D358 Global Human Resource Management - Set 1 - Part 1

Correct Answer: Managing people across national borders and cultures

IHRM focuses on managing an organization's workforce across national borders, addressing the added complexity of different cultures, legal systems, labor markets, and economic conditions.

Correct Answer: Ethnocentric

An ethnocentric staffing policy fills key positions in foreign subsidiaries with parent-country nationals, ensuring control and consistency but limiting local advancement opportunities.

Correct Answer: Host-country nationals

A polycentric policy staffs foreign subsidiaries with host-country nationals who understand the local market and culture, while the parent country retains key headquarters roles.

Correct Answer: The best person for the job regardless of nationality

A geocentric approach seeks the best-qualified individual for each role regardless of nationality, building a truly international management team, though it can be costly and complex to administer.

Correct Answer: An employee sent to work in a country other than their home country

An expatriate is an employee assigned by their organization to live and work in a country other than their home country, usually for a defined period.

Correct Answer: Advances in communication and transportation technology

Advances in communication and transportation have lowered the cost of operating across borders, allowing firms to source talent globally and requiring HR to manage a geographically dispersed workforce.

Correct Answer: Owns or controls value-adding activities in more than one country

A multinational enterprise owns or controls production or service operations in more than one country, requiring coordinated HR practices across multiple national environments.

Correct Answer: Greater exposure to varied legal, cultural, and economic environments

International HRM must operate across differing legal systems, cultures, currencies, and labor markets, adding complexity and risk that domestic HRM does not face.

Correct Answer: An employee who is a citizen of neither the parent nor the host country

A third-country national is an employee working in a host country who holds citizenship in a country different from both the host country and the parent company's home country.

Correct Answer: Multidomestic strategy

A multidomestic strategy adapts products and practices extensively to each local market, giving subsidiaries substantial autonomy, including in HR policies and staffing decisions.

Correct Answer: Cost reduction through uniform products and processes worldwide

A global standardization strategy pursues economies of scale by offering standardized products and consistent processes worldwide, favoring centralized control including standardized HR practices.

Correct Answer: Aligning talent, structure, and culture with strategic goals

HR supports international strategy by ensuring the organization has the right talent, structures, culture, and capabilities in each location to execute its chosen approach to global markets.

Correct Answer: Sending a parent-country expatriate

Expatriate assignments are usually the most costly because they involve relocation, housing, cost-of-living adjustments, tax equalization, schooling allowances, and repatriation support.

Correct Answer: Converting the expatriate to local terms and conditions of employment

Localization transitions an expatriate onto the host country's local pay and benefits structure, ending expatriate premiums. It reduces cost but must be handled carefully to retain the employee.

Correct Answer: The host country's labor market and skill availability

The host country's labor market conditions, including skill availability, education levels, and competition for talent, directly determine how easily an MNE can staff positions locally.

Correct Answer: The tension between uniform global policies and adapting to local contexts

Global HR constantly balances standardizing policies for consistency, equity, and efficiency against adapting them to comply with local law and fit local cultural and market expectations.

Correct Answer: Understanding local employment law and hiring practices

Employment law varies substantially by country, covering contracts, termination, working hours, and benefits. Understanding and complying with local law is essential to avoid legal and reputational risk.

Correct Answer: Transferred from a foreign subsidiary to the parent company's home country

An inpatriate is an employee from a foreign subsidiary transferred into the parent company's home country, often to build global capability and transfer local market knowledge to headquarters.

Correct Answer: A company that internationalizes very early after founding

A born global firm pursues international markets from or near its inception rather than expanding abroad gradually, requiring global HR capability much earlier than traditional firms.

Correct Answer: Limiting career opportunities and morale for host-country staff

An ethnocentric approach can demotivate local employees by capping their advancement, increase turnover, and produce managers who lack local market understanding, despite giving headquarters tighter control.