<i>Dear Workforce</i> We're Expanding Into Eastern Europe. What Are the Recommendations for Launching a New HR Function

August 13, 2009
Dear Overwrought:
Companies all too often establish new operations, or relocate existing operations, in far-flung regions without giving extensive thought to labor issues. The desire to take advantage of cheap labor and push production costs down is understandable, but selecting a location without proper diligence could result in the opposite: soaring production costs despite lower labor rates. The first action items on your to-do list should include:
1. Find out if any of your strategic partners, vendors or customers have operations in or near the target area. These organizations have a vested interest in helping you be more successful, and are more apt to share their learning with you.
2. Find out if any current employees are immigrants from the target location. If you are lucky enough to have someone, find out from them what the trusted news sources are in the region, and if they would be willing to help translate online news sources so that you can develop a better understanding of the labor climate. If you do not have any current employees who emigrated from the region, consider reaching out to a local university to find a current student from the region who is studying business, language/journalism or a field related to your industry. Having someone native to the region help you review news relating to labor issues helps ensure that you interpret the news—and the social/cultural ramifications—more accurately.
3. Use the Internet to find professional conferences and events that relate to HR in the region. A number of international-conference companies are active in Eastern Europe, including IIR and Management Centre Europe. Brochures from recent and upcoming events will tell you what topics are emerging and which vendors (sponsors) are active in the region.
4. If possible, hop a plane and get a feel for the land. If you are going to play a role in deciding when and what to do in a region, it is critical that you understand that region. Take a week to 10 days, travel to the region, and stay in a hotel outside the business center. Eat where the locals eat, talk to people, meet with the faculty of local schools, meet with civic leaders and build your learning network. Assembling a network of people who represent the region's character, and who do not have a financial interest in your organization, will help you evaluate the massive array of outsourced services and products that vendors will try to sell you as a new entrant to the region.
Building a world-class workforce abroad is all about understanding the local labor force, specifically what motivates and frustrates them. If you can learn this, and engineer an HR strategy/function that coordinates all of your “deliverables” under a shared vision, you will be successful.
SOURCE: Dr. John Sullivan, San Francisco State University, July 16, 2007
LEARN MORE: Please read advice about how to launch a new HR division. Also, How HR Keeps Pace in Growing Companies.
The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.
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