ch office has discretion on hiring and other HR policies. This is perhaps one of the key challenges noted in the case study. Due to its strategic issue, or rather a lack of a sound strategy, Paine & Co conducted a review in 2008 to try to fix this issue.
As Paine & Co expands their international operations, they will need to identify and put in place a HR planning strategy which derives the best fit with regards to which IHRM activities of the parent country could and would be adopted worldwide. I will explore more on best fit in deeper analysis below.
International Recruitment, Selection and Development
As Paine & Co expands their international operations, they will need to manage the challenges of international recruitment, selection and development. Staff retention will also be a key issue which is link to compensation as well.
Edwards and Rees (2006) weight in on international managers selection and noted that MNC need to consider a wider scope of issue including the organization needs, the candidate's needs, the nature of the global and local pressures, the circumstances of the assignment and tailor their programme accordingly.
Tarique and Schuler (2010) noted that increasingly, the efforts of most IHRM staff is now being redirected toward managing talent on a global basis and MNC need to examine how IHRM activities of attraction, development, and retention work together in an international context.
They further noted that one of the key challenges for MNC is to establish a long-term global talent management (GTM) strategy which will take into consideration the laws, culture, society, politics, economy, and general environment of a particular location.
Paine & Co will need to establish such a GTM system that will enable it to address a more complex and diverse international operating environment while also anticipating the future concerns of varied stakeholders.
International Compensation and Performance Management
Paine & Co's compensation and benefits strategy relies on bonus system which makes up of 20 to 30% of annual remuneration. However the formula is based on assessment of the consultants' works on projects and this leads to discretionary element; with the final remuneration decision decided by the senior management. This system has also created internal politics resulting in confusion for the client.
Pay and conditions of employment are too important for MNC to standardise throughout all the offices. Although it is not easy to manage pay packages of staff in different international offices, who are all earning at different rates, employees are more likely to be more satisfied if they feel they are being paid what they are worth, especially those who are posted on an expatriate's package. (Plessis, 2010)
Festing et all (2007) summarized that compensation systems can support the corporate strategy and play a major role for MNC in realising competitive advantage and must be aligned with the corporate strategy (vertical fit) as well as with other HR practices in the MNC (horizontal fit). A high degree of transparency; fosters a feeling of equal treatment among the employees and a consistent compensation systems can facilitate the administration processes by increasing operational efficiencies.
Deeper analysis on HR Strategic Planning
We will continue our analysis of this case study by looking deeper into t
