Chapter Sixteen: 16.1 STAFFING TO CONTROL INTRODUCTION BUREAUCRATIC AND CULTURAL CONTROL EXPATRIATE OR LOCAL MANAGEMENT? LOCAL MANAGERS STAFFING THE IJV IMPLICATIONS FOR THE MANAGER SUMMARY EXERCISE.

Chapter Sixteen: 16.2 CONTROLLING THE SUBSIDIARY CULTURE THROUGH BUREAUCRATIC AND CULTURAL CONTROLS (Jaeger, 1983). By BUREAUCRATIC CONTROL, headquarters aims to develop a culture of impersonal and bureaucratic efficiency. By CULTURAL CONTROL, headquarters aims to develop a culture of loyalty to the company and headquarters. Techniques used include staffing with large numbers of expatriates who act as role-models employee socialization programs

(16.2) frequent visits between the subsidiary and headquarters social events. Harzing (1999) distinguishes bureaucratic formalized control personalized centralized control control by socialization and networks output control.

Chapter Sixteen: 16.3 THE ADVANTAGES OF AN EXPATRIATE MANAGER include Headquarters’ control is greater Headquarters’ organizational culture is spread to the subsidiary Headquarters’ staff gain experience abroad headquarters becomes more sensitized to subsidiary needs headquarters controls local managerial and skill levels headquarters protects its technology headquarters and the manager share a common national culture communications between headquarters and subsidiary is stronger headquarters can influence operations at critical times closer links are made with other subsidiaries.

(16.3) THE ADVANTAGES OF A LOCAL MANAGER include the multinational is “internationalized” the subsidiary is empowered the local manager is developed the local manager is better connected in local markets political risk is reduced the local manager can better manage local staff there is no need for expatriate training expatriation costs are avoided the local manager costs less to reward ill-feeling arising from disparities in rewards are avoided.

Chapter Sixteen: 16.4 HEADQUARTERS RETAINS THE LOYALTY OF LOCAL MANAGERS by showing that it trusts their judgment, particularly about local conditions appraising and promoting them by criteria that recognize contributions to the MNC and the subsidiary giving them responsibilities appropriate to their level in the MNC compensating them at rates that are fair providing opportunities to rotate to headquarters having HR managers devote equivalent time to locals and expatriates providing appropriate training.

Chapter Sixteen: 16.5 IJV STAFF may be recruited from The foreign partner The local partner The country of the foreign partner The country of the local partner A third country / third countries These different groups have different needs, cultures, and long-term loyalties.