1. 1 Human Resources Planning for Global Expansion Chapter 13

2. 2 Hospitality and Tourism Is a Global Industry Stages of Global Expansion 1. Domestic operator 2. Market expansion to foreign countries 3. Use of subsidiaries and/or joint ventures 4. Multinational organization 5. Transnational organization

3. 3 Hospitality and Tourism Is a Global Industry Mode of Entry – The process by which a hospitality organization begins a business in another country. Subsidiaries – A foreign company operated by a domestic hospitality organization with majority (more then 50%) ownership by another (parent) company.

4. 4 Hospitality and Tourism Is a Global Industry Joint venture – A foreign branch partially owned by the domestic organization, and partially owned by an entity in the host (foreign) country. Ownership could be a company, several companies, one or more individuals, and/or the government.

5. 5 Hospitality and Tourism Is a Global Industry Multinational Organization – A hospitality organization with operating units in many countries and regions of the world. Transnational Organization – A company with operations throughout the world that features highly de-centralized decision-making, is less aligned with its country of origin, and which may have weak ties to any specific country.

6. 6 Cultural Factors Impact International Operations Culture – A set of learned beliefs, values, and behaviors that influence the way of life shared by the members of a society. Organizational culture – A set of understandings shared by members of an organization that are relevant and distinctive, that are passed on to new group members, and that influence organizational decision-making. Socio-cultural – Relating to social and cultural matters.

7. 7 Cultural Dimensions Impact Hospitality Operations Country cluster – The notion that some countries can be grouped together based upon their population’s characteristics such as language, location, ethnicity, religion, and economic status. Cultural intelligence – The process by which one learns about a culture, and adjusts thinking and behavior responses when interacting with persons from the culture.

8. 8 Cultural Dimensions Impact Hospitality Operations Hofstede’s five cultural dimensions:  Power distance  Individualism  Risk avoidance  Rigid gender roles  Past, present and future orientation

9. 9 Cultural Dimensions Impact Hospitality Operations Generally accepted “truths” in the US that are not universal:  Pay for performance is best  Formal objectives should drive management actions  Human resources management

10. 10 Focus on International Assignments  The political environment  Economic concerns Exchange rate – The rate at which the money of one country is exchanged (traded) for that of another country. Inflation – The economic condition that exists when prices charged for products and services increase throughout a country.  Cultural environment Culture shock – The feeling of disorientation, and an inability to adjust to a cultural environment that is different from one’s own. Concerns for a manager interested in an expat position:

11. 11 Focus on International Assignments Cultural sensitivity Interpersonal skills Managerial flexibility Adaptive leadership International motivation Intercultural competence Ability to work with limited resources Important skills for international hospitality managers: Understanding of international business Interest International etiquette Stress management Functional skills Technical skills

12. 12 Focus on International Assignments Cross-cultural adaptability – The extent to which a person can be comfortable in a different culture.

13. 13 Focus on International Assignments Concerns that may arise when an expatriate returns from a global assignment:  Next assignment  Reverse culture shock – Emotional and physiological re-adjustments that can occur as one returns from an international assignment.  No recognition for global assignment

14. 14 Managing Employees During Global Assignments Use Locals or Expatriates? Advantages and disadvantages of each…