Decision of Staffing approaches by a MNE depends on the following factors
Government Regulations in the Host country in which MNE want to Operate-Host country government may have policies which would make it compulsory to hire locals at Sr executive positions. For example in UAE, presence of local in executive/promoter level is necessary for a new set up.
Parent Company policy of control and strategic importance of the subsidiary in the new area- In case a Parent company wants to just open an ancillary and do not wish to transfer the technical know-how of the business, it would not hire Management from the host country but would rather hire staff which is just capable of carrying out day to day operations. For example if a company wants to outsource its customer care operations to a third world country, it would rather not invest in hiring highly competent staff. For such set ups managers may be hired/transferred from the parent nation.
Parent company culture and strategy –some companies have a culture of putting Managers from the parent company only. This is most of the time done to oversee that parent company policies and strategy is maintained even in the host country. Japanese companies, generally do hiring in this particular way. Most of the decision makers in any Japanese subsidiary will be Japanese only and not the local staff.
Manpower Skills available in the Host Country-Parent company strategy depends on the type of manpower available in the host country. Some countries may be have skilled industrial labour and some may host good service industry. Singapore has become a host nation where many companies set up and hire locals in decision making positions, while China has established itself a manufacturing hub where the class of labour available is very different from Singapore.
MNE thus cant have same staffing approach all over. It would change based on its own strategy, country where is planning to open and cuture and manpower availability in the host country .
Reference
Website, Cengage Learning, www.drluisortiz.com/PPT/IHRMchapter_04.ppt
Selection Decision
Skill set and experience-Some positions require a certain skill set and experience. Companies would not hire candidates which do not have the required skills, experience and education.
Salary requirement-Company would have a maximum budgeted amount to pay for the position created. But they may be flexible if company finds candidate more promising and want to retain the talent.
Relocation-Companies prefer to hire local candidates as local candidates may stay longer and the process also requires company to spend less compared to candidates form outside the area
Website, , http://smallbusiness.chron.com/factors-influence-hr-selection-method-38650.html
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