HR related challenges and strategies

 

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1.        HRM strategies and Company ABC’s achievement of objectives

 

1.1    The assistance from job analysis

 

1.1.1            Definition of job analysis

 

Job analysis could be referred as a purposeful, systematic process for collecting information on the important work-relative aspects of a job (Gatewood, Field & Barrick 2008, p.257). The key components of job analysis include job content, job requirements and job content. Job content is about the duties and responsibilities of the job in a way that can range from global statements to very detailed descriptions of tasks and procedural phrases; job requirements refers to the identification of the formal qualifications, knowledge, skills, capabilities and personal traits that employees need to perform the job in a particular situation or context (Stone 2011, p.150). From the definition of the concept, conclusion could be made that the purpose of a job analysis is to combine the task demands of a job with our knowledge of human attributes and produce a theory of behavior for the job in question. Two frequently used approaches of job analysis are: task oriented job analysis and employee oriented approach (Landy & Conte 2010, p.203). The appropriate use of the job analysis could assist the Company ABC to achieve its business objectives and some advantages of job analysis are listed as following.

 

1.1.2            Identification of the KSAOs

 

No matter which approach is taken, task oriented job analysis or employee oriented approach, the next procedure in HR practice would be the identification of the KSAOs which is short for Knowledge, Skill, Ability and Other characteristics needed in the jobs. And based on the identified KSAOs test and other assessment techniques could be used to measures these KSAOs. Assessment devices developed based on the job analysis are of widely used such as aiding the recruitment process by identifying the job requirements. As the Company ABC is moving oversea, job analysis would be very helpful in collecting information and data for the various assessment devices for the analysis base in the later frequent HR practices. And what’s more in a strategic view, the information generated in the job analysis could make the management of the Company ABC know more about the company’s own situation as part of the situational analysis and only based which companies could achieve its objectives with more chance.

 

Figure 1 The role of job analysis in assessment

Source: Landy, F. J. & Conte, J. M. 2010, Work in the 21st Century: An Introduction to Industrial and Organizational Psychology. 3rd edition, Danvers: Blackwell Publishing Ltd., p.206

 

1.1.3            Clarify organizational structure and design

 

The valuable data collected through the job analysis could help clarify the various job requirements and the relationship between different functions, job content, tasks and duties, the Company ABC could be able to identify the duties and responsibilities of the positions in different level, based on such clarification the company could understand set the organizational structure and design and avoid obscurity and overlap of job functions existing between different positions.

 

 

1.2    The assistance from strategic recruitment

 

1.2.1            Definition of strategic recruitment

 

Recruitment is defined as the process of seeking and attracting a pool of qualified applicants from which candidates for job vacancies can be selected (Stone 2011, p.194). And strategic recruitment is defined in book “Fundamentals of human resource management (4e)” as the linking of recruiting activities to the organizations strategic business objectives and culture (DeCenzo & Robbins 2004). And because of the Company ABC’s strategy is to expand the current business geographically to the oversea market, we can expect that the company would increase the head counts largely to meet the need in human resource with the unfolding of the strategy of expansion oversea.

 

1.2.2            Meet the future needs of labor force

 

Rather than sourcing the appropriate talents when there are vacancies, strategic recruitment would instead take into the consideration of the future human resource needs in the long run. The importance of preparation to meet the future needs could be rationalized like this, because any strategy is taken because there is an opportunity which means that if company misses the opportunity due to any reason, then the company could be forced into a very passive position. For Company ABC, the company should perform the strategic recruitment in advance of the expansion and when the opportunity is there, the company could be able to seize with all the conditions ready and obviously the well prepared human resource is one of the most important conditions.

 

 

 

1.2.3            Avoid culture shocks

 

Strategic recruitment as suggested previously in the definition given above not only builds up link between recruiting activities and the organizations strategic business objectives but also establish such link with the company’s culture. As Company ABC’s strategy is to expand the current business geographically to the oversea market, the business culture might be very different from the company’s corporate culture that is accepted by the employees. When with different cultures, strategic recruitment could have taken into the consideration of this difference and select those with high culture compatibility and help avoid the happening of the severe culture shocks which will impact the effectiveness of the strategy.

 

1.3    The assistance from strategic remuneration

 

1.3.1            Definition of strategic remuneration

 

Strategic remuneration deals with the remuneration practices being aligned with the achievement of the organizations’ strategic business objectives (Stone 2011, p.452). Strategic remuneration is an important tool that any company uses to communicate its expectation to the employees by changing the strategic remuneration method. For example, by adopting a skill-based pay the company is actually requesting the employees to learn the particular skills that will make them receive a higher pay.

 

1.3.2            Increased employee motivation

 

The design and management of the remuneration program is important to the company’s strategic plan. Compensating the key employees such as some of the team leaders is believed could enhance the employee motivation and growth and at the same time aligning the direction of the employees’ work with the overall objectives, values, and culture of the organization (Kumar 2011, p.284), it is a major consideration for all growing companies including the company in our case, Company ABC.

 

1.3.3            Push for changes needed in success strategy implementation

 

To reach the strategic goals set by the Company ABC to expand its business from domestic market to the oversea market, with differences in the foreign business environment Company ABC can not apply the same business model without major changes such as business repositioning and changes of marketing strategy, but changes could be unsuccessful because of a number of potential sources of resistance to the changes such as people’s born fear to uncertainties. With the resistance to change, the Company ABC could add to the forces to change to fight against the resistances and push for changes needed in success strategy implementation. For example, when mangers from the home country are sent to exploit the new markets and negotiate talks, they will suffer from homesick due to the cultural differences so that they will in their heart resist the foreign journey though they may not express such resistance explicitly but their work could be impacted by homesickness, under this scenario strategy implementation could help fight against the resistance by increasing the pay to those who work oversea for a long time, this could give the involved employees a hint that “we are paid extra to come here, it is our responsibility to do the job well”.

 

 

 

 

 

 

 

2.        HR related challenges and issues and the impacts on expansion overseas

 

2.1    Expatriate failure and associated controversies

 

2.1.1            Definition of expatriate failure

 

Expatriate overseas assignments are not always successful because there is chance of failure in international assignments like many other tasks. Before we can probe into the issue of expatriate failure, we have to understand what the term is. Dowling, Welch and schuler (1994) state that the term expatriate failure has been defined as the premature return of an expatriate during the process of expatriation which can be broken down into a set of phases (Brewster & Harris 1999):

 

ü  Selecting expatriates

ü  Preparing and orienting expatriates

ü  Adjustment process

ü  Expatriate compensation

ü  Repatriation

 

Effects and signs that suggest a failed international assignment not only include the premature ending of the international assignment but also include the involved employees quitting the organization soon after the repatriation, underperformance, eroding business relationships, lost business opportunities and low morale (Novelli 1997). It is not the problem whether lost business opportunities or low morale should be included in the definition of expatriate failure that we should care about, it is how we can reduce the effects created by the expatriate failure and all these associated controversies to the Company ABC’s foreign expansion strategy that do matter. What makes us concern about the expatriate failure and the relative issues is the high percentage of failures. As proposed by Shaffer, Harrison and Gilley (1999) that the expatriate failures rates range from 16 percent to 40 percent according to their study which is a worrying problem. In the next two parts, we will analyze the impacts of the expatriate failure on expansion overseas and the possible reasons of such failure and controversies.

 

2.1.2            Impacts of expatriate failure on expansion overseas

 

2.1.2.1      High cost of expatriate failure

 

The costs of expatriate failure could include both tangible and intangible costs. Tangible cost is frequently in term of monetary value and at the same time the intangible cost could not be measured directly by money (Hsiu 2008, p.29). Regarding the monetary cost, it could take the form of salary paid, travel expenses and relative financial costs and intangible cost to the company could take the forms of damage to the organization’s reputation, lost business opportunities, delayed productivity, poor relationship with local nationals, negative perception of the company, and difficulty for expatriate successors (Graf & Harland 2005). In the scenario of Company ABC, if expatriate failure happens the greatest loss would not be the financial loss which could still be accepted if not large because business activities come with risks, the greatest loss that the company would rather not to have is the loss of the business opportunities especially during its implementation of the expansion strategy because time is critical. If the strategy is delayed because of the expatriate failure but the project is still running, then productivity would be sacked until the replacement, some business opportunities would be missed during the period of low productivity and what makes it worse is that the delay of implementation of strategy gives the competitors to adopt strategies to defend their market share.

 

 

 

2.1.2.2      Impede the expatriate’s further job performance

 

In addition to the financial and other mentioned costs, another challenge that human resource would have to deal with is the impact on the expatriates themselves such as the loss of self-confidence, self-esteem and prestige among their colleagues (Graf & Harland 2005). In the case of Company ABC, even when the expatriate employees fail to show their similar excellent capabilities in managing the business as they have done in the home market these failed expatriated managers are still the core people to the company back in the domestic business sector. But as their ability on the work has been doubted by the company and themselves, it would certainly affect the future job performance if the failed expatriates failed to adjust psychologically. The domestic market is the based and cash cow of the Company ABC, if its normal operation has been disturbed by the employees with low morale and work confidence the oversea expansion strategy would also be affected.

 

2.1.3            Motivators to expatriate failure

 

2.1.3.1      The failure to select the “right” people

 

Openness to the profound personal transformation that awaits the expatriate executive is perhaps the most fundamental sign of expatriate readiness (Puffer 2004, p.81). As we know, in a psychological thinking, people with some characteristics such as boldness, risk taking and courage are more likely to get adapted to external changes such as the changes of the living environment and cultural environment; and those with characteristics such as authoritarianism, rigidity and ethnocentrism would encounter some difficulties in the process to get adapted and accept the major changes on the issues that they have already have assumptions. And because of the restriction of the deeply ingrained personalities that could not be changed easily, it is more suitable to deploy those with suitable characteristics such as boldness, risk taking and courage because these traits are considered to be helpful to assist people to accept changes more easily, and failure could be caused if these right people have been replaced by other people who are with authoritarianism, rigidity and ethnocentrism.

 

2.1.3.2      Poor adjustment of the spouses

 

A company may have taken into consideration of the expatriates’ personality flexibility to get adapted to the new cultural environment, but another issue that could also result in expatriate failure is the poor adjustment of the spouses of the expatriates. According to an early study by Tung (1981), expatriate failure is not only often due to the inability of the expatriate or the expatriate spouse to adjust with the changing living environment and social network. In Company ABC, most spouses of the employees and managers are local Malaysian, if they go to a foreign country, such as China, there is great chance that they will find it hard to adjust to the new environment, fast pace of work and life and also there are difficulties in communication due to different languages and cultural background. The situation could be worse if the spouses could not find a job in the host country and do not have a social network, then when the expatriate go to work family life for the spouses could be very lonely and tedious. And in my own opinion, culture differences are more sensitive and important issues to the spouses of the expatriates than what can be felt by the expatriates because employees are professionals who are paid to do their job in the international assignments but their spouses are those who actually need to experience and cope with many of the cultures conflicts in life and yet they are not paid to do so.

 

2.1.3.3      Poor culture fit

 

What is more, there may be some candidates who are much less familiar with the culture background in the new market than others and they are less likely to be the “right people”. A study carried out by Korn/Ferry International concludes that the poor cultural fit has become a major reason that results in the international assignment failure (Bohlander & Snell 2010, p.673). For example suppose the Company ABC is a Malaysia based company and it is going to enter into the new foreign market in China, there are employees with the Islam religion beliefs and if these people are sent to China, they could find out that people in China are with totally different culture and beliefs and it is very difficult to change the beliefs because beliefs and value are something that could not be changed easily.

 

2.1.3.4      Lack of expatriate support from headquarters

 

Early studies have found out that organizational support given by the headquarters to the international assignment carried out in the host country has a positive influence on the expatriate success and commitment (Aycan 1997). And such support could take the term of pre-departure training, transportation assistance, and support during the work such as sufficient authorization and timely guidance from the senior management and pre-return preparations. As in the situation of Company ABC, similar challenges could happen to the expatriates especially in the first batch of people who are sent to develop the new market without being able to refer to any predecessors in the company.

 

2.2    Workplace diversity relative issues

 

2.2.1            Definition of workplace diversity

 

Diversity refers to the differences among people in term of age, ethnicity, gender, race or other dimensions and workforce diversity in definition means a workforce made up of people with different human qualities or who belong to various cultural groups (Daft & Lane 2008, p.333). Sears, Rudisill and Mason-Sears (2006) suggested the changing labor market has put a lot of pressure on companies to pay closer at attention on matters of labor diversity. And due to the crucial role of workplace diversity to the survival of the companies, it has become a strategic imperative in many firms especially those with cross border business (Griggs & Louw, 1999). Though the concept of diversity management is well known by the human resource department of many companies, there are still some challenges that result in ineffective workforce diversity management which will be discussed below.

 

2.2.2            Impacts of diversity relative issues on expansion overseas

 

2.2.2.1      Increased management complexity

 

Diversity’s benefits are not automatic, and diversity could have meant challenge such as racism, sexism, ageism and homophobia as well as opportunities such as saving costs and innovative thinking (Sonnenschein 1997, p.4) depending how well the company manage the diversity in the work place. For example in Company ABC, from the management’s perspective, it will be easier to manage a group of similar-minded employees and if employees are largely different in mind and thinking, then conflicts could happen because people could all have their own opinions and differences in opinions could result in inefficiency in making decisions because it is not easy to come to a conclusion that agreed by all the team members. So when diversity is not well managed, management complexity could be enlarged in a great extent.

 

2.2.2.2      Threatened employee satisfaction

 

When there are companies are very ambitious to increase the diversity in their companies through ways such as increasing promotion on female manager and hiring more minorities in the society, they could fall into other problems that compromise the companies’ rule of fairness, equity and the most importantly, the employee satisfaction level. Actually there has been some worrying attending to diversity would actually threaten employee satisfaction based on the notion that responding to unique needs of various demographic groups would constitute differential treatment and would result in the compromises of the principles of merit and equal treatment among the employees and this reduces the employee satisfaction (Bond 2007, p.10). And for example in the case of Company ABC, if the company is ambitious in increasing chance for the minorities such as women staffs and black staffs in term of employment and promotion during its expansion, there is a possibility that the existing employees would perceive that the company is actually putting the minority employees in a positions that is more important to the company and could fire the other employees if needed, such thoughts actually influence the company’s value of equity and fairness and would eventually result in employee dissatisfaction and finally the lowered work performance in the implementation of the expansion oversea strategy.

 

3.        HR strategies proposed by HR Director of the company

 

3.1    Strategies to deal with expatriate failure

 

3.1.1            Implement and improve the selection process

 

As discussed previously, because of the restriction of the deeply ingrained personalities that could not be changed easily, it is more suitable to deploy those with suitable characteristics such as boldness, risk taking and courage it is recommended that the Company ABC to adopt a strategic recruitment and here are some advices to improve the selection process to select the “right” people to avoid many future issues caused by deploying the “wrong” people. First of all, the Company ABC can institute a more holistic selection process that includes personal attributes and interpersonal skills in addition to professional skills (Marquardt, Berger & Loan 2004, p.104); secondly, the HR manager could tell the candidates who are interested about the international assignments about the possible expatriate challenges and ask them how they would response if they were in such positions to see whether they are psychologically mature enough to overcome the challenges.

 

3.1.2            Pre-departure preparation

 

There are a number of methods that Company ABC could use to make the pre-departure preparation before the actual international assignment being carried out; one of these methods that are used frequently is cross cultural training which is a valuable tool for employees and managers and the target of the cross cultural training is to develop an understanding of the basic differences in values, styles of the communication, and conventions (Silverthorne 2005, p.247). The cross cultural training could be done to the involved employees or the majority of the employees regardless of fact that some of them will not be sent out to carry out international assignment eventually. The significance of using cross cultural training to the majority of the employees could be understood in two different points: firstly, by giving the cross cultural training to the majority of the employee regardless of the future plans the Company ABC has prepared the international assignments with a large pool of talents rather than just several selected talents and this also shorten the period to prepare for a replacement if there should be an expatriate failure; secondly, with the increase of the international business, all the employees will have greater chance to communicate and work with foreign partners in a remote distance though they may not be sent to work in a foreign market. What is more, the Company ABC could invite the expatriates’ spouses to attend the cross cultural training to also prepare them with the appropriate expectation about what will be different in the particular foreign country of the international assignment.

 

3.1.3            Provide support during the project

 

Like the fact that theory is different from actual practices, even when the expatriates have gone through the cross cultural training before the flight to the targeted country, there is still need for the company to continue to provide support to the relative expatriates during the implementation of the project to overcome the challenge of “Lack of expatriate support from headquarters” which has been discussed above. Another tool that the HR department could have used after the arrival of the expatriates to the destination to help the expatriates to effectively and gradually get in touch with the different business and living environment is the host country orientation and pre-work training. For example, in the work life before the actual work starts the expatriates should be provided with chance to take part in the work-related orientation to know about the layout of the facilities, the use of the relative equipment and resources, the basic information about the company’s business status in the foreign market and most importantly the expatriates’ work contract and position responsibilities; and in the family and social life, the expatriates and their families should be assisted by the Company to get sufficient information regarding the local life in term of food, transportation, mailing system, banking system, entertainment and other necessary services needed in life. And when the expatriate actually start to work in the foreign country, continued support in work and life is very important. And to the headquarter of Company ABC, it should put the requests from the oversea employees in priority and offer help in all ways to facilitate their life and work and make them feel that the company is behind their back rather than isolation from the company which in my opinion is one of the major reasons why there is a high rate of failure the international assignments.

 

3.2    Strategies to deal with workplace diversity issues

 

Following we will try to provide some advises in how to build up a good diversity management strategy for Company ABC in its foreign expansion.

 

3.2.1            Diversity Training

 

To build up a good diversity management strategy, one of the key components of the strategy is diversity training which is often seen as the cornerstone of diversity initiatives (Cox & Beale 1997). By increasing participants’ cultural awareness, knowledge, and skills to different culture groups, diversity training is set to achieve two major targets. The first target is to use diversity training to disseminate the information about the diversity strategy and initiatives from the Company ABC’s management to the employees regarding the benefits of the diversity program and strategic importance of building up the diversified labor force to the business goals of the company and persuade the employees to buy-in the diversity program; the second target is to put such diversity training effort into action by changing the employee behavior to improve the relations among the organizational members (Brief 2008, p.277). For example, as said above differences in opinions due to labor force diversity in work place could result in inefficiency in making decisions because it is not easy to come to a conclusion that agreed by all the team members, by holding diversity training the Company ABC could try to improve competencies believed to be important to effective diversity management which include conflict management, team building and decision making skills.

 

3.2.2            Planning a Mentoring Program

 

Mentoring entails informal communication, usually face-to-face and during a sustained period of time, it is help between the mentor who is perceived to have greater relevant knowledge, wisdom, or experience and an employee who is less experienced (Bozeman & Feeney 2007). Mentoring provides an opportunity to build the potential of employees from diverse backgrounds by the mentors’ more persuasive guidance and experience sharing and knowledge teaching. The expected result of the diversity mentoring program include increased self-awareness, developing capacity to work effectively across organizational network and different business culture systems and enhance the individual and team ability to work with ambiguity and change.

 

3.2.3            Organizing Talents Strategically

 

With the mentioned importance of creating a diversity and global work force to facilitate the company’s process to achieve the business goals, there is a necessity to employ diverse talents to understand the various niches of the market. For example, if the company is going to exploit the Chinese market, then the hiring of the marketing talents with Chinese cultural background and international working experience such as some Singaporean marketing talents who are living in a culture that share many features and values with the Chinese culture. And the selection of the talents should take into the consideration of the company’s strategic intension and position in term of which market to be developed and what culture conventions are in the market.

 

3.2.4            Leading the Talk by HR

 

The HR department could have done a lot of effort in selecting and managing a diversified labor force based on the strategic considerations, but the majority of the company’s existing employees may not pay attention too much to the concept of diversity management and put diversity as a principle to be adhered and a kind of belief to be valued, it is HR’s job to carry out a comprehensive diversity management strategy in which making diversity evident at all organizational levels and to promote a diverse workforce is of great importance. Leading the talking like making advertisements will repeatedly reinforce employees’ impression of the concept and by and by make them accept the idea of diversity in the work place. 

 

3.2.5            Control and Measure Results

 

Any strategy without followed-up assessment to evaluate the effectiveness of the strategy will not be comprehensive and could finally lead to failures. Assessment on the diversity management in the work place could be done according to the plan on a regular basis and the content of the evaluation could include pay, benefits, work environment, management and promotional opportunities and so on throughout the organization. This could be done by using measuring tools to measure the impact of diversity initiatives at the organization through organization-wide feedback surveys and other methods. And the result of the assessment could be made known to the employees and some suggestions could be made to inform the relative departments and employees to do a better job based on the results of the assessment. Also the identified issues during the assessment would surface and thus arouse the attention form the management. And what is more, the results of the assessment on the diversity management and strategy implementation could be very valuable and could be used for further reference when the company needs to review the previous diversity management efforts in labor force and propose new similar programs and strategies.

 

 

 

Reference list

 

Aycan, Z. 1997, Expatriate adjustment as a multifaceted phenomenon: individual and organizational level predictors, International Journal of Human Resource Management 8, 4: 434-456

 

Bohlander, G. & Snell, S. 2010, Managing Human Resource. Fifteenth Edition, Mason: South-Western, Cengage Learning. p.673

 

Bond, M. A. 2007, Workplace chemistry: promoting diversity through organizational change, Lebanon: University Press of New England. p.10

 

Bozeman, B. & Feeney, M. K. 2007, Toward a useful theory of mentoring: A conceptual analysis and critique. Administration & Society 39 (6): 719–739

 

Brief, A. P. 2008, Diversity at work, Cambridge: Cambridge University Press. p.277

 

Brewster, C. & Harris, H. 1999, International HRM: Contemporary issues in Europe, London and New York: Routledge.

 

Cox, T. H. & Beale, R. L. 1997, Developing competency to manage diversity readings, cases, and activities. San Francisco: Berrett – Kohler.

 

Daft, R. L. & Lane, P. G. 2008, The leadership experience, 4th edn, Mason: Thomson higher Education. p.333

 

DeCenzo, D. A. & Robbins, S. P. 2004. Fundamentals of human resource management. San Francisco: John Wiley & Sons.

 

Dowling, P. J., Welch, D. & Schuler, R. S. 1994. International dimensions of human resource management, 2nd ed, Belmont, CA: Wadsworth.

 

Gatewood, R. D., Field, H. S. & Barrick, M. R. 2008, Human resource selection. Mason: Thomson Higher Education, p.257

 

Graf, A. & Harland, L. K. 2005. Expatriate selection: evaluating the discriminant, convergent, and predictive validity of five measures of interpersonal and intercultural competence. Journal of Leadership & Organizational Studies, 11(2), 46-62.

 

Griggs, L. B. & Louw, L. L. 1999. Valuing diversity: New tools for a new reality. New York: McGraw Hill, Inc.

 

Hsiu, C. K. 2008, Study of the success of Taiwanese expatriate managers on overseas assignments: a grounded theory approach. Ann Arbor, ML: ProQuest LLC. p.29

 

Kumar, R. 2011, Human Resource Management: Strategic Analysis Text and Cases. New Delhi: I. K. International Publishing House Pvt. Ltd. p.284

 

Landy, F. J. & Conte, J. M. 2010, Work in the 21st Century: An Introduction to Industrial and Organizational Psychology. 3rd edition, Danvers: Blackwell Publishing Ltd., p.203

 

Marquardt, M. J., Berger, N. O. & Loan, P. 2004, HRD in the age of globalization: a practical guide to workplace learning in the third millennium. Cambridge MA: Basic Books. p.104

 

Novelli, P. 1997. International assignee research project, Princeton, NJ: HFS Mobility Services Inc, and Berlitz Languages Inc., p.1; and Solomon, C. M. 1996, Danger Below! Spot failing global assignments, Personnel Journal.

 

Puffer, S. M. 2004, International Management: Insights from Fiction and Practice. New York: M. E. Sharpe, Inc. p.81

 

Sears, R. W., Rudisill, J. R. & Mason-Sears, C. 2006. Consultation skills for mental health professionals. New Jersey: John Wiley & Sons, Inc.

 

Shaffer, M., Harrison, D. & Gilley, K. 1999. Dimensions, determinants, and differences in the expatriate adjustment process. Journal of international business studies, 30(3), 557-581

 

Silverthorne, C. P. 2005, Organizational psychology in cross-cultural perspective. New York and London: New York Press Books. p.247

 

Sonnenschein, W. 1997, The diversity toolkit: how you can build and benefit from a diverse workforce, Chicago: Contemporary Books, p.4

 

Stone, R. 2011, Human Resource Management, 7th edition, Milton Old: John Wiley & Sons Austraila, Ltd, p.150

 

Tung, R. L. 1981, Selection and training of personnel for oversea assignments, Colombia Journal of World Business, 16: 68-78.

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