Part 2: Case study: Staffing at L\'Oréal (50 points) Until the mid-2000\'s, L\'O

Question

Part 2: Case study: Staffing at L'Oréal (50 points)

Until the mid-2000's, L'Oréal had only worldwide product lines and brands (e.g. L'Oréal, Biotherm, Garnier, Lancôme, Maybelline, etc). Since the mid-2000's, L'Oréal has strived to increase its multicultural product space coverage, by acquiring ethnic lines (e.g. SoftSheen-Carson for consumers of African origins).

"In our business, it is absolutely vital to be in tune with your consumers. And it's by listening very carefully to our consumers all over the world that we've come to understand the extreme diversity of their needs. (…). But additionally (…) we have developed a unique portfolio of brands, each one with a different cultural origin to better satisfy the differences in sensitivities of people around the world" (Lindsey Owen-Jones, Chairman, 2006)

            "a major part of our success is due to the diversity of the brands in our portfolio. Building further on this, we now have research centers not only in Europe, but also in North America, in Asia, and soon in Latin America to better understand the diversity of hair and skin types across all 5 continents." (Jean-Paul Agon, CEO)

            "In order to be global, we must be global from within" [It] has more to it than simply attracting diverse [employee] profiles. We must go beyond representation and strive for equitable management in order to ensure that every [employee] has an equal opportunity of realizing their potential" (Lindsey Owen-Jones, Chairman, 2006).

            While some L'Oréal subsidiaries are very advanced in hiring from a very diverse pool of candidates in terms of country of origin and ethnicities (e.g., over 30% of L'Oréal USA staff come from ethnic minorities), in other countries such as China or Japan where ethnic diversity is minimal and the local office is only expected to cater to local consumers, building a diverse workforce has not been a target, let alone a priority.

Please answer BOTH questions in about one page total:

Q1: Which type of International Business (IB) strategy is L’Oreal implementing? [Justify your type choice]

Q2: How does L’Oreal’s chosen IB strategy type align with the company’s staffing strategy? Should they change anything about their staffing strategy?

Explanation / Answer

Explanation:

Loreal is using the Foreign Direct Investment as it has expanded facility over the many countries like US, China Japan and India and its been directly building their facility in the different countries since in FDI you have to built your own production facility and operate under decided stack controlled by the parents company

Ans 2: Loreal using the best technic to recruit the local ethnic population and utiliziing the local workforce without doing any outsourcing and minimizing the cost plus the introducing the local worlforce which is both good for loreal and host country in which they have facility being build. As followed by their FDI IB strategy the loreal has given preference to the host country's local labor to give some international exposure and adequate chance to explore the new big opportunity.

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