business management assignment

Appointing a division manager in France

Helvetica Chemical was a Swiss-based multinational company engaged in pharmaceuticals, agrochemicals, dyestuffs and industrial chemicals. It operated in more than .60 countries and was organised as a matrix of product and country divisions. The corporate headquarters in Basel was staffed with global central function services establishing and supervising policies in research, IT, legal, personnel and finance. In each country there was a Group Company Managing Director responsible for the total activities of local divisional units and for the overall financial results of the country. Each Division General Manager had dual reporting: to the Group Company Managing Director (country head) and to the Global Division Director in Basel responsible for the worldwide performance of the product line. The case describes how a staffing decision can raise a general global strategic issue.

In France, the Group Company Managing Director, Lucien Boyer, was about to retire and the corporate headquarters designated Pierre Jourdan, General Manager of the French Pharmaceutical Division, to replace him. Jourdan's promotion opened the position of the Pharmaceutical Division in France, and the issue was to appoint a replacement for him. Two potential candidates had been identified.

(1) Philippe Dupont, a French national, with a doctoral degree in pharmacy from Toulouse University, had been recruited two years previously from a competitor as Marketing Manager. He had had his entire career in France and had a deep experience of the French pharmaceutical industry. Since his recruitment at Helvetica, he had obtained excellent results. Dupont was Jourdan and Boyer's preferred choice.

(2) Michel Gamier, a Canadian from Quebec, who had extensive international experience as a Marketing Manager in Canada, Brazil and the United States. He had spent two years in Basel at the corporate office in the Strategic Planning Department and was at present managing the Pharmaceutical Division of Helvetica Chemical in Morocco, where he obtained excellent results. Garnier was the preferred choice of the Basel Global Pharmaceutical Division.

Whom to appoint?

Answers to the question provoked very emotional attitudes and heated debates. For some, it was obvious that Dupont was the best choice, given his knowledge of the French market, his experience and the support of the French management structure. For some others, Garnier should be appointed, because he would bring a global perspective that could enrich the French subsidiary and position Helvetica Chemical as a true global player capable of transcending national barriers. After the first instinctive reactions, it became obvious that the appointment decision was more than a pure personnel management issue, it was really a global strategic issue. In practice, both choices were valid, but each conveys a fundamentally different message to the employees, competitors and customers. If this kind of decision systematically obtains the same kind of answer, it will 'drive' the strategy of the company in a particular dimension.

Dupont was the perfect choice for a strategic orientation based on local responsiveness.

His French education and experience with the market made him a perfect choice for the French subsidiary. No doubt, he would perform well and Jourdan would be happy to supervise a colleague with whom he could share the same 'culture'.

Garnier brought a 'global' perspective and his appointment would be an opening into the walled city of a national subsidiary. His international experience would give him the capability to transcend national cultures and to enhance a global corporate mindset. From an operational point of view, he would bring different methods and approaches to the French subsidiary.

The final choice depends upon the strategic orientation that Helvetica Chemicals wants to give to its global operation. If, from a competitive viewpoint, there is little advantage to be gained in adopting cross-border integration and the prime objective is to let local subsidiaries focus on their own market, the choice of Dupont is the most effective. If, on the contrary, it becomes strategically important to adopt a worldwide co-ordinated strategy, then it is time to implement a global human resource management (HRM) approach that fits with this objective and Garnier would be the recruit of choice.

This example illustrates the four kinds of issues presented in Figure 12.1: assignment of personnel, expatriate management, localisation and skills development.

© Lasserre Global Strategic Management 2nd ed. 2007