MGMT30004 · Managing Globally
International HRM
International HRM answers 'who do we need to deliver the strategy?' — managing people as strategic resources in a multinational. This chapter starts with the firm's HR orientation, Perlmutter's EPRG model (ethnocentric, polycentric, geocentric, regiocentric), which drives who staffs key roles: PCN / HCN / TCN and the inpatriate, each with advantages and drawbacks across control, cost, local fit and coordination. It stresses vertical alignment — matching HR practices to the business strategy — and walks the main HR practice areas (each bent by local law and culture), the expatriate lifecycle (select → prepare → adjust / culture shock → repatriate), global mobility and compensation. It then carries the people-side into motivation across cultures: Erin Meyer's feedback work (direct vs indirect, upgraders/downgraders, status incongruence), whether Maslow / Herzberg / McClelland travel (they are culture-bound), goal-setting (Locke & Latham), and algorithmic management and diversity. In the exam a firm expands and must staff a role: name EPRG and the staffing categories, then recommend a mix justified from strategy and host context.
What this chapter covers
- 01IHRM as people-as-strategic-resources; vertical alignment to strategy
- 02Perlmutter's EPRG staffing approaches: ethnocentric / polycentric / geocentric / regiocentric
- 03PCN / HCN / TCN / inpatriate — advantages and drawbacks; the HR practice areas bent by law & culture
- 04The expatriate lifecycle: select → prepare → adjust / culture shock → repatriate; mobility and compensation
- 05Feedback across cultures (Meyer): direct vs indirect, upgraders/downgraders, status incongruence
- 06Culture-bound motivation (Maslow / Herzberg / McClelland), goal-setting, and algorithmic management & diversity
Worked example: staffing a new country role
- +2Name the EPRG approach and category. For local responsiveness and goodwill in a distant market, a polycentric / HCN (local hire) approach usually beats an ethnocentric / PCN one — a local leader brings language, network and lower cost.
- +2Justify from strategy + context. Tie it to vertical alignment (a localisation strategy leans polycentric) and the host context (high cultural distance, available local talent), and add one risk with a mitigation (weaker HQ coordination → clear reporting and shared values).
- +2Name a motivation/feedback risk. A remote manager giving blunt, upgraded criticism over video risks the local team privately disengaging (Meyer: localise to indirect, status-aware feedback; set team-level goals where collectivist).
Key terms
- EPRG approaches
- Perlmutter's four HR orientations — ethnocentric (standardise, HQ control), polycentric (localise, let each country run HR), geocentric (best person regardless of nationality, a global cadre) and regiocentric (standardise within a region). The orientation drives the staffing mix.
- PCN / HCN / TCN
- The staffing categories: a parent-country national (expat from HQ's home country — control and consistency, but expensive and slow to adjust), a host-country national (local hire — local fit and cheaper, but weaker HQ coordination), and a third-country national (from neither — adaptable and cost-effective, but with visa and loyalty frictions).
- Vertical alignment
- Matching HR practices and policies to the business strategy — 'right people, right place, right time, with the right support'. An integration/global strategy leans ethnocentric; a localisation strategy leans polycentric; a transnational strategy needs the geocentric global cadre.
- Expatriate lifecycle
- The four stages of an international assignment — selection (for cultural adaptability and CQ, not just technical skill), preparation (cross-cultural training, logistics), adjustment and culture shock (the U-curve), and repatriation (planning the return role and managing reverse culture shock). Each stage has a failure mode.
- Upgraders / downgraders (Meyer)
- Words that strengthen or soften criticism in performance feedback. Direct-feedback cultures use upgraders ('absolutely', 'totally'); indirect-feedback cultures use downgraders ('maybe', 'a little'). A manager who exports one home-country style is heard as either brutal or meaningless.
International HRM FAQ
What is the EPRG model and how does it connect to staffing?
Perlmutter's EPRG model is the firm's HR orientation: ethnocentric (standardise and control from HQ — key roles go to PCN expats), polycentric (localise — local roles go to HCNs), geocentric (best person regardless of nationality — a PCN/HCN/TCN mix building a global cadre) and regiocentric (standardise within a region). The orientation drives who staffs key roles, and the marks come from matching approach → strategy → staffing for the specific firm, not just listing the four approaches.
What's the difference between PCN, HCN and TCN, and when do you use each?
A PCN (parent-country national) is an expat from HQ's home country — strong HQ control and consistency, but expensive, slow to adjust, and may block local advancement. An HCN (host-country national) is a local hire — local language, culture and network, cheaper, good for responsiveness and goodwill, but weaker HQ coordination. A TCN (third-country national) is from neither — often regionally adaptable and cost-effective, but with visa, relocation and loyalty frictions. The choice trades control and consistency against local fit, cost and flexibility; an inpatriate (an HCN/TCN moved into HQ) builds a global mindset and an HCN–HQ bridge.
Do the classic motivation theories (Maslow, Herzberg) work in every culture?
No — they are culture-bound. Maslow, Herzberg and McClelland were built on US/Western samples and silently assume an individualist, self-actualising worker. The needs may be human, but their ranking and meaning shift across cultures: in collectivist cultures belonging/social needs may outrank esteem and self-actualisation, and in high-uncertainty-avoidance cultures security can sit near the top. Goal-setting theory (Locke & Latham) travels more robustly, provided the goal is accepted — which itself depends on whether goals are set top-down, individually, or by consensus.
What is the 'Hiring a New Country Manager' lesson?
A common scenario asks you to staff a new service-centre or country-manager role — PCN, HCN or TCN? Grounded in a distributed fintech, the rule of thumb is to appoint a local leader once a location has roughly five or more staff, keeping values and performance expectations consistent while localising employment law, holidays, payroll and communication style. The cautionary tale: a remote home-country manager leading a larger overseas team produced a communication breakdown and people not speaking up — so a polycentric/HCN answer (a local leader) usually beats an ethnocentric/PCN one here.
Exam move
Make the staffing answer a fixed structure: name the EPRG approach, name the staffing category (PCN/HCN/TCN), then justify with two reasons — the firm's strategy (vertical alignment) and the host context (cultural distance, local talent, cost, law) — plus one risk and a mitigation. That mirrors how markers score 'application'. Map Hofstede's dimensions straight onto HR (high power distance kills upward appraisal; high collectivism resists individual bonuses) so you can flag why a copy-HQ policy backfires. For the motivation half, drill that Maslow/Herzberg/McClelland are culture-bound and use the sentence pattern 'name it → diagnose the culture-bound assumption → recommend a localised lever', anchored in the Meyer feedback framework and a grounded distributed-team example.
