Sending Expatriates Abroad

Sending Expatriates Abroad

Introduction

The issue of international staffing is important to international companies. 80% of mid size and large companies currently send professionals abroad and 45% plan to increase the number on assignment. With globalization on the increase, and even small to medium size organizations becoming players, sending expatriates abroad is becoming increasingly important. However, high failure rates suggest that many of the methods currently implemented in sending expatriates abroad are unsuccessful and need reconsideration. In U.S organizations a 15% staff turnover rate is generally considered to be too high. By comparison, the average turnover rate for expatriates is 30%, illustrating changes must be made. Studies also show a third of U.S expatriates become "brownouts"- that is they stay abroad but consistently under-perform (Morosini, 1999.)

In many circumstances, organizations fail to implement any international strategy for managing expatriates. In response to the problems associated with sending expatriates abroad, recent trends indicate an increase in the use of host-country nationals. This paper addresses the reasons why expatriates fail overseas. It specifically focuses on the social problems associated with assigning employees overseas and the social issues that they face once they begin working in their host country. Finally, this paper proposes that that sending expatriates abroad is a viable option if companies implement suitable strategies to deal with the issues faced.

Topic A - Selection of Expatriates

Introduction Topic A

Some Americans view international assignments as a welcoming challenge to expand their global horizons. However, many view it as an ordeal (Black, 1999.) Many organizations often make critical errors when deciding who to send abroad

Home country managers often make mistakes in deciding the type of person they want to send overseas because they ignore a fundamental principle of international management- different cultures require managers to be understanding and able to adapt to difficult cultures in order to work. This section will look at the assumptions and inconsistencies that human resource personnel in the home country make because of undeveloped cross cultural training programs, and will suggest alternative approaches to the selection process.

Literature Review

Studies show that human resource planning decisions are a major cause of expatriate failures. This is often attributed to the decision making process being the same as that used in the home country (Lee, 2005.) In a domestic setting, human resource personnel often base selection of expatriates on technical competence. However, repatriation and poor performance has shown to be caused primarily by factors unrelated to technical competence, such as an inability to adjust to the local culture (Andreason, 2003).

The cost of sending expatriates abroad averages three to four times the base salary of domestic employees (Gates 1996.) This does not include preparation and training costs. Direct costs alone average $150,000 per person. Not included in this figure is the potential loss of self confidence, damage to reputation, and increased turnover if the expatriate fails to adjust to their new environment (Thomas, 2002.)

Another problem in selecting expatriates is the consistent under representation of women. Even though 30% of the appropriate females have business degrees etc, only 16% of women make up expatriate management. The image of expatriates is an image of middle aged males, married with children. Barriers to female selection often result from home country bias. This bias stems from the fact that expatriates are generally chosen from middle to senior management, a section of business where women are under represented. It has been argued that the lack of women in expatriate management has subtle links to the "glass ceiling" and other stereotypical assumptions underlying women in the workplace (Hard, 2004.)

Discussion

Home country personnel often fall into the ethnocentric belief that strategies used at home will work as effectively in another country. Research shows that skills which work in one country, may not necessarily work in another. 'Our way is the only way' thinking encourages a strategy that fails to recognize the influence of cultural differences. Culturally sensitive human resource planning should be considered an important part of the overall planning process (Rodrigues, 2001.)

An overlooked element of the selection process is recognition of the family unit. The most common reason cited for expatriates to return early in the U.S and Europe was that the spouse was unable to adapt to the new culture. Furthermore, the ability of the spouse to adapt appears closely related to the managers' ability to adapt too. Why then, do so many companies neglect to include the family in selection considerations? With dual careers on the increase, the issue is of heightened importance because it may involve the spouse leaving their own career behind.

Failing to recognize differences when changing culture has also led to the provision of inadequate pre-departure training. Managers in the host country often believe that expatriates simply represent the host country and act as an intermediary between the two countries. These managers often fail to recognize that expatriates need to identify and accept cultural differences; otherwise the placement may diminish or negate the value of the assignment. Currently, many expatriates work overseas without a basic understanding of the local culture and language. These competencies were found to be more important than interpersonal competencies and business cannot be conducted effectively without them.

There is a belief that women cannot be chosen as expatriates because some cultures will not accept them in upper management as this is not considered a female position in such cultures. However if a woman is chosen as an expatriate, the cultures that hold such bias tend to respect the woman more than a male because they believe she must have extremely high levels of expertise to obtain the position.

Conclusion

International firms need a greater understanding of the problems involved in expatriate selection by looking beyond the individual and towards the social context of where the expatriate works and lives (Crocitto and Ashamalla, 2000.) In addition