Hrm Ikea China Essay

4136 Words Nov 19th, 2008 17 Pages
International Human Resource Management Policies

Changes due to a new subsidiary in China of a MNE

The Case IKEA

1 IHRM: A Key Factor For Success Of A MNE – An Introduction
1.1 The three components of IHRM – a description
1.2 Key elements concerning IHRM – the details
1.2.1 Recruitment
1.2.2 Training and Development
1.2.3 Performance measurement
1.2.4 Compensation

2 The expansion of a Swedish MNE to China – an example
2.1 Sweden and China – a comparison
2.2 The “IKEA way” – an international company from Sweden
2.3 Changes due to an expansion of IKEA to China – the example
2.3.1 Recruitment
2.3.2 Training and development
2.3.3Performance measurement
2.3.4Compensation
2.4 Employing Swedish expatriates in
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Looking back in history MNE used managers from their home country to make sure that those policies and plans given by the headquarters were met. They were also called expatriates. Another advantage of using an expatriate was the amount of control a headquarters had over the subsidiary by using this way of staffing. The parent country national(PCN) would be to bring core knowledge and transfer the MNE’s key characteristics to the subsidiary. In addition the manager would be able to bring new knowledge back to the headquarter and develop his own personality and abilities from which the company would benefit. He would be a liable trouble-shooter and connection.
This would include a significant amount of support needed from the MNE. An example for that would be the adjustment to new business practices, language or culture which is not always easy. Consequently it’s an expensive decision.

The alternative would be to recruit host-country nationals (HCN). With this decision new weaknesses and insecurity arises. The subsidiary might not be able to fulfil the headquarters expectations towards coordination, control and transfer of core values. More rules and regulations might be required. By using this way a significant advantage is gained; the local responsiveness would be much higher than if

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