Recruiting and Selecting Human Resources

Naturally, companies try to recruit and select qualified managers and nonmanagerial workers
who are well suited to their tasks and responsibilities. But how does a company know the number of
managers and workers it needs? How does it recruit the best available individuals? How does it select
from the pool of available candidates? In this section, we explore some answers to these and other
important questions about recruiting and selecting employees.

Human Resource Planning

Recruiting and selecting managers and workers requires human resource (HR) planningthe
process of forecasting a companys human resource needs and its supply. The first phase of HR planning
involves taking an inventory of a companys current human resourcesthat is, collecting data on every
employee, including educational background, special job skills, previous jobs, language skills, and
experience living abroad.

The second phase of HR planning is estimating the companys future HR needs. For example,
consider a firm that plans to sell its products directly to buyers in a new market abroad. Will it create a
new operation abroad and staff it with managers from the home office, or will it train local managers?
Will it hire its own local sales force, or will it hire a distributor? Likewise, manufacturing or assembling
products in an international market requires factory workers. A company must decide whether to hire
these people itself or to subcontract production to other producersthus eliminating the need for it to
hire the workers. For additional issues that companies should consider when staffing internationally, see
the Managers Briefcase feature, titled Growing Global.

As we noted in previous chapters, this decision frequently raises ethical questions. The general
public is becoming increasingly well informed about the fact that global companies make extensive use
of subcontractors in low-wage nations. Of particular concern is the question of whether subcontractors
are taking advantage of sweatshop labor. But publicity generated by allegations of workplace abuse
caused many firms to establish codes of conduct, and they stepped up efforts to ensure compliance. For
example, Apple (www.apple.com) sent a team of investigators to China to look into charges of
sweatshop-like conditions at a company manufacturing Apples iPod. The company that Apple
investigated was a division of the worlds largest contract electronics manufacturer, Hon Hai Precision
Industry.3 Another example on this topic involves Levi Strauss (www.levistrauss.com). When apparel
contractors in Bangladesh admitted that they hired children, Levi Strauss demanded that they comply
with local regulations. Unfortunately, it turned out that many of the underage workers were their
families sole sources of support. So Levis struck a deal: Contractors agreed to continue paying wages to
the youngsters while they went to school, and then they would be rehired when they reached age 14.
Levis paid for them to attend school until they came of age.

In the third phase of HR planning, managers develop a plan for recruiting and selecting people to
fill vacant and anticipated new positions, both managerial and nonmanagerial. Sometimes, a firm must
also make plans for reducing its workforcea process called decruitmentwhen current HR levels are
greater than anticipated needs. Planning for decruitment normally occurs when a company decides to
discontinue manufacturing or selling in a market. Unfortunately, the decision by global companies to
shift the location of manufacturing from one country to another can also result in lost jobs. Lets now
take a closer look at the recruitment and selection processes.
Recruiting Human Resources

The process of identifying and attracting a qualified pool of applicants for vacant positions is
called recruitment. Companies can recruit internally from among their current employees or look to
external sources.

CURRENT EMPLOYEES

Finding an international manager among current employees is easiest for a large company with
an abundance of internal managers. Likely candidates within the company are managers who were
involved in previous stages of an international projectsay, in identifying the new production site or
potential market. It is likely that these individuals have already made important contacts inside the host
country and that they have already been exposed to its culture.

RECENT COLLEGE GRADUATES

Companies also recruit from among recent college graduates who have come from other
countries to attend college in the firms home country. This is a particularly common practice among
companies in the United States. Over a one-year period, these new hires receive general and specialized
training and then are given positions in their native countries. As a rule, they learn about the
organizations culture and the way in which it conducts business. Most important, perhaps, is their
familiarity with the culture of the target market, including its customs, traditions, and language.

LOCAL MANAGERIAL TALENT

Companies can also recruit local managerial talent. Hiring local managers is common when
cultural understanding is a key job requirement. Hiring local managers with government contacts can
speed the process of getting approvals for local operations. In some cases, governments force
companies to recruit local managers so that they can develop their own internal pools of managerial
talent. Governments sometimes also restrict the number of international managers that can work in the
host country.

NONMANAGERIAL WORKERS

Companies typically recruit locally for nonmanagerial positions because there is often little need
for highly specialized skills or training. However, a specialist from the home country is typically brought in
to train people chosen for more demanding positions. Firms also turn to the local labor market when
governments restrict the number of people allowed into the host country for work purposes. Such
efforts are usually designed to reduce unemployment among the local population. On the other hand,
countries sometimes permit the importation of nonmanagerial workers. Kuwait, a wealthy oil-producing
country in the Middle East, has brought in large numbers of nonmanagerial workers for its blue-collar
and technical jobs. Many of these workers come from Egypt, India, Lebanon, Pakistan, and the
Philippines in search of jobs or higher wages.

Selecting Human Resources

The process of screening and hiring the best-qualified applicants with the greatest performance
potential is called selection. The process for international assignments includes measuring a persons
ability to bridge cultural differences. Expatriate managers must be able to adapt to a new way of life in
the host country. Conversely, native host-country managers must be able to work effectively with
superiors who have different cultural backgrounds. In the case of expatriate managers, cultural
differences between home country and host country are important factors in their potential success.
Culturally sensitive managers increase the likelihood that a company will achieve its international
business goals. Recruiters can assess cultural sensitivity by asking candidates questions about their
receptiveness to new ways of doing things and questions about racial and ethnic issues. They can also
use global aptitude tests to assess an employees readiness for an international assignment. It is also
important to examine the cultural sensitivity of each family member who will be going to the host
country. The ability of a family member (particularly a spouse) to adapt to a new culture can be a key
factor in the success or failure of an expatriate manager.

Culture Shock

Successful international managers typically do not mind, and often enjoy, living and working
outside their native lands. In extreme cases, they might even be required to relocate every year or so.
These individuals are capable of adapting quickly to local conditions and business practices. Such
managers are becoming increasingly valuable with the emergence of markets in Asia, Central and
Eastern Europe, and Latin America. They are also helping to create a global pool of managers who are
ready and willing to go practically anywhere on short notice. The size of this pool, however, remains
limited because of the difficulties that many people experience in relocating to unfamiliar cultures.

Living in another culture can be a stressful experience. Selecting managers comfortable traveling
to and living in unfamiliar cultures, therefore, is an extremely important factor when recruiting for
international posts. Set down in the midst of new cultures, many expatriates experience culture shock
a psychological process affecting people living abroad that is characterized by homesickness, irritability,
confusion, aggravation, and depression. In other words, they have trouble adjusting to the new
environment in which they find themselves. Expatriate failurethe early return by an employee from an
international assignment because of inadequate job performanceoften results from cultural stress.
The higher cost of expatriate failure is convincing many companies to invest in cultural-training programs
for employees sent abroad. For a detailed look at the culture-shock process and how to reduce its
effects, see the Culture Matters feature, titled A Shocking Ordeal.

Reverse Culture Shock

Ironically, expatriates who successfully adapt to new cultures often undergo an experience called
reverse culture shockthe psychological process of readapting to ones home culture. Because values
and behavior that once seemed so natural now seem so strange, reverse culture shock may be even
more disturbing than culture shock. Returning managers often find that either no position or merely a
standby position awaits them in the home office. Companies often do not know how to take full
advantage of the cross-cultural abilities developed by managers who have spent several potentially
valuable years abroad. It is not uncommon for expatriates to leave their companies within a year of
returning home because of difficulties blending back into the company culture. Moreover, spouses and
children often have difficulty leaving the adopted culture and returning home. For many Japanese
employees and their families, reentry into Japanese culture after a work assignment in the United States
can be particularly difficult. The fast pace of business and social life in the United States, plus the
relatively high degree of freedom and independence for women, contrasts with life in Japan. Returning
Japanese expatriates can find it difficult to adjust back to life in Japan after years of living in the United
States.
DEALING WITH REVERSE CULTURE SHOCK

The effects of reverse culture shock can be reduced. Home-culture reorientation programs and
career-counseling sessions for returning managers and their families can be highly effective. For
example, the employer might bring the entire family home for a short stay several weeks before the
official return. This kind of trip allows returnees to prepare for at least some of the reverse culture shock
that may await them. Good career development programs can help companies retain valuable managers.
Ideally, the career development plan is worked out before the employee goes abroad and is revised
before his or her return. Some companies work with employees before they go abroad to plan career
paths of up to 20 years within the company. Mentors who have previously gone abroad and had to
adjust on returning home can also be assigned to returning managers. The mentor becomes a confidant
with whom the expatriate manager can discuss particular problems related to work, family, and
readjusting to the home culture.