Global Corporate Strategy: Multinational Enterprises Essay

Question:

Discuss about the Global Corporate Strategy for Multinational Enterprises.

Answer:

Reflective Essay on International Human Resource Management

Importance of International Training and Development

There are many training and development programs included in the international human resource management. Most of the Multinational Enterprises (MNEs) focuses on international HRM with a global approach. It is a fact that an improved cultural adjustment helps reducing expatriate failure. According to Aswathappa (2013), therefore, every company should focus on four things while conducting training session for cultural adjustment. At first, focus should be given on understanding different behaviours of cultural diversity. Bratton and Gold (2012) discussed, the training involves creation of awareness about it. Cultural diversity related issues could be removed if the employees and the organization start respecting the local cultures. Only then the process of adjustment can be started. Understanding the psyche process is another part of the training. At last, they should practice the way they should behave in the new overseas business environment. To understand cultural adjustment better, the U-shaped graphical representation is included into the learning module. The graph defines the phases of cultural adjustment. The study reveals the assistance of the company as the most positive predictor during the cultural adjustment process. However, stages of cultural adjustment are based on two factors. These are time and adjustment. During the phase1, the person is a tourist coming to a new place, among new people, and new environment. He found himself in a different culture. Then comes the phase 2, in which the tourist faces a crisis. The reason of this crisis might be culture shock. In such a situation, the tourist goes through the problems of language barrier, information overload, homesickness, infinite regress, and boredom. All these act as major barriers in creating new relationships with the new people. Therefore, the crisis occurs and the adjustment graph is seen falling downwards. In the third phase, which is the pulling up stage, the adjustment graph moves upwards with time as the tourist consistently make effort to adjust him with the new situation. As discussed by Buller and McEvoy (2012)., as a result of the training process, the tourist starts adjusting with time and the graph is seen coming to n equal position as with the phase 1. It is considered as the fourth stage which is named the adjustment phase.

Availability of Cross-Cultural Training in MNEs

According to Griffin and Pustay (2012), cross-cultural training involves implementation of management strategies and inclusion of training policies. These training policies are known as Cross-Cultural Training polices or CCT. Lenartowicz, Johnson and Konopaske (2014) discussed that most of the Australian Multinational Enterprises or MNEs have included these CCT programs. However, the study has helped me gain knowledge about the availability of CCTs in most Australian MNEs. It is found that they provide highly precise and accurate CCTs. The learning module included the Brookfield’s estimation on the availability of CCTs in 2009, 2011, and 2014 (Pekerti et al. 2014). MNEs have started focusing not only on the cultural adjustment of the employees but also on the cultural adjustment of the spouse and other members of the family. Therefore, the percentage of CCT provided only to the employees has declined from the percentage given to all the members of the family. It accelerates the process of adjustment. It is because most of the employees relocate along with their family. Therefore, the cultural shock persists even in the home environment apart from the workplace environment. Even the spouses and the other members of the family are found interested in going through the training process and remove the barriers of culture. It has proved that the MNEs have adopted an approach of overall development that eventually helps them to grow.

I have found that the most of the MNEs have given importance to providing CCTs to the whole family of the new employees. It is a positive factor because the cultural adjustment should take place not only within the workplace but also within the home environment. As opined by Purce (2014), most of the employees take their families with them while coming to a new place in search of a job. The chances are that the family members too feel alienated in a new place. Therefore, the employee has to bear the crisis both in workplace and in home. The cross-cultural training programs accelerate the process of adjustment and help both the employee and the other members in the family to cope better in a new environment.

Cross-Cultural Training Model

The cross-cultural training process follows variety of methods for teaching the cross-cultural skills to the employees and their family members. This training framework is known as Mendell and Oddou paradigm propounded in 1986. They have improved the training methods given by Tung in 1982. The main objective of the improved training process is to initiate interaction with foreign people within a foreign culture. All the activities included in the model are time bounded. This model outlines the need of the particular denominators in the training process. Involving the cultural elements into the content of the training and integrating job-related tasks of the individuals, this method tries to adjust the employees with the new workplace culture.

According to Reiche et al. (2014), some of the major approaches of CCT models are Immersion approach, Affective approach, and Information-giving approach. They have outlined three elements of this training that include training methods, level of rigor, and duration of the training. The Immersion approach takes place from one to two months. The level of rigor is high in the Immersion approach. The training session in this approach involves assessment centre, field experiments, simulations, sensitivity training, and extensive language training. It focuses on the practical task-oriented training sessions for the employees so that they learn from experiment (Hendry 2012). Foreign language learning is given supreme importance as an important factor of cultural acquisition. Employees are trained to understand each other’s language, communicate and express their emotions and develop sensitivity among them. The next approach is Affective approach. It is a training process involving one to four weeks. Shen and Lang (2009), opined, during the Affective approach, the employees are trained to assimilate with the foreign culture. Other elements of training include role playing, critical incidents, cases, stress reduction training, and moderate language training. According to Thomas and Peterson (2014), this approach helps increasing the self-esteem of the expatriate. They start adopting a new role in the new environment. They are made to exercise the stress reduction activities on a regular basis for a permanent solution. Moderate language training develops interaction with the new people. They are also trained to adjust themselves in a critical situation. The level of rigor in this phase is moderate.

Another major phase is Information-giving approach. It includes Area briefings, cultural briefing, films or books or videos, Use of interpreters, and ‘survival-level’ language training. The level of rigor is low in this stage. As found from the content of the training process, this approach incorporates various cultural elements and involves the expatriate in a process of adoption. They are made to understand the foreign culture and communicate it with foreign people.

Effective Pre-Departure Training Programs

The CCT program includes expatriate training methods. One of the most important training methods is the pre-departure training. The effective pre-departure training should include cultural awareness program. As discussed by Tran (2016), the expected outcome is to make the expatriates aware of the foreign culture. They are learnt to appreciate the culture in which they will have to survive. Before adopting the culture, they should learn to appreciate various aspects of it. If they fail to understand the host culture, they will face difficulty while dealing with international assignment. It is true that composition of program varies from one country to another. The type of assignment that the expatriate is going to undertake, the duration of the assignment or meeting, and the purpose of the assignment all depend on the culture of that country. According to Tyson (2014), after the cultural awareness programs, preliminary visits are undertaken. It helps the employees to orienting with the foreign culture. They are provided a realistic preview of how the business of the foreign culture works. It enables them to understand any assignment better. After the orientation is done, the expatriates are able to predict the sustainability of the project. During the training session, the average length of the visit is one week. The third part of the training includes language training. It is found that most MNEs do not consider it as an important element. Training in English language is necessary as it is considered as the international language. Most of the MNEs think that English language training is unimportant. However, the real situation demands English language to be taught precisely. It is important to learn the foreign language for a better understanding of the tasks. In a competitive market, the employees will lag behind if they are not well conversant with the foreign language. It affects the knowledge management too. During the practical assistance stage, the employees are provided information and assistance about their relocation. They are trained to adopt the new environment. It is done by providing the local relocation specialists during the training process and giving more extensive language training.

It is seen that the pre-departure training program has achieved great value in 2009, but in 2014 the high-value has decreased. However, it has gained a great value in 2014. The estimation is made by Brookfield. In 2009, the neutral value of it has also increased as compared to 2011 and 2014.

Overview of Repatriation figures

It is found that most employees with their experience in living and working in a foreign place leave their company after gathering experience. They leave in search of a better assignment that benefits them. Due to lack of an attractive career position, they return to their own country for a better opportunity. The turnover that takes place within one year had decreased to 24% in 2012 (Aswathappa 2013). In 2012, 26% expatriate had returned to their own country within one and two years. The rate was 24% in 2011. In 2012, 28% expatriate had returned to their own country within two years. The rate has increased by 2% from 2011. The data has proved the significance of CCTs in MNEs (Aswathappa 2013).

Re-Entry and Career Issues

The Re-Entry process follows the pre-departure training. It is already discussed that during the pre-departure training, the employee is made to interact through media and other communication protocols. However, in the re-entry process, they are given new assignment. They are provided with organizational reconnection. According to Tyson (2014), they get assistance of non-work factors, and they get conversant with rituals and ceremonies. This repatriation process helps them to get out of the culture shock. They develop an integrated global perspective.

Factors Influencing Repatriate Adjustment

Various job-related factors and social factors influence the repatriate adjustment. Career anxiety takes birth from isolation and workplace changes. They face difficulty while coping with their new roles. Cultural diversity gives birth to disturbed employee relationship. They are expected to do work adjustment in such a situation. Social factors such as family adjustments, social networks and effect on partner’s career influence the repatriation.

Most Useful ways to Reduce Expatriate Turnover:

It is estimated that the expatriate turnover can be reduced by creating opportunity for them to use their experience. The percentage is 47%. It is the most useful way. Other ways include support to their career, giving recognition, and giving a suitable choice of position after return (Tran 2016).

The Way MNEs Should Repatriate

The MNEs should focus on identification of implicit knowledge sharing, and reducing the resistance to the employees at the workplace. According to Ulrich (2013), they should incorporate more formal activities include mentoring or coaching, organizing seminars, and developing knowledge disseminating teams. After that they should link the repatriation process to outcomes. The international experience of the employees should be valued. Focus should be given on staff availability and retention, organizational commitment, and knowledge sharing.

Knowledge Transfer

Knowledge transfer within the workplace is an effective tool of Human resource management. It should be treated as a one-way activity. As a result, employees should develop their local management talent so that they could do project related assignments for the company and leave. The main reason behind sending the expatriates is to supplement the national staff capacity (Ulrich 2013).

References

Aswathappa, K. 2013. Human resource management: Text and cases. Tata McGraw-Hill Education

Bratton, J., and Gold, J. 2012. Human resource management: theory and practice. Palgrave Macmillan

Buller, P. F.,and McEvoy, G. M. 2012. Strategy, human resource management and performance: Sharpening line of sight. Human resource management review, 22(1), 43-56.

Griffin, R. W., and Pustay, M. W. 2012. International business. Pearson Higher Ed.

Hendry, C. 2012. Human resource management. Routledge

Lenartowicz, T., Johnson, J. P., and Konopaske, R. 2014. The application of learning theories to improve cross-cultural training programs in MNCs. The International Journal of Human Resource Management, 25(12), 1697-1719

Pekerti, A. A., Moeller, M., Thomas, D. C., and Napier, N. K. 2014. n-Culturals, the next cross-cultural challenge Introducing a multicultural mentoring model program. International Journal of Cross Cultural Management, 1470595814559532.

Purce, J. 2014. The impact of corporate strategy on human resource management. New Perspectives on Human Resource Management (Routledge Revivals), 67.

Reiche, B. S., Lee, Y. T., and Quintanilla, J. 2014. Cross-cultural training and support practices for international assignees. The Routledge Companion to International Human Resource Management, 308.

Shen, J., and Lang, B. 2009. Cross-cultural training and its impact on expatriate performance in Australian MNEs. Human Resource Development International, 12(4), 371-386

Thomas, D. C., and Peterson, M. F. 2014. Cross-cultural management: Essential concepts. Sage Publications.

Tran, B. 2016. Communication (Intercultural and Multicultural) at Play for Cross Cultural Management within Multinational Corporations (MNCs). Handbook of Research on Impacts of International Business and Political Affairs on the Global Economy, 62.

Tyson, S. 2014. Essentials of human resource management. Routledge.

Ulrich, D. 2013. Human resource champions: The next agenda for adding value and delivering results. Harvard Business Press.

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