MNCs can approach the management of international human resources in a number of ways. Four of these approaches are given by Ken Kamoche:
Approach
1. Ethnocentric:
In the ethnocentric approach, the MNC simply exports HR practices and policies used in the home country to subsidiaries in foreign locations.
The foreign subsidiaries do not have much autonomy and the strategic decisions are made only at the headquarter? The key positions are managed by personnel from the headquarters. In short the subsidiaries are managed by expatriates from the home country.
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2. Polycentric:
In the polycentric approach, the subsidiaries are basically independent from headquarters. HR policies are adapted to meet the circumstances in each foreign country.
Local managers in the foreign country are hired to manage HRM activities. The MNC treats each subsidiary as a distinct entity with some autonomy. The subsidiary is managed by local nationals.
3. Regiocentric:
The regiocentric approach represents a regional grouping of subsidiaries. HR policies are coordinated within the region to as great an extent as possible. Subsidiaries may be staffed by managers from any of the countries within the region.
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Coordination and communication within the region are high, but they are quite limited between the region and the MNCs headquarters. It utilises a wider pool of managers but in a limited way. Personnel may move outside their countries but only within the particular geographic region.
4. Geocentric:
In the geocentric approach, HR policies are developed to meet the goals of the global network of home-country locations and foreign subsidiaries. Here the MNCs are taking a worldwide approach to their operations, recognising that each part makes a unique contribution with its unique competence.