14.7 Organizational structure and human resource management  (Page 6/6)

Regiocentric staffing involves staffing within a global region. In this case, a Korean company might fill a position in Italy with a Spanish employee.

Advantages: Moves are often made over shorter distances as employees are relocated. Cultural and linguistic differences may be less pronounced. Employees gain the benefits of cross-cultural experience as they work outside their home country.

Disadvantages: Costs of relocation often remain fairly high. While cross-cultural perspective is built, a truly global perspective may still be lacking. It is also important to note that cultural and language differences will often be significant factors even within region.

All of the above models have strengths and weaknesses which must be seriously considered. In most companies with multiple employees in overseas locations a mixed strategy will often make the most sense both in terms of efficiency and effectiveness. A few select positions may best be filled with either home country or third country nationals while the vast majority of employment positions are usually filled by local employees. Because cross-cultural difference will be encountered in almost any overseas staffing configuration, significant investment in cross-cultural skills training will be extremely valuable.

Trends and challenges in a global hr environment

HR leaders in the 21st century will be challenged to address a number of issues to ensure availability of skilled staff, regardless of which staffing option the MNC pursues. As the global environment continues to develop, MNCs are challenged to address the shortage in global skills and cross-cultural communication barriers. The successful MNC will be able to adapt to the changing environment by globalizing their HR systems and function, and globalizing the workforce mindset. These efforts must also be aligned with business and organizational objectives and will require HR professionals to adopt a new way of thinking to identify and implement new ways of getting work done.

HR systems in the MNC must be aligned with global business imperatives both in terms of pay and performance systems. As the number of overseas transfers increases, MNCs must look to develop general policies and compensation packages rather than negotiating these on a case-by-case basis in order to obtain efficiency and consistency of process. Systems must also be in place for succession planning on a local level as well as a global level. Currently many MNCs are not operating an effective expatriate pipeline, either not sending the most effective individuals to host countries or failing the repatriate them effectively. The trend towards increasing reliance on integrated systems should contribute to better access across borders and regions to better serve expatriate relocation and business decisions.

Another opportunity for MNCs in regards to creating a global workforce will be to standardize and revisit current expatriate compensation packages to include soft benefits. Until now, individuals have often not been willing to take positions abroad because the incentives are solely financial. Historically, systems have not been in place to repatriate smoothly the individual and family following completion of their overseas assignment. Many employees find themselves out of their home HR system, and therefore are not made aware of possibly enticing job opportunities at home. This can be improved greatly simply by creating alignment and communication between the home and international HR department.