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Challenges Facing Multinational Companies Essay

Human Resource Challenges Facing Multinational Entities Human Resource Challenges American Companies in Venezuela Encounter

To remain competitive, U.S. firms, and indeed other global firms, have found it necessary to venture to other markets. Although, there are numerous benefits to be reaped from such a move, global companies often have to contend with a number of challenges. Some of these challenges have got to do with the hiring of both local and expatriate talent. This text highlights some of these challenges -- in the Venezuelan context.

Challenges in Attracting and Retaining Local Talent

Skill Barrier

To begin with, one of the most significant challenges American multinationals encounter in Venezuela is skills gap. Unlike their counterparts in the U.S. not many Venezuelans possess the skills necessary to run or manage specialist functions of a U.S. multinational subsidiary. Indeed, this is one of the key reasons that could motivate American companies to 'export'...

It should also be noted to be able to compete effectively, American companies could be forced to invest in the training and development of local talent. This is an undertaking that could turn out to be rather costly for the company involved.
Communication Challenges

Spanish is the official language in Venezuela (CIA, 2014). The U.S., on the other hand, is a predominantly English speaking country. In that regard, therefore, communication between the head office in America and the subsidiary in Venezuela could become rather difficult as a result of the said language barrier. As a matter of fact, this particular issue could lead to instances of wrong interpretation of messages originating from either country.

Remuneration

According to the U.S. Department of State (2014), Venezuela maintains a strict currency control regime. As the U.S. Department of State (2014) further points out, "the official exchange rate overvalues the local…

Sources used in this document:
References

BBC. (2014). Police Clash in Venezuela with Anti-Government Protesters. Retrieved from http://www.bbc.com/news/world-latin-america-26676806

Central Intelligence Agency -- C.I.A. (2014). The World Factbook -- South America: Venezuela. Retrieved from https://www.cia.gov/library/publications/the-world-factbook/geos/ve.html

Fragomen. (2014). Country Summary: Venezuela. Retrieved from http://www.fragomen.com/newsresources/xprNewsDetailFrag.aspx?xpST=CountrySummaries&news=55

U.S. Department of State. (2014). 2013 Investment Climate Statement -- Venezuela. Retrieved from http://www.state.gov/e/eb/rls/othr/ics/2013/204759.htm
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