CHAPTER#06 Separation by time and generally lower level,
distance: A fourth factor that supervisory positions.
MULTINATIONAL can impact on the performance PERFORMANCE of a subsidiary is the effect of MANAGEMENT separation by time and distance. Types of Expatriates When evaluating subsidiary Judgments concerning the Assignments performance against congruence between the MNE expectations, however, it is and local subsidiary activities ‘technical assignments’ – important to recognize various are further complicated by the short-term knowledge constraints that may affect goal physical distances involved, transference activities, said to attainment. These include the time-zone differences, the make up 5 to 10 per cent of following five constraints frequency of contact between expatriate assignments. outlined below: the corporate head-office staff and subsidiary management and developmental assignments’ – Whole versus part: First, it is the cost of the reporting system. focusing on in-country important to appreciate that by performance and the acquisition its very nature, the MNE is a Variable levels of maturity of local or regional single entity that faces a global across markets: the need for understanding by the assignee, environment, which means that relevant comparative data: A said to make up 5 to 10 per cent it simultaneously confronts final factor influencing the of assignments. differing national environments. performance of a subsidiary is the variable level of maturity strategic assignments’ – high- Integration and control profile activities that focus on imperatives often place the across markets. without the supporting infrastructure of the developing a balanced global multinational in the position perspective, said to make up 10 where it decides that the good of parent, market development in foreign subsidiaries is generally to 15 per cent of assignments. the whole is more important than one subsidiary’s short-term slower and more difficult to functional assignments’ – profitability. achieve than at home. described as more enduring Expatriates Task: expatriates assignments with local Non-comparable data: A employees that involve the two- second key constraint it that are assigned to foreign operations to fulfil specific way transfer of existing frequently the data obtained processes and practices, said to from subsidiaries may be neither tasks: make up between 55 and 80 per easily interpretable nor reliable. The chief executive officer, or cent of assignments. These factors can make an subsidiary manager, who objective appraisal of subsidiary oversees and directs the entire Non-expatriate performance performance problematic, which foreign operation. management challenges in turn complicates the task of appraising the performance of The structure reproducer performance criteria and goals individual subsidiary managers. carries the assignment of for non-standard work. Criteria building or reproducing in a for performance is subject to Volatility in the global foreign subsidiary a structure cultural differences. Isolating business environment: A third similar to that which he or she international dimensions of job factor that can impact on the knows from another part of the performance is not as straight performance of a subsidiary is company. forward as for traditional the occurrence of volatility and expatriate jobs. Outstanding and turbulence in the global business The troubleshooter is the failures will challenge environment. This volatility may individual who is sent to a performance appraisal process. require that long-term goals be foreign subsidiary to analyze Performance appraisals are flexible in order to respond to and solve a particular complicated by international potential market contingencies. operational problem. context, outside appraisers. Ways to improve and rewards The operative is the individual are unclear. Impact of non- whose assignment is to perform standard work on HCN co- functional job tasks in an workers existing operational structure, in PERFORMANCE Frequency of appraisal: In APPRAISAL OF practice, formal appraisal is INTERNATIONAL commonly on a yearly basis, and EMPLOYEES this appears to extend to international performance Performance criteria: Goals systems, even though the tend to be translated into domestic-oriented literature on performance appraisal criteria so this topic recommends an specificity and measurability ongoing combination of formal issues are important aspects, and and informal performance we need to recognize that hard, appraisal and feedback. soft and contextual goals are often used as the basis for Performance feedback: An performance criteria. Hard important aspect of an effective goals are objective, quantifiable performance management and can be directly measured. system is the provision of timely Soft goals tend to be feedback of the appraisal relationship or trait-based, such process. One of the problems as leadership style or with annual appraisal is that interpersonal skills. Contextual employees do not receive the goals attempt to take into consistent frequent feedback consideration factors that result considered critical in order to from the situation in which maintain or improve their performance occurs. performance. Who conducts the Appraisal of HCN employees: performance appraisal? : The discussion so far has Another issue is who conducts omitted the issue of appraising the performance appraisal. the performance of HCN Typically, employees are employees. It is important to appraised by their immediate mention here is that the practice superiors, and this can pose of performance appraisal itself problems for subsidiary chief confronts the issue of cultural executive officers. applicability. Performance Consequently, subsidiary appraisal in different nations can managers tend to be assessed be interpreted as a signal of according to subsidiary distrust or even an insult. performance, with a reliance on hard criteria similar to that applied to heads of domestic units or divisions. Standardized or customized performance: Domestic firms commonly design performance appraisal forms for each job category, particularly those using a traditional performance appraisal approach rather than performance management. Such standardization assists in the collection of accurate performance data on which HR decisions can be made, and allows for cross-employee comparisons.