Inter-cultural Management: Part III: The Global Strategy

1. Choosing an Approach to Global HRM

Although the overall international corporate strategy determines which of the four approaches to IHRM, Francesco & Gold (2005) argue that the six following factors, in host countries, have influence: political and legal concerns, level of development, technology and nature of the product, organizational life cycle, age and history of the subsidiary, organizational and national cultural differences. I’d add the Labor Unions power level.

Thus, there is no better approach to be recommended except the fact that managers should remain vigilant and flexible and monitor developments in each regional subsidiary.

For further considerations, we will assume that our subsidiaries headquarters are located in Hong-Kong for the Asian market(s), in Cairo for the Middle-East market(s), in Brussels for the European market(s) and in Toronto for US and Canadian markets.

This headquarters choice remains open as it is justified by their easy access to market.

1. Major Global Human Resource Management Functions

Czinkota et al (2002), Francesco & Gold (2005) and Mello (2006) sustain that IHRM has responsibility for five functional areas. In fact, multicultural organizations have two general human resource objectives: The first one is the recruitment and retention of a workforce made of the best people available. The second objective is to increase the effectiveness of the workforce. This one depends to a great extent on achieving the first one. Competent managers or workers are likely to perform at a more effective level if proper attention is given to the factors that motivate them. To attain the two major objectives, the activities and skills needed are:

1. Personnel planning and staffing, the assessment of personnel needs. 

This function is known as “recruitment and selection”.

2. Personnel training to achieve a perfect fit between the employee and the assignment. This function is defined as “training and development”.
3. Performance evaluation on a regular basis. 

This function is called “personnel performance evaluation”.

4. Personnel compensation according to employees’ effectiveness.

This function is known as “compensation and benefits”.

5. An understanding of labor management relations in terms of how the two groups view each other and how their respective power positions are established. This function is called “labor relations”.

Of course, there are other less important functions such as salaries taxation in host countries and repatriation of benefits, school and religious activities/churches organization for expatriates’ children, spouses, establishment of welfare activities etc…

Important remark:

The five functions of international human resource management show, once more, that choosing an HRM approach (among the four) is not an easy task and may even become very complex. That is why I recommend that each market region be handled according to its own specific cultural characteristics. Flexibility will prevail always.

For example, the concept of labor relations varies greatly in different parts of the world. So does the concept of compensation and benefits practices. Therefore, managers may find it more effective to apply an ethnocentric approach in one region while applying polycentric, regiocentric or geocentric approach (es) in another region (other regions).

According to Chong & Park (2003), from international perspective and drawing upon Hofstede (1980 &1993) model of cultural dimensions there are nine classical planning principles that can potentially provide useful broad guidelines for managers engaged in international planning, including workforce staffing planning: principle of the contribution to objectives, principle of primacy of planning, principle of efficiency of plans, principle of planning premises, principle of strategy and policy framework, principle of limiting factor, the commitment principle, principle of flexibility and principle of navigational change. Hofstede’s dimensions are: power distance, uncertainty avoidance, masculinity, individualism and long-term orientation.

Hempel (1998), Schuler & Rogovsky (1998) use these dimensions in exploring compensation theories.

3.1        Classifying Employees

According to Francesco & Gold 2005, employees in international organizations are classified in one of the following three types: PCN-parent country national (same nationality as the firm country). HCN-host country national (employee’s nationality is same as the location of the subsidiary). TCN- third country national (employee’s nationality is different from both firm’s and subsidiary’s). However, Briscoe 1995 argues that as IHRM staffing becomes increasingly more and more complex, these classifications do not cover all employees. For example, within EU workers of one country can work in other member countries without any work permit.

2.         Searching for Global Executives and Regional Senior-       Managers

In recent years, many corporate decision makers and academics, including Czinkota et al 2002, have realized that finding effective global leaders and executives is not easy. A full of 29 of Fortune 500 firms surveyed had nowhere near enough global leaders and 56% said they had fewer than needed and 2/3 said that the global leaders in their companies had less capability than needed. According to another survey of 1,200 midsize US multinationals with annual sales of $1billion or less conducted by International Business Magazine, senior executives seek managers who are culturally diverse but responsive to the direction of headquarters. Most western-based companies try to fill senior positions abroad by locals, using expatriates only in such specific projects as technology transfer. However, the same companies send their middle managers clear messages that overseas operations are so important to corporate welfare that solid international experience is needed for advancement. Another difficulty lies in the fact that while major markets in Europe and in Asia possess deeper pools of managerial talent than ever before, many of these nationals prefer working for their domestic rather than for foreign firms. In particularly short supply are marketing managers-49% of the surveyed companies say “marketing manager” is the very hardest slot to fill. It is also especially hard to find people with cross-cultural experience and skills to make good “regional managers”.

In fact, very few global managers are born that way, that is, with an international childhood, a command of several languages, and an education from an institution with an international focus. In most of cases, they need and have to be trained and nurtured carefully. To make a business global, its leadership has to be able to:

1). See the world’s challenges and opportunities. 2). Think with an international mindset. 3). Act with fresh, global-centric behaviors; and 4). Mobilize a world-class team and company. To achieve this, companies use different and various approaches of selection and recruitment. None of the approaches should be considered to be the best or the most recommendable/effective one. It is all a matter of feeling that a candidate is the right person at the right place. Anyway, international managers should know that recruitment for positions in a host country (for top positions) is one of the most difficult IHRM tasks. Once such a leader has been found, his/her retention is vital! That is why companies that spend time and money creating and training global talent naturally want to retain it as long as possible, by offering global opportunity, professional challenge, and a competitive compensation package. (Czinkota et al 2002, page: 477.

3.3        A Competency-Based Leadership

According to Harvey et al (2000), significant demands are imposed on corporate management of multinational corporations to develop a strategic orientation of their global human resource management systems. This strategic orientation, which should balance the need for both global stability and local flexibility, necessitates a more multicultural management membership. Developing a human resource system designated to identify, attract and retain an adequate complement of global managers who are capable of coordinating the global strategic efforts of the firm while at the same time controlling local host strategies is a daunting task. The competency-based criteria are used to identify global manager candidate pools capable of executing an integrated global management system (Harvey et al 2000). Czinkota et al 2002 suggest that in addition to competence factors, which include technical knowledge, leadership ability, experience, past performance, area expertise and language, we should look also for adaptability that requires the candidate to be interested in overseas work, his/her relational abilities, cultural empathy, appreciation of new management styles, appreciation of environmental constraints and adaptability of his/her family. Personal characteristics are also important: age, education, sex, health, marital status/relations, and social acceptability.

Example of gender: There is growing evidence to suggest that women are making greater stride on the international front than ever before. According to a 1999 Global Relocation Survey, conducted by Windham International and National Foreign trade Council (of America) provides various measures of that trend.  Expatriate women have reported numerous advantages to being female. Being highly visible (both internally and externally) has often been quoted as an advantage given that many such women are “firsts” for their companies. Foreign clients are curious about them, want to meet them, and remember them easily after the 1st encounter. ().

3.4        Recruitment and Selection for non-Executive Positions

Francesco & Gold (2005) sustain that global companies need also competent people in other non-executive positions for their subsidiaries. For example, they may need engineers. For example, a given firm will hire and use specialists in software and in computers. There are two possibilities: a. filling all (or part of) subsidiaries management or specialized positions with nationals or b. hiring entry-level managers and specialists who have lived abroad or were born and educated abroad and acquired cross-cultural skills for the region. Companies may fetch from the foreign affairs and diplomatic departments or corps. They concur with Czinkota et al 2002 when he argues that the location and the nationality of candidates for a particular job are the key issues in recruitment. A decision will have to be made to recruit within the company or to rely on external talent. Similarly, a decision will have to be made whether to hire or promote locally or use expatriates (or expats); that is, parent-country nationals or third–country nationals (citizens of countries other than the home or host country). All may depend on environmental constraints on the legal, cultural, political and/or economic host front.

3.5        Advantages and Disadvantages of Expatriates

A.        Advantages: 

Quelch & Bloom (1999) determine that the advantages of appointing a national of headquarters country in an overseas post as the expatriate: Knows the company’s products and culture, relates easily and efficiently to corporate headquarters; speaks the verbal and cultural language, has technical or business skills not available locally (in host country), may have special transferable capabilities, for example, opening operations in emerging markets; will protect and promote the interests of headquarters in international joint ventures and acquisitions requiring tight financial control; is unlikely to seal proprietary knowledge and set up competing business; does not put the country ahead of the company(unless she/he goes native); fits the company’s need to develop future leaders and general managers with international experience.

B.        Disadvantages: 

Quelch & Bloom (1999) add that the disadvantages of appointing an expat include: High costs-covering relocations, housing, education, hardship allowance (often exceeding 200% of the home country base). Black-outs: 25% of expats have to be called home easily. Brown-outs: another 30 to 50% stay but under-perform, leading to lost sales, low staff morale and a decline in local goodwill. Prolonged start-up and wind-down time: in a typical three-year assignment the first year is spent unpacking and the third year is spent in packing and positioning for the next move.         A shortsighted focus: expats with a three year assignment tend to focus on the next career rather than on building the local company. Difficulty in finding experienced managers willing to move because of spouse’s career, children’s schooling, or life-style and security concerns (for example, in Middle-Eastern countries). Expat’s concern: about negative out-of-sight, out-of-mind impact on career development. Re-entry problems: a high percentage of expats leave their companies because jobs with similar breadth of responsibility are either not available or not offered. Division of senior managers to overseas markets is difficult especially for similar companies that do not yet have a lock on their domestic markets. Czinkota et al (2005, page: 480).

6.  Recommendations to International Managers

1. Selecting and Recruiting for Asian market (s):

We learn from different authors and academics, including Lewis (2004), Elashmawi (2001) and Morrison, Conaway & Borden (1994) that Asians value mostly harmony (of family and/or group), relationships, seniority, authority and reputation. We also found that Chinese are quite everywhere (in mainland, Taiwan, Singapore, Hong-Kong, Thailand and Malaysia). I advise that the Asian subsidiary headquarters be located in Hong-Kong, mostly because Hong-Kong is one of the Asian cities having accumulated profound Western influences and cultural values, where Western-style churches, schools and kitchen and entertainment are available, in addition to other religions temples and mosques. Any firm has still options of opening sales offices in New Delhi, Tokyo, Jakarta, Singapore, Shangai, Macao, Kuala Lumpur, Bangkok, Manila, etc. To reduce probabilities of cultural clashes between the firm and its Asian counterpart firms, the Senior Manager of the Asian headquarters should be fully versed in Asian cultures. It is recommended this individual is a male, over 45 years old, married, speaking either Mandarin or Cantonese (preferably Mandarin). This man should have global marketing skills but mostly, he must be used to ascriptive culture and to collectivist values. He will need to negotiate and deal with Chinese, Koreans and Indonesians, who will consider testing him on all those Asian cultural values (Huo, Huang, and Napier (2002). Of course, he will require utilizing various other connections when negotiating with Japanese, Singaporeans, Taiwanese, Thais, etc. However, his job will be much easier if he can understand and master all main Asian cultural values and he must respect all of them.

2. Selecting and Recruiting for Arab and Middle-Eastern Market (s)

According to Elashmawi (2001) and Lewis (2004), this is a world of masculinity and collectivism. The recommendations made above for Asia remain good for the Middle-Eastern markets, except that instead of mastering Mandarin or Cantonese, he will need to speak Arabic and have an Arabic profound background. I’d advise he is of Arabic origin and a Muslim. Cairo was chosen as regional headquarters.

4. Selecting and Recruiting for European & North-American Market(s)

According to Czinkota et al (2002) and Francesco & Gold (2005), the candidates will be first selected according to their qualifications and competencies as this time we are dealing with individualistic cultural values. It will depend also on the employees’ wish, if it is an internal recruitment. Currently, most subsidiaries in Europe are managed by host country nationals. If our firm opts for an expatriate from Canada to Europe, considerations should be taken regarding the many European languages. For example, she/he should speak German, Dutch, Spanish, French or Danish if she/he goes to head offices in Germany, Netherlands, Spain, France/Belgium or Denmark. Since we said Brussels would be the headquarters, English and French would be enough. Canadian and U.S. markets share similarities in candidates selecting and recruiting. Individual qualifications are the 1st criteria. Job competence, adaptability factors and personal characteristics, such as commitment are also very important because living and working abroad isn’t easy.

Summary:

Czinkota et al (2002) argues that in general, in its approach to recruitment and selection, an organization considers both headquarters practices and those prevalent in host countries of its subsidiaries. For example, women will negotiate rarely a contract in the Middle-East. A very young graduate in MBA would hardly gain esteem and trust in Korea.

4.        International Human Resource Development System.

Theuerkauf (1991) gives us an example of an international management development system, which I believe should be explained here immediately after the tasks of selecting and hiring for international positions have been carried out an before we start exploring other IHRM tasks, including training, career development, performance, compensation...

Tenure years

Source: Adaptation from Figure 18.1, Czinkota et al (2002, page: 478).

The given example above shows that going international or global requires a proven patience and that only after 5 to 10 years, a global company can start relying on its own internally trained, nurtured international experts and specialists, amongst some can even be promoted to top management positions (after 10 years).

Another interesting aspect is that, according to Czinkota et al (2001) and Barlett & Ghoshal (1992), in global corporations, there is no such thing as a universal global manager. Instead, there is a network of global specialists in four general groups of managers, who must work together:

1. Global business production managers have the task to maintain and further the company’s global scale efficiency and competitiveness.
2. Country managers have to be sensitive and responsive to local market needs & demands but, at the same time, be aware of global implications.
3. Functional managers have to make sure that the corporation’s capabilities in technical, manufacturing, marketing, human resources, and financial expertise are linked and can benefit from each other.
4.  Corporate executives at headquarters have to manage interactions among the three groups of managers as well as identify and develop the talent to fill the positions.

It is recommended that our firm should show clear career paths for managers assigned to overseas and develop the systems and the organization for promotion. This approach will serve to eliminate many of the perceived problems and thus motivate managers to seek out foreign assignment. Then, IHRM will become easy. (Quelch & bloom 1999)

1.       Training and Adaptability Screening:

Francesco & Gold (2005) argue that the training and development function includes planned individual learning, organization development, and career development. It is a recognized professional field known as human resource development (HRD). At international level, many companies have HRD professionals, who are responsible for training and development of employees located in subsidiaries around the world, specialized training to prepare expatriates for assignments abroad, and development of a special group of globally minded managers. According to Marquardt & Engel (1993), the delivery of HRD programs may be centralized or decentralized, ethnocentric or geocentric. When it is centralized and ethnocentric, training originates at headquarters and corporate trainers travel to subsidiaries, sometimes making adaptations to fit the local situation. A centralized geocentric training model develops through input from both headquarters and subsidiaries. Trainers from various positions in the headquarters or subsidiaries could travel to any other corporate location. In a decentralized approach, training is on a local or regional basis, following a polycentric or regiocentric model.

Any of the training models described above may fit our firm. The most important in training is the content and objectives. In either model, there are some adaptations that must be taken to each regional market. Training value is subject to local cultures and external environments. For example, Avitabile and Kleiner (2002) explore how to train employees to work safely in the Mid East. Screening adaptability is another challenging task of multicultural firms HR managers. Avitabile and Kleiner (2002) conclude that no amount of classroom training can cover the myriad of things that can go wrong when interactions breed misunderstandings, tension strains relationships, and instability creates conflict. (Avitabile and Kleiner 2002, page 54). Thus, as conclude Francesco and Gold (2005), the most important aspect of expatriate training is cross-cultural training (CCT) that can be delivered either through cultural briefings, area briefings, cases studies, roles playing, culture assimilator, or field experiences.  In fact, an organization may choose an appropriate CCT method based on three situational factors of the expatriate’ assignment: novelty in the culture, degree of interaction with host country nationals, and novelty of the job (Francesco & Gold 2005: 161). Training doesn’t stop here, because it is imperative to avoid a cultural shock to expats or their family members.

Upon arrival in the host country, the expatriate will be continuously screened for cross-cultural adjustment and adaptability factors. (Black and Gregersen 1991) Avitabile and Kleiner (2002) assert 45% companies provide either method of training.

2.        Recommendations to International Managers

Training in Asia and in Middle-East cannot be done the same way as in Europe or in North America. Global companies should be aware of the existing dissimilarities.

According to Francesco & Gold (2005), in order to maximize training effectiveness, it is important to take into account how trainees learn more effectively, as cultural factors have a strong impact on training practices in different parts of the world. For example, in U.S.A and Canada, where power distance is small, the relationships between trainers and trainees tend toward equality. Trainers and trainees can call each other by first names and trainees can challenge ideas and opinions of the trainers. This can never happen in Asia, nor in the Middle-East, where due to a large power distance, a trainer receives respect and is considered to be an undisputable expert. In Europe, the trainers will be challenged by a large diversity in cultural management models.  In assignment # 1, we saw that Comparative HRD academics found out that there are three most distinctive European Management Models: Anglo-Saxon, French and Germanic. Sparrow 1998 asserts that within Europe, the strong and culturally distinctive (homogeneous) management models in France, Germany, and Scandinavia stand opposed to the Anglo-Saxon model. The Anglo-Saxon model would include UK, US and Canada. Training effectiveness and its value will be different in those models.

As global competition intensifies, note Francesco & Gold (2005), it is increasingly important for successful companies to have a group of globally minded managers (who have a global perspective). Czinkota et al advises to develop such managers through the international resource management development strategic systems. It is important that the firm includes in this group both PCNs and managers from other countries. Having one or more international assignments, working on cross-cultural and cross-national teams and projects, and learning other languages and cultures will contribute greatly to making a manager more globally minded.

5.        Personnel Performance Evaluation

According to Francesco & Gold (2005), Performance evaluation is the systematic appraisal of employee’s performance within the organization. Performance evaluation is a challenging task for any domestic organization and it becomes even more complex for multinational enterprises. At the international level, the complexity of performance evaluation is greater because the organization must evaluate employees from different countries working in different subsidiaries. The need for consistency across subsidiaries for performance comparisons can conflict with the need to consider the cultural background of employees to make the evaluation meaningful. Ramamurthy and Carroll (1998) argue that collectivist workforces, such as Asians and Arabs, will not like the type of formal appraisal systems that are common in most Western firm and, of course, in the Toronto headquarters. Communication style may have an influence.

Therefore, the Company will apply different performance evaluation methods in its different subsidiaries. In Asia and the Middle-East, where group and family harmony, authority and seniority  are more valued than just competency or professionalism, the firm will have to use methods that are different from those used in Europe, Canada and USA, where individualism is prevalent and where employer and employee can discuss issues.

4. Compensation and Benefits

Briscoe (1995) and Francesco & Gold (2005) define “compensation and benefits” as the function that develops and administers the salary system and other forms of remuneration such as vacation and sick pay, health insurance, and pension funds. 

In developing an international system of compensation and benefits, an organization has two primary concerns: The first is comparability (Briscoe 1995). An effective compensation system assigns salaries to employees that are internally competitive and comparable within the marketplace. For example, the salary of a senior manager is higher than that of a supervisor, and each position should receive an amount within the local market range. The international organization must also consider the salary of people who may transfer from other locations. Cost is the 2nd major concern (Dowling et al 1994). Organizations strive to minimize all expenses, and payroll is one of the largest. Labor costs vary widely by country, and companies often subsidiaries in countries that have lower wage rates than at home. Compensation and benefits reflect local labor market conditions even when an organization takes an ethnocentric or geocentric approach. The availability of qualified local people to fill positions, prevailing wage rates, the use of expatriates, and local laws interact to influence the level of compensation and benefits. Security status is also important as some companies are obliged to cover monetarily the risks an expatriate or a local staff takes when working in a volatile and war torn areas such as in Iraq today.

Czinkota et al (2002) and Francesco & Gold (20050 argue that a company should usually develop a policy, which could apply globally, to offer salaries and benefits representing a specific market level. For example, a large successful multinational that emphasizes the quality of its products and employees may have a global policy to pay the highest wages everywhere it operates. Another company could offer top salaries in the country where it does research and development yet pay average wages in the country where it manufactures. Culture may influence the value that people in different societies put on various compensation and benefits practices. For example, more masculine countries like Asian and Arab countries make use of flexible benefit programs and are less likely to provide workplace childcare, opportunities for career breaks, or maternity leave (Schuler and Rogovsky 1998). Childcare is a crucial issue in Europe and Canada.

1. Recommendations to International Managers

In Asia and in the Arab world, the firm should consider the high value of seniority and family security, high power distance and masculinity. Thus, preferred practices should be more certainty in compensation systems (seniority, or skill-based), centralized bureaucratized but separate pension system with many controls and protections. In Europe, we still have some uncertainty avoidance, individualism and feminine cultures. Compared to Asia, there is lower power distance in Europe. Thus, companies will use a combination of defined contribution pension plan with flexible plan implementation.  A same type of pension plan will be offered to all employees and family friendly policies (childcare) will apply to enhance quality of life. Laws are tough. In USA and Canada, individual incentives and flexible benefits programs are advised. For executives, stock options and ownership plans may apply. (Hempel 1998)

7.  Management of Labor Relations

Francesco & Gold (2005) note that the labor relations function defines and identifies the roles of management and workers in the workplace. The concept of labor relations varies greatly in different parts of the world. In USA and Canada, for example, labor relations are often formal relationship, sometimes antagonistic, between labor and management defined by a union contract. In Japan, the relationship between management and unions is cooperative, and management often appoints union leaders (Hodgetts and Luthans 1994). Dowling (1994) assets that in many countries governments regulate labor relations practices. Consequently, in this function more than HRM functions, an organization may have to be polycentric. However, advises Wahl 2002, even though labor relations are local-level issues it is good to have a corporate strategy to coordinate labor relations policy across subsidiaries. 

1. Recommendations to International Managers

Labor relations issues should be dealt with separately, country per country, but there must be a coordination of all the labor relations function at HQ of Toronto.  Indeed, as claim Czinkota et al (2002), none of the firm’s objectives can be realized without a labor force, which can become one of the firm’s major assets or one of its major problems, depending on the relationship that is established and maintained. Because of local patterns and legislation, headquarters’ role in shaping the relation is mainly advisory, limited to setting the overall tone for the interaction. However, many of the practices adopted in one or more markets or regions, may come easily under discussion in another (or other), making it necessary for multinational corporations to set general policies concerning future labor relations.   Any firm should view its labor relations strategy from three perspectives:                                                                        

 (1). the participation of labor in the affairs of the firm, especially as it affects performance and well being.  (2). the role and impact of the unions on relationship.

 (3). specific human resource policies in terms of recruitment, training and development.        

Firms should understand that labor cannot be considered anymore as a simple service that can be bought. Increasingly, workers are taking an active role in the decision-making of their firms and in issues related to their own welfare. Some countries like Japan, have understood a long time already that incorporating labor unions leaders in their top management is more productive than excluding them. But, this also is explained by the high value of harmony, which defines Asians. In Iceland and China, unionization can reach 90%. Labor and trade unions are spread in Europe, but some countries limit these unions power through appropriate legislations that don’t oblige Corporate to conduct collective bargaining with workers’ unions (Duane 2001). In Arab countries, firms may need to cooperate with local governments. In USA and Canada the company will be careful because even if North –American labor unions seem harmless, they may become very tough and involve international federation of trade unions when they feel that a global firm is doing wrong to the staff. (Jay Mazur 2000). The organization should be aware that many countries don’t like the use of expatriates.

8        Implications for Managers of Multicultural Organizations

Note:

The following will serve as general conclusion to this paper and it constitutes the last and final recommendations to Transnational Software Developers Ltd.

8.1        Particularities of any Corporate Global Strategy

Elashmawi (2001) insists that international managers should be aware of the cultural and cultural complexities met when going global or when expanding business across borders. For example, it might seem for many foreigners that dealing with all Europeans is the same. It is definitely not. Elashmawi (2001) highlights the diversity of European Cultural Values. Europeans are characterized by their diversity and doing business, conducting negotiations or communicating in France, for example, is not the same as in Germany, Ireland or Italy. The firm should be aware of the diverse dissimilarities within the European workforce’s management practices, as well. The advice is also true for compensation and benefits management, labor relations, etc. There are many European management models, of which the most important are French, Germanic, Scandinavian and Anglo-Saxon. While Asians may have common cultural values encountered all over in Asian countries, Lewis 2004 argues that each Asian country has its own cultural particularities. Western businesspeople have frequent cultural clashes with Japanese and South-Koreans. Those clashes are not necessarily caused by the same reasons. For example, Koreans conduct business with a quasi military style. Chinese and Japanese adopt a softer style. It doesn’t make them easier (than Koreans) to negotiate with! International managers should know that.

        8.2        Best IHRM Practices:

Francesco & Gold (2005) argue that there are no best practices applicable to different cases, in different regions, under different environmental constraints. However, each organization should have an organizational culture applicable everywhere with additional local re-adjustment. Francesco & Gold (2005) warns that organizations recruiting PCNs and TNCs must deal with the complexities of employing and moving people outside home countries. Employing expatriates, although it may be a good business decision, is expensive. Parker and Janush 2001 add that because of the additional compensation required, an expatriate’s remuneration package could be two to three times the base salary. Consequently, successfully managing all aspects of expatriate HRM is extremely important. Black et al (1999) argue that an expatriate returning home before the end of his/her assignment may cost a company $200000 to $1.2million. Many scholars, including Macnamara (2004), insist on the training for multicultural and cross-cultural communication skills Thus, managing a multicultural organization is a daunting task. Some claim that IHRM practices are converging under globalization while other academics insist on the importance of HRM skills that cannot be imported wholesale into a given country. It is recommended to have managers’ pools (Francesco & Gold 2005).  

9.         List of References:

1. Adler, N. J., 1994, “Competitive Frontiers: Women Managing across Borders”. MA: Blackwell
2. Azevedo, A., Drost, E. A., & Mullen, M. R., 2002, “Individualism and Collectivism…”, Cross Cultural Management, 9/1; ABI/INFORM global: 19-29
3. Avitabile, L. and Kleiner, B.H, 2002, “Training Employees to Work in the Mid East Safely”, Cross Cultural Management; 9, 1: ABI/INFORM Global
4. Banutu-Gomez, M. B. , 2002, “Leading and Managing in Developing Countries…”, Cross Cultural Management, ABI/INFORM Global: 29-41
5. Barlett, and Ghoshal, 1992, “What is a Global Manager?” , Harvard Business Review, 9/10,
6. Black, J. S., and Gregersen, H. B., 1991, “Antecedents to Cross-Cultural Adjustments for Expatriates in Pacific Rim Assignments”,  Human Relations, 44: 497-515
7. Black, J.S., Gregersen, H.B., Mendenhall, M. E.,  and Strohl, L. M., 1999, “Globalizing People through International Assignments”, NY: Addison-Wesley, Longman
8. Briscoe, D. R., 1995, “International Human Resource Management”, Upper Saddle River 
9. Chong, K. S., and Park, J., 2003, “National Culture and Classical Principles  of Planning”,
10. Czinkota et al, 2002, “International Business”, Thomson Learning, Southwestern, 6th Ed.
11. Dowling et al, 1994, “International Dimensions of Human Resource Management”, 2nd Ed.
12. Dresser, N., 1996, “Multicultural Manners”, John Wiley & Sons, Inc, Canada
13. Elashmawi, F., 2001, “Competing Globally: Mastering Multicultural Management and Negotiations”, Butterworth Heinemann, Boston, MA
14. Francesco, A. and Gold, 2005, “International Organizational Behavior”,
15. Harvey et al, 2000, “Human Resource Management”, Vol. 39: 381-394
16. Hempel, P. S., 1998, “Designing Multinational Benefits Programs: The role of national culture”,  Journal of World Business, 33: 277-294
17. Hodgetts, R.M., and Luthans, F., 1994, “International Human resource Management”, 2nd Ed.
18. Hofstede, G., 1980, Culture’s Consequences”,
19. Hofstede, G., 1991, “Cultures and Organizations”,
20. Horn, P (Prof), 2005, “Multicultural Management”, Course No # ISM- 924 DBA/PhD online,
21. Lewis, R., 2004, “When Cultures Collide: Managing Across Cultures”, Nicholas Brealey, UK
22. Macnamara, J. R., 2004, “The crucial role of research in multicultural and cross-cultural communication”, Journal of Communication Management, 8, 3; ABI/INFORM Global: 322-334
23. Marquardt, M. and Engel, D. W., 1993, “Global Human resource Development”, Upper Saddle River, New Jersey.
24. Mazur, J., 2000, “Labor’s New Internationalism”, Foreign Affairs, January/February: 79
25. Mead, R., 1998,“International Management”, Blackwell, 2nd Ed. UK, US
26. Mello, J. A., 2006, “Strategic Human Resource Management”, Southwestern Thompson, 2nd Ed. 
27. Morrison, T., Conaway, W. A., & Borden, G, A., 1994, “How to do Business in Sixty Countries: Kiss, Bow or Shake Hands” Adams Media Communications, MA, US
28. Ogbor, J. O., & Williams, J., 2003, “The Cross-Cultural Transfer of Management Practices,” Cross Cultural Management, ABI/INFORM Global:3-23
29. Parker, G., and Janush, E. S., 2001, “Developing Expatriate Remuneration Packages”, Employee Benefits Journal, 26/2:3-5
30. Quelch, J. A., & Bloom, H., 1999, “Ten Steps to a Global HR Strategy”,  Strategy and Business, 1: 18-39
31. Ramamurthy, N., and Carroll, S. J., 1998, “Individualism/Collectivism Orientations…”
32. Schuler, R. S., and Rogovsky, N., 1998, “Understanding compensation Practice…”
33. Selmer, J., and Leung, A. S. M., 2003, “International Adjustment of Female vs. Male Business Expatriates”, International Journal of Human Resources Management, 17/7:1117-11131
34. Sparrow, P. R., 1998, “Reappraising psychological contracting”, ABI/INFORM, Global: 30-63
35. Theuerkauf, I., 1991, “Reshaping the Global Organization”, Mc Kinsey Quarterly, 3: 103-119
36. Thompson Jr., A. A., & Strickland III, A. J., 2003, “Strategic Management”, McGraw Hill Co.

.             _____________________END OF DOCUMENT#3_____________