Evaluation Of Recruiting Country Nationals And Expatriates Into Senior Positions: DragonSoop Case
DragonSoop’s corporation must decide whether to recruit host-country nationals or expatriates for senior positions within the company. This decision made by the HR department could play a significant role as to whether DragonSoop succeeds within India or not. It is vital for small businesses like DragonSoop to keep costs to a minimum in order to maximize profit levels. Hiring a host country national would allow DragonSoop to save on hiring costs such as visas. The business could then use these savings to re-invest within the firm and help its growth.
Culture also has a huge impact on international business success. It is vital to know the country’s beliefs and traditions before entering the market as cultural differences can create a clash between firms. Host country nationals (HCN) can narrow the gap of cultural distance between firms, helping initiate DragonSoop’s Indian market with established knowledge of the culture already. On the other hand, Harzing and Van Ruysseveldt (2004) outlined that hiring country nationals would result in the home country’s employees missing out on an opportunity to gain cross-cultural experience abroad. This new market could potentially allow home country nationals to gain vital international experience, however hiring an expatriate would eliminate this chance and keep opportunities for home country nationals limited.
As India is one of the leading countries to employ foreign workers, hiring expatriates could be a viable option, as foreign management is not an unfamiliar concept. As expatriates have an annual cost of three to five times that of their home salary, it must be proven to be beneficial to overall integration in order to recruit this kind of management. As the transfer of information between the UK and Indian firms must include incorporating company culture, the knowledge transfer that expatriates can bring could exceed the cost, as it allows a merging of objectives, values, and general culture of Dragonsoop into the new firm and market. It will also enhance trust between the companies, as there is already a level of commitment from the expatriate to Dragonsoop, linking their actions to the interests of the organisation.
HR will have to be careful in this approach however, as they will face obstacles of integration with new customer needs, new environment, and could face the risk of inaccurate cultural assumptions, as no prior experience in India will be present in the senior management. The role of expatriates, although still successful in generating control over foreign firms, may struggle with the changing demands of cultural integration and global responsibilities.
The use of traditional expatriate management is becoming quite dated, as they are looking to develop understanding of the foreign location, environment, and possible ventures instead of teaching foreign firms the organisation’s culture. That is why it is advantageous to recruit both country nationals and expatriates into senior positions, as this allows initial integration to be bridged successfully through the knowledge base of industry expertise which expatriate managers bring, while also allowing local talent to share their knowledge of the economic culture of India, allowing the mergence between the Indian and UK firms.
