International Recruitment Methods -Ethnocentric approach- Polycentric approach- Regiocentric approach- Geocentric approach
While recruiting people for international operations, the international HR managers must identify the global competitiveness of the potential applicants at the time of the recruiting process. It is essential that the workforce of an international organization is aware of the nuances of international business. Understandably, the company must keep international knowledge and experience as criteria in the recruitment and selection process.
Besides, the international HR department must have a fairly good idea about the skills and availability of human resources in different labour markets in the world. The HR department must have the capacity to foresee the changes in these markets and exploit those changes productively. A truly international HR department would insist on hiring people from all over the world and place them throughout the international business operations of the organization. Approaches to Recruitment in IHRM Though the general aim of any recruitment policy is to select the right people for the right task at the right time, the HR department of international companies may adopt one of the following three specific approaches available for recruiting employees for global operations.
The Immigration Reform and Control Act of 1986 (IRCA) bars employers from hiring individuals who are not legally entitled to work in the U.S. Employers must verify work eligibility by completing Form I-9 along with required supporting documents. IRCA also prohibits employers from discriminating in hiring, firing, recruiting, or referring on the basis of national origin or citizenship status.
H-1B workers may be employed temporarily in a specialty occupation or as a fashion model of distinguished ability. A specialty occupation requires theoretical and practical application of a body of specialized knowledge along with at least a bachelor’s degree or its equivalent. An H-1B alien may work for any petitioning U.S. employer for a maximum period of six years.
International recruitment methods
1. Ethnocentric approach
Countries with branches in foreign countries have to decide how to select management level employees. Ethnocentric staffing means to hire management that is of same nationality of parent company.
Regio centric approach
When a company follows the strategy of choosing only from the citizens of the parent country to work in host nations, it is called an ethnocentric approach. Normally, higher-level foreign positions are filled with expatriate employees from the parent country. The general rationale behind the ethnocentric approach is that the staff from the parent country would represent the interests of the headquarters effectively and link well with the parent country. The recruitment process in this method involves four stages: self-selection, creating a candidate pool, technical skills assessment, and making a mutual decision. Self-selection involves the decision by the employee about his future course of action in the international arena. In the next stage, the employee database is prepared according to the manpower requirement of the company for international operations. Then the database is analysed for choosing the best and most suitable persons for global assignments and this process is called technical skills assessment. Finally, the best candidate is identified for foreign assignment and sent abroad with his consent.
The ethnocentric approach places natives of the home country of a business in key positions at home and abroad. In this example, the U.S. parent company places natives from the United States in key positions in both the United States and Mexico.
2. Polycentric approach
When a company adopts the strategy of limiting recruitment to the nationals of the host country (local people), it is called a polycentric approach. The purpose of adopting this approach is to reduce the cost of foreign operations gradually. Even those organizations which initially adopt the ethnocentric approach may eventually switch over lo the polycentric approach. The primary purpose of handing over the management to the local people is to ensure that the company understands the local market conditions, political scenario, cultural and legal requirements better. The companies that adopt this method normally have a localized HR department, which manages the human resources of the company in that country. Many international companies operating their branches in advanced countries like Britain and Japan predominantly adopt this approach for recruiting executives lo manage the branches."
The polycenlric approach uses natives of the host country to manage operations in their country and natives of the parent country to manage in the home office. In this example, the Australian parent company uses natives of India to manage operations at the Indian subsidiary. Natives of Australia manage the home office.
Indians popular choice for senior roles at Asian companies
ET Bureau| Jul 10, 2018
Nikon and Sony have appointed Indians to lead their local operations, which were earlier managed by the Japanese. Asian consumer electronics makers are increasingly placing their trust on Indian executives, especially at a time when several of them are struggling in their home turf, or finding the going tough in the largest markets, and are expecting India to play a bigger role when they are expanding to emerging markets.The number of expats in senior roles in the Indian arms of Sony, Panasonic, Hitachi and Daikin too have come down, while Samsung too now has Indian executives in their global think tank. At Daikin India, Indian executives have replaced expats in seven critical functions like deputy plant head, senior vicepresident (tech support) and general managers for service, HR (factory) and R&D. In Panasonic, expats in mid-tosenior roles are now 20%, compared with 40% three years ago
Hitachi Air Conditioning India said overseas entities have begun to realise that business is best understood by locals and have started handing over major roles to them. The overseas entities send in their representatives from various departments to share best practices being followed by various entities all over the globe. The process is laid down between local entity and global teams and then those processes are monitored and administered.Empowering domestic leaders helps companies to understand the pulse of the market, aids in faster decision making to facilitate growth, gets the best of local knowledge to promote R&D and deliver customised products for local customers.
2012, July: Indian Information Technology companies supported nearly 2.8 lakh jobs in America in the year 2011 by way of foreign direct investment through acquisitions of IT companies. India invested nearly $ 5 billion in foreign direct investment. Top Indian IT companies like TATA, HCL technologies India's fourth largest software export, Infosys and Wipro stepped in United States to set up their subsidiaries and recruited American nationals from colleges and experienced professionals who had the local knowledge and domain expertise. local employees have the requisite knowledge and understanding of culture, people and were in a particular region.
3. Geocentric approach
When a company adopts the strategy of recruiting the most suitable persons for the positions available in it, irrespective of their nationalities, it is called a geocentric approach. Companies that are truly global in nature adopt this approach since it utilizes a globally integrated business strategy. Since the HR operations are constrained by several factors like political and ethnical factors and government laws, it is difficult to adopt this approach. However, large international companies generally adopt the geocentric strategy with considerable success.
For international recruitment, especially on foreign soil, organizations generally use manpower agencies or consultants with international connections and repute to source candidates, in addition to the conventional sources. For an effective utilization of the internal source of recruitment, global companies need to develop an internal database of employees and an effective tracking system to identify the most suitable persons for global postings.
The geocentric approach uses Ihe best available managers for a business without regard for their country of origin. In this example, the UK parent company uses natives of many countries at company headquarters and at the U.S. subsidiary.
4. Regio centric Approach
The Geocentric Approach is one of the methods of international recruitment where the Multi National Companies recruit the most suitable employee for the job irrespective of their Nationality.
The Regio centric approach uses managers from various countries within the geographic regions of business. Although the managers operate relatively independently in the region, they are not normally moved to the company headquarters.
The Regio centric approach is adaptable to the company and product strategies. When regional expertise is needed, natives of the region are hired. If product knowledge is crucial, then parent-country nationals, who have ready access to corporate sources of information, can be brought in.
One shortcoming of the Regio centric approach is that managers from the region may not understand the view of the managers at headquarters. Also, corporate headquarters may not employ enough managers with international experience.
The regiocentric approach places managers from various countries within geographic regions of a business. In this example, the U.S. parent company uses natives of the United States at company headquarters. Natives of European countries are used to manage the Italian subsidiary.
Manufacturing cos recruit expats in key artificial intelligence, digital roles.
Indian manufacturing companies are going all out to woo expat talent in digital, artificial intelligence and other new-age technologies, as they seek to strengthen their global footprint with improved products. Companies in sectors such as automobile, industrial, pharmaceutical, chemical and packaging are keen on bringing in people familiar with international best practices who can replicate the quality and precision of developed markets such as North America, the UK, Korea, Japan and Germany. Over the last six months, automaker Mahindra & Mahindra has hired six expats for top-level posts while the diversified Vedanta Ltd in February brought in five expats at senior levels in India. A spokesperson for Hero MotoCorp said several experts have joined the company of late.“There has been an increase in expat hiring in the last six months. Expat hiring isn’t about numbers but about inducting appropriate capabilities and talent,” said Rajeshwar Tripathi, chief people officer, M&M, which last year inducted 15 expats at senior levels. “For critical roles, given the skill sets required, we have been going abroad more often than in the past.” Vedanta has appointed Clint McLachlan as head of plant-1- Jharsuguda and Werner Van Schalkwyk as technical expert- carbon (Jharsuguda). Christopher W Waid has been appointed as chief health and safety officer- tight gas facilities, Cairn Oil & Gas, a Vedanta subsidiary, while Paul Dewar has been brought in as chief health safety & environment officer-iron ore business. Geoffrey Dean Currie has joined as chief health, safety & environment (HSE) officer at the group’s iron ore business. Geoffrey Dean Currie has joined as chief health, safety & environment (HSE) officer at the group’s iron ore business
At Hero MotoCorp, Roberto Restelli joined the company’s research and development team last week, adding to the pool of 15 new senior expat employees who have joined the Indian motorcycle and scooter manufacturer in recent times. “Several automotive experts from around the globe have joined our research and development and global product planning functions,” said a spokesperson of Hero MotoCorp. Some of the recent expat hires at M&M include Steven Woolley, of the UK, who has joined as chief engineer, and Mathew Gausden of the US who is chief engineer.Tripathi cites non-availability of local talent for critical roles as the reason for the increase in expat hiring. “The aim is also to achieve global standards and to create instances to bring in global expertise,” he said.
The roles for which they were hired include product development, ride and handling, vehicle refinement, architecture, technology-led programmes, safety to meet global standards, electric vehicle, etc. Suresh Bose, head – group human resources at Vedanta group, said, “Among the hired expats you will find skills across all verticals and across all areas including safety, environment, health, technical and enabling. They will be responsible for setting up processes in line with the best practices from our industry around the globe.”
Indian companies that are expanding their footprint overseas have to focus on product quality, meeting consumer needs and keeping up with technological advances. These aspects require relevant talent to be brought into their processes. R Suresh, managing director of Insist Executive Search, said that if there are four-five members in the shortlist for a CXO search, two are invariably expats. “We have started the CFO assignment of one of the largest pharmaceutical companies, where out of the five five shortlisted candidates, three are expats,” he said. For certain professions, there is a dearth of talent in the country. These include digital, large world-class manufacturing, research and development, data sciences, artificial intelligence, machine learning, etc., said experts.
K Sudarshan, managing partner – India at EMA Partners, is currently running global searches for CXO-level executives in engineering industry across operations, safety, process excellence and quality functions. “Today, Indian companies are competing across global markets and are increasingly looking to bring in people with knowledge of global best practices and best-in-class experience,” he said.
It is a win-win for the executives too, as they are seeing scale and growth in India. “The slowdown in some overseas opportunities and the value of the “India experience” tag also has got expat talent to look at an India stint more favourably,” said Prabir Jha, president & global chief people officer, Cipla.
Updated: Apr 17, 2018,
World’s highest paid expats
Mumbai, India’s financial, commercial and entertainment capital, tops global rankings for expat salaries, according to a survey conducted by HSBC Bank International Ltd.
Switzerland, the nation that has previously topped country rankings for expat salaries, had two cities in the top five. Zurich, home to banks including Credit Suisse Group AG and UBS Group AG and a tech hub for firms including Alphabet Inc., reported the third highest expat salaries, while Geneva, the base for some of the world’s biggest commodities traders including Trafigura Group and Mercuria Energy Group, was fifth.
Top 7 destinations for women expats
Singapore, Hong Kong, South Korea, Japan, China and Malaysia are the other countries most preferred by expat working women ahead of India, according to an HSBC survey.
The survey was done among 27,587 expats from 159 countries and territories, including India, through an online questionnaire in March-April 2017.
However, when it comes to better career progression, China topped the list with 73 per cent women expats choosing the country, followed by Hong Kong at 64 per cent, India at 62 per cent, Singapore at 60 per cent and Indonesia at 52 per cent, the survey revealed.
Hong Kong was found to be the best country in Asia to acquire new skills with 62 per cent women expats opting for it, closely followed by Singapore at 61 per cent, China at 47 per cent, Taiwan at 44 per cent and Vietnam at 43 per cent.
The survey found Singapore to be the best place to improve earning prospects with 71 per cent women expats choosing the country, followed by Hong Kong at 55 per cent, China at 45 per cent, South Korea at 44 per cent and Vietnam at 42 per cent.
Top five countries for women expats to experience good work or life balance in Asia are Thailand (62 per cent), Vietnam (58 per cent), Singapore and Taiwan (49 per cent each), Indonesia (44 per cent) and Malaysia (42 per cent).
In terms of job security, the survey said, Japan and Taiwan were rated as the best places for women expats (50 per cent), closely followed by Singapore (49 per cent), Hong Kong (47 per cent), India (45 per cent) and China (41 per cent).
The top five countries in terms of work culture for women expats were Singapore (51 per cent), Hong Kong (44 per cent), Vietnam (43 per cent), Indonesia (39 per cent) and China (36 per cent).
For women expats looking to find personal fulfilment at work, the best places in Asia were Singapore (56 per cent), China (48 per cent), India (48 per cent), Hong Kong (47 per cent) and Indonesia (41 per cent).
Even though cultural differences influence the selection procedure to some extent, organizations tend to follow similar criteria and methods worldwide. This is due to the fact that the end objective of any selection process is to choose the most capable persons for the job. The selection criteria for international jobs usually revolve around the five core areas of behaviour, attitudes, skills, motivation and personality. More specifically, the focus of selection for international operations normally includes cultural adaptability, strong communication skills, technical competence, professional or technical expertise, global experience, country-specific experience, interpersonal skills, language skills, and family flexibility. Employers around the world usually rank personal interviews, technical competency and work experience in similar jobs as important criteria for selection. International firms, while choosing employees for overseas operations, usually prefer people with
highly developed technical skills
good language and communication skills
tolerance towards other culture, race, creed, colour, habits, and values
high level of motivation
Finally, at the time of selection for international assignments, an organization should consider the previous overseas experience, family circumstances and cultural-adaptability level of the candidates aspiring for the global jobs.
28% employees In India willing to relocate overseas: Survey
NEW DELHI: More than a quarter (28%) of employees in India are willing to take up a full-time job opportunity overseas for two to three years with at least a 10% increase in pay increase, said a study conducted by research company Ipsos.
Asked about their willingness to relocate within India, about three in ten Indian employees expressed that they are 'very likely' to relocate to another city in India if they were offered a full-time job opportunity in the near future, for a minimum of two years with at least a 10% pay raise and all moving expenses covered, while another 48% said they are 'somewhat likely' to consider the option.
Globally, two in ten (19%) employees across 24 countries said they are 'very likely' to take a full-time job in another country for two to three years with a minimum 10% pay rise. Those most likely to say they would relocate internationally were from Mexico (34%), Brazil (32%), Russia (31%), Turkey (31%) and India (28%).
"Employees from developing economies like Mexico, Brazil, Russia, Turkey and India are willing to relocate to developed countries," said Biswarup Banerjee, head of marketing communications, Ipsos in India. On the other hand, employees from developed countries like Sweden (6%), USA (9%), Australia (10%), Canada (10%), Belgium (11%), Germany (11%) and Japan (11%) are less likely to relocate overseas.
Most common mistakes when hiring international employees
Whether you are looking for international employees who can take on roles that your local job market is unable to handle sufficiently or you just want to diversify your workforce, you will need to avoid the common, costly mistakes that recruiters make when hiring internationally. Or maybe you have opened an international shop and you are now looking for local employees to help you with business localization. To simplify things for you, we have provided you with 5 of the most common hiring mistakes that you cannot afford to make. Be our guest.
1. Prioritizing language skills over core skills
It is common practice for recruiters to hire staff members who are experts in the language of their target market. While this is perfectly in order, it is extremely dangerous to put unnecessarily huge emphasis on a candidate’s language skills to the point of overlooking some more fundamental skills.
Let’s say you are opening shop in China. Your business will stand a great chance to prosper if you can hire competent Chinese professionals to run the business for you. But in the event that you don’t get qualified locals to hire, avoid panic hiring. The best thing to do is to hire foreign talents with a fairly good grasp of the local language and then help them develop their language skills through a specially-designed management development program.
2. Failure to comply fully with set employment/termination laws
Multinational companies are in most cases subjected to more scrutiny than local companies when it comes to their adherence to employment laws. Foreign businesses in China, for example, have to follow stricter reporting structures and administration protocols than their local competitors. If your employees understand the regulatory aspects of running an international office in China, they will use that knowledge against you in case of future employment disputes. The best thing is to understand and comply with all regulations before, during, and after the recruitment process.
3. Avoiding uncomfortable conversations with new employees
Because taking a local business to the international stage can sometimes be intimidating, some employers opt to play safe with their new staff by avoiding direct, uncomfortable confrontations. That way, they conceal their dissatisfaction with some workers’ performance, making problem-solving processes slow and in most cases unfruitful.
According to experts from Globalization Pedia “the only way of getting the most out of your workforce is through having those candid, uncomfortable discussions with them regarding their competency and dedication to their assigned roles. If an employee is too incompetent for your preferences, don’t shy away from firing them. Just remember to follow the right termination laws.
4. Ignoring mandatory employee benefits
In most of Europe and the US, employment laws do not obligate employers to give their employees mandatory annual paid vacations. The decision to or not to grant such benefits rest with an individual employer. However, employment laws in Asia specify sick leaves, paid vacations, and many other mandatory benefits that you have to grant your staff members on an annual basis. There are some limitations to these benefits, which basically attempt to provide checks and balances so that neither the employer nor employee can take undue advantage over the other.
The mistake some employers make is to assume that their international employees will conform to the employment laws as applied to the US or Europe, for example. To avoid future friction with authorities, it is imperative that you familiarize with the employee benefits in the international market from which you are hiring, and then fully comply with each one of them. Be sure to understand how leaves are administered, how the compensation during the leave should be done, the definitions and expectations of a “sick day”, and any other relevant benefits.
5. Hasty hiring
Hiring processes are known to be tedious, lengthy, and sometimes inconveniencing. Everything gets worse when it comes to international hiring. If you are interviewing candidates who don’t speak your language, then you already have a major stumbling block in your way. On the other hand, you can get the best talent for the job but then due to travel hurdles, the process gets more sophisticated and exhausting. Then there is the issue of paperwork and other legal formalities that you have to comply with, most of which are new to you. Lastly, you may not have enough prior information about universities and colleges in the country from which you are hiring, so you may have a hard time authenticating the academic papers that candidates present to you. In the midst of all these hiring challenges, many employers opt to trust their gut and hire people without following the due process. But because you don’t want to keep hiring and firing even before your business gains enough momentum, the best thing to do is to take your time to understand the process, internalize the hiring laws, and learn everything there is to learn regarding local universities and colleges. Take all the time that you need to find the best talent for the job.
Hiring internationally requires many extra steps, bigger budgets, and more research. To avoid making the wrong hire, ensure that you do your homework well and consult widely.