Host Country National (HCN)

Host Country Nationals (HCNs) are employees who are citizens of the country where the foreign subsidiary is located. Companies often hire HCNs to benefit from their local knowledge, language skills, and cultural understanding.

Key Facts

  1. HCN (Host Country National):
    • HCN refers to employees who are citizens of the country where the foreign subsidiary is located.
    • Companies often hire HCNs to benefit from their local knowledge, language skills, and cultural understanding.
    • Advantages of hiring HCNs include familiarity with the local environment and lower recruitment costs.
    • Disadvantages may include difficulties in understanding the organization’s processes and goals without proper training and potential cultural differences.
  2. PCN (Parent Country National):
    • PCN refers to employees who are citizens of the country where the parent company is located.
    • Companies may choose to send PCNs to work in foreign subsidiaries to ensure control, maintain company culture, and transfer knowledge and expertise.
    • Advantages of hiring PCNs include their familiarity with the parent company’s culture and values.
    • Disadvantages may include difficulties in adapting to foreign cultural values and environments, as well as limited opportunities for PCNs to work in foreign countries.
  3. TCN (Third Country National):
    • TCN refers to employees who are citizens of a country other than the parent country or the host country.
    • Companies may hire TCNs to bring international perspectives, skills, and expertise to the organization.
    • Advantages of hiring TCNs include lower recruitment costs compared to PCNs and the ability to bring diverse perspectives to the company.
    • Disadvantages may include potential conflicts with traditional cultural values and the responsibility of HCNs and PCNs to delegate hiring responsibilities to TCNs.

Advantages of Hiring HCNs

  • Familiarity with the local environment
  • Lower recruitment costs

Disadvantages of Hiring HCNs

  • Difficulties in understanding the organization’s processes and goals without proper training
  • Potential cultural differences

Parent Country National (PCN)

Parent Country Nationals (PCNs) are employees who are citizens of the country where the parent company is located. Companies may choose to send PCNs to work in foreign subsidiaries to ensure control, maintain company culture, and transfer knowledge and expertise.

Advantages of Hiring PCNs

  • Familiarity with the parent company’s culture and values

Disadvantages of Hiring PCNs

  • Difficulties in adapting to foreign cultural values and environments
  • Limited opportunities for PCNs to work in foreign countries

Third Country National (TCN)

Third Country Nationals (TCNs) are employees who are citizens of a country other than the parent country or the host country. Companies may hire TCNs to bring international perspectives, skills, and expertise to the organization.

Advantages of Hiring TCNs

  • Lower recruitment costs compared to PCNs
  • Ability to bring diverse perspectives to the company

Disadvantages of Hiring TCNs

  • Potential conflicts with traditional cultural values
  • Responsibility of HCNs and PCNs to delegate hiring responsibilities to TCNs

Conclusion

The choice of whether to hire HCNs, PCNs, or TCNs depends on various factors, including the company’s goals, the specific needs of the foreign subsidiary, and the availability of qualified candidates. Each type of employee brings unique advantages and disadvantages, and companies should carefully consider these factors when making hiring decisions.

References

  • Dörrenbächer, C., Gammelgaard, J., McDonald, F., Stephan, A., & Tüselmann, H. (2013). Staffing foreign subsidiaries with parent country nationals or host country nationals? Insights from European subsidiaries. Working Paper, No. 74, Hochschul
    e für Wirtschaft und Recht Berlin, Berlin School of Economics and Law (HWR Berlin).
  • EduPlanetBD. (2016, September 22). PCN, HCN, TCN. EduPlanetBD. http://eduplanetbd.blogspot.com/2016/09/pcn-hcn-tcn.html
  • U-college. (2021, January 22). Advantages and Disadvantages of HCN, PCN and TCN. U-college. https://ucolleges.wordpress.com/2021/01/22/advantages-and-disadvantages-of-hcn-pcn-and-tcn/

FAQs

What is HCN?

HCN stands for Host Country National. They are employees who are citizens of the country where the foreign subsidiary is located.

What is PCN?

PCN stands for Parent Country National. They are employees who are citizens of the country where the parent company is located.

What is TCN?

TCN stands for Third Country National. They are employees who are citizens of a country other than the parent country or the host country.

What are the advantages of hiring HCNs?

Advantages of hiring HCNs include familiarity with the local environment, lower recruitment costs, and a better understanding of local customs and regulations.

What are the disadvantages of hiring HCNs?

Disadvantages of hiring HCNs may include difficulties in understanding the organization’s processes and goals without proper training, and potential cultural differences.

What are the advantages of hiring PCNs?

Advantages of hiring PCNs include their familiarity with the parent company’s culture and values, and their ability to transfer knowledge and expertise to the foreign subsidiary.

What are the disadvantages of hiring PCNs?

Disadvantages of hiring PCNs may include difficulties in adapting to foreign cultural values and environments, and limited opportunities for PCNs to work in foreign countries.

What are the advantages of hiring TCNs?

Advantages of hiring TCNs include lower recruitment costs compared to PCNs, and the ability to bring diverse perspectives and skills to the organization.

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