IHRM: Chapter 5

Question 1

Why are there so many expats in Dubai?

Answer 1

• good sense of knowledge, well-rounded
• Emirates don’t want to get into the construction field, they are comfortable where they are hence they hire expats to do their job

Question 2

Ethnocentric Approach (ethnicity)

Answer 2

• staffing subsidiary from the headquarters of the parent company
• for example foreign embassies will have a Canadian staff

Question 3

Advantages of the ethnocentric approach

Answer 3

• need to maintain good communication, coordination and control with HQ
• firms that are in the earlier stages of internationalization can avoid risks in the environment

Question 4

Disadvantages of the ethnocentric approach

Answer 4

• opportunities are limited for HCNs which reduces productivity and increases turnover
• expatriate managers adapting to the host country will take time and PCNs make poor decisions
• income gap between PCNs and HCNs
• expatriates overseas will experience a high cost of living

Question 5

Polycentric approach (locals)

Answer 5

staffing subsidiary with locals (host country nationals)

Question 6

Advantages of the polycentric approach

Answer 6

• eliminates language barriers
• avoids issues with expatriate managers and their families
• removes expenses for cultural training programs
• less expensive even if premium is paid to hire high quality candidates

Question 7

Disadvantages of the polycentric approach

Answer 7

• range of cultural differences such as personal values and attitudes
• limited opportunities to gain experience outside their own country making it difficult to earn senior positions

Question 8

Regiocentric approach (region)

Answer 8

• staffing subsidiary from the region (Schengen)
• Europe is the continent
• EU is the arrangement of certain countries in Europe
• Schengen is a subset within Europe which includes 26 countries who have freedom of movement (passport stamped in Portugal means you won’t need it stamped again in countries like Spain, Germany, France)
• Eurozone is the currency adoption

Question 9

Advantages of the regiocentric approach

Answer 9

• maintains interactions between managers transferred to regional HQ
• demonstrates common sense within the environment

Question 10

Disadvantages of the regiocentric approach

Answer 10

• produces federalism in a region and constrains MNEs to develop a global perspective
• regional barriers so MNEs cannot advance to the next position

Question 11

Geocentric approach (globally)

Answer 11

staffing the subsidiary with anyone around the world

Question 12

Advantages of the geocentric approach

Answer 12

• enables MNEs to develop an international executive team to develop a global perspective
• overcomes the federation of the polycentric approach
• supports cooperation and resource sharing across units

Question 13

Disadvantages of the geocentric approach

Answer 13

• utilizes immigration controls to have a higher number of citizens employed and if not applicable, they will need training
• MNEs need to offer extensive documentation if they wish to hire a foreign national, this can be time-consuming
• it can be expensive due to the relocation and training involved

Question 14

Advantages of PCNs

Answer 14

• organizational control and coordination are maintained
• managers promise to give international experience and skills
• subsidiary complies with MNEs objectives

Question 15

Disadvantages of PCNs

Answer 15

• promotional opportunities of HCNs are limited
• takes time to adapt
• compensation differs in PCNs and HCNs

Question 16

Advantages of TCNs

Answer 16

• salary and benefit requirements are lower than PCNs
• more informed about the host country environment

Question 17

Disadvantages of TCNs

Answer 17

• need to consider national oppositions (India/Pakistan)
• the host government may resent in hiring TCNs
• TCNs might not want to return home

Question 18

Advantages of HCNs

Answer 18

• language and other barriers are eliminated
• no work permit is required
• lower costs
• continuity of management improves

Question 19

Disadvantages of HCNs

Answer 19

• limited career opportunities
• control and coordination of HQ may be delayed
• hiring HCNs gives limitations to PCNs and foreign experience
• may encourage federation of nationals than global units

Question 20

Determinants of staffing choices - context specificities

Answer 20

MNEs tend to staff culturally distant subsidiaries with PCNs which has a positive effect on labour productivity. For ex: education system directly related to staff availability

Question 21

Firm specific variables

Answer 21

relevant variables are MNE structure and strategy, international experience, corporate governance and organizational culture

Question 22

IHRM practices

Answer 22

selection, training and compensation

Question 23

What are the roles of expats?

Answer 23

• maintain direct control over subsidiaries
• control subsidiary’s activities by sending expats
• instill corporate values in subsidiaries
• develop interpersonal connections
• gather information for HQ
• expats being able to speak the foreign language and have local knowledge
• sharing ideas with home and host country

Question 24

Why do we need non-expats despite technology

Answer 24

• build relationships with others
• cultures cannot be interpreted online, you need the face to face interactions
• Edward Halls’ framework about implicit and explicit communication, understanding body language and building trust before conducting business

Question 25

Challenges for non-expats

Answer 25

• home and family life
  -work intensification
• travel arrangements
• health concerns
• lack of cross cultural training

Question 26

Why are there international assignments?

Answer 26

• filling in a managerial or technical gap due to a lack of skills in certain areas of the organization
• staff cannot move into other parts of the organization, additional training will be required
• organization development: control, transfer of knowledge, procedures and practices

Question 27

Short term assignments

Answer 27

• several days to 3 months
• involves trouble shooting, supervision, oversight

Question 28

Extended assignments

Answer 28

• up to one year, similar activities to short term assignments

Question 29

Long term assignments

Answer 29

• 1-5 years, traditional expatrations

Question 30

Commuter assignments

Answer 30

• expats who fly in and fly out of neighbouring countries
• done on a weekly or biweekly basis to solve problems regarding the assigned employee

Question 31

Rotational assignments

Answer 31

• includes both job rotation and overseas assignment so that employees can pick up new skills and one day can become a regional manager
  -commonly used in hardship locations like the mining industry

Question 32

Contractual assignments

Answer 32

• expats on a contract for 6 months to a year
• conducting research and development

Question 33

Virtual assignments (not real expats)

Answer 33

• using technology to do their work
• can cause issues in effective communication, how much work should be done and cultural misunderstandings

Question 34

Self-initiated assignments

Answer 34

• an individual conducts work on their own and not tracked by management

Question 35

What is the role of inpatriates

Answer 35

• responsible for sharing local knowledge to HQ and conduct corporate activities in the local market
• socialize and learn from specific routines and behaviours that can enable future management tasks