Question 1 Case Specific Question from Human Resource Challenges at Sony

What is your view of Sony’s training efforts? What steps could Sony take to improve its training in light of its multi-country operations?

Question 2

Explain how the below key concept are linked to this case (i.e. how the key concepts you have learned in this topic is applied in this case study?)

• The strategic role of human resources in international business.

International human resource management (IHRM) is the selection, training, employment, and motivation of employees for international operations. IHRM is more complex than its domestic counterpart. The firm must develop procedures, policies, and processes appropriate for each country where it does business. A parent-country national (PCN) is an employee who is a citizen of the country where the MNE is headquartered. A host–country national (HCN) is an employee who is a citizen of the country where the MNE subsidiary or affiliate is located. A third-country national (TCN) is an employee who is a citizen of a country other than the home or host country. An expatriate is an employee who is assigned to work and reside in a foreign country for an extended period, usually a year or longer. There are six key tasks in IHRM: international staffing policy; preparation and training of international employees; international performance appraisal; compensation, including formulation of benefit packages that vary from country to country; international labor relations; and managing diversity in the international workplace

• International staffing policy.

IHRM managers determine the ideal mix of employees to work in the firm’s subsidiaries and affiliates abroad. Managers best suited for working abroad typically have technical competence, self-reliance, adaptability, interpersonal skills, leadership ability, physical and emotional health, and, if present, a family prepared for living abroad. Expatriate assignment failure is the unplanned early return home of

an employee or the failure of an expatriate to function effectively abroad. It is not unusual for expatriates to experience culture shock.

• Preparation and training of international employees.

Proper training and orientation of managers improves firm performance. Training for foreign assignments includes area studies, practical information, and cross-cultural aware- ness. Training includes methods such as videos, lectures, readings, simulations, and field experience. Acquiring language skills provides managers with numerous advantages. Repatriation is the return of the expatriate to the home country and requires advance preparation. Training is also important for the nonmanagerial workforce abroad.

• Performance appraisal and compensation of international employees.

International performance appraisals involve providing feedback on how well employees are doing their jobs, identifying problems and areas where more training is needed, and providing a basis to reward superior performance. Firms must develop systems to measure foreign unit performance. Various factors in the foreign environment can impede effective performance appraisal. Compensation packages vary internationally because of differences in legally mandated benefits, tax laws, cost of living, local tradition, and culture. Expatriates expect to maintain their usual standard of living, which can be costly in some locations. Typical expatriate compensation includes four com- ponents: base salary, benefits, allowances, and incentives. Tax equalization must be considered because expatriates may face two tax bills for the same pay, from the host and home countries.

• International labor relations.

MNEs employ many nonmanagerial employees abroad, of- ten represented by labor unions, to work in factories and per- form other tasks. Management must ensure effective labor relations and take care when reducing the workforce. Along with the cost of labor, the quality and productivity of the workforce are important considerations. Codetermination, the participation of workers on boards of directors, is com- mon in some countries. Labor unions are sometimes at odds with the realities of global competition and the influx of immigrants in many countries. Leading MNEs establish an information system on labor developments, communicate with all employees, and formulate a standard policy on employment and working conditions worldwide.

• Diversity in the international workforce.

Experienced MNEs include people from diverse backgrounds, nationalities, and gender who bring a wealth of experience and knowledge to addressing the firm’s problems and opportunities. Employee cultural diversity increases the complexity of interaction. Success comes from understanding and accepting differences and then using them to enhance planning, strategy, and the firm’s operations. In most countries, female managers in international business are still somewhat rare. Firms can take several steps to ensure that women achieve more equality in international business.