Chapter 19 Global Human Resource Management
True / False Questions
1.
An expatriate manager is a citizen of one country who is working abroad in
one of the firm’s subsidiaries.
TRUE
An expatriate manager is a citizen of one country who is working abroad in
one of the firm’s subsidiaries.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-01 Summarize the strategic role of human resource management in international business firms.
Topic: Introduction
2.
HRM professionals have a critically important strategic role.
TRUE
The HRM function, through its staffing, training, compensation, and
performance appraisal activities, has a critical impact upon the people,
culture, incentive, and control system elements of the firm’s organization
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-01 Summarize the strategic role of human resource management in international business firms.
Topic: The Strategic Role of International HRM
3.
An organization’s norms and value systems are known as its corporate
culture.
TRUE
Corporate culture refers to the organization’s norms and value systems. A
strong corporate culture can help a firm to implement its strategy.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
4.
The most attractive staffing policy is the ethnocentric approach.
FALSE
An ethnocentric staffing policy is one in which all key management
positions are filled by parent-country nationals. The policy is now on the
wane in most international businesses.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Staffing Policy
5.
A firm with an ethnocentric staffing policy will fill all key management
positions with parent-country nationals.
TRUE
An ethnocentric staffing policy is one in which all key management
positions are filled by parent-country nationals.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
6.
Cultural myopia refers to a firm’s failure to understand host-country cultural
differences that require different approaches to marketing and
management.
TRUE
An ethnocentric policy can lead to cultural myopia, the firm’s failure to
understand host-country cultural differences that require different
approaches to marketing and management.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Staffing Policy
7.
In the case of an ethnocentric approach, it is possible that managers may
make decisions that are ethically suspect because they do not understand
the culture in which they are managing.
TRUE
an ethnocentric policy can lead to cultural myopia, the firm’s failure to
understand host-country cultural differences that require different
approaches to marketing and management. Expatriate managers may also
make decisions that are ethically suspect simply because they do not
understand the culture in which they are managing.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
8.
A firm following a polycentric approach to staffing believes that the host
country lacks qualified individuals to manage subsidiaries.
FALSE
A polycentric staffing policy requires host-country nationals to be recruited
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
9.
A firm that adopts a polycentric approach to staffing is likely to suffer from
cultural myopia.
FALSE
An ethnocentric policy can lead to cultural myopia, the firm’s failure to
understand host-country cultural differences that require different
approaches to marketing and management. A polycentric staffing policy
requires host-country nationals to be recruited to manage subsidiaries,
while parent-country nationals occupy key positions at corporate
headquarters.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
10.
Firms may choose an ethnocentric approach to staffing as opposed to a
polycentric approach because of the cost savings it promotes.
FALSE
A polycentric approach may be less expensive to implement, reducing the
costs of value creation. Expatriate managers can be expensive to maintain.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
11.
A geocentric staffing policy seeks the best people for key jobs throughout
the organization, regardless of nationality.
TRUE
A geocentric staffing policy seeks the best people for key jobs throughout
the organization, regardless of nationality.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
12.
A geocentric approach tends to weaken local responsiveness.
FALSE
The multinational composition of the management team that results from
geocentric staffing tends to reduce cultural myopia and to enhance local
responsiveness.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
13.
Many firms adopt a geocentric policy toward staffing because it is a
relatively inexpensive staffing policy.
FALSE
A geocentric staffing policy also can be expensive to implement. Training
and relocation costs increase when transferring managers from country to
country.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
14.
An ethnocentric approach is compatible with both global standardization
and transnational strategies.
FALSE
Broadly speaking, an ethnocentric approach is compatible with an
international strategy, a polycentric approach is compatible with a
localization strategy, and a geocentric approach is compatible with both
global standardization and transnational strategies.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Identify the pros and cons of different approaches to staffing policy in international business
firms.
Topic: Staffing Policy
15.
A citizen of Japan who moves to the United States to work at Microsoft
would be classified as an inpatriate.
TRUE
Sometimes the term inpatriates is used to identify a subset of expatriates
who are citizens of a foreign country working in the home country of their
multinational employer.
AACSB: Analytic
Blooms: Understand
16.
Expatriate failure refers to a manager’s failure to understand host-country
cultural norms and values, leading to ineffective work.
FALSE
A prominent issue in the international staffing literature is expatriate failure
—the premature return of an expatriate manager to his or her home country.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
17.
A seminal study, R. L. Tung, revealed that for European firms, the top
reason for expatriate failure was the inability of the manager to cope with
larger overseas responsibilities.
FALSE
Tung asked her sample of multinational managers to indicate reasons for
expatriate failure. Managers of European firms gave only one reason
consistently to explain expatriate failure: the inability of the manager’s
spouse to adjust to a new environment.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
18.
An executive who performs well in a domestic setting may not be able to
adapt to managing in a different cultural setting.
TRUE
Domestic performance and overseas performance potential are not the
same thing. An executive who performs well in a domestic setting may not
be able to adapt to managing in a different cultural setting.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
19.
An expatriate needs to have language fluency to show willingness to
communicate.
FALSE
Although language fluency helps, an expatriate need not be fluent to show
willingness to communicate. Making the effort to use the language is what
is important.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
20.
The ability to understand why people of other countries behave the way
they do is perceptual ability.
TRUE
Perceptual ability is the ability to understand why people of other countries
behave the way they do; that is, the ability to empathize.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
21.
Expatriate managers who have perceptual ability tend to treat foreign
nationals as if they were home-country nationals.
TRUE
Perceptual ability is the ability to understand why people of other countries
behave the way they do; that is, the ability to empathize. Expatriate
managers who have this ability tend to treat foreign nationals as if they
were home-country nationals.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
22.
According to Mendenhall and Oddou, poorly-adjusted expatriates tend to be
nonjudgmental and nonevaluative in interpreting the behavior of host-
country nationals.
FALSE
According to Mendenhall and Oddou, well-adjusted expatriates tend to be
nonjudgmental and nonevaluative in interpreting the behavior of host-
country nationals and willing to be flexible in their management style,
adjusting it as cultural conditions warrant.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-03 Explain why managers may fail to thrive in foreign postings.
Topic: Staffing Policy
23.
Cultural toughness refers to the relationship between the country of
assignment and how well an expatriate adjusts to a particular posting.
TRUE
Cultural toughness refers to the relationship between the country of
assignment and how well an expatriate adjusts to a particular posting.
Some countries are much tougher postings than others because their
cultures are more unfamiliar and uncomfortable.
Topic: Staffing Policy
24.
A manager might be sent on several foreign postings over a number of years
to build his/her cross-cultural sensitivity and experience as part of a
management development program.
TRUE
As part of a management development program, a manager might be sent
on several foreign postings over a number of years to build his or her cross-
cultural sensitivity and experience. At the same time, along with other
managers in the firm, the person might attend management education
programs at regular intervals.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-04 Recognize how management development and training programs can increase the value of
human capital in international business firms.
Topic: Training and Management Development
25.
Historically, most international businesses have been more concerned with
training than with management development.
FALSE
Historically, most international businesses have been more concerned with
training than with management development. Plus, they tended to focus
their training efforts on preparing home-country nationals for foreign
postings.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-04 Recognize how management development and training programs can increase the value of
human capital in international business firms.
Topic: Training and Management Development
26.
English is considered the language of world business.
TRUE
English is the language of world business; it is quite possible to conduct
business all over the world using only English.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-04 Recognize how management development and training programs can increase the value of
human capital in international business firms.
27.
Where an expatriate community exists, firms often devote lesser effort to
ensuring that the new expatriate family is quickly integrated into that
group.
FALSE
Where an expatriate community exists, firms often devote considerable
effort to ensuring the new expatriate family is quickly integrated into that
group.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-04 Recognize how management development and training programs can increase the value of
human capital in international business firms.
Topic: Training and Management Development
28.
Firms pursuing a transnational strategy increasingly are using management
development as a strategic tool.
TRUE
International businesses increasingly are using management development
as a strategic tool. This is particularly true in firms pursuing a transnational
strategy, as increasing numbers are.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
29.
Bringing managers together in one location for extended periods and
rotating them through different jobs in several countries helps the firm build
a formal management network.
FALSE
Bringing managers together in one location for extended periods and
rotating them through different jobs in several countries helps the firm build
an informal management network.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-04 Recognize how management development and training programs can increase the value of
human capital in international business firms.
Topic: Training and Management Development
30.
A firm’s performance appraisal systems are an important element of its
control systems.
TRUE
A firm’s performance appraisal systems are an important element of its
control systems, which is a central component of organization architecture.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-05 Explain how and why performance appraisal systems might vary across nations.
31.
Unintentional bias makes it difficult to evaluate the performance of
expatriate managers objectively.
TRUE
Unintentional bias makes it difficult to evaluate the performance of
expatriate managers objectively. In many cases, two groups evaluate the
performance of expatriate managers—host-nation managers and home-
office managers—and both are subject to bias.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 19-05 Explain how and why performance appraisal systems might vary across nations.
Topic: Performance Appraisal
32.
Most expatriates believe that more weight should be given to an on-site
manager’s appraisal than to an off-site manager’s appraisal.
TRUE
Most expatriates appear to believe more weight should be given to an on–
site manager’s appraisal than to an off-site manager’s appraisal. Due to
proximity, an on-site manager is more likely to evaluate the soft variables
that are important aspects of an expatriate’s performance.
AACSB: Analytic
33.
In ethnocentric firms, the lack of managers’ mobility among national
operations implies that pay can and should be kept country-specific.
TRUE
In ethnocentric firms, the issue can be reduced to that of how much home–
country expatriates should be paid. As for polycentric firms, the lack of
managers’ mobility among national operations implies that pay can and
should be kept country-specific.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-06 Explain how and why compensation systems might vary across nations.
Topic: Compensation
34.
If a firm is serious about building an international cadre, it may have to pay
its international executives the same basic salary irrespective of their
country of origin or assignment.
TRUE
If a firm is serious about building an international cadre, it may have to pay
its international executives the same basic salary irrespective of their
country of origin or assignment. Currently, however, this practice is not
widespread.
Learning Objective: 19-06 Explain how and why compensation systems might vary across nations.
Topic: Compensation
35.
Base pay in most firms is set with regard to global market conditions.
FALSE
Except for a relative small cadre of internationally mobile executives, base
pay in most firms is set with regard to local market conditions.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-06 Explain how and why compensation systems might vary across nations.
Topic: Compensation
36.
An expatriate’s base salary normally varies from the base salary for a similar
position in the home country.
FALSE
An expatriate’s base salary is normally in the same range as the base salary
for a similar position in the home country. The base salary is normally paid
in either the home-country currency or in the local currency.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-06 Explain how and why compensation systems might vary across nations.
Topic: Compensation
37.
When a reciprocal tax treaty is in force, the firm typically pays the
expatriate’s income tax in the host country.
FALSE
When a reciprocal tax treaty is not in force, the firm typically pays the
expatriate’s income tax in the host country. In addition, firms normally make
up the difference when a higher income tax rate in a host country reduces
an expatriate’s take-home pay.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-06 Explain how and why compensation systems might vary across nations.
Topic: Compensation
38.
From a strategic perspective, the key issue in international labor relations is
the degree to which organized labor can limit the choices of an international
business.
TRUE
The HRM function of an international business is typically responsible for
international labor relations. From a strategic perspective, the key issue in
international labor relations is the degree to which organized labor can limit
the choices of an international business.