698 Part G aas:s ffitl:E=sr1l,t Molex, a 70-year-old manufacturerof electronic com- ponents based in Chicago, is rhe world'ssecond-largest manufacturer of electronic components. The company established an internarional division to coordinate exporting in 1967 and opened its first overseas plant in Japan in 1970 and a second in lreland rn 1971. From that base, Molex has evolved inro a global business that generates about 61 percent of its $1.84 billion in revenues oursideof the United States. The company operates some 50 manufacturing plants in 21 countries and employs more than 16,000 people worldwide, with only one.third of them located in the United States. Molex's competitive advantage is based on a strategy that emphasizes a combination of low costs, excellent customer service, and the mass pro- duction of standardized products that are sold globally. Manufacturing sites are located in countries where cost conditions are favorable and major customers are close. Since the 1970s,a key goal of Molex has been to build a truly global company that is at home wherever in the world it operates and that proactively shares vaiuable knowledge across operations in different countries. The human resoLlrce managemenr function of Molex has alwaysplayed a cenrral role in meeting this goal. As Molex grew rapidly overseas, the HRM function made sure that every new unir did the samebasicthings. Each new entity had to have an employee manual with policies and practices in writing, new employee orientation programs, salary administration with a consistent grading system,written job descriptions, written promotion and grievance procedures,standard performance appraisal systems that were written down, and so on. Beyond thesethings, however,Molex views HRM as the most localized of functions, Different legal systems, particularly with regard to employmenr law, different compensation norms, different cultural atti- tudestoward work, different norms regardingvacation, and so on all imply that policies and programs musr be customizedto the conditions prevailing in a country. To make sure this occurs,Molex's policy is to hire ex- periencedHRM professionals from other companiesin the same country in rvhich it has operations. The idea is to hire peopie who know the language,have cre- dibility, know the lar.v, and know how ro recruir in that country. Molex's strategyfor building a global company starts with its staffing policy for managers and engineers. The company frequently hires foreign narionals who are liv. ing in the United States,have jusr completed MBAs, and are willing to relocate if required. These individuals will typically work in the United States for a while, be. coming familiar with the company's culture. Some of them will then be sent back to their home country to work there. Molex also carefully screensits American applicants, favoring those who are fluent ln at least one other language. Molex is unusual for a U.S. cornpany ln this regard.However, with more than i5 languages spo- ken at its headquarters by native speakers, Molex is com- mitted to multilingual competency. The company also hires a significant number of managers and engrneers ar the local level. Here, too, a willingness to relocate inrer- nationally and foreign languagecomperency are impor- tant, although this time English is the preferred foreign language.In a sign of how multinational Molex's man- agement has become, it is not unusual to seeforeign na- tionals holding seniorpositionsat companyheadquarters. In addition to Americans, individr,rals of Greek, German, Austrian, Japanese, and British origin have ail sat on the company's executive committee, its top decision.making body. To help build a global company, Molex moves people around the world to give them experience in other countries and to help them learn frorn each other. It has five categories of expatriates: ( 1 ) regularexpatri- ateswho live in a country other than their home coun- try for three- to five-year assignments (there are approximately 50 of these at any one time), (2) "in- pats" r,vhocome to the company's U.S. headquarters from other counrries, (3) thlrd'counrry nationals who move from one Molex entity to another (e.g., Singapore to Thiwan), (4) short-term transfers who go to anorher Molex entity for six to nlne months to work on a specific project, and (5) medium-term transfers who go to another entity for 12 to 24 monrhs, again to work on ^ ^^^^i{; ^ .^-^: ^^- 4 JfrsLrrrl PruJtrLL. Having a high level of inrracompany movernenr is costly.For an employeemaking $75,000 in basesalary, the total cost of an expatriate assignment can run as high as $250,000 when additional employee benefits are added in, such as the provision of schooling ancl housing, adjustments for higher costsof living, adjust- ments for higher tax rates, and so on. Molex also insists on treating all expatriates the sarne,whatever their country of origin, so a Singapore expatriate living in Taiwan is likely to be living in the same aparumenr building and sending his child ro the sameschool as an American expatriate in Thiwan. This boosts the overall costs, but Molex believes that lts extensive useof expa- triates pays dividends. it allows individuals to under- stand the challenges of doing business in different countries, it facilitates the sharing of useful knowledge