Ninad.

L
Shantashree
Uma
Vaseem
 Multinational Enterprise
A multinational corporation (MNC), also called a
Trans-National Co-operation,(TNC) or
multinational enterprise (MNE),is a corporation or
an enterprise that manages production or delivers
services in more than one country. It can also be
referred to as an international corporation.
 The Multinational Workforce
International human resource
management (IHRM) is the process
of procuring, allocating and
effectively utilizing human resource
in a multinational corporation,
while balancing the integration and
differentiation of Human Resource
activities in foreign location
 Types of Employees in the MNE

Parent country nationals (PCNs)

Host country nationals (HCNs)
Third country nationals (TCNs)
 Parent Country Nationals
A parent-country national is a person working in a
country other than their country of origin. Such a person
is also referred to as an expatriate.

Competencies
Familiarity with the MNE’s corporate culture
Ability to effectively communicate with headquarters
Ability to maintain control over the subsidiary
operations
Advantages:

 PCNs may be the best people for the job.

 Assurance that the subsidiary will comply with company
objectives policies etc.
 Control and co-ordination by HQ is maintained.
 Promising managers get international experience.
Disadvantages:

 PCNs may impose an inappropriate HQ style.

 Compensation differences between PCNs and HCNs may
cause problems.
 HCNs promotion opportunities are limited.
 Adaptation to host country may take a long time.
 Host Country Nationals
A host-country national (HCN) is an employee who is a
citizen of a country in which an organization's branch or
plant is located, but the organization is headquartered in
another country. An impediment to hiring HCNs is that such
employees may not understand the parent company’s
culture.
Competencies
 Familiarity with the cultural, economic, political, and legal
environment of the host country
 Ability to respond effectively to the host country’s
requirements for localization of the subsidiary’s operations
Advantages
Continuity of management improves since HCNs stay longer in
positions.
 Govt. policy may force hiring of HCNs.
 Promotional opportunities not limited – so higher morale among
HCNs.
 No problems with language and culture.
 Reduced hiring costs.
 No work permits required.
Disadvantages
 Hiring HCNs may encourage a federation of disintegrated
national units rather than one integrated global unit.
 HQ may have less control over operations.
 HCNs may still have limited career opportunities outside the
subsidiary.
 Hiring HCNs limits opportunities for PCNs to gain overseas
experience.
 Third Country Nationals
Employees who are neither citizens of the host country nor
citizens of the country where the enterprise is headquartered
Example
Contract personnel being used by the US government to fight
the global war on terror in Iraq consist of Expats, namely
those personnel of US citizenship that represent a private
military contractor being contracted by the US Government,
Indigenous Iraqi and Kurdish personnel and TCNs such as
are currently being employed by many of the Private
Military Contracting Firms currently under contract.
Advantages:

 Salary and compensation may be lower than for PCNs.

 May be more familiar with host country than the PCNs.

Disadvantages:

 TCNs may not comply with HQ style of management.

 TCNs may not want to return after assignment.
 Transfers must consider national animosities.
 Host government may resent TCNs as much as PCNs.
 Conclusion
MNEs face challenges and issues related to staffing
and training their multinational workforce
Training programs can increase the cultural
effectiveness of the workforce