The ‘EPG’ in the title of this model stands for the following –. Ethnocentrism; Polycentrism; Geocentrism. Knowing where your organization lies under these three. Ethnocentrism is pre- dominantly a home country orientation. Ethnocentric Polycentric Regiocentric Geocentric Management orientation. Ethnocentric is a staffing policy that is used in companies that has primarily international strategic orientation. This policy is generally adopted by headquarters.
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Management is unable to have total control over the company in the host country because it is found that “local nationals have a better understanding and awareness of national market conditions, more so than home office personnel. Fortunately, using this model can be a quick and easy way to bring things back into line. Organizations that are designed with an ethnocentric focus will portray certain tendencies. To the greatest extent possible, nationalities are largely ignored in this system, with the company being run as a global enterprise rather than a large corporation which is deeply rooted in one specific nation.
The regiocentric approach uses managers from various countries within the geographic regions of business. Polycentric approach When a company adopts the strategy of limiting recruitment to the nationals of the host country local peopleit is called a polycentric approach.
Often there are major differences between countries in a region. Geocentric approach When a company adopts the strategy of recruiting the most suitable persons for the positions available in it, irrespective of their nationalities, it is called a geocentric approach. These people or companies believe that the home country is superior. In contrast, polycentric organizations or managers see each country as unique, and consider that businesses are best run locally. Since the HR operations are constrained by several factors like political and ethnical factors and government laws, it is difficult to adopt this approach.
The ethnocentric approach places natives of the home country of a business in key positions at home and abroad. The geocentric approach uses Ihe best available managers for a business without regard for their country of origin.
EPG model – Wikipedia
In performing an EPG analysis, a firm may discover that they are oriented in a direction that is not ethnocnetric to the firm or misaligned with the firm’s corporate culture and generic strategy. In contrast to ethnocentrism, polycentrism polcyentric to the strategies, methods, and techniques of the host country when it comes to decision making for the organization. Indian manufacturing companies are going all out to woo expat talent in digital, artificial intelligence and other new-age technologies, as they seek to strengthen their global footprint with improved products.
This article is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor’s personal feelings or presents an original argument about a topic. R Geocnetric, managing director of Insist Executive Search, said that if there are four-five members in the shortlist for a CXO search, two are invariably expats. These include digital, large world-class manufacturing, research and development, data sciences, artificial intelligence, machine learning, etc.
The HR department must have the capacity to foresee the changes in these markets and exploit those changes productively. In Geocentric orientation nationalities are eghnocentric ignored, with the company being run as a global enterprise rather than a large corporation which is deeply rooted in one specific nation.
Today’s Top Picks for Our Regioccentric On the plus side, running the business this way can keep things simple. They will be responsible for setting up processes in line with the best practices from our industry around the ethnpcentric. For example, Norway and Spain are both in Europe, but are very different in climate, culture, transport, retail distribution, and so on.
The recruitment process in this method involves four stages: A polycentric approach “gives rise to the problems of coordination and control.
In this example, the Australian parent company uses natives of India to manage operations at the Indian subsidiary. The idea ethnoocentric ethnocentrism is the concept that the organization is going to default to the thinking, traditions, and more of its home country. When they look to new markets they rely on what they know and seek similarities with their own country.
A third force causing this movement is the abundance of growing world markets, occurring in areas such as income earning age population, rising GDP’s, and escalating disposable income in areas such as China and Korea. Natives of Australia manage the home office.
However, large international companies generally adopt the geocentric strategy with considerable success. It is a win-win for the executives too, as they are seeing scale and growth in India.
Such companies are also sometimes referred to as domestic companies.
The company does not want to have divisions within its ranks based on nationality. When regional expertise is needed, natives of the region are hired. Instead of moving in directions that are not going to allow the business to ultimately reach its desired destination, it is important that the organization remain focused on its core values and culture in order to thrive.
Polycentric orientation assumes that host country cultures are different making a centralised approach unfeasible. Home standards are applied to the evaluation and control of the organization. All articles with dead external links Articles with dead external links from November Use dmy dates from October Wikipedia articles with style issues from November All articles with style issues All articles with links needing disambiguation Articles with links needing disambiguation from September The first drawback of a polycentric approach is that the “benefits of global coordination between subsidiaries such as the development of economies of scale cannot be realized.
The EPG Model
When a company follows the strategy of choosing only from the citizens of the parent country to work in host nations, it is called anethnocentric approach. As noted earlier, it is not easy to run a business that is operating around the globe, as there will always be the potential to get off-track in terms of goals and the overall direction of the business.
For an effective utilization of the internal source of recruitment, global companies need to develop an internal database of employees and an effective tracking system to identify the most suitable persons for global postings.
It is essential that ethnocentrix workforce of an international organization is aware of the nuances of international business. Unification is the ultimate goal of a geocentric operation.