La Costbucks is an Italian coffee bar chain specialising in organic high quality coffees and French pastries. Its unique stance on CSR (corporate social responsibility) and ethically sourced delicious

Running head: LA COSTBUCKS 0

Introduction

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Abstract 3

Introduction 3

Discussion 3

CSR Strategy Pros and Cons. 3

Key Culture Differences 5

Most effective IHRM staffing strategy 5

PCN’s & TCN’S Difficulties 6

Ethical Issues 8

According to the ILO, decent work involves creating and maintaining opportunities for men and women to obtain productive work under the conditions of freedom, equity, security and human dignity (ILO, 1999). This ensures that the defining features of Decent Work can be measured “with and acceptable degree of consistency, accuracy and cross-country comparability” (Richard Anker, 2008). 8

Conclusion 9

Recommendations 9

References 11

Abstract

When evaluating a companies

When a company decides to expand on its brand it must consider many different factors especially when branching out to different countries. Due to the different cultures in Italy and China, La Costbucks must be careful not to stray or waif in the quality of products and services offered therefore, in order for La Costbucks to survive in China the company must be familiar with the culture of the country while keeping its business identity.

Corporate Social Responsibility, the continuing commitment by businesses to not only behave ethically, but also contribute to the economic development of the communities in which they operate and to improve the quality of life of their workforces, their families, as well as society at large (Tarique, Briscoe, & Schuler, 2016). CSR can affect companies both negatively and positively. The pros outweigh the cons in pursuing a CSR strategy in China.

Some of the Pros of Corporate Social Responsibility are:

• It boosts value and profitability – with should CSR, persons in the community will want to spend their money at La Costbucks, which in turn would boost the value and profitability.

• It improves company reputation – when customers/clients realize that La Costbucks practices corporate social responsibility, entices them to want to support the company more and even tell their friends and family members.

• Taking advantage of new technology – by taking advantage of new technology La Costbucks can reduce its carbon footprint on the environment.

• Increase in employee productivity and improve the quality of their work -

Some Cons of Corporate Social Responsibility are:

• Requires hire costs – to setup a company to be Corporate Social Responsibility, is a huge investment. So La Costbucks has to budget their money and decide if they want to invest in a CSR operation. La Costbucks would need to incur special costs by implementing a Corporate Social Responsibility operation. Other associated costs are is the training of employees, dedication programs for the upliftment of community and safety of the environment.

• Clashing of business objectives – in Corporate Social Responsibility operation the company must take the interest of the people into consideration, this may cause a conflict in the business objectives of the company all while making important business decisions.

• Shift in the profit-making objective – investing the in the Corporate Social Responsibility operation may turn away shareholders, some shareholders prefer to invest in companies that are socially responsible while others only want to invest in businesses that result in profits for them.

There are many cultural differences that will impact the HRM and managerial practice. One of the major differences is language and relocating a General Manager from Italy will be quiet challenging. The General Manager from Italy will have to learn how to speak the main language of Chinese or even also speak English. These are two (2) of the languages mostly spoken in China. Another culture difference would be how food/coffee is prepared in China, even though La Costbucks would incorporate its own receipies and coffee blends, this would be an adjustment for China.

La Costbucks has identified a General Manager from Italy, which I think is a good idea. With having the Manager from Italy, it would take less time to help set up the branch in China. The Ethnocentric Staffing Approach can be used to hire the General Manager. By using this approach, they will maintain a common corporate culture and this allows HQ to control and coordinate subsidiary operations, and to maintain a common corporate culture across subsidiaries, however, it may be costly because the PCN’s are used and tension between PCN’s and host-country nationals (HCN’s) e.g. because of compensation differences.

Along with a General Manager, other employees need to be hired such as, baristas, supervisors, accountant, cashier, cleaners and greeters.

For hiring the other employees, two approaches can be used, these are the Polycentric Staffing Approach and the Geocentric Staffing Approach. With the Polycentric Staffing Approach there is access to local communities and markets, and this sends a signal to the local community and government that subsidiary is committed to the local culture. Locals may not be committed to the MNC and may not be able to acquire international experience. With the Geocentric Staffing Approach, La Costbucks and hire the best talent available and employees can work with other employees with other employees from different geographic, cultural and regional backgrounds. Managing a large number of international assignees can be costly (e.g. relocation and training costs) and work authorizations in several countries is a complex process. (Tarique, Briscoe, & Schuler, 2016).

Relocating to a different country can be a challenging and stressful and persons may encounter a lot of challenges, whether they are single or are relocating with a family. A person may relocate and not have enough support around them. With no family members and close friends around persons may be faced with the possibility of turning to strangers for help in certain instances. La Costbucks should set up a support system within the company for relocating employees. This support system should include liaison officers which should be assigned to the employee. This liaison officer should be able to help the employee settle in, help them with their entire relocation process, accommodations, finding transportation, the process of enrolling children in school. There should also be a guide to help the employee find places they would need to frequent most or it should show them or let them know of the better options or selection of places to eat, shop etc.

With relocating an employee may be worried about finances, they would need to ensure that they are making enough money to take care of finances back home and in their new country of residence. They may have mortgages or maybe taking care of elderly family members. The company should offer allowances which may ease these burdens. Settling allowances, housing allowances, traveling allowances, telephone allowance are some of the allowances which can be included in the compensation package offered to the employee.

The language barrier could also be an issue and employee when relocating. Why in Italy, Italian is the main language spoken and in China the main language is Chinese. La Costbucks must invest in the technology to ensure that the language barrier is not an issue.

The relocated employees will also have to get accustom to the culture of China, this is to ensure that they don’t offend any of the employees who are from China. The liaison officer assigned to the employee should be able to help the employee with this.

The employee should also understand the laws of China, this would also include the traffic laws. Especially if the employee relocates with their family and need to have their own transportation, they would need to be familiar with the traffic laws. Arrangements should be made in the first instance for the employee to be transported while getting familiar with their new surroundings.

Some of the elements that support the ILO framework on the measurement of decent work are employment opportunities, tolerable earning and productive work, combining work, family and personal life and stability and security or work.

In the area of global ethics, even the best-informed, best-intentioned executives often have to rethink their assumptions. What works in an enterprise’s home country may be viewed very differently in another country, which may have very different standard or perceptions of what is ethical conduct. Evidence even suggests that not only is there variance among countries and cultures, but even amount different industries (Tarique, Briscoe, & Schuler, 2016).

In conculusion La Costbucks must be willing to end

For La Costbucks to strive and continue to be a successful brand, I recommend the following:

• Ensure that all employees relocating receive extensive training about the culture of China, this is to guarantee that no one is offended and managers and employees can have communicated effectively and efficiently.

• Ensure that all staff are paid adequately, compensation packages should be able to compensate for the relocation of employees.

References

Conti, D. M. (2019, October 22). China Multi Service - Similarities and differences between China and Italy. Retrieved from China Multi Service : http://www.chinamultiservice.com/it/similarities-and-differences-between-china-and-italy/

Tarique, I., Briscoe, D., & Schuler, R. (2016). International Human Resources Managment, Policies and Practices for Multinational Enterprises. New York : Routledge.