International Firms' Practice of International Management Functions

Managing International Business
Name
Institution
Course
Instructor
Date
Managing International Business
Introduction
International businesses operate beyond national boundaries. Like any business, multinational firms engage in various operations or activities as they expect to realize specific goals in the long run. Most importantly, these firms practice the commonest international management functions in various ways. For instance, international companies consider different human resource management staffing approaches like the ethnocentric, polycentric, and geocentric models to hire key personnel for specific positions. They apply ethical frameworks such as egoism and utilitarianism to guide their operations and effective interactions at the organizational level. Also, organizations manage political risks using integrative and defensive methods. Specifically, the methods have several strategies like political lobbying, political donations, contingency planning, and risk insurance. Practicing these management practices allows the firms to control the problems of working in selected markets and intensify success opportunities globally. The essay will comprehensively discuss political risk management, ethical behavior, and human resource management as the leading international business management functions.
International Firms’ Practice of the International Management Functions
Three main staffing approaches, the ethnocentric, polycentric, and geocentric models, are important for international businesses to consider in their Human Resource Management (HRM) frameworks (Harzing, 2001). Firstly, the ethnocentric staffing tactic entails a company’s use of parent country nationals to manage foreign processes. Workers from the parent firm or headquarters fill the foreign subsidiaries’ crucial positions. The model suggests an organization’s operations, techniques, and values are transferable to other locations. Although the approach might offer uniformity and effective control, it can fail to use local skills and cultural information and interfere with local responsiveness.
Secondly, the polycentric staffing technique uses a decentralized strategy, permitting local employees to manage subsidiaries. The model alleges that local staff better comprehend the culture, market, and business operations. Therefore, it believes that local managers can control organizational activities more efficiently. The polycentric staffing approach helps evade the language barrier and get more business networks. However, this model can lead to insufficient communication and collaboration between subsidiaries and headquarters. It can also create a strategic alignment gap between the parent corporation and its foreign practices. The polycentric staffing model indicates to the local and main governments the corporation’s dedication to the market. The technique allows companies to think internationally and perform locally. The local managers assure a local understanding of culture and control of the business, permitting firms to familiarize their model efficiently. Overall, the staffing model differs from geocentric and ethnocentric models primarily because the firm mainly utilizes host country inhabitants or...