIONAL STAFFING
OTHER FACTORS IN EXPAT
SELECTION
 Dual career couple
 Female international managers
 Family considerations
26INTERNATIONAL STAFFING

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International Staffing

  • 2. INTERNATIONAL STAFFING  The decision of international staffing in MNC depends on following factors:  General staffing policy on key positions in HQ and subsidiary.  The ability of organization to attract the right candidate.  The constraints placed by the host government on hiring policies. 2INTERNATIONAL STAFFING
  • 3. APPROACHES TO INTERNATIONAL STAFFING  4 approaches:  Ethnocentric approach  Polycentric approach  Regiocentric approach  Geocentric approach 3INTERNATIONAL STAFFING
  • 4. ETHNOCENTRIC APPROACH  Results in the staffing of key positions in the MNC by PCNs.  MOTTO this works in my country, so it must work in all other countries. 4INTERNATIONAL STAFFING
  • 5. ETHNOCENTRIC APPROACH REASONS:  Lack of qualified HCNs particularly senior management talent.  A desire to maintain good communication, coordination, tighter control and a unified corporate culture linked with corporate HQ.  A desire to transfer parent firm’s core competencies to a foreign subsidiary more expeditiously. 5INTERNATIONAL STAFFING
  • 6. ETHNOCENTRIC APPROACH ADVANTAGES:  Organizational control and coordination is maintained and facilitated.  Promising managers are given international experience.  Assure that subsidiary will comply with company objectives. 6INTERNATIONAL STAFFING
  • 7. ETHNOCENTRIC APPROACH DISADVANTAGES:  Limits the promotion opportunities of HCNs which may lead to reduced productivity and increased turnover among that group.  The adaptation of expatriate managers to new environment takes time during which these expatriates make poor decisions.  Income packages of expatriates are 4 times higher than locals. 7INTERNATIONAL STAFFING
  • 8. POLYCENTRIC APPROACH  The MNC with this approach staff its foreign subsidiaries with HCNs and its home office with PCNs.  MOTTO When in Rome, do as the Romans do. 8INTERNATIONAL STAFFING
  • 9. POLYCENTRIC APPROACH ADVANTAGES:  Eliminates language barriers.  Avoids adjustment problems of expatriates and their families and removes the need for cultural awareness training.  Less expensive.  Gives continuity to the management of foreign subsidiaries, thus reduces turnover. 9INTERNATIONAL STAFFING
  • 10. POLYCENTRIC APPROACH DISADVANTAGES:  The gap between HQ and subsidiaries increased which becomes difficult to be managed.  Limited career opportunities for HCN and PCN managers. 10INTERNATIONAL STAFFING
  • 11. GEOCENTRIC APPROACH  This approach utilizes the best people for key jobs through out the organization, regardless of nationality. 11INTERNATIONAL STAFFING
  • 12. GEOCENTRIC APPROACH REASONS:  Highly competent employees are available not only at HQs but also in subsidiaries.  International experience is a condition for success in top positions.  Managers with high potential are constantly ready to be transferred from one country to another. 12INTERNATIONAL STAFFING
  • 13. GEOCENTRIC APPROACH ADVANTAGES:  Enables an MNC to develop an international executive team.  Overcome the federation drawback of polycentric approach. 13INTERNATIONAL STAFFING
  • 14. GEOCENTRIC APPROACH DISADVANTAGES:  Host govt. pressurizes MNC to employ high number of HCNs.  Expensive to implement because of training and relocation expense.  Time consuming.  Requires more centralized control of staffing. 14INTERNATIONAL STAFFING
  • 15. REGIOCENTRIC APPROACH  Refers to the functional rationalization on a more than one country basis.  Regionally oriented approach where an MNC divide its operations into geographical regions and transfer staff within those regions. 15INTERNATIONAL STAFFING
  • 16. REGIOCENTRIC APPROACH ADVANTAGES:  Allows interaction between executives transferred to regional HQs.  A step for MNC to move from purely poly or ethnocentric or geocentric approach. 16INTERNATIONAL STAFFING
  • 17. REGIOCENTRIC APPROACH DISADVANTAGES:  It provides federalism at regional basis rather than country basis. This serves as a barrier in taking a global stance.  Limits career progression opportunities to the regional level. 17INTERNATIONAL STAFFING
  • 18. ISSUES IN STAFF SELECTION  Expatriate selection  Selection criteria  Use of selection tests  Other factors in expat selection 18INTERNATIONAL STAFFING
  • 19. EXPATRIATE SELECTION  The major challenge in international staffing is Expatriate selection.  Incase of expat selection, main issue is the Expatriate Failure. 19INTERNATIONAL STAFFING
  • 20. EXPATRIATE FAILURE  The premature return of an expatriate before completion of assignment is referred to as Expatriate Failure.  It incurs direct as well as indirect cost on the organization. 20INTERNATIONAL STAFFING
  • 21. EXPATRIATE FAILURE  DIRECT COST:  Airfares  Associated relocation expenses  Salary  Training 21INTERNATIONAL STAFFING
  • 22. EXPATRIATE FAILURE  INDIRECT COST: Affecting organization  Loss of market share  Difficulties in dealing with the host govt. officials. Affecting Expats  Loss of self esteem  Loss of self confidence  Loss of prestige among peers  Reduced motivation  Loss of promotional opportunities 22INTERNATIONAL STAFFING
  • 23. EXPATRIATE FAILURE REASONS:  Spouse/partner dissatisfaction  Family concerns  Ability to adapt  Wrong Candidate selection  Job fails to meet expectations  Job performance  Quality of life  Remuneration dissatisfaction 23INTERNATIONAL STAFFING
  • 24. SELECTION CRITERIA  Technical ability  Cross cultural suitability  Family requirements  Country cultural requirements  Language 24INTERNATIONAL STAFFING
  • 25. USE OF SELECTION TESTS  Personality tests  Psychological tests 25INTERNATIONAL STAFFING
  • 26. OTHER FACTORS IN EXPAT SELECTION  Dual career couple  Female international managers  Family considerations 26INTERNATIONAL STAFFING