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Ethnocentric Staffing Approach
MNE Hire from HQ country and send employees on international assignment to the subsidiaries. USED WHEN: lack of local talent, HQ needs to control sub, sub is in early stages, MNE has global business strategy. ADV: Allows MNC to fill key positions when local talent not available, Allows HQ to control sub operations and maintain corporate cultures, allows parent country national sto aquire inernational experience. DIS: Costly, tension between home country and parent country individuals, prevents/slows development of home country people.
Polycentric Staffing Approach
MNE's prefer to use locals from the sub country. USED WHEN: need competitive advantage with localizing operations, each sub is individual and adapts to its local conditions, MNCS that have a multi domestic strategy. ADV: Access to local communities and markets, sents signal that sub is commited to local culture, Relatively less costly than using PCNs. DIS: Locals may not be commited to MNE, local may not be able to acquire international experience, local career development and promotion opportunities may be limited.
Geocentric Staffing Approach
MNE source talent from all over regardless of nationality. USED WHEN: MNE has network of subs with various degrees of centralization/decentralization. Highly integrated process across subs, MNEs have a transnational business strategy. ADV: Employees can develop a geocentric mindset, MNEhires the best available talent, career opportunites for top performers are truly global, employees can work with others from different geographic, cultrueal and regional backgrounds. DIS: Can be costly, managing work auths in several countires is complex and requires high level of communication among all employees from diff countries
Regiocentric Staffing Approach
MNEs tend to favor using people from a specific region. USED WHEN: theres a strong need to organize subs into regions,when each region works as a unique unit with considerable autonomy, MNE has several regional HQ, Key positions are filled by TCNs and HCNs. ADV: reduces costs by sharing resources within a region, managers can develop region specific expertise, MNEs are able to respond to specific region needs. DIS: lack of multi-cultural perspective, career opportunities limited to specific regions,m not easy for region-based managers to move to company HQ
Demand Driven Assignment
Using Iast as general managers or directors; for subsidary start-ups to roll out new products; for technology transfer; to solve problems, perform functional tasks such as accounting, sales and manufacturing; and for organizational control
Learning Driven Assignment
Managmenet development, transfer of knowledge, socialization of locals into corporate culture and values
Impacts of International Workforce Planning
Availability of Data
Population characteristics: shortages and surpluses
Labor mobility: Emigration and immigration
Brain drain and job exporting
Increasing diversity of labor forces and workforces
Multidomestic Business Approach
(Low Integration, Hi Local Responsiveness) Responds high to needs, values and demands. Subsidaries in multiple countires that operate independentaly
International Business Approach
(Low Integration, Low Local Responsiveness) Simplest business strategy. Organization markets and sells the same product/service locally and internationally. Typically no overseas offices or operations other than small sales
Transnational Business Approach
(Hi Integration, Hi Local Responsiveness) Attempt to maximize both sides, global and multidomestic at the same time. Being global but wanting to be seen as local. Part of a global network but each subsidary is given responsibility related to its capabilites and strategic mission.
Global Business Approach
(Hi integration, Low Local Responsiveness) unified approach that is implemented for all countires regardless of their cultural and national differences. High centralization/inegration. Products and services will be increasingly designed for and marketed to customers all over the world. Mostly impletmented by MNES through global organizational structure. Looks at whole world as one market. Tightly connected with the HQ and heavily dependent on resource, brand identities, ideas, polices etc.
Ethnocentrism
Managers use a home-country standars as reference is decision-making and high control over operations. Managers likely to follow an international business strategy or a global business stragegy of maintaining control from the home country and parent firm headquarters and replicating home country systems and procedures and strucutre abroad.
EX Walmart
Polycentric
This strategy refers to a business approach where different regions or markets are managed independently based on local needs, without one overarching central approach. It refers to multiple centers of influence
EX Nestle
Regiocentric
This strategy involves tailoring operations and strategies to regional markets, where a company might adapt its approach to cater to the specific needs, preferences, and regulations of a specific geographical region. This strategy narrows this focus to a particular region.
Geocentrism
Mindset is creating a global network and a preference for following a transnational strategy that is integrative and interdependent among various elelments. IHRM is more eclectic, borrowing best practices. The world is a single market EX Apple
Exogenous Factos
Forces that are external to the firm that are largely beyond an MNE's control but can create challenges that affect an organizations issues, functions, policies and practices. EX national culture, economic conditions, political systems, legal environment and workforce characteristics. Reactionary response strategy.Often unpredictable requiring adaptation. Low control.
Endogenous
Describes the issues and concerns that are internal to the firm and include structure of the organization, stage of internationalization, business strategy, and HQ's international orientation. Proactive response strategy. More predictable and manageable internally. Leaderhsip culture and internal processes. High control company can influence them
Convergence
Using a parent-company policies and procedures throughout a firm's global operations
International Organizational Structure
Coordinated Federation. Foreign subsidaries may be dependent on HQs for resources and limited direction but will still have major freedom to adapt to local conditions.HR decisions, policies and practices will be of limited significance in the subsidaries
Multidomestic Organizational Structure
Decentralized Federation. Has subsidaries in multiple countries operating independently within each country, independently of operations in other countires and often fairly independently of parent HQs. HR Role more complex and difficult.
Global Organizational Structure
Centralizaed Hub: Subsidaries are heavily managemed and controlled by HQ's. Assets and resources are cenralized. Products and services are created where costs are lowest, quality is highest and time to deliver is shortes and are delivered to wherever demand is sufficient. HR decisions are made at HQ and implemented worldwide.
Transnational Organizational Structure
Integrated Network. Resemble an integrated and interdependent global network of subsidiares that have the ablity to manage across national boundaries retaining local flexibliites while achieving global integraton.
Sustainable Competitive Advantage
The ability to learn and innovate faster than its competitiors and react more quickly to continual volatility and change, created a culture of learning and nurturin, and facilitating that learning across borders, may be the only avenue to success.
Organizational Design
Process used to determine the formal arrangement of components listed below in next definition.
Organizational Structure
The formalized arrangmeent of organizational components such as the headquarters subsidaries busneiss units/divisions within the HQs and subsidaries products lines, jobs, positions, tasks and reporting relationships in an organization. Structure is an outcome of the organizational design
International Mergers and Acquisitions
One firm from one country acquires a fim in another country
International Joint Ventures
two or more firms from two or more countries create a new and separate - legal- business entitiy
International Alliances
Two or more firms enter into formal or informal partnerships that do not invovle the creation of a new and separate legal entity.
Equity Based International Combination
Involve long term relationships - with one partner buying all or most of the equity in the other partner - and that requires active day to day management by the controling partner of a wide variety of business issues in the combined firm
EX: International mergers and aquisitions/ IJVS
Non Equity International Combinations
Share profits, responsibilities, and resources according to specific contractual relationships - but do not involve one party buying equity in the other party. They are two separate legal entities that bear their own liabilities and has the freedom to organized its own resources, production processes and operations. EX Joint Exploration process, Research and development consorita, co-production agreements, co-marketing arrangements and long-term supply agreements.
International Mergers and Aquisitions Process of Combination
Phase 1: Pre-Combination: Initial target screening and pre-bid courtship of potential target firm. Due Dilligence review. Price setting and negotiation. HR closely involved in each of the steps
Phase 2: Combination planning and signing of agreement. Decision about how to implement the deal. Post deal negotiation. HR Plays key role
Phase 3: Post-Combination and Implementation of deal. HR plays a key role in helping to facilitate the integration with the merged firm. HR provides employee communication and vision for business.
Surface Culture
Explicit Culture. Things that are readily observable. Dress, food, architecture, customs
Hidden Culture
Values, religions, and philosophies about child rearing, views of right or wrong
Invisible Culture
Implicit Culture. the cultures universal truths - the bases for all of a culture's values and beliefs
Divergence
Support the point of view that countries' cultural values and practices continue to exert quire strong influences on their business and HR practices
Convergence
The point of view that modern technology and the modernizing of industries around the world is influencing firms to adopt similar "best practices"
Cross-Vergence
The intermising of culutral systems between different countries
IHRM Research Forms
Cross-Cultural : The study of issues or practices, comparing one country to another
Multicultural: the study of a practice or issue in a number of countries or cultures
HR Practices in other countires: describing HR practices in one or more countries that are foreign to the researcher.
Common Law
A legal system based on judicial decisions and precedents rathan than on written statues or regulations. Judge made law, state decisis, case law
WTO World Trade Organization
the international body in which multilateral tariff reductions are negotiated, reductions in non-tariff trade barries are negotiated, and international trade disputes are reviewed and adjuicated. Replaced the GATT
European Union
The most highly developed economic trade treaty. An international organization of European countries formed after World War II to reduce trade barriers and increase cooperation among its members.
Ethical Relativism
Suggest that what is right is whatever a society defines as right. There are no absolute rights or wrongs
Ethical Absolutism
Is the view that there is a single set of universal ethical standards or principles, which apply at all times, in all circumstances, in all cultures
Civil code/ Civil Law
This is based on an all-inclusive system of written rules, of which there are three types: Commercial, Civil and Criminal. Statues tend to be very specific, defining peoples basic rights and duties.
Islamic Law: The Sharia
Most common religious law. Offers detailed guidance on proper behavior in almost every aspect of life
NAFTA
A trade agreement between Canada, the United States and Mexico that encourages free trade between these North American countries.
Cosmopolitanism
Developing unique responses to cross-cultural ethical dilemmas, ones that try to find common ground among disparate moral views
Corporate Governance
the way in which a corporation is structured and the effect that structure has on the corporation's behavior. The basis upon which decisions are made in organizations
Corporate Sustainability
Is defined as meeting the needs of the present without compromising the ability of future generations to meet their own
Codetermination
Alternative Union. Asystem of corporate governance where employees have a role in decision-making processes alongside shareholders or management.
Expatriates
Work outside of the home country on assignment by their employers or hired to emigrate to fill vacant jobs in other countries
Brain Drain
Educated and skilled citizens leave for jobs with better pay in the developed countries.
Repatraiting
The process of brining international assignees and their familes back home for their foreign assignments
Recruiting
Searching for and attracting qualified applicants to create a pool of candidtates for screening for possible hiring
Selecting
Focuses on gathering and analyzing information about the applicants in order to select the most suitable person or persons for the job
Recruitment
employees who were relocated from the parent company or HQ to foreign subsidaries or overseas operations.
Secondment
Common Foreign Staffing Operation. the assignee remains employed by home country/HQ and is loanded to work fo rthe firm's foreign subsidary in the host country
Transfer of Employment
Common foreign stafffing operation. employee is terminated in the home country and is then rehired by a different/new employer in the foreign/host country
Dual Employment
Common foreign staffing operation. the employee maintains more than one employement relationship, thus working for two or more employers with what is referred to as split payroll.
Global Employment Company/ Prefessional Employer Organization
Common foreign staffing operation. enables employers to hire a foreign workforce through an existing foreign company that is already established. This option is increasingly used
Employer brand
the evaluation by potential candidates of an organization as a desirable place of work and as a desirable option for seeking international experience.
Inpatriate
This term was developed to describe particular employees who are relocated from a foreign subsidiary or JV to the parent company in the HQ country. Purpose is for teaching the subsidiary employee about the products and culture of the parent firm and to introdue the employee to the operations, ways of thingking and corporate culutre of the HQs
Elite Cohor Approach
identifying talent at the time of initial entry into the workforce when cohorts are recruited from top univerisites, carefully selected, screened, trainged, and developed for a number of years.
Elite Political Approach
Identifying talent at the time of entry when individuals are recrutied from elite schools
Functional Approach
leaders are identifified for their functional excellence
Managed Development Approach
the decentralized responsibility for functional development lies at the local level while the overall process of _______________ _______________ is centralized at the corporate level.
Geocentric
An organization with a global mindset
COLA Cost Of Living Adjustment
Enable IAs to maintain as closely as possibe the same standard of living in the foreign assignment as they would have had at home.
Aualitative Parity
_________ is a commitment to offer something from each core category of benefit to every employee world wide
Core Benefits - basic items that the company commits to making available to all employees worldwide such as a certain level of health care
Requried benefits - compensation items or non-cash benefits required by local law
Recommended benefits - less essential compensation or benefit programs to be made available wherever cost considerations permit, such as life insurance
Optional benefits - non-essential compensation items to be made available if it is a competitive practice in the local marketplace, such as local transportation or meal support.
Cultrual Fit
focuses on the influence of the sociocultural context on HRM practices nd the transferability of the western practice of PM to another culture with fundamentally different socio-culuteral environment
IPM Phase 1 Design
Purpose (why) Performance Criteria (what) Instrument (how) Frequency (how often) Choice of Evaluators (who) Sttandardization/Localization
IPM Phase 2 Implementation
Job performance expectations, Cognitive processes affecting PA (motivation, self efficacy, affective regard, raters-ratee context) Performance appraisial trianing, performance feed back
IPM Phase 3 Evaluation
Fit, Alignment, Effectiveness, Organizational Justice, Performance Outcomes, Rewards
Business Strategy
What largely dictates the overall expectations for an IA's performance in any specific country?
Meso Level Challenge WLB
Micro Level Challenge WLB
Macro Level Challenge WLB
Micro-Region
is usually an area bigger than a municipality but smaller than the state which it is in.
Macro-Region
These regions or clusters include independent countries that share certain attributes such as social, economic, politicial, geographical, cultural and historical characteristics. Most important of these include geographic, economic and cultural perspectives. Africa, aisia europe, latin america and the caribbean, northern america, oceania, sub saharan africa
Psychological Contract
A set of expectations employees have from employers.
Asia Cluster Regions
East, South, South east, West
International Relocations and Orientation
Ensuring employees relocating to another country receive the best possible attention to very personal concerns. Tax and Financial advise, Visas and Work Permits, International Moving, Medical exams for particular foreignlocations, Training and orientation, education adn schooling for IA and family, Security and saefty
Global Administrative Services
Established to ease the process of transferring employees from one country to another. Travel arrangements, Housing in the foreign locale, local transportation, office services, currency conversion, local bank accounts, government relations,