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week6lecture.pptx
WEEK 6: SIGNALS, ATTRACTIVENESS AND RECRUITMENT IN EMNCS
Emerging Market MNCs: Internationalisation and HRM (CMSE11380)
Dr. Keyan Lai Office: 2.13
Email: [email protected]
Home country effect, e.g. competitive disadvantage associated with their country origin
The complex relationship between EMNCs and their home country states, which may lead to problematic relationship between EMNCs and host country states
Legitimacy issue, i.e. pragmatic, moral, and cognitive legitimacy, and legitimation strategies (e.g. CSR and economic, social impacts)
How do these issues translate into a challenge for EMNC in recruitment?
Recap on previous lectures
A survey of 626 German, French and American respondents (including students and working professionals)
In general, EMNCs (i.e. Chinese and Indian firms) have significantly lower organizational attractiveness than European and American MNCs.
Working professionals attribute higher level of attractiveness to European and American MNCs; students with no significant difference
American respondents significantly less attracted to EMNCs, compared to French
(Alkire, 2014)
Some empirical evidence!
The attractiveness of EMNCs differs significantly in terms of industry
Auto-motive, consultancy, banking/insurance are least attractive industries ( the first two most attractive for local German firms!)
Chinese MNCs: IT & electronics, transport & logistics, consumer goods most attractive as employers
Indian MNCs: IT & electronics, media, and consumer goods
Russian MNCs: transport & logistics, consumer goods, engineering
Compensation and job security the most important factors to consider ( compared with career development and work atmosphere for local German firms)
(Holtbrugge & Kreppel, 2015)
Chinese, Indian & Russian firms in Germany
Korean
Chinese vs. US MNCs in Korea
Korean job seekers perceived China’s image significantly lower than the US in terms of economic and technological development
As a result, less attracted to Chinese firms compared to US firm
CSR activities of Chinese firms have strong influence on Korean job seekers’ job-pursuit intentions
CSR provide EMNCs with the opportunity to
– To overcome the image of their country of origin
– To build trust and reliability to increase attractiveness
(Hong & Kim, 2017)
Defined as ‘an amalgamation of transient mental representations of specific aspects of a company as an employer as held by individual constituents’ (Lievens & Slaughter, 2016)
Made up of specific attributes that an individual associates with the organization as a place to work
Employer Image
Functional attributes: job seekers’ association about more tangible attributes that have utilitarian value (e.g. location, pay, career opportunities)
Symbolic attributes: inferences that describes the organization in terms of subjective and intangible attributes (e.g. innovative, prestigious, stylish)
Experiential attributes: actual experiences with the employer through past classifications or recruitment events
Decision making benefits: better recruitment outcomes, e.g.
– People would accept 7% lower pay to work at an organization with a strong image (Cable & Turban, 2003)
Emotional power: good image inferences increase organizational attractiveness of potential applicants, and lead to satisfaction and loyalty of current employees.
Financial benefits: organizations on the Best Companies to Work For list deliver strong financial performance (Fulmer et al 2003)
Outcomes of employer image
A two step process: screening (i.e. compatibility test), followed by choosing (i.e. profitability test).
Screening is based on the evaluation of incompatibility
Whether an object fits their image of what is desired
Whether the object is compatible to his/her values, principles, goals, and the plan to achieve the goals
non-compensatory violation of fit: good aspects do not
compensate for incompatible aspects
Image and job choice
(Held & Bader, 2018)
Applicants’ job choice based on signaling and image theory
(source: Held & Bader, 2018, based on Beach, 1990, 1993, and Spence, 1973)
Sponsorship of university activities
Strategic design of websites
Training recruiters
Use recruitment media that provide personal focus
Has a presence at career fairs and clearly communicates its values
“Dare to be different” by using recruitment media that other organizations are not
Have a strong Facebook, LinkedIn presence
Treat employees well so that they spread positive word-of-mouth information about the company
And others…
A long list of image management strategy
A concept in marketing focusing on the country-of-origin effects on consumers’ perceptions of product quality and purchase intension (e.g. Knight & Calantone, 2000)
Country-of-origin image as a multifaceted construct (e.g. Roth & Diamentopoulos, 2009, Froese, Vo & Garrett, 2010)
Perceptions of product quality
Perceptions of people
Perceptions of economical, political and technological environment
Country-of-origin image
Country-of-origin image significantly influence corporate image (Zhang, et al 2019)
Affective CI
Economic CI
Political CI
Affective CI: “focuses on psychological and ideological characteristics, such as negative sentiments stemmed from political, religious, or ideological conflicts.”
Country-of-origin image
Let’s talk about national security!
Class activity: an experiment
Spencer (1973) defines signals as “those observable characteristics attached to the individual,” e.g. education background
– these observable characteristics inform the employer’s judgment of this individual candidate.
The signals we receive about a person or company influence our perception of the quality of the person or company
Signaling theory
A central idea of signaling theory is concerned with reducing information asymmetry between two parties (Connelly et al., 2011).
One party (the sender) holds information that the other party (the receiver) does not; the first party then decides to send relevant information to the latter
The signal is subject to perception and interpretation by the receiver.
The relationship between signals/signal quality and the interpretation of the signal
Signaling theory
Organizational actions and characteristics, e.g.
Substantive organizational investments, e.g. investing in human capital, product development
Symbolic organizational investments, e.g. advertising, PR, CSR policies
Being state-owned
Information disseminated by the organization, e.g.
Job advertisements, web pages
The behaviours of recruiters
Information disseminated by non-organizational sources, e.g.
Words of mouth
Media
NGOs
Categories of signals
Employers as the sender can influence applicants’ perceptions on organization
Applicants also receive signals the employers do not have control on (e.g. country image, home country institutional voids; industry scandals)
Three signal-based mechanisms that affect organizational attractiveness (Jones et al 2014)
Anticipated pride
Perceived value fit
Expected treatment
Signaling theory & recruitment
Anticipated pride: Affiliation with a particular company partly defines who we are; we feel a sense of pride from being affiliated with a good company (Tajfel & Turner, 1986). It enhances self-esteem and helps us gain social approval and impress others (Highhouse et al., 2007).
Perceived value fit: Person–organization (P–O) fit defined as “the congruence between the norms and values of organizations and values of persons” (Chatman, 1989, p. 339); the greater the value fit we perceive, the more attracted to the organization.
Expected treatment: expectations about how favorably the organization treats its employees and by extension, how favorably they would be treated if they worked there; instrumental inference.
Signal-based mechanisms
Objectives
To test the impact of national security accusations on organizational attractiveness
To advance our understanding of the impact of national security concerns on MNEs and their strategies
Research questions
How do accusations of being a national security threat impact organizational attractiveness?
To what extend does employer branding mitigate these negative impacts?
Our experiments
The hypothetical effects
Anticipated pride:
It perceived as representing the interest of and working as an agent for the home government; status as an independent commercial entity questioned;
Affiliation with companies that work for their home government does not evoke a strong sense of pride;
particularly when their owners (i.e., the state government) are frequently plagued by such accusations as human rights abuse, intellectual property theft, and cyber hacking.
When the firm becomes a security threat…
Perceived value fit
Bad signals regarding what it values and what it might not.
The interest of the home government may come before the responsibility for the local community; the political agenda may be prioritized over business growth and profits; transparency and integrity may be sacrificed for secrecy and corruption
The values represented by the company can be perceived as problematic, and accordingly, the perceived value fit and ultimate attraction to the company are undermined.
When the firm becomes a security threat…
Expected treatment
State ownership and sponsorship amplify the issue of corporate governance and send out a message about who the real boss is.
The issue of participation and inclusion: to what extent can an individual be included in the decision-making process, be able to voice opinions, be able to feel valued, and be able to make career progress within the company?
Job seekers’ intention to join these companies will be reduced, because they may infer that the interests and rights of the government and politicians will be prioritized over those of the employees.
When the firm becomes a security threat…
The hypothetical effects
The market leadership signal
Highly successful companies, partly owing to the support and sponsorship provided by their home government
Cutting-edge technology and products (for example, Huawei is a world leader in 5G technology, and Kaspersky is a long-time market leader in security software); on the Fortune 500 list
Prestigious organizations: “organization[s] that [seem] superior to other organizations in the industry, and [may be] considered impressive by others” (Highhouse et al., 2007, p. 142).
Hypothesis: the market leadership signal can be applied to induce pride anticipation
The signals to be sent
The social responsibility signal
An organization that sends out signals of being respectable and honorable will attract job seekers because people want to join a respectable and honorable organization, and associations with such organizations will satisfy job seekers’ need to express their value and to project the image of being a good person with good values (Highhouse et al., 2007).
Is this company a responsible corporate citizen? Does it act ethically? Does it value transparency and integrity?
Hypothesis: the social responsibility signal can induce the value fit perception
The signals to be sent
The learning and growth signals
Technical leadership allows them to provide opportunities for training and learning for employees (Huawei in 5G, Kaspersky in cybersecurity, TikTok in immersive technology )
They tend to experience rapid growth, and with it, uncertainty and change. This also means that growth can be a key benefit of working for these companies.
Hypothesis: learning and growth signals can induce positive treatment expectations
The signals to be sent
Experiment 1
Experiment 2
Employer image is individual’s perception of various aspects of a company as an employer
Varieties of sources send out signals to existing/prospective employees about what it might be like to work with the company.
For EMNCs, employer branding and other HRM activities could send out a positive signal
Some conclusions
