Chapter 9: Staff and Employment

            There are three major approaches to staffing in multinational firms in foreign markets. These three types are ethnocentric, polycentric, and geocentric. Ethnocentric focuses on the placement of parent-country nationals in virtually all management positions. Polycentric focuses on home-country nationals occupying key managerial positions, while hiring host-country nationals to smaller firms or branch offices. Finally geocentric can be characterized as increasing mobile capital resources that are very attracted to low-cost productions such as Mexico, Vietnam, and China.

            I find it very interesting how nearly half a million Chinese locals return to the mainland after earning a degree at universities abroad. China is especially competitive in the job market and rural areas the locals continue to go to the cities looking for work. There are a lot of family style management companies based in China. I find it very interesting that Japanese firms struggle to work with China due to their slow responses and slow management.

            China has a list a number of common mistakes foreign firms should avoid when hiring an employee. They should avoid putting one person in control. The firm should avoid nepotism by disallowing employees to hire family members. You should not hire someone without china experience, especially for a position that is related to local knowledge.