January 10th, 2018
TNT’s Human Resource Strategy and Expansion to China
Expansion of firms to foreign markets brings along various Human resources management (HRM) challenges. One of these is in relation to ensuring credible recruitment practices exist in the organization. The choice between host country nationals (HCNs) and parent country nationals (PCNs) in staffing top positions in foreign subsidiaries may also present challenges for multinational corporations – MNCs (Harzing 2001). Further due to the shortage of fresh candidates to fill up positions that fall vacant and to better the entity’s performance; companies are forced to establish informed employee training and development practices. Such challenges imply that for successful growth; companies must have a credible human resource strategy to meet these challenges.
The focus of this paper is thus to evaluate a strategy that TNT – one of the global integrators can use for its expansion to China. Headquartered in the Netherlands the entity’s mission is ‘to exceed its customers’ expectations in the transfer of their goods and documents around the world’ (TNT 2009, p. 1). To better its services in China the entity therefore requires massive human resources to meet the needs of the high Chinese population. The entity however also faces great competition from other global courier and freight powerhouses such as FedEx, UPS and DHL. The paper will thus evaluate; recruitment, selection, staffing and employee development practices advanced in literature to give advice on how best the entity can implement these in China. Internal versus external recruitment, expatriation and repatriation, employee training and development, and performance management practices will thus form the scope that the paper intends to cover.
For such assessment, the paper will review literature related to the subjects to be covered as presented on publications and compare these with the existing practices in company so as to inform on ways that HRM practices can be bettered in the entity’s Chinese operations. As such the limitations to the study would primarily be related to the available literature that bears specific relation to China and courier entities’ management practices. Secondly a public relations presentation of information in the company’s website may hinder identification of the divergent HR practices in the company and best practices advanced in literature.
The focus on china was informed by various aspects. First the country is arguably the largest emerging market in the global world (Enderwick 2009). With a large population and a rapidly growing economy, the country presents an opportunity for MNCs such as TNT to achieve sustainable growth (Enderwick 2009). On the other hand however China presents various challenges to effective HRM practices for TNT such as a wide cultural distance between China and the Netherlands where the company is headquartered (Itim International 2009, see appendix for cultural distance). According to Ghemawat (2007) such aspects as cultural, administrative, geographic and economic (CAGE) distances between host and parent countries could influence the success of an entity’s operations. The diversity between china and Europe – TNT’s main Market (TNT 2009) – and the potential that the country bears in furthering firm growth then informed on the selection of China as the country for analysis.