NME-COMMERCE
Human Resource Management
Lesson: International Staffing
Lesson Developer: Dr. Shachi Yadav
College/Dept: Ramjas College
University of Delhi
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Lesson: International Staffing: Ethnocentric, Geocentric,
Polycentric Approaches
Table of Contents:
1: Learning Outcomes
2: Introduction
3: International Staffing
4: Staffing Orientation
4.1. Host Country Nationals (HCNs)
4.2. Parent Country Nationals (PCNs)
4.3. Third Country Nationals (TCNs)
5: Approaches of International Staffing
5.1. Ethnocentric Approach
5.2. Polycentric Approach
5.3. Geocentric Approach
6: Cultural Aspects of International Staffing
7: Challenges of International Staffing
8: Legal Aspects of International Hiring
9: What makes a Manager Successful in International Assignments?
Summary
Glossary
Exercises
References
1. Learning Outcomes:
After reading this lesson, you should be able to:
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comprehend the theoretical framework, behind the concept of international
staffing;
demonstrate an understand the differences between national and international
staffing;
analyse the different staffing orientations of the firms;
critically evaluate the different approaches to international staffing;
recognize and demonstrate the variety of factors that influence international
staffing, in the context of culture;
examine the challenges, faced by HR managers, in staffing multinational
organizations;
analyse the important legal aspects of international staffing;
exhibit an understand the key considerations, for staffing the international
organization;
appreciate the competencies, required by the manager, to be successful in an
international assignment.
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2. Introduction:
Organizations, in the backdrop of globalization, have realized that they must seek
sustainable competitive advantage, not only from new products and technology, but also
from the effective management of human resources.
The world of today‟s business is evidenced by the diminished trade barriers and regional
economic alliances. For some organizations, it may mean a minimal physical presence in
a foreign country, while for others it may involve setting up of foreign operations to
exceed the size of domestic operations. The strategic opportunities, in the global
marketplace, are resulting in global expansion of the organizations.
A multinational organization is characterized by geographical dispersion. Multinational
organizations, not withstanding their size or structural form, are operating in several
countries at the same time. A multinational organization is a type of multi- unit business
organization which usually has a corporate centre in the home country and its business
units in various host countries.
With the increase in global revenues, the need of multinational companies for
international staffing shows little signs of slowing down. The slow growth of workforces,
in all the developed nations, fuels the need to look international staffing as a crucial
activity.
It is evident, from the above discussion that a divisional or the multi-unit structure adds
to the complications for the management of human resources of a multinational
company. The management of a Multinational company, theoretically speaking, can
decide to run the organization somewhere on a continuum between two distinct choices
of centralized or a decentralized approach.
In centralized approach, the managers are given the responsibility of several sites, based
at head office. This centralized approach gives recognition to the needs of the
corporation as a whole and operates with a cost effective and standardized human
resourcing, based on the policies and culture at the centre.
While in decentralized approach, the human resourcing function operates at the business
unit level. This may lead to some inconsistency in the way employees are managed
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across the business units. The philosophy of the organization, regarding the nationality
of its international managers, has a key role to play in the extent of internationalization
and also the degree of centralization or decentralization.
The decision, regarding international staffing, has a strong bearing on a company‟s
success and is also of critical concern for the person who is engaged internationally.
A crucial point, in this debate, is the often quoted edict of „think globally, act locally‟.
How might it be possible to think globally and yet act locally? No matter how appealingly
simple it may sound in the first instance, the management of the human resource
function, across the countries of a multinational enterprise, will always present
difficulties. It becomes all the more important when the managers are faced with the
challenges of pursuing local diversity and corporate integration simultaneously.
In the opinion of Gamble, an MNC does not simply transmit capital, what it transfers
along is management „know-how‟. Managers play a great role in transferring practices
and management styles of the MNCs to the affiliate countries. The home country national
is supposed to be more familiar with home country expectations as well as company‟s
practices and procedures. At the same time, a manager, associated with the host
country, will be more familiar with the local laws and customs.
Such is the stuff of international staffing. Having said this, it is also true that the area of
international staffing involves dimensions that are worthy of particular analysis.
Value Addition :1 Discussion Forum
Challenges of Internationalization
Discuss the human resourcing activities from the perspective of internationalization
characterized by geographical dispersion. Also discuss the new human resourcing
challenges that a Multinational Company faces when it adopts a global business
strategy.
2.
International Staffing:
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Planning and staffing organizations abroad is a critical activity of international human
resource management. The alternatives and the environment, associated with
international staffing, might be very different from those confronted by domestic-only
organizations. Effective staffing of an organization is an important step towards
achieving organization‟s long term success. The path of international staffing is laced
with an increased range and complexity of political, economic, cultural issues,
employment legislations, and labour market conditions, present in foreign countries, as
against domestic environment.
An organization‟s success greatly relies on the skills, knowledge and efforts of its
employees. International staffing depicts how managers attend to the problem of
sourcing these human resources to enable the organizations to continue in the long run.
Staffing policy is concerned with selection of employees for particular jobs. The
Multinational organizations need to identify potential applicants for positions in the home
country and overseas to begin their evaluation for future employment. In international
staffing, one of the great challenges is to use the human resource processes in order to
increase the likelihood of hiring individuals who possess the right skills and abilities to be
successful in their jobs.
In the views of E.H.Schein, at one level, international staffing is concerned with selection
of skilled employees, to do a particular job, at another level, it can be seen as a tool to
develop and promote the corporate culture.
Organization planning, for sustained growth and existence, mandatorily has to develop
an international perspective as far as staffing is concerned. The success of international
organizations greatly depends upon the efforts to hire the right candidate for the right
job at the right time.
It should be noted that managers would make human resourcing decisions, based on
their interpretation of societal and organizational factors. The managers entrusted with
the task of international staffing may view it as a complex task and therefore there is a
need to address this complexity by conducting investigations, taking expert advice,
hiring a consultant, and so on.
Taking forward the debate of „Think Globally and Act Locally‟, it should be well
understood that international staffing, in particular, would have far reaching implications
for the organizations. It is therefore essential for multinational concerns to achieve a
dynamic balance between the pressures for central control and the pressures for local
responsiveness, across the countries they are operating.
As stated earlier, at one level, staffing involves selection of individuals, having the
required skills to perform their jobs and on the other hand, it is also concerned with
developing and promoting corporate culture. It is thus evident that while staffing, the
managers are required to give due attention to the fact that the selected individuals not
only have required skills to perform jobs they are selected for but also „fit‟ for the
prevailing culture of the organization.
The problems, regarding international staffing, can be reduced by careful selection and
training. Much of the international staffing literature is focused on the expatriate
selection. Expatriate refers to an employee who works and resides in a foreign country.
In general, the terms international managers and expatriate managers are considered
synonymous in the global business context. The international staff can be pooled in
variety of ways. The managers working in multinational organizations can be parent
country nationals, host country nationals or third country nationals. The staffing policy
mirrors the general dilemma of central versus local i.e. whether to transfer dominant
norms of MNC‟s national culture or utilize intellect and make use of those of the local
culture.
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Value Addition :2 Activity
Search the Website of Proctor & Gamble
Search the website of Proctor and Gamble. Visit the worldwide operations and select the
P & G affiliates e.g., P & G India, P & G Australia and P & G Canada. Document the
history of the local affiliate and find out how P & G first entered domestic market it
evolved subsequently. Gauge whether P & G use expatriates or hires local managers.
3. Staffing Orientation:
Source:
http://en.wikipedia.org/wiki/Flag#/media/File:ASEAN_Nations_Flags_in_Jakarta_3.jpg
Multinational organizations need to identify potential applicants for openings in the home
country and abroad. The employees may come from two broad categories: those already
working in the organization and new hires. The reassignment of present employees, in
addition to filling the job opening offers an opportunity to the employee for career
advancement. On the flip side, Culture, family and language are some of the obstacles
that prevent experienced managers to apply for positions abroad. Dual –career families,
children, adjustment problems and high cost of expatriate failure are some of the
problems that are associated with present employees. Because of these problems, the
range of options for international staffing is expanding.
Many multinational corporations are turning to locally engaged employees or third
country nationals. Increased level of education, across the globe, and emergence of
trained technical employees, in emerging economies, has significantly expanded the pool
of talent from which multinational companies can draw.
But the organizations are experiencing a „war of talent‟. The reason being, despite
greater levels of education, there is still a shortage of „skilled talent‟. In the words of
Anderson, expatriate selection refers to be a matter of good luck than management.
MNC‟s can tap three basic sources for global positions:
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4.1 . Home-Country Nationals:
Home country nationals or parent country nationals are managers who are the citizens of
the country where the MNC headquarters are located. The employees who live and work
outside their home country are commonly called expatriates. As a common trend,
multinational companies are likely to use home country managers for key managerial
and technical positions. Major reasons for using home country nationals include, starting
up the operations and leveraging the technical expertise. It also helps the multinational
company to maintain financial control over the operations. Recently, multinational
companies have shifted their focus from expatriates to hiring local managers, as high
cost of keeping expatriates overseas has a strong bearing on declining company‟s
profits. Moreover, the growing number of well qualified managers makes it no longer
necessary to rely heavily on expatriates.
In the past, most of the expatriates were men but there has been a growing number of
female expatriates, as women have proven that they are ready to tackle challenges that
accompany foreign assignments.
Value Addition :3 Discussion Forum
Glass Border
The term „Glass Border‟ refers to the perception of the senior management of parent
country about the suitability of females for international assignments. To what extent
consideration of gender still relevant for international assignments. What can be done
to ensure equal opportunity for women managers?
4.2 . Host-Country Nationals:
Host- country nationals are the local managers who are the citizens of the country where
the subsidiary is located. They are hired by the multinational company to handle their
operations. Staffing subsidiaries with local talent is advantageous as these managers are
familiar with the local cultural needs, are able to stay longer in their respective positions,
and involve a low cost than expatriates in hiring and maintaining.
It is unlikely to staff whole of the subsidiary with home country nationals, keeping the
size of operations in mind. Also, the cost of hiring and maintaining the expatriates in the
host country would be prohibitive.
In some countries, government regulations dictate a certain percentage of employees to
be of the host country citizenship. Many Governments, across the globe, do exercise real
and subtle pressures on the multinational companies for hiring local nationals.
The main disadvantage of using host country nationals, as perceived by the multinational
companies, is the difficulty in exercising an effective control over subsidiary operations.
The concerns also revolve around the level of commitment that locals may have towards
the organization and how effective communication will take place between home country
and host country.
However, careful selection and training can reduce many of the potential problems,
associated with host country nationals.
4.3 . Third-Country Nationals:
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Third –country nationals are the nationals of country where neither subsidiaries nor the
headquarters are located and are given managerial responsibilities in the subsidiaries.
The recruitment and selection of the managers take place globally and most competent
employees can be identified. The competency of the managers overweighs the
considerations of the individual‟s country of origin.
These people have necessary expertise to adapt to different cultures and usually are
multilingual. The third country nationals have very good working knowledge of the
region and often speak in the local language. It helps the multinationals to build in a
pan-global culture with a better talent pool. The different perspective of the third country
national can complement and expand on the sometimes narrowly focused viewpoints of
both host country nationals and home country nationals. They are truly international in
the sense that they bring in unique cross cultural sensitivity to the relationship.
The major obstacle, in the way of hiring and maintaining third country nationals, is the
complicated human resource processes. Most multinational companies would require
dedicated human resource unit to handle all ongoing employee issues.
5. Approaches to International Staffing:
Approaches to international staffing have important implications for recruitment and
selection practices. Approach to staffing is basically concerned with selection of
employees for particular jobs. At one hand, it involves selection of skilled employees,
required to do specific jobs, and on the other hand, it can serve as a tool for promoting
and developing organizational norms and value systems.
Research has affirmed at least three approaches to international staffing: the
ethnocentric approach, the poly centric approach and the geocentric approach. A
particular approach is identified through its stance on different national cultures.
5.1. Ethnocentric Approach:
The ethnocentric approach tends to rely on formal structures and control systems. In
this approach, there is a tendency to regard one‟s own culture as superior to others. All
the key positions are filled by parent country nationals. This is done to make sure that
the organization‟s culture will mirror the culture of home country and very little attention
is placed towards the culture of home country. The reasons cited for the adoption of this
particular stance include:
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A perception that the qualified host country managerial talent may not be
available.
To ensure maintenance of a unified corporate culture.
Transference of core competencies of the parent company.
To ensure that the coordination and communication, with the parent company,
are maintained adequately.
The ethnocentric approach is criticised to be too narrow in its focus and suffers from the
following disadvantages:
The approach limits the advancement opportunities for the host country nationals
and often becomes the cause of resentment and low productivity. It also severe
the problem of employees‟ turnover.
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The parent country nationals may suffer from what is known as „cultural myopia‟,
the organization‟s failure to understand and respond to host –country cultural
differences.
The adaptation time of expats may be quite high, leading to more mistakes and
poor decisions.
Value Addition: 4
Dutch Mafia
Did You Know?
In Dutch firm, Philips, at one point in time, all important positions were filled by Dutch
nationals who were termed by their colleagues as Dutch mafia.
5.2. Polycentric Approach:
This approach represents a conscious belief that the host country nationals understand
the culture of host country better than the parent country nationals. Hence, host country
nationals are recruited to manage subsidiaries. This may be seen as a response to the
shortcomings of the ethnocentric approach and claims to have the following
advantages:
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The host country nationals are less susceptible to cultural myopia as they are
more familiar to the culture of the country than the expats.
It is less expensive to implement as expatriate managers may be quite expensive
to maintain.
The satisfaction level of the host country nationals is high due to advancement
opportunities and fair appraisals.
The polycentric approach is criticised on the following grounds:
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It may cause isolation of the subsidiary as the culture cannot be exchanged from
the headquarters of the parent country. Bridging the gap between the host
country managers and parent country managers may be quite difficult due to
language barriers, cultural differences and national loyalties.
A major drawback cited for this approach is lack of career mobility for host
country nationals. The host country nationals have limited opportunity to gain
experience outside their country, this approach restricts their mobility among
subsidiaries. This may lead to resentment and dissatisfaction among the host
country managers.
5.3. Geocentric Approach:
The geocentric approach calls for recruiting people, based on their skills and
competencies, regardless of their nationalities. It ensures the selection of most
appropriate candidate for the jobs from any part of the world. There are a number of
advantages, associated with this approach. Some of them are listed below:
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It enables most effective utilization of human resources.
It promotes a multicultural environment and enables the firm to leverage cultural
diversity.
This approach may reduce cultural myopia in true senses and lead to an
increased local responsiveness.
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Though it seems to be the most favourable approach, it is also criticised on the following
grounds:
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The political pressure may demand the organizations to fill the positions with the
host country nationals, the immigration controls by the host country government
may be tight, making this a difficult task in practice.
The cost, associated with this approach, may be quite high because of relocation
and training costs involved.
As we have seen the above approaches showcase the dominant management orientation
of the multinational organizations. This has important implications on how international
staffing would be done by the organizations. The choice of approach would impact
decisions, regarding national differences and cross cultural issues. The repercussions on
other functional and strategic aspects of the organizations are huge and so they deserve
a lot of attention by the decision makers.
Value Addition : 5 Case Situation
International Staffing at Coca- Cola
Coca- Cola represents one of the most successful multinational enterprises. However,
Coca –Cola refers to itself as „multi-local‟ company. Coca- Cola tries to create a global
mind- set that all the employees share and, at the same time, grant freedom to national
businesses to create market appropriate mechanism. Coca- Cola manages its operations
through operating divisions, organized under regional groups. Go to the company‟s
website and look at the career opportunities it offers overseas. Read what the company
has to say in this area. You can also contact any official of the company via e-mail
address, provided on the website for information, regarding opportunities available in the
company.
Question: Comment on the international staffing approach adopted by Coca- Cola for
filling managerial positions. Is it ethnocentric, polycentric or geocentric? Do you think it
is appropriate?
Source: D.A. Amfuso, “HR unites the world of Coca –Cola”, Personnel Journal, Nov 1994,
pp. 112-20.
6. Cultural Aspects of international Staffing:
It is very evident from the above discussion that there are choices available before
human resource professionals with respect to international hiring. The above mentioned
analysis revealed how an MNC‟s human resources might be managed. All the decisions
taken in the area of international staffing are greatly influenced by the different national
contexts and culture of the subsidiary‟s local community.
Vast differences can be observed among countries and it is well accepted how much they
matter in managing business effectively. These differences can be accorded to the
differences in cultural set-up of the country.
Greet Hofstede, a cross cultural expert has defined culture as, “the collective
programming of the mind which distinguishes the members of one human group from
another.”
It is the institutional set-up of countries that influences the expectation of people and
their orientation towards life. Academicians, Hofstede (1991) and Hall (1990), have
defined this and designed comparative frameworks, demonstrating relevant attributes of
national culture.
Hofstede Cultural Dimensions:
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There are several models which explain how culture influence work behaviour. Perhaps
the most commonly referred to is the Hofstede‟s „theory of the cultural relativity of
organizational practices‟. As per Hofstede, culture differs in at least following five ways,
that should be understood, as it has strong implications for understanding business.
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Individualism Versus collectivism
Culture differs with respect to the relationship a person has to his „family‟. In
some societies, like USA and Australia, more emphasis is laid down on individual
actions, accomplishments and goals. In contrast, collectivist societies, like Taiwan
and Japan, group‟s achievements and accomplishments will be emphasized.
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Power Distance
Cultures also differ in their view of power relationships. The cultures with high
power distance tend to emphasize human inequalities. Large power distance
cultures characterize this with symbols of power, such as, large offices, titles, and
so on. In countries with low power distance such emphasis is less.
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Uncertainty avoidance
The cultures with low uncertainty avoidance tend to take things day by day in
contrast to the high uncertainty avoidance cultures which attempt to predict,
control, and influence future events. In high uncertainty avoidance culture, like
Japan, there is rigid use of managerial control systems in order to reduce
uncertainty.
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Masculinity
This dimension refers to the traditionally accorded roles by the society to the
males and females. Masculine cultures have predominantly strict gender roles.
The feminine cultures, on the other hand, have less well defined roles.
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Long term versus short term orientation
This fifth dimension is the result of studies, involving Chinese values by him and
it did not feature in the original work by him. It refers to the extent to which
cultures think, in terms of the future, or in terms of immediate events.
Every aspect of Human resource management and more specifically, staffing
decisions are influenced by the above dimensions. To understand the implication
of culture, over international staffing, our approach would be to go beyond
(without ignoring) such broad classification and critically evaluate the actual
situation of the host country subsidiary.
The true knowledge of the shared nature of the beliefs, philosophies and norms is critical
for the success of the organization at least for two reasons. First, it is important for
crafting and executing human resource staffing strategy that guides how the
organization attempts to achieve competitive advantage in a given environment and
secondly, to foster high level of commitment from the employees.
While designing HR Practices that enhance productivity and ensure staff retention in an
foreign subsidiary, it may be required to amend or modify parent country systems and
practices. For example, recruitment in china as a norm is greatly influenced through
personal or government connections, it may be wise to give exclusively impersonal
selection criteria a second thought.
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A recognition that same HR systems and practices will not produce the same effect in
different cultural environments will go a long way in organizational success.
7. Challenges of International Staffing:
An enterprise, with international staff, is characterised by greater complexity and
cultural diversity. The workforces in these organizations often consist of people from
variety of ethnic, racial and cultural backgrounds. Managing the performance of this
diverse workforce is posed with challenges.
Well known author, Adler (1991), has suggested that culturally diverse groups can
perform either extremely well or extremely poorly. She further says that diversity may
well be a boon for creativity and divergent thinking but may prove to be rather a bane
and a source of friction in the decision making phase.
The success of an enterprise will depend on the inter-culturally competent people. The
ability to create a shared vision through collective participation, negotiation and empathy
will lead to culturally aligned Human Resource Practices.
Apart from only people, it is the highly complex economic and political nature of
countries, which affirms the need of an intensive international research to develop
successful HR strategies. International staffing presents unique contingencies, in the
form of taxation issues, exchange rates, co-ordinating foreign currencies ,compensation
plans, etc. in short, it requires addressing broader range of functional areas. It also
involves more involvement in employee‟s personal life. The employee needs assistance
in acquiring accommodation in host country, selling or leasing domestic accommodation,
school arrangements for the employee‟s children, recreational and cultural opportunities
for the employee etc.
International staffing enables organizations to enjoy „choice‟. Culturally diverse people
bring unique perspectives to the organizations. Understanding these differences and
managing them effectively can help organizations to capitalize on diversity. International
staffing , if managed well, can become an asset for the organization ; managed badly
can turn into a liability.
8. Legal Aspects of International Staffing:
The impact of law on HRM practices/ is enormous. There is a steeping rise in the number
of suits by employees and job candidates against employers. It is therefore in the best
interest of organization that the HRM unit develops policies and procedures in
accordance with the law.
Equal employment opportunity is the area which has implications for every aspect of
international staffing. It is very important to devote time and attention to the dimension
of Equal Employment Opportunity (EEO) to make sure that HRM practices comply with
the law, avoid penalties, and develop a discrimination free working environment.
Various countries of the world have enacted elaborate laws, prohibiting business houses
from discrimination against employees, on the basis of race, colour of skin, religion,
gender or national origin.
The Human resource managers have compliance responsibilities, in light of these laws,
to ensure non- discrimination and equal opportunities. Besides the state and national
Governments, the courts are constantly interpreting the laws and there should be due
attention given to the various rulings that come from time to time.
The growth in the area of equal employment opportunity has given employees specific
rights in their employment relationships. HR professionals from US firms will find
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substantial differences in the area of employment discrimination. The various laws worth
giving attention with respect to prohibiting employment discrimination in USA are Title
VII of the 1964 Civil Rights Act, Age Discrimination Act, Americans with Disabilities Act
of 1990, Civil Rights Act of 1991 and so on.
The major point in focus here is that many of these laws are applicable to American
corporation‟s overseas operations as well. The above discussion indicates that any
attempt to become international organization must be inclusive of a systematic analysis
of diverse legal background as well.
9. What Makes a Manager Successful in International
Assignments?
International assignments account for managing a workforce which comes from diverse
cultural backgrounds. The complexity, arising out of the need for successful integration
of culturally diverse team members, calls for managers endowed with specific attributes.
Orla Leonard (2002) suggests the managers to be having the following traits to be
successful at work across national boundaries:
Curiosity about local cultures
An aptitude to learn more about the culture of the host country may go a long way in
understanding the prevailing public opinion. A manager has to work like a cultural
anthropologist instead of relying only on the understanding he had of the host country.
This can be put to action by reading local publications and having a keen interest in
understanding the local customs and rituals.
Focussing on reciprocal learning and integration
Managing diversity at work place calls for genuine interest in learning from people. A
manager is expected not only to make others understand and succumb to his point of
view but allow for expanding his own point of view. A lot of reciprocal learning and
integration is required to succeed in the efforts of managing culturally diverse team
members.
Tolerance for mistakes
An acceptance that mistakes may well be made can go a long way in making the
manager successful. Such an acceptance may make the managers risk taking rather
than following rule of thumb. The managers to be successful should have the courage to
stand by their mistakes and learn from them for success in the long run.
An open and inquisitive mind
An open mind allows the managers to listen to the views, different from their own, in a
constructive manner. It allows for a better understanding of the world around them and
broadens their world view.
Confidence
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A manager should show utmost maturity while dealing with issues that were unknown to
him earlier. Managers on international assignments should expect the unexpected to
happen and be ready for the same with confidence.
Approaching business issues with creativity
Bringing in flexibility and displaying appropriate negotiating traits and behaviour,
befitting the given situation, is the real test of competency of the managers. The major
challenge, before them, is to strike a balance between the organizational objectives and
local customs and policies.
They should be conscious of who they are but emanate a great deal of creativity while
operationalising the rulebook.
An ability to tolerate ambiguity
Ability to interpret silent cues about the culture and public opinion rather than waiting for
information as supplicated by the headquarters or the local unit would enable them to
make decisions quickly and more realistically.
Executives, emanating above characteristics, ensure development of strong bond
between the home and the host country operations. Besides training and development,
picking of such people would go a long way in the organizational success.
Summary:

Effective staffing of an organization is an important step towards achieving
organization‟s long term success.

The decision, regarding international staffing, has a strong bearing on a company‟s
success and is also of critical concern for the person who is engaged internationally.


The alternatives and the environment, associated with international staffing, might
be very different from those confronted by domestic-only organizations.

MNC‟s can tap three basic sources for global positions viz., home –country nationals,
host-country nationals, and third-country nationals.

Home country nationals or parent country nationals are managers who are the
citizens of the country where the MNC headquarters are located.

Host- country nationals are the local managers who are the citizens of the country
where the subsidiary is located.

Third –country nationals are the nationals of country where neither subsidiaries nor
the headquarters are located and are given managerial responsibilities in the
subsidiaries.

Different approaches to international staffing have important implications for
recruitment and selection practices.
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
Research has affirmed at least three approaches to international staffing: the
ethnocentric approach, the poly centric approach, and the geocentric approach.

The ethnocentric approach tends to rely on formal structures and control systems. In
this approach, there is a tendency to regard one‟s own culture as superior to others.

The polycentric approach represents a conscious belief that the host country
nationals understand the culture of host country better than the parent country
nationals.

The geocentric approach calls for recruiting people, based on their skills and
competencies, regardless of their nationalities.

Equal employment opportunity is the area which has implications for every aspect of
international staffing.

Any attempt to become international organization must be inclusive of a systematic
analysis of diverse legal background as well.
All the decisions taken in the area of international staffing are greatly influenced by
the different national contexts and culture of the subsidiary‟s local community.
Greet Hofstede, a cross cultural expert, has defined culture as, “the collective
programming of the mind which distinguishes the members of one human group
from another.”
As per Hofstede, culture differs in at least following five ways that should be
understood as it has strong implications for understanding business Viz.,
Individualism Versus collectivism, Power distance, uncertainty avoidance,
masculinity, and long term vs. short term orientation.


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An enterprise with international staff is characterised by greater complexity and
cultural diversity.
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Culturally diverse people bring unique perspectives to organizations. Understanding
these differences and managing them effectively can help organizations to capitalize
on diversity.
International assignments account for managing a workforce which comes from
diverse cultural backgrounds.
An open mind allows the managers to listen to the views, different from their own, in
a constructive manner.
Managing diversity, at work place, calls for genuine interest in learning from people.
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Glossary:
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Ethnocentric Approach: a nationalistic predisposition of management where the
interest and values of home country guide decision making.
Expatriates: employees who work away from their home country.
Polycentric Approach: an approach where management appoints local nationals in
key positions and allow for development of these professionals.
Geocentric Approach: calls for integrating a global systems approach to decision
making, giving emphasis to skill of individuals rather than nationality.
Multicultural Group: a group where there are individuals from more than two
ethnic backgrounds.
Subsidiary: an overseas operation that is totally owned and controlled by an MNC.
Diversity Management: managing people in a way that recognizes differences
among people and values these differences as a source of productive potential to be
leveraged.
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Globalization: a process whereby there is an integration of national economies,
political structures and social systems. The constraints of time and space become
less significant.
Culture: the collective programming of the mind which distinguishes the members of
one human group from another.
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Exercises:
A. Objective Type Questions:
1. Do as Directed:
a) Match the following International Staffing concepts:
Match the Following
A. Expatriate
B. Third-Country National
C. Ethnocentric Approach
D. Host-Country National
E. Geo-Centric Approach
1. Nationals of country occupying managerial
positions,
where neither subsidiaries nor the
headquarters are located
2. Local managers who are the citizens of the
country where the subsidiary is located.
3. Recruiting people based on their skills and
competencies regardless of their nationalities.
4. Employee working away from home country
5. A nationalistic predisposition of management
where the interest and values of home country
guide decision making.
b) Choose the Right Answer:
Which of the following approaches is not an approach to international staffing?
A.
B.
C.
D.
Polycentric Approach
Macro Political Approach
Ethnocentric Approach
Geocentric Approach
2. Fill in the Blanks:
a. ---------------approach calls for recruiting people, based
competencies, regardless of their nationalities.
on
their skills and
b. ---------------- are the local managers who are the citizens of the country where the
subsidiary is located.
B. Short Answer Type Questions:
1. What do you mean by international staffing?
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2. Define the term expatriate.
3. Define host-country nationals.
4. List the advantages of international staffing.
5. Critically evaluate the ethnocentric approach to international staffing.
6. What is geocentric orientation, with reference to international staffing?
7. What do you mean by Culture?
8. List Greet Hofstede‟s dimensions of culture.
9. What are the challenges to international staffing?
10. List some managerial competencies for success in an international assignment.
C. Long Answer Type Questions:
1. What do you mean by international staffing? Give your opinion, regarding the
importance of international staffing, in light of increasing globalization.
2. Discuss in detail the advantages and disadvantages of hiring home-country, hostcountry and third-country nationals.
3. Critically evaluate the ethnocentric, polycentric and geocentric approaches of
international staffing. When is each approach appropriate?
4. How is international staffing different from domestic staffing? What are the major
challenges of international staffing?
5. Elaborate the requirements for a manager to be successful on an international
assignment .
6. Prepare a detailed analysis of how the culture affects staffing decisions.
7. Write a note on legal aspects of international staffing.
Answers to Objective Type Questions:
Correct answer 1a
Correct answer 1b
A.4
B.1
C.5
D.2
E.3
B. macro political approach
Correct answer 2a
Correct answer 2b
Geocentric
Host- country nationals
References:
A. Work Cited and Suggested Readings:
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Adler, N.J. and Ghader, F.(1989)‟ International Business Research for the twenty –
first century: Chanda‟s new research agenda‟, in A. Rogosan (ed.) Research in Global
Strategic Management: A Canadian Perspective , Greenwich, CT: JAI Press.
Anderson, B.A.(2005) Expatriate selection : Good Management or Good Luck?
International Journal of Human Resource Management, 16(4): 567-83
D.A . Amfuso, “ HR unites the world of Coca –Cola”, Personnel Journal, Nov 1994, pp.
112-20 .
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E.H.Schein, Organization culture and leadership (San Francisco:Josssey-Bass,1985).
Gamble,J.(2003) Transferring human resource practices from the United Kingdom to
China: the limits and potential for convergence. International Journal of Human
Resource Management, 14(3): 369-87.
Greet Hofstede(1984), Culture‟s Consequences: International Differences in Work
related Values( Newbury Park, CA: Sage Publishing)
Greet Hofstede(1993), “ Cultural Constraints in Management Theories,” Acdemy of
Management Executive, pp. 81-94.
Orla Leonard(2002), “Away Winners”, Financial Management, March 2002.
B. Web Links:

http://wps.prenhall.com/wps/media/objects/728/745520/chapter13.pdf
C. Video Links:
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Visit the link to listen to John Drake on Global Human Resource Management
http://www.youtube.com/watch?v=n2ZAmwpwMFg
Visit the link to listen to Ernest Antoine on best practices to support returning expats
http://www.youtube.com/watch?v=QS5n2R9wtmo
Visit
the
link
to
know
more
about
international
recruitment
http://www.youtube.com/watch?v=Ze-KB8wFN8Y
_________
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