What is the advantage of hiring third country nationals for a global business?

It is interesting times, as the business world is constantly struggling to find solutions to the VUCA ( Vulnerable, Uncertain, complex and ambiguous ) environment. As a member of a global Recruiter Network, I am plugged in-courtesy my extended network-to some of the best practices, as companies are changing tacts to deal with the scarcity of Top Talent.

And as the HBR article alludes, the three forces "Globalisation, Demographics & Pipelines" are likely to make senior talent ever scarcer in the years to come.

The article "Mastering the art of foreign staffing" based on the research by Sebastian Reiche and Anne-Wil Harzing (of the Instituto de Estudios Superiores de la Empresa at the University of Navarra in Spain.) highlights several influential trends in multinational staffing.

1. PCN (Parent-country nationals) are employees whose nationality is the same as that of the firm headquarters — for example, a German employee of a German company who is working at a Chinese subsidiary.

2. HCN (Host-country nationals) are employees who have the same nationality as the local subsidiary. This could be a Chinese employee working at the Chinese subsidiary of the German company

3. TCN (Third-country nationals) are employees whose nationality is different from that of either the headquarters or the subsidiary office. In the above scenario, this might mean an Indian employee working at the Chinese office of the German company.

Culture eats Strategy for breakfast, it is said! As a person closely working with companies hiring for middle and senior management in India, I have been increasingly noticing that the days of expats being seconded to run operations are passe'.

-Some prefer to hire 'returning Indians' ie people of Indian origin but with international experience in the domain-as they have best of both worlds. The grounding overseas helps empathise with the accepted culture-and the 'roots' perhaps help in looking at the roles for a longer & more effective tenures.

-Some others are pro-actively building the pipeline for 'succession planning', so that the local Indian Managers -can take over in a couple of years, after being closely mentored by the expats deputed-who are seconded from their parent companies.

-Interestingly some companies are increasingly looking at India- not just as a market for consumption, but also as a market place for sourcing global talent- as they groom 'future ready leaders'. -And yes, there are " growing number of “inpatriate” assignments, in which foreign-subsidiary managers are sent to corporate headquarters for a fixed amount of time, reversing the typical expatriate assignment of the past.!!

Harzing also quotes "One future challenge for human-resources departments will be linking international assignments more directly to organisational career paths, capitalising on the experiences and skills developed during transfers."

Well, there is a flipside to it to. With the onus of careers now in the hands of the supply side, I feel every professional now has the world as her/his playground-and make up the mind -of being at the right place at the right time.

I am tempted to start a series of blog posts on the kind of global opportunities that are available across the globe-at the moment. Perhaps -at least in the 29 countries my worldwide network is privy to!! Till next time :)!

If you’re planning on opening an international office, or relocating members of your team to run your company’s operations in a foreign country, there are a few things you should know. Yes, sending expats overseas is expensive as you will need to take into account immigration requirements, tax equalizations, allowances, insurance and other payments, but, most of the times, it’s worth the investment.

Want to know more about the hiring of locals over expats?  Click here.

In most situations, an expat assignment will cost you two, maybe three times, the price of a local employee. However, having a person you can trust running your business and training new employees, or hiring a knowledgeable expat for your business, may result in better long-term results. Today we would like to take a closer look at international recruitment and weigh the pros and cons of hiring expats.

Pros of Hiring Expats for your International Business

1. Quality over Quantity

From my experience, hiring locals can be extremely difficult, especially if you’re trying to open an international office. That’s because most local candidates will not understand your company’s practices. On the other hand, sending someone who knows the ropes of your company will make it easier to train local workers.

This means that one talented & hard-working individual may actually be worth three newcomers to the practices of the trade. Hiring locals may seem like a cheaper short-term solution, but the initial savings may be undermined by poor results on the long-term.

Of course, this decision may vary from one situation to another. For example, some companies work with a combination of expats and local workers.

How to Structure Global Mobility Assignments and Expatriate Postings

In structuring overseas postings, organizations inevitably struggle with the interplay between expatriate assignment strategy and the legal ramifications of a particular foreign posting. Download this free ebook to  learn more about expatriates and global mobility. 

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