21 Nov 2018

In my last post, I laid out my impressions of the philosophical differences between "recruitment" and "talent acquisition." The conclusion was that the convenience of having a formal talent acquisition strategy is vital to those enterprises looking to grow and compete in a very competitive industry for finding and retaining talent. Now, let's consider how this applies when an organization's growth exposes operations and talent acquisition to different countries and cultures.

Do we consider a standardized orientation or approach that supports this new strategy for globalization? Before we answer that, let's start by taking into account immediate challenges and considerations.

The inclusion of different countries, distances, time zones, languages, cultures, as well as differences in local labor laws and policies, makes the application of a global talent acquisition strategy much more complicated than one applicable to a single country. You can attempt to replicate processes that have worked in your host country/organization, but that is not always the best way to proceed if you haven't assessed local risks.

Before designing and executing a strategy of talent acquisition in a foreign location, it is imperative first to define the orientation and operational approach that the organization will use. Start by uncovering and examining the process that currently exists while being careful not to omit the legal precepts applicable to the municipalities in question.

Risk increases considerably due to the difficulties involved with having resources spread across multiple locations within the new geography, thus calling into account the critical element of "culture." If you are not careful to consider the defining spirit and professional climate of your location, the advantage of a shared experiential culture can quickly become a weakness to your organization. Assess cultural impacts in advance, or it will be difficult to transcribe your mission and objectives with consideration to the customs observed in the new location.

Based on Howard Perlmutter’s “EPRG” model for global businesses, there are four different orientations into which global organizations frequently fall. Each one of them is different in their strategic approach and has cost/benefit differences to the firm that applies them. Each method has a disparate impact on your strategy of talent acquisition.

Perlmutter's first orientation is the Ethnocentric (home country). Some of the characteristics of this approach are a tight control of internal operations, little autonomy in host locations, and critical positions held only by HQ. All the policies and processes related to staffing are designed in the home country and are replicated in the new geographies. All the recruitment processes are also executed with the same personnel, for all locations, from the HQ. This approach offers very little operational and cultural flexibility but produces a more straightforward operation and higher control over processes.

The second approach of the EPRG model talks about the Polycentric orientation (host country), where all the subsidiaries are considered as individual and independent entities. Policies and strategies, including those related to talent acquisition, are unique in each country. There is a recruitment team in each location with specific processes and procedures. In this approach, local preferences have a priority over HQ processes, and there is a benefit of quicker access to the local talent market. This access is due to the full and natural cultural alignment produced by the polycentric approach. Some of the downsides are the higher costs incurred by the duplication of positions and tasks, control and coordination problems, and sacrificing the experience and knowledge developed in HQ.

In the third approach, Regiocentric, enterprises acknowledge similarities within a group of foreign locations and operate using those affinities in a regional strategy. When developing talent and skills within a region, there is a minimal interregional transfer. The transfer produces challenges in succession planning across sectors and cross-regional knowledge sharing.

The last orientation described by the ERPG model is the Geocentric (global orientation). This model presents the organization as a single international entity, where talent and growth opportunities can come from any location. One of the characteristics of this approach is that there is a circulation of employees throughout the organization. Here, the talent acquisition strategy should focus on finding talent that can be deployed globally to achieve goals while meeting local requirements. The complexity requires that the talent acquisition process should be continuously reviewed based on their organizational impact and that the procedures be dynamic enough to serve the ever-changing global requirements. Cost is also something to keep an eye on since a geocentric model is typically more expensive than other orientations due to aspects like increased travel and the time required for decision-making increases because of the broader distribution of power.

Many organizations that operate with a global reach fall within the Ethnocentric, Polycentric and Regiocentric models. Therefore, pro-actively setting guidelines for global talent acquisition, or following those already in place, is vitally important as it will help to establish a proper strategic foundation. This strategy includes the definition of processes, policies, tools and human teams required to attract, and more importantly to retain, the talent needed for the goals defined by our organizations.

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