Question 1

A policy of hiring and promoting based on ability and experience without considering race or citizenship is
A) an ethnocentric policy.
B) a polycentric policy.
C) a regiocentric policy.
D) a geocentric policy.

Accepted Answer

A policy of hiring and promoting based on ability and experience without considering race or citizenship is a geocentric policy.

Question 2

A drawback of ethnocentric staffing policies is that
A) it is less expensive to use employees from the home country.
B) there are no additional expenses associated with relocating these employees and their families.
C) these employees may not have experience with the language and culture of the host country.
D) they expand the experience base of home-country employees.

Accepted Answer

A drawback of ethnocentric staffing policies is that home-country managers may find it difficult to be effective in the host country, due to differences of language and culture as well as other environmental forces.

Question 3

Which of the following is not true?
A) A company's competitive strategy is determined by two competing forces. A company's competitive strategy should, in turn, drive the organization's approach to international human resource management.
B) Pressure to achieve global integration is a force determining a company's competitive strategy.
C) Pressure to achieve reduced costs is a force determining a company's competitive strategy.
D) Pressure to achieve local differentiation is a force determining a company's competitive strategy.
E) Pressure to achieve low prices is a force determining a company's competitive strategy.

Accepted Answer

Two competing forces-the pressure to achieve global integration and reduce costs and the pressure to respond to local differentiation-determine which of four alternative competitive strategies (home replication, multidomestic, global, or transnational) a company should adopt. Low price is not one of these forces.

Question 4

A regiocentric staffing policy
A) involves human resources policies that are created at the local level for the specific context in which the local operations operate.
B) may send TCNs to fill management posts, to avoid problems from using PCNs or HCNs.
C) selects the best person for each job, without considering national origin.
D) provides an opportunity to use home-country employees for positions abroad.
E) tends to be used with a transnational strategic orientation.

Accepted Answer

As stated directly in the text, the disadvantages often encountered when using employees from the home or host country can sometimes be avoided by sending third-country nationals to fill management posts.

Question 5

An employee who is a citizen of the nation in which the parent company is headquartered is known as
A) a home-country national.
B) a host-country national.
C) an ethnocentric employee.
D) a third-world national.
E) an expatriate.

Accepted Answer

An employee who is a citizen of the nation in which the parent company is headquartered is known as a home-country national.

Question 6

An advantage of using home-country citizens abroad is that
A) they have expertise in the host-country culture.
B) they expand their experience, enhancing their potential for promotion at home.
C) they have lower-cost salaries and benefits than HCNs or TCNs.
D) host-country governments encourage their use.

Accepted Answer

An advantage of employing home-country citizens abroad is expanding their experience in preparation for their becoming high-level managers at headquarters. Firms earning a large percentage of their profits from international sources require top executives who have a worldwide perspective, both business and political. It is difficult or impossible to acquire that sort of perspective without living and working abroad for a substantial period of time.

Question 7

A drawback of polycentric staffing policies is that
A) it is less expensive to use employees from the home country.
B) there are additional expenses associated with relocating these employees and their families.
C) these employees may not have experience with the language and culture of the host country.
D) there can be a conflict of loyalty between the host country and the employer.

Accepted Answer

A drawback of polycentric staffing policies is that there can be a conflict of loyalty between the host country and the employer. For example, the host-country national may give preference to a local supplier even though imported products may be less expensive or of better quality. Local managers may oppose headquarters' requests to set low transfer prices that might benefit the IC by causing lower levels of taxes to be paid to the host government.

Question 8

A high volume of orders,commands,and advice to subsidiaries is associated with
A) ethnocentric staffing and home replication strategy.
B) regiocentric staffing and multidomestic strategy.
C) ethnocentric staffing and regiocentric strategy.
D) polycentric staffing and multidomestic strategy.
E) geocentric staffing and transnational strategy.

Accepted Answer

As shown in Table 14.1, a high volume of orders, commands, and advice to subsidiaries is associated with ethnocentric staffing and home replication strategy.

Question 9

A policy of hiring and promoting based on the parent company's home-country frame of reference is
A) an ethnocentric policy.
B) a polycentric policy.
C) a regiocentric policy.
D) a geocentric policy.

Accepted Answer

A policy of hiring and promoting based on the parent company's home-country frame of reference is an ethnocentric policy.

Question 10

Parent company nationals might be concerned with all of the following except
A) the rate at which industrial skills are learned by host-country nationals.
B) how quickly they can learn the local language in their host country.
C) the exchange rate movement of their host-country's currency.
D) whether the family of transferred home-country executives can adapt to and enjoy the experience abroad.
E) whether they can adapt to the home-country culture.

Accepted Answer

Parent-company nationals will not generally need to be concerned about their ability to adapt to their own culture.

Question 11

A polycentric staffing policy is appropriate when
A) there are low levels of pressure for cost reduction and high levels for localization.
B) information technology is of increasing importance.
C) there are low levels of pressure for cost reduction and low levels for localization.
D) international companies are entering India, where there are more women in management.
E) new technology for the subsidiary is involved.

Accepted Answer

As stated directly in the text, when the company's primary strategic orientation is multidomestic, with low pressures for cost reduction and high pressures for local responsiveness, a polycentric approach may be used.

Question 12

Training and development of potential candidates for expatriate assignments
A) is unnecessary with host-country nationals.
B) is unnecessary with home-country nationals.
C) depends on whether the candidate is a home-, host-, or third-country national.
D) wastes company resources because management is an art form, not a skill.
E) is only necessary for third-country nationals.

Accepted Answer

The training and development of managers and other key IC employees vary somewhat, depending on whether the candidate is from the home country, the host country, or a third country.

Question 13

When an IC hires and trains local,host-country people,the IC often
A) pays them too much and creates inflation.
B) overtrains them to IC culture-based standards.
C) may lose them to local firms or other ICs once they are trained.
D) encourages their transfer, causing brain drain.

Accepted Answer

In many countries, there is a shortage of talented, experienced managers and other skilled employees. The best of these people may be pirated away by local firms or other IC subsidiaries, as local executive recruiters are constantly on the lookout to make raids and entice the most talented employees to leave the original IC and join another firm that is seeking to overcome its own shortage of skilled personnel.

Question 14

A geocentric staffing policy
A) enables the practices used at headquarters to be transferred worldwide.
B) tends to be used with a global strategic orientation.
C) selects the best person for each job, without considering national origin.
D) involves human resources policies that are created at the local level for the specific context in which the local operations operate.

Accepted Answer

Companies with a transnational strategic orientation, driven simultaneously by high pressures for cost reduction and high pressures for local responsiveness, often follow a geocentric staffing policy. These organizations select the best person for each job without considering national origin and can therefore capitalize on the advantages of each staffing policy.

Question 15

Home-country nationals may be used in host-country management because
A) host-country managers lack the required language and culture expertise.
B) host-country nationals are less desirable from the host-country government's perspective.
C) home-country nationals are being groomed for IC headquarters.
D) IC headquarters wants a host-country national in the home country.

Accepted Answer

An advantage of employing home-country citizens abroad is expanding their experience in preparation for their becoming high-level managers at headquarters.

Question 16

A policy of hiring and promoting based on the specific local context in which the subsidiary operates is
A) an ethnocentric policy.
B) a polycentric policy.
C) a regiocentric policy.
D) a geocentric policy.

Accepted Answer

A policy of hiring and promoting based on the specific local context in which the subsidiary operates is a polycentric policy.

Question 17

A polycentric staffing policy
A) involves human resources policies that are created at the regional level for the specific context in which the subsidiary operations operate.
B) results in the company hiring local managers who are familiar with the home country of the IC and with its corporate culture, policies, and practices.
C) may confront the problem of having the best people pirated away by local firms or other IC subsidiaries.
D) eliminates conflicts of loyalty between the host country and the employer.

Accepted Answer

Foreign-owned companies that hire and train local, host-country people frequently experience a common, and disruptive, IHRM problem. In many countries, there is a shortage of talented, experienced managers and other skilled employees. The best of these people may be pirated away by local firms or other IC subsidiaries, as local executive recruiters are constantly on the lookout to make raids and entice the most talented employees to leave the original IC and join another firm that is seeking to overcome its own shortage of skilled personnel.

Question 18

Relatively low levels of authority and decision making in headquarters is associated with
A) ethnocentric staffing and home replication strategy.
B) regiocentric staffing and multidomestic strategy.
C) ethnocentric staffing and regiocentric strategy.
D) polycentric staffing and multidomestic strategy.
E) geocentric staffing and transnational strategy.

Accepted Answer

As shown in Table 14.1, relatively low levels of authority and decision making in headquarters is associated with polycentric staffing and multidomestic strategy.

Question 19

When host-country nationals are employed
A) training costs are a minimum.
B) they are familiar with local customs, culture, and language.
C) they are already familiar with the home country.
D) any conflict of interest is removed.

Accepted Answer

Host-country nationals are familiar with the customs, culture, and language of their own country. However, host-country nationals are more likely to lack knowledge of advanced business techniques, particularly those that are specific to business applications and operations of the IC, and knowledge of the company as a whole. As a result, training programs will need to be developed to enable host-country nationals to more fully understand and perform effectively within the IC.

Question 20

An ethnocentric staffing policy
A) uses host-country nationals in key foreign management and technical positions.
B) assigns expatriates who have learned the language and culture of the country of their assignment.
C) is required to prepare home-country citizens for high-level managerial positions at headquarters.
D) tends to be used by companies with an international strategic orientation.

Accepted Answer

Companies with a primarily international strategic orientation (characterized by low pressures for cost reduction and low pressures for local responsiveness) may adopt an ethnocentric staffing policy. In this approach, most decisions are made at headquarters, using the home-country's frame of reference. International companies (ICs) use citizens from their own countries, or PCNs, in key foreign management and technical positions.

Quiz 14: Managing Human Resources in an International Context

A policy of hiring and promoting based on ability and experience without considering race or citizenship is

A drawback of ethnocentric staffing policies is that

Which of the following is not true?

A regiocentric staffing policy

An employee who is a citizen of the nation in which the parent company is headquartered is known as

An advantage of using home-country citizens abroad is that

A drawback of polycentric staffing policies is that

A high volume of orders,commands,and advice to subsidiaries is associated with

A policy of hiring and promoting based on the parent company's home-country frame of reference is

Parent company nationals might be concerned with all of the following except

A polycentric staffing policy is appropriate when

Training and development of potential candidates for expatriate assignments

When an IC hires and trains local,host-country people,the IC often

A geocentric staffing policy

Home-country nationals may be used in host-country management because

A policy of hiring and promoting based on the specific local context in which the subsidiary operates is

A polycentric staffing policy

Relatively low levels of authority and decision making in headquarters is associated with

When host-country nationals are employed

An ethnocentric staffing policy