Question

Mystique Cosmetics is a privately held(non-Union) giant in the beauty and fragrance retail industry. Headquartered in New York, Mystique also owns more than 60 stores throughout the United States. The company operates under its slogan, “Bringing out the Beauty in Everyone We Touch”. Mystique Cosmetics is a family owned business that caters to different clientele, but mostly high-end customers. Business has been exceptional with revenues exceeding $2 Billion for last 5 years. To establish itself as an important brand, Mystique has worked hard to represent quality skin care products and accessories. They accomplish this by using high quality manufacturing and research, a creative marketing program, and a comprehensive distribution network with their retail outlets, internet presence, and consumer catalogue.After 25 years of being a family owned business, the Dunne Family has decided to expand its operations into Germany or Japan. The company is 100% owned by Ray and Barbara Dunne, the founders. The Board of Directors consists of their children: Robert and Victoria; Mr. R.G. Dunne, brother to Ray Dunne; three outside directors appointed by Ray Dunne; and two representatives appointed by their major investor(s). Together, Mr. and Mrs. Dunne have 50 years’ worth of combined experience in the retail industry. Both of them have held senior management positions with major cosmetics companies. Their 10 year plan is to own 100 retail stores throughout Europe and/or Japan. They believe they have a talent management plan that shows a controlled and conservative ramp up of personnel.

The Situation: After much deliberation, the decision was made for Mystique Cosmetics to expand globally. They would like to move a percentage of production to either Germany or Japan. In speaking with their key employees, here is what we know thus far: ·A majority of their existing managers said they would like a chance to work abroad · None of their existing managers speak Japanese or German. · They expect to recruit a large number of staff for the new retail outlets. · They will require their managers to be flexible and move between countries if problems arise The company has decided to create a new position entitled Global Director of Operations (for either Germany or Japan). The position was conveyed to the management team. Thirty managers applied by writing a letter to the CEO conveying why they are interested and qualified for the role. The resumes of the top 5 candidates have been included. All 5 currently work for Mystique. You need to recommend which one you would hire. Nathan Dixon is the only outspoken person who believes expanding globally is too risky for a Cosmetic company, particularly Mystique given the fact that they are family owned. Being outspoken in Board of Director meetings, Nathan drafted and sent an email to the other executives voicing his concern. This email angered the CEO and created concern amongst the employees at Mystique Cosmetics. It was agreed that Patricia Healey would remain VP of Human Resources in the U.S. but there is a true need to hire a Global Director of HR. YOUR ASSIGNMENT You have been hired as the new Global Director of HR for Mystique Cosmetics.

Nathan Dixon Email:

From: Nathan Dixon

Date: 6/1/18 9:30 AM

To: BOD CC: R. Dunne

Subject: Global Expansion Concern

Good morning,

It is with great trepidation that I write to you on this occasion. As you are all aware, the American Mystique Cosmetics is performing quite well with earnings on the increase and a stable workforce. In recent months, our respected President and CEO, whom I consider a dear and trusted friend, has steered our resources to expanding globally. What some of you may or may not know at this juncture is that he is looking towards establishing operations in either Japan or Germany.Ladies and gentlemen, we are not a global enterprise. We are not built to operate in this manner. I have been part of this incredible organization for over 30 years and have witnessed unparalleled growth and expansion within our own glorious US country. We have recognized records profits; continued employment growth; environmental friendly products and the ability to provide profit sharing bonuses to our entire staff for the past 20 years. Expanding globally is going to be a crucial mistake and one that will require massive resources in terms of finances and manpower. It is my understanding that a new Global HR Director has been hired to evaluate the situation. While I do not disagree with this hiring, I do have to announce my voice of discontent in that our President and CEO is possibly no longer operating with the best interest of Mystique in mind. While it pains me to say that, I would like for each of you to strongly consider your vote when expanding to either Asia or Europe. Two countries we know nothing about. Two foreign lands that could very well not welcome us. The research is proven that other companies have tried and failed. Thank you for your time and consideration.

Question:The Board of Directors is looking for a proposal from you to cover the questions below. Please review the questions and write a 2-3 page proposal to Mr. Dunne, the President and CEO. Be sure that you reflect on all of the questions and provide a comprehensive and supporting argument for each.

1. Would you recommend using a Home Country National or hiring an Expat to help run each of the new facilities opening? Why? 2. What are the advantages and disadvantages of using an Expatriate for management role(s) at each facility?

Answer 1

Question 1:

Answer: A home country national and ex-pat will provide entirely different ideas and perspectives which will be sometimes hard to counter. It is important to mention that Mystique is a family-owned business and it will require more resources and manpower and leadership qualities of a leader to move the company to the next level. However, a home country national will not be able to handle the affairs of international expansion and will require someone who will be experienced in handling international affairs and business operations. It is important to mention both the European and Asian markets are different and Mystique does not have any prior experience before. Therefore, hiring an ex-pat will provide more opportunities in this current scenario.

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