Transition from a Regiocentric to Geocentric Approach
1.0 Introduction
Unilever, a multinational organisation, are geocentric in their approach to globalisation and have recently taken over a factory in China. This factory has had no previous relations with any international corporation and operates solely through a regiocentric style of management. Unilever wish to bring the Chinese factory into line with their current practices and to assist in the transition of the factory from a regiocentric to a geocentric approach a group of proficient managers will be selected from Unilever’s UK team and sent out to China.
The purpose of this report is to present a comprehensive analysis of the shift from a regiocentric to a geocentric style of approach, while explaining the likely challenges to be encountered by the expatriates.
2.0 Chapter 1
2.1 Geocentric
When considering management and staffing approaches, large national organisations will commonly select the geocentric approach for international operations. Under the geocentric approach the MNE will adopt a global attitude towards its operations, recognizing that both the subsidiaries and headquarters of the company present a unique contribution with its overall competence. Companies will be implementing a transnational orientation whereby employees will be selected owing to their skills and abilities regardless of their nationality. Unlike the alternative approaches to staffing and management, PCNs, HCNs and TCNs can be found in key positions throughout the organisation, including on the board of directors. This aids in the utilization of a wider pool of managers as well as developing core competency by securing the best talents in the core team.
There are three expected impacts on staffing as a result of this approach:
• Staff will circulate throughout the global organisation,
• Talent acquisition policies will maximise the long-term strength of the global organisation, and
• Talent and skills will be increased globally to achieve universal goals
Unilever, a multinational organisation, are geocentric in their approach to globalisation and have recently taken over a factory in China. This factory has had no previous relations with any international corporation and operates solely through a regiocentric style of management. Unilever wish to bring the Chinese factory into line with their current practices and to assist in the transition of the factory from a regiocentric to a geocentric approach a group of proficient managers will be selected from Unilever’s UK team and sent out to China.
The purpose of this report is to present a comprehensive analysis of the shift from a regiocentric to a geocentric style of approach, while explaining the likely challenges to be encountered by the expatriates.
2.0 Chapter 1
2.1 Geocentric
When considering management and staffing approaches, large national organisations will commonly select the geocentric approach for international operations. Under the geocentric approach the MNE will adopt a global attitude towards its operations, recognizing that both the subsidiaries and headquarters of the company present a unique contribution with its overall competence. Companies will be implementing a transnational orientation whereby employees will be selected owing to their skills and abilities regardless of their nationality. Unlike the alternative approaches to staffing and management, PCNs, HCNs and TCNs can be found in key positions throughout the organisation, including on the board of directors. This aids in the utilization of a wider pool of managers as well as developing core competency by securing the best talents in the core team.
There are three expected impacts on staffing as a result of this approach:
• Staff will circulate throughout the global organisation,
• Talent acquisition policies will maximise the long-term strength of the global organisation, and
• Talent and skills will be increased globally to achieve universal goals