How to establish localization strategy?

With the acceleration of the process of world economic integration, more and more enterprises are moving towards the road of transnational operation. Foreign enterprises have entered the China market, and China enterprises have also entered the international market. Compared with operating in China, multinational enterprises are facing a more complicated operating environment, including economic environment, political environment, legal environment, social environment and cultural environment. How to adapt to the completely different market and management environment from the home country is particularly important for multinational enterprises. Localization strategy is a key to solve the above problems.

"Localization" includes several aspects: localization of production and operation, localization of scientific research and development, localization of human resource management and localization of market concept. Among them, the localization of human resource management in cross-cultural management is of great significance to the formation of a business philosophy of cross-cultural harmonious communication with the characteristics of the host country.

First, the advantages of localized human resource management

In practice, the talent localization of multinational companies has many advantages compared with other human resources strategies, which are embodied in the following aspects:

First of all, strengthen the trust of the country where the subsidiary is located in the company and improve the integration of multinational companies with the host market.

A large number of people from the host country have entered the local subsidiaries of multinational companies to engage in management work. Out of feelings for their own country, multinational companies will be restricted from engaging in any behavior that harms the interests of the host country. At the same time, the management team with nationals holding important positions will also enable the foreign branches of multinational companies to gain more trust and affinity from the host government and people. In recent years, the degree of talent localization of multinational corporations in China has been deepening. LG Electronics has renamed LG Electronics (China) Co., Ltd. as China LG Electronics Co., Ltd., and appointed China as the top management of China Branch. This series of actions is undoubtedly accelerating its integration with China people and China market.

Second, the implementation of talent localization strategy can reduce operating costs.

Like the production localization strategy of multinational corporations, the implementation of talent localization strategy can greatly reduce operating costs and make multinational corporations profit obviously. Under normal circumstances, the company will not only invest a lot of money in the selection and training of managers sent abroad, but also enjoy higher allowances and subsidies than its home country, as well as the round-trip travel expenses between its home country and the host country. On the one hand, it can avoid the above expenses and on the other hand, it can make full use of the advantage of low wages in the host country to attract high-quality talents with wages far lower than those of the parent company but significantly higher than those in the host country. At the same time, a large number of expatriate allowances and subsidies have also been reduced.

Third, to a certain extent, it ensures the relative stability of the company's managers and improves their work efficiency.

When people from their home countries go to work in foreign countries, they are mentally unstable due to cultural differences, their family members can't accompany them, or they encounter opportunities for transnational promotion, which makes managers give up their management responsibilities in the host country; Because of the unstable workplace, managers sent abroad often have some short-term behaviors in enterprise management. Recruiting local managers in the host country will reduce this negative impact. The residence and living environment of local managers are stable, so the people's hearts are stable, and the management behavior has a long-term development consciousness, which is more in line with the interests of enterprises. At the same time, from the company's point of view, it can also reduce the time and times for managers to visit relatives and take vacations, which substantially improves the utilization efficiency of human resources.

Fourth, it will help multinational companies to get familiar with the market situation of the host country more quickly and expand the market.

A country's national conditions, a market has a market rules of the game. Usually, multinational companies must employ a considerable number of local employees when investing overseas. This is mainly because local employees are familiar with local customs, market trends and government regulations, and it is easy to reach an understanding with local consumers. It is undoubtedly convenient for multinational companies to expand their markets and gain a foothold in the local area.

Second, some thoughts on implementing the localization strategy of human resource management

The advantages of localization strategy in human resource management are obvious, and there are also some problems worthy of our attention in the implementation of localization strategy.

1, the management communication of multinational companies is essentially concerned with the best integration and communication between multiculturalism and ideas. Every culture has its own characteristics and advantages. When establishing the corporate culture of the branches of multinational corporations, we should of course take the cultural background of the host country as the fundamental starting point of branch management and market operation, but we should not be overly biased. In the process of implementing the localization strategy, we should fully consider and absorb the advantages of the two cultures, highlight the key points, and not neglect one side. For example, compared with local enterprises in China, foreign-funded enterprises have obvious advantages in core technology, product quality, overall image, comprehensive strength and international operation. When implementing the localization strategy of human resources, we should introduce the cultural, management and technical advantages of foreign enterprises into enterprises in personnel recruitment and training, such as appointing personnel from the parent company in corresponding management positions, and using some training methods and contents of the parent company to train local managers in China.

2. In multinational companies, employees from two or more countries cooperate with each other. Usually, because all members of a company only pay attention to self-development, it is impossible to form a corporate culture with collective values, which makes enterprises lack long-term cohesion to individuals. Therefore, many companies have implemented the "multi-directional and cross-cultural" strategy in transnational human resource management. In practical application, the following methods can be adopted to avoid "cultural conflict" caused by huge cultural differences between individuals: choosing a native with local nationality; Choose a foreign country with its own nationality; Selecting local foreigners to study and work in their own countries; Choose your home country to study and work locally. This strategy enables people with multiple cultural backgrounds and ways of thinking to be managers of multinational companies, making it easier for them to understand and appreciate cultural differences, and they can also play a bridge role in management communication and cultural translation.

3. When implementing localization of human resource management, most enterprises are: important decisions are made by the top management of the parent company, and the daily operation management is the responsibility of the local supervisor. Local people are in charge of management, which shortens the adaptation period of employees and enables them to enter the state more quickly, but it also makes the management style and corporate culture infiltration of enterprises particularly difficult. In order to solve these problems, the company can adopt the dual supervisor system, give consideration to localization, and bring the advantages of the parent company to its subsidiaries. In other words, the management policy is jointly decided by the heads of overseas branches and parent companies. This arrangement can not only retain the operating characteristics of the parent company, but also facilitate the monitoring of employees of overseas branches and ensure that "feelings" can be "released". Local supervisors can reduce communication problems by taking care of the business in the region, but their managers are familiar with the background of the parent company and know more about the product characteristics, which is helpful to promote the branch company's understanding of the headquarters.

4. Talent localization strategy is accompanied by talent internationalization strategy. Theoretically speaking, in the personnel strategy of multinational companies, the internationalization strategy of talents should be the most effective. Because it does not consider the nationality of managers, but only from the perspective of ability, the rational allocation and use of human resources on a global scale is more in line with the growing global strategic needs. However, in practice, because many countries where subsidiaries are located require to hire local personnel as managers and realize this requirement through state intervention, there are a series of insurmountable weaknesses in the talent localization strategy. First of all, in order to internationalize managers, multinational enterprises must recruit employees in a large geographical area, train employees in language and culture, and transfer managers and their families to different countries, which may make the cost of implementing this strategy higher. Second, this strategy requires multinational companies to implement highly centralized control in human resource management, thus limiting the autonomy of regional managers in employing people.

5. The localization strategy of multinational corporations has an important influence on the host country: on the one hand, they have trained a large number of high-quality talents for the host country, and in a sense, they have reserved management talents for the future development of the host country. Local managers employed by multinational companies have more opportunities to get in touch with foreign advanced science and technology and management experience, and are familiar with the operation mechanism of market economy. The flow of these new enterprise managers and technicians in China will certainly promote the spread of international advanced management experience and technology in the host country. On the other hand, the talent localization strategy of multinational companies makes the local senior managers and technical backbones of some multinational companies have a big gap with ordinary workers in terms of salary. For example, the salary of China staff in multinational companies can reach more than ten times that of directors of state-owned enterprises. Due to the salary policy adopted by multinational companies, a large number of talents from state-owned enterprises are drained, and high flyers, who has spent a lot of resources to train by the state, is given priority employment by multinational companies, which brings psychological imbalance to the cadres of state-owned enterprises at the same level and affects their work enthusiasm.

In a word, multinational companies hope to achieve globalization, and at the same time they realize that in order to succeed, they must localize their management. Localization can reduce the crisis and resistance of local society to foreign capital, and more fundamentally, localization can integrate corporate culture with local culture to achieve a cultural integration, thus making enterprises prosperous. In terms of human resource management, localization is beneficial for multinational companies to reduce the high cost of sending overseas personnel and transnational operations, integrate with local social culture, increase employment opportunities in host countries, manage changes and accelerate integration with the international community. Localization connects the interests of both multinational corporations and host countries, so it has become the core measure for multinational corporations to solve foreign environmental obstacles.