Reasons for appointing home or country management
Reasons for appointing home or country management
One of the most critical decisions that global companies must undertake effectively is the choice of the manager to oversee the company’s operations in a foreign subsidiary. The choice of a manager is a critical success factor for the success of the business franchises positioned in foreign countries (Briscoe & Schuler, 2004). With this regard, it is the responsibility of the selected manager to facilitate the execution of orders from the head office and uphold the relationship between the subsidiary franchises in a host country with the head office. This section reviews the decisions regarding the choice of the managers for foreign assignments and possible alternatives. The section concludes with a decision and its rationale.
The choice of home country management is usually referred to as an ethnocentric staffing policy, as outlined in the Perlmutter’s model. The choice of home country management is influenced by loyalty factors; this is because home country managers are more loyal to the primary compared to host country management. It is evident that home country managers are effectively equipped to communicate with the head office, which is a core requirement in international management. In addition, they have better knowledge of the corporate values and operations of the primary company. The aspect of familiarity with the company’s corporate values, cultures and operations means home country managers have the capacity and capability to execute orders from the head office in Melbourne effectively. Home country management results to a centralized decision making framework for the headquarters and results to a centralization of the company and a power structure that is characterized by hierarchy. The choice of a home country manager can be influenced by lack of the required technical expertise among the host country management (Klarsfeld, 2010).
Some of the setbacks associated with home country management are challenges in adaptation to the business environment of the host country and a low morale on the staff because of the perception that there are limited career promotion opportunities.
Host country management is usually referred to as polycentric staffing. There are various advantages associated with the selection of host management during global strategic expansion. Host management is effective in elimination of the cultural barriers, which plays an important role in enhancing the adaptability of the business within the host country. Host country managers usually have adequate knowledge of the local business environment compared to the home country managers. There are limited constraints associated with cultural adaptability, language barriers and transition problems.
Another potential benefit associated with the choice of a host country manager is that it will boost the morale of the staff if a manager is selected from their country. Improved staff morale is because of the perception that there are better opportunities for promotion. On rare occasions, the choice of the manager for a business franchise located in a host country cannot be influenced by the primary company (Klarsfeld, 2010). This is the case whereby the immigration policies of the host country place emphasis on offering employment to the local nationals of the host country. There are also financial benefits associated with the selection of host country nationals because the selection of the host country management is significantly less compared to the costs associated with the selection of the home country management (Haar & Bardoel, 2008).
Despite the benefits, there are also various setbacks associated with the selection of host country management. The most notable challenge that host country management impose is with regard relationships between the subsidiary and the head office. This presents a potential challenge associated with a conflict in the national loyalties. This can be attributed to language problems and difficulties in having and understanding of the corporate culture of the Brunt Hotels Group, which questions the capability of the host country management to execute the orders from the head office in Melbourne.
The choice of the host country manager can also be constrained by lack of the required international management experience in managing the business franchise situated in foreign countries. The selection of host country management is also constrained if the Brunt Hotels Group does not have an established system used to facilitate the selection of foreign employers (Thill & Courtland, 2011).
A global manager, who is a manager from third country, is also an option for consideration in the international assignments to be undertaken by the Brunt Hotels Group. The potential benefits associated with the global manager are a reduction in the aspect of cultural identity and the subsequent politics regarding cultural identity.
In summary, the Brunt Hotels Group needs to have control over its foreign franchises; this means that ethnocentric approach is the effective management decision for its international assignments. The choice of home country management is influenced by loyalty factors; this is because home country managers are more loyal to the primary compared to host country management. It is evident that home country managers are effectively equipped to communicate with the head office, which is a core requirement in international management. Having selected home management for the foreign assignments for the Brunt Hotels Group, the following section discusses how the selection of managers will be conducted and the advantages and disadvantages of the selection methods.
Selection of home managers and the advantages and disadvantages of the selection methods proposed
The selection profile for the home country managers to undertake the Brunt Hotels Groups international assignments will be based on technical experience in international management, the maturity of the candidates, positive attitudes towards foreign assignments, effective decision-making skills, eager to learn foreign languages and efficiency in line management. Numerous selection methods could be deployed to evaluate the potential candidates for the international assignment basing on the identified criteria. This section discusses the selection of home country managers and the various advantages and disadvantages of the proposed selection methods. The proposed selection methods for the home country managers will be internal applications and structured interviews.
Internal applications mainly involve recruiting from the already existing employees of the company. During internal applications, it is vital to ensure that the positions are advertised internally and request for applications from interested individuals who have attained the minimum requirements as per the outlined criteria. The following section discusses the advantages and disadvantages of internal applications (Briscoe & Schuler, 2004).
Internal applications are advantageous due to familiarity with the staff of the organization. This is because the existing employees have more knowledge regarding the company’s operations, values and corporate culture (Briscoe & Schuler, 2004).
Internal applications also result a maximal use of the organizational talent. The policy relating to internal applications offers opportunities through which the company can exploit the talent available internally and enhance them further in order to meet the human resource of the firm in future (Briscoe & Schuler, 2004).
Internal applications are also an economical form of recruitment because it saves the company the need for expenditures associated with the search and attracting the potential candidates (Briscoe & Schuler, 2004).
Internal applications also serve to enhance the morale of the in-house staff because the employees are sure that they are likely to be hired next time an opportunity for international assignment comes up. In addition, internal application also serves as a source of motivation for the company employees to enhance their career and their levels of income. This is because it creates a perception that the employees can rely on the organization to build up their careers. In addition, it is an employee retention and attraction strategy within the company (Briscoe & Schuler, 2004).
A significant drawback associated with internal recruitment is its limited choice. This is because internal applications restrict the recruitment only to the talent that is available within the firm. This means that internal applications deny grasping vast talent that is found in the large labor market outside the firm. Internal applications cultivate the aspect of inbreeding, which is not a healthy strategy for business enterprises (Briscoe & Schuler, 2004).
Internal applications also discourage competition because the internal applicants are shielded from the outside applicants. This results to a tendency whereby the employees can be assigned to positions without working extra hard (Skills Australia, 2010).
Internal applications also results to stagnation of expertise because there is a perception that the internal employees will be selected when an opportunity for international assignments comes up. Internal applications also have the potential of imposing conflicts within the organization because of controversies within the candidates. Job analysis on internal applications will be conducted using interviews in order to assess the capabilities of the applicants.
Structured interview, sometimes called pattern interviews mainly entails assessing the capabilities of the internal applicants in relation to the established criteria for the home management positions in foreign assignments. It is done using a one-on-one interview with applicants. Structured interviews are preferred because of its adaptability and obtaining first hand information regarding the capabilities of the applicants (Briscoe & Schuler, 2004).
Structured interviews are useful when evaluating the communication or social skills of the applicant, which is a core requirement for an international assignment in a foreign country. In addition, supplementary information can be gathered by the interviewing panel.
Structured interview is also an effective method of assessing the verbal fluency of the applicants and their knowledge of the job position. This is an effective method for selecting applicants, who have equal qualifications. The interviewing panel can also assess the level of the compatibility of the applicants with regard to the employees and the overall organizational policies and procedures. In addition, the interview process can be modified in order to facilitate the collection of additional information that can influence the selection decision.
The significant drawback of structured interview is that the company has to assess many applicants prior to embarking on comparison, this takes more time and needs designing interview assessment questions. The second drawback is that structured interview is a form of data communication, which may jeopardize the principal objective of assessing the communication skills of the potential candidates (Briscoe & Schuler, 2004).
In summary, Internal applications and structured interviews offer an effective methodology that the Brunt Hotels Group can deploy to select the managers for the foreign assignments. Internal applications will serve to attract the potential candidates within the organizations, after which structured interviews is used in assessing their social and communication skills. Having explored the selection methods for the home managers, the following section analyses the issues during the preparation of the managers to take up their positions.
Analysis of the issues in the training of the managers for their positions in foreign assignments
Foreign assignments require careful planning and analysis in order to turn out successful. This means that the managers have to undertake adequate training in order to perform their tasks abroad effectively and have adequate knowledge in order to perform as required. A significant issue in global assignments is the repatriation of the home country manager, this implies that is vital to involve the Human Resources in the global expansion strategic planning; the family should also be involved at any early stage and deploy strategies that can make the transition easy. It is also vital that the selected managers be informed of the exact locations of their postings and the responsibilities associated with the position. Therefore, it is the mandate of the HR to organize visits to the host country, offer language and cultural awareness training programs for the manager’s family and address any issues related to dual-career for the selected manager. Continual support, planning for repatriation and constant evaluation of the process is needed in order to get the managers ready to undertake their international assignments. This section of the essay discusses the issues in preparing the managers to take up their positions.
Induction and training is a vital process when preparing the managers for global assignments. In this context, the managers are taken through an induction program whereby they have a chance to meet the employees that he/she will be working with during the foreign assignments. In addition, they are shown the skills that they must have in order to work in subsidiaries that are far from the head office. This means that the managers should be familiarized with the internal procedures, corporate values and the organizational mission and vision, to serve as a guideline when working for the organization in subsidiaries that are foreign countries (Hill & Cronk, 2010). Observational learning is important during this stage in order to ensure that the newly hired managers are more informed of what is required at organizational level prior to adapting to the business environment in the host country. Organizational learning and training will entail outlining the norms of behavior, the shared terminology and the reporting procedures, and dominant organizational values. It is also vital to inform the employees the significance of organizational loyalty when undertaking international assignments for the company. This is important in drawing the boundary between what is expected from the organization and the expectations of the business environment of the host country such as government policies and regulation, cultural requirements that affect the business (Haar & Bardoel, 2008).
Studies have reported that there is a positive relationship between pre-departure preparation and overall adjustment and effectual functioning of the managers in the foreign countries. It is important to take into account during overseas assignments; the mangers are not only changing jobs, but also experience significant changes in their way of lives. This implies that the needs of the family members should be addressed as part of the issue when preparing them to take up their positions in foreign countries. As such, the preparation should entail cross-cultural training, awareness, family orientation, training of the foreign language, and briefing.
A briefing program serves to provide the manager with the fundamental information that is related to the job and other issues involving the socio-cultural environment of the host country. This briefing will include the company’s foreign transfer policy, benefit packages and any compensation required during the international assignment. It is also vital to offer background information related to schools found in the host country, taxes, government systems, duration of the assignments and the repatriation after the completion of the assignment. The managers should also be informed of the living conditions, cultural aspects and the business and social norms that are acceptable in the host country (Peng, 2008)……
List of References
Briscoe, D. & Schuler, R., 2004. International Human Resource Management. London: Routledge.
Dowling, P 2008, International human resource management: managing people in a multinational context, Cengage Learning EMEA, New York.
Haar, J. & Bardoel, A., 2008. Work-life in Australia. Asia Pacific Journal of Human Resources, 46(3), pp.258-71.
Hill, C. & Cronk, T., 2010. Global Business. New York: McGraw Hill/Irwin.
Klarsfeld, A., 2010. International handbook on diversity management at work: country perspectives on diversity and equal treatment. Washington, DC: Edward Elgar Publishing.
Peng, M., 2008. Global strategy. New York: Cengage Learning.
Skills Australia, 2010. Australian workforce futures: a national workforce development strategy. Canberra: Commonwealth of Australia.
Thill, J. & Courtland, L., 2011. Excellence in Business Communication. New Jersey: Prentice Hall.