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EPRG Model of International Human Resource Management

Ethnocentric Employment

Recruitment and Selection

An ethnocentric company assumes that the host country will be unable to supply skilled labor. Although it will recruit local people for low-level positions, an ethnocentric company will reserve skilled positions and managerial roles for employees from its home country

Employee Development

Ethnocentric companies usually fill senior roles with expatriate employees from their home nations, often on short-term assignments. They are unlikely to offer management training or high-level technical training to nationals from the host country; this limits the ability of local people to progress into promoted posts.


Polycentric Employment

• The polycentric approach uses natives of the host country of a business to manage operations within that country and natives of the parent country to manage at headquarters.  
• In this situation, host country managers rarely advance to corporate headquarters since natives of the parent country are preferred by the company as managers at that level.  This approach is advantageous since locals manage in the countries for which they are best prepared.  It is also cheaper since locals, who require few, if any, incentives are readily available and generally less expensive to hire than others. 
•  The polycentric approach is helpful in politically sensitive situations because the managers are culturally sensitive locals, not foreigners.  Further, the polycentric approach allows for continuity of management.

•          The polycentric approach has several disadvantages.  One disadvantage is the cultural gap between the subsidiary managers and headquarters managers.  If the gap is not bridged, then the subsidiaries any function too independently.  
• Another disadvantage is limited opportunities for advancement.  Natives of the host countries of the host countries can only advance within their subsidiaries, and parent country natives can only advance within company headquarters. 
•  The result is that company decision makers at headquarters have little or no international experience.  Nevertheless, their decisions have major effects on the subsidiaries.

• Regiocentric Employment The regiocentric approach uses manager’s form various countries within the geographic regions of a business. Although the mangers operate relatively independently in the region, they are not normally moved to the company headquarters. 
•  The regiocentric approach is adaptable to fit the company and product strategies. When regional expertise is needed, natives of the region are hired. IF product knowledge is crucial, then parent- country nationals who heave ready access to corporate sources of information can be hired. One shortcoming of the regiocentric approach is that managers form the region may not understand the headquarters view. Also, corporate headquarters may not employ enough managers with international experience. This could result in poor decisions.

Geocentric Employment

• The geocentric approach uses the best available a mangers for a business without regard for their country of origin.  The geocentric company should have a worldwide strategy of business integration.  The geocentric approach allows the development of international managers and reduces national biases.
•          On the other hand, the geocentric approach has to deal with the fact that most governments want businesses to hire employees from the host countries.  Getting approval for nonnatives to work in some countries is difficult or impossible.  Implementing the geocentric approach is expensive.  It requires substantial training and employee development and more r5elocation costs.  It also requires more centralization of human resource management and longer lead times before employees can be transferred because of the complexities of worldwide operation.