NATIONAL ECONOMIC UNIVERSITY

Sunshine Hotels case study

Full name: Do Huyen Trang Nhung Students ID: CQ501972

Hanoi, Ferbuary 2012

1. What is an ethnocentric approach? Many can describe the ethnocentricsm in business as the attitude and belief in that home country management style, knowledge, and way of doing business are superior and readily transfered to anything the host country might have to offer. Thus, an ethnocentric approach can be described as that headquarters from the paranet country makes key decisions, employees from the parent country hold important jobs, and the subsidiaries follow the parent country resource management practice. For the Sunshine Hotel situation: company wants to build its image consistently around EU by using ethnocentric approach; it first carries business formula from UK to France through initial employees. Its executives thinks that existing managers with strong sense of corporate values can successfully lead the changeover of the new hotels, and then manage them after the re-open. They consider only internal candidates for crucial positions (10 ones); so that such people can direct host-country national staff to run new ventures with core value maintenance and potential flourish to expand in whole EU. In order to penetrate in EU market, taking France is the first, strategic move of Sunshine. The business method of French hotel chain will be duplicated in many other countries; so the chosen method must be the best one with great ability of success in various environments. The company has decided to keep operating as it has been done in UK; this is a typical example of ethnocentric approach. 2. What are arguments for and against the use of a. Parent-Country-Nationals (PCNs): for using such emplyees: Pros Cons Centralization with high level of Need for additional incentives to move control abroad Standardization with quality of Language constraint products and service. Culture shock and lack of cultural Already set up relationship and intelligence. internal network among managers Suit for specialized products with technical knowledge Arguement can be pointed out to support PCNs are: Initial employees or founders can maintain their power and level of control. To expand the business will not lessen their benefits and influences. For a global brand, with distinguish attribute, only PCN can truely oporate the business, especially in a changing environment. This prevents any distortion or misleading the Sunshines image. There will be strong connection between headquarter in UK and new chain in France. Since top positions in French subsidiary are current managers who have been familiar with the hotel, the link between two entities will be cultivated with great harmony.

Arguement can be pointed out to against PCNs are: PCN lack of language usage and cultural knowledge. They have not known about French environment, thus it will take much time and effort for them to run the business there. Some PCN must be apart from their families and personal sets. There will be some emotional hardship.
b. Host-Country-Nationals (HCNs): for using such emplyees

Pros Cons Understanding of market preference and Unable to verify new staff ability customer need Cultural acquaintance Living Might disconjucted with corporate value convenience from parent company. Political/legal proficiency For adjusted product with customized experience Arguement can be pointed out to support HCNs are: For HCNs, the subsidiary is in their hometown, which they have already built strong conjunction with; so working and living seem not cause them any problem. HCNs know about political and legal settings, which will facilitate the hotel by dealing with administrative procedure or sovereign risk. HCN might serve customers better Arguement can be pointed out to against HCNs are: To recruit new HCNs, it will take more time and cost. Moreover, we can verify their capacity to adapt and work with Sunshine business model. HCNs also might not be able to understand the corporat culture for the implicit part of iceberg. c. Combination between PCNs and HCNs Pros Cons Diversity Must build for have common Flexibility understanding Might have much arguement and dispute Arguement can be pointed out to support boths are: Diverse perspective: Arguement can be pointed out to against PCNs are: They might have much arguement and dispute to settle in order to find common understanding

d. What is your personal opinion and why? In my opinion, the astute decision for international HRM is to use the mixture of PCN and HCN. Going for any extreme cannot be used consistently in every market. Internationalization and globalization, a company must be flexible and cultural intelligience, which ask for a pool of employees with diverse background. 2. How would you design a salary structure that balances the firms careful existing salary structure with being able to attract the right people to the positions? I think the salary structure for 10 mentioned position should be like: Main amount: equivalent or slightly higher than people with comparable power in the headquarter Bonus: greatly depends on operating results, especially after re-opening period Additional incentive: provide living accommondation. 3. How would you formulate a recruitment advertisement for the new positions that take into consideration the complex nature of the positions? Please consider the main required responsibilities and skills of the positions as well as the above concluded salary. Recruitment advertisement for the new positions must consider: Responsibility: to build a whole business chain almost from beginning with re-brand task and completed strang staff. Leadership: to attract and direct people in a new environment Cultuural adaptibility: to learn French and be successed in new society. Loyalty and full understanding of corporate culture: to consistently transfer the imange of the corporation.

4. What do you suggest, which topics must a successful training that is offered cover

(irrespective of time or cost) for: Training topics which should be covered for each type of employees are about: a. Parent-Country-Nationals (PCNs): Working environment of French (pre-departure) Culture of French society (some for predeparture and continued on the job) Potential customers in France, marker segment (some for predeparture and continued on the job) Language (on the job)
b. Host-Country-Nationals (HCNs):

Operation standard: how to clean the room, how to greet visitors, how to serve them... Corporate cultue: value, image, and brand name of Sunshine
c. Mix of Parent- and Home-Country-Nationals (PCNs/HCNs):

Team work or cooperation How to influence others