PowerPoint Presentation - Belk College Of Business

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					                        MGMT 3275-090
                           Spring 2011
                      Mrs. Tamara L. Cohen




 Class #10


  Human      INTERNATIONAL
 Resource     MANAGEMENT
Management
 Human Resource
   Management
Preparation:
Read ch.9


Homework:
Case study #2:
   Red Cross
              Visitor to class
              March 28: 8 pm

Norman Cohen
 - author
 - international businessman
 - UNC Charlotte trustee
Extra credit homework
 - read Epilogue, via library reserve; e-mail me
 It‟s all
 about
people
people
people
at work
• Strategic importance to MNC of global human
  resource management
• Staffing options for global operations:
  ethnocentric, polycentric , global, regiocentric.
         • Manage performance of expatriates
           through careful selection, training &
           compensation
         • Host country managers – their role,
           training & compensation
         • Expatriate preparation
         • Expatriate failure
          Emerging Market Challenges:
           Staffing in BRIC countries
                         INDIA
                         Deficit starting at middle
BRAZIL                     level. Also, dealing
Deficit at upper-level     with “brain drain”
 management
                         CHINA
RUSSIA                   Deficit starting at middle
Deficit at all            level. Also, dealing
 management levels        with “brain drain”
    How to attract & retain Talent
       for Emerging Markets
Despite a slowing economy, 68% of MNCs continued
  to relocate employees at record levels. ¹
Successful companies offer more than a good salary:
1. BRAND - global “name brand” known for its excellence
2. PURPOSE - company that is breaking into new markets,
   with new models and strategy
3. OPPORTUNITY - company that provides a fast-
   track training and career path
4. CULTURE - organizational culture of openness
   and transparency
                 International Human
                Resource Management
• recognized as a major determinant of success or
  failure in international business
• key source of sustainable competitive advantage
  to companies
                                               strategy
• human resources provide control over
  other resources
• system of fits between strategy, structure, structure
  and staffing for optimal effectiveness
                                                 staffing
    Int‟l Human Resource functions
•   Recruit & select employees
•   Provide preparation & training
•   Set up compensation packages
•   Set up performance management programs
•   Manage expatriates (“expats”)

                     STAFFING
    STRATEGY
                       STRUCTURE
           Staffing Approaches
               “Globalization in the 21st century has
                 resulted in an even higher demand for
                 businesses to send the right talent to
                 the right place at the right time.”

International assignments          # migrants worldwide,
                                   in millions
    growing.
Assignment policies more
    flexible for expats
   e.g. commuter assignments /
   virtual expats, especially in
   European-HQ companies
Global Operation Staffing
      ETHNOCENTRIC                   POLYCENTRIC
 People from HQ go to staff     “Act local” = key managerial
  key managerial posts =          posts filled with host country
  parent country nationals        nationals
 Used at internationalization  Often used with multinational
  stage of strategic expansion,   strategy / acquisitions
  with centralized structure       Advantages: less expensive,
  Advantages: familiar with co.   helps political sensitivity;
  goals, tech, policies,          reduces cultural myopia
  procedures; control              Disadvantages: difficulty
  Disadvantages: limited          coordinating goals between
  opportunities for &             parent & subsidiary, local
  development of locals; poor     managers may have
  adaptation & effectiveness      conflicting loyalties; HQ mgt
  overseas                        don‟t get overseas experience
                    more
                 Global Operation Staffing
     GLOBAL STAFFING                          REGIOCENTRIC
 Best managers recruited from           • Managers recruited regionally
  inside / outside / anywhere              e.g. within Latin America for a
 Can be 3rd country nationals             position in Chile
 Expats         “Transpatriates”        • Can produce a mix of parent-
                                           country nationals, host-country
   Advantages: greater pool of
                                           nationals & 3rd country
   applicants willing & able; more
                                           nationals
   cultural flexibility; multilingual;
   compromise between HQ &                 Advantages: expedient; fewer
   subsidiaries; cost effective            cultural challenges; cost
                                           effective
   Disadvantages: hard to find
   good managers willing to                Disadvantages: cultural „hodge
   transfer frequently                     podge‟; no standard
                                           acculturation program
        Strategic Mode, Organizational
        Variables & Staffing Orientation
 Aspect of
                  Ethnocentric         Polycentric      Regiocentric         Global
 enterprise

  Strategic
                International       Multidomestic     Regional          Transnational
 orientation

Perpetuation
                                    Locals used for
 (recruiting,   Expatriates used                      Regional people   Best people used
                                    key positions
   staffing,    for key positions                     used regionally   anywhere
                                    locally
development)

                Home standards
Evaluation &                        Determined        Determined        Globally
                applied to people
  control                           locally           regionally        integrated
                & performance


                                                      Based on          Based on
                High at home;                         contribution to   contribution to
  Rewards                           Wide variation
                low in subsidiaries                   regional          local & worldwide
                                                      objectives        objectives
    SELECTING expats
What makes an employee suitable
       to be an expat?
•   Tech/professional skills              •   Family's‟ willingness to go
•   Willingness to go                     •   Educational qualifications
•   Experience in company                 •   Previous int‟l experience
•   Personality factors (e.g.             •   Language proficiency
    open mind, flexibility, resilience)
                                          •   Loyalty to company
• Leadership skills
                                          •   Knowledge of new locale
• Ability to work in teams
                                          •   Gender
• Previous performance
                                          •   Age
  appraisals
       Managing
    PERFORMANCE of
        expats
Manage the whole picture, i.e. not only expat‟s
 working life, but also support home life.
Major causes of expat failure:
•   Selection based on HQ criteria rather than assignment needs
•   Poor preparation, training, orientation before assignment
•   Alienation / lack of support from HQ
•   Inability to adapt to local culture & working environment
•   Family problems (spouse, children, adaptation)
•   Insufficient compensation & financial support
•   Poor career support & repatriation
            PREPARING expats
3 critical areas:
1. Cross-cultural training
2. Language
3. Familiarity with everyday matters
Culture shock = disorientation & anxiety about not knowing
   how to behave in unfamiliar culture
   - caused by trauma of unfamiliarity
   - results in inability to work, family stress, hostility to locals
Subculture shock
   - in another part of country with cultural differences
   - feel like an immigrant in one‟s own country
Good expat PREPARATION
1. Evaluate
                  2. Select      3. Develop
  potential
                   expats.       contracts.
 problems.



6. Repatriate                    4. Assess
                 5. Evaluate
    after                       development
 successful     effectiveness
                                 & support
assignment.     & problems.
                                  needs.



7. Integrate     8. Debrief
value-added     expatriate &
   to firm.        family.
         TRAINING expats
1. Area studies - country‟s geography,
     economics, socio-political history
2.   Culture simulations
3.   Language training
4.   Sensitivity training
5.   Field experiences
On-the-job training
Global manager has “seen several
  environments first hand”
Corporate programs to develop
    GLOBAL MANAGERS
   • ABB rotates 500 managers to different
     countries every 2–3 years.
   • Pepsi brings foreign managers to the USA
     for 1-year assignments.
   • British Telecom uses informal mentoring
     between expatriates & potential assignees.
   • A global move is a good career move.
   • GE likes engineers & managers to have
     global perspective – regular training
   • Honda prepares managers culturally &
     sends them to Japan for < 3 years
    INTEGRATING expats with local staff
               HELPS                                    HURTS
   Forming close working relationships   •   Not using team concept
   Learning local language               •   Not learning local language
   Transferring tech/bus. knowledge      •   Arrogance
   Integrating into local life           •   Spouse/family adjustment
   Cultural sensitivity; adaptability        problems
                                          •   Lack of cultural sensitivity
   Willingness to learn
                                          •   Reluctance to change/adapt
   Team-building skills
                                          •   Being autocratic
   Marketing know-how
                                          •   We-they mentality
   Friendliness/openness
                                          •   Lack of curiosity
   Self-confidence
                                          •   Acting like back home
   Strong work ethic
   Respecting local staff
   Listening skills
   Acceptance of local culture
       COMPENSATING expats
• Expat assignments are expensive. MNCs look
  for ways to conserve these costs.
• Need to reconcile parent- & host-country
  practices - adds complexity.
• Balance sheet approach
• Tax equalization
• Components of the compensation package:
  1.   Salary (local buying power versus home buying power)
  2.   Taxes (equalize different tax effects)
  3.   Allowance (relocation expenses; housing, trips home)
  4.   Benefits (health insurance; stock options)
Next class:
Global
Management
Issues

Preparation:
Read
ch.10


Homework:
Investigate the
global career of
our guest, J.
Barry Leonard,
and his current
company,
Welspun Group.
www.welspun.com

				
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posted:8/8/2011
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