Key Issues in Selection of Expatriates - Essay Example

?Table of Contents Contents Page No. Introduction 2 Key issues in selection of expatriates 2 Recommendations 5 Implementation issues 7 References 9 International Human Resource Management Introduction The dynamic nature of business and the growth of multiculturalism have imparted the need for companies to be managed globally. This has raised new challenges for the managers. Companies face pressing needs of international human resource management (HRM) in the present age particularly with respect to recruitment, training, and compensation of the global employees. Differences between the countries affect the HRM processes of a company in a variety of ways. Such differences mainly include labor cost factors, cultural factors, industrial relations norms, and economic factors. Key Issues in Selection of Expatriates Expatriate assignments fail quite often. The stress process of expatriates is shown in Fig. 1. Careful selection of international assignee can help improve the results. Most of the managerial positions are held by locals instead of expatriates, though it does not always happen so. The attitude that prevails in the ethnocentric corporations is that local managers are superior whereas host-country managers are considered superior in the polycentric corporations. In contrast to them, the most suitable manager for a certain position in the geocentric firms is selected from the global workforce of the firm. Fig. 1: Stages of Expatriates’ Stress Process (Koteswari and Bhattacharya, 2007, p. 91). The training of expatriates before assignment typically revolves around cultural differences, factual knowledge about the country of assignment, and the way behavior is influenced by attitude. The approach that is most commonly used in the formulation of expatriate pay is equalization of the power of purchasing across the countries. This term used for this is the “balance sheet approach”. Culture shock is one of the most commonly experienced issues in the international assignments. Cultural novelty of the international subsidiaries is directly related to the difficulty of adjustment of expatriates in the host countries (Black and Mendenhall, 1991). Fig. 2 shows the issues commonly experienced by expatriates in cultural transition from the home to the host country. Culture of China and India is significantly different from that of England. Everything ranging from dress code to work ethics, norms, values, trends, and traditions are different among the three countries. This induces perceived inability of adjustment in the expatriates. “Perceived inability to adjust may indicate a lack of cross-cultural skills such as cultural empathy, intercultural Selmer” (Selmer, 2004, p. 805-806). Apart from the issues of expatriation, employees also become hesitant to become expatriates if they think that their organization does not support the repatriates (Black, 1991). Fig. 2: Problems Experienced by Different Age-Groups of Expatriates (Just Landed, 2012). Recommendations The need of having both home-office and local supervisors as reviewers of the expatriates’ performance complicates the process of expatriate appraisal. The process of expatriate appraisal can be improved by stipulating the level of assignment difficulty, weighing the appraisal of on-site managers more heavily, and getting background advice from the managers that have been to the foreign country before. These managers should also assist the expatriates in developing connections in the host country. Research by Wang and Kanungo (2004, p. 775) has shown that the network characteristics of expatriates have a significant and direct impact on their psychological well-being. Fig. 3 shows the factors influencing expatriates’ participation in social networks. This would create awareness in the selected expatriates regarding the culture of the host country and the impact of culture shock on them would be reduced. Fig. 3: Factors Influencing Expatriates’ Participation in Social Networks (Harvey, 2008). The problems of repatriation are commonly experienced. These problems include the fear of forgetting the expatriate as he/she gets out of sight, and difficulties experienced in the reassimilation of the family of the expatriate into the culture of the home-country. Ways in which these problems can be avoided included but are not limited to assigning a sponsor, using the agreements of repatriation, providing the expatriates with career counseling, building in the return trips, providing the expatriates and their families with reorientation programs, plugging the expatriates into home-office business, and sustaining the expatriates’ residence in the home-country by providing them with financial assistance. Management at the British firm should spend the maximum resources in measures to ensure smooth transition of the expatriates from the British culture to the Chinese and Indian culture. Cultural adaptability is critical for achieving effectiveness on the part of the expatriate managers in China (Lund and Barker, n.d., p. 515). Lack of proficiency in the Indian and Chinese languages is a potential demotivator for the expatriates. Management at the British firm should consider providing the expatriates with short courses on these languages. Language proficiency helps facilitate the expatriates in adjustment in the international subsidiaries (Selmer, 2006, p. 347). There are certain issues especially the perceived issues on the part of the expatriates that only take time to be resolved. “Over time, expatriates in China may feel more intrinsically motivated, having acquired new skills and abilities useful in facilitating adjustment” (Selmer, 2004, p. 807). Implementation Issues Management at the British firm should plan for the “International relocation and orientation [that] involves: arranging for predeparture training, providing immigration and travel details, providing housing, shopping, medical care, recreation and schooling information, and finalizing compensation details such as delivery of salary overseas, determination of various overseas allowances and taxation treatment” (Dowling et al., 2008, p. 5-6). To improve the process of expatriates’ appraisal, it is imperative that the difficulty level of the assignment is stipulated. It is usually more difficult to be an expatriate manager in China and India than it is in England which imparts the need for the appraisal to be considerate of such differences in levels of difficulty. The selection of managers for assignments as expatriates imparts the need for management to screen them for the characteristics which enhance their adaptability to environments that are dramatically new. The essential expatriate traits include but are not limited to flexibility, adaptability, self-orientation, cultural toughness, relational skills, job knowledge, family situation, extracultural openness, and motivation. A step that is of prime importance in the process of expatriate selection is adaptability screening that is directed at the probable success of the family in dealing with the foreign transfer. References: Black, JS 1991, Returning Expatriates Feel Foreign in Their Native Land, Personnel, Vol. 68, No. 8, pp. 32–40. Black, JS, and Mendenhall, M 1991, The U-Curve Adjustment Hypothesis Revisited: A Review and Theoretical Framework, Journal of International Business Studies, Vol. 22, No. 2, pp. 225 – 247. Dowling, PJ, Festing, M, and Engle, AD 2008, International Human Resource Management Managing People in a Multinational Context, (5th edition), Thomson. Harvey, WS 2008, The social networks of British and Indian expatriate scientists in Boston, Geoforum, Vol. 39, Issue 5, pp. 1756-1765. Just Landed 2012, Expatriate challenges: What are the biggest problems for expatriates? [Online] Available at http://www.justlanded.com/english/Common/Footer/Expatriates/What-are-the-biggest-problems-for-expatriates [accessed: 12 March 2013]. Koteswari VB, and Bhattacharya, MS 2007, Managing Expatriate Stress, Delhi Business Review, pp. 89-98, [Online] Available at http://www.delhibusinessreview.org/v_8n1/v8n1h.pdf [accessed: 12 March 2013]. Lund, and Barker, n.d., Organizational Commitment of Expatriate Managers in China, International Journal of Management & Organisational Behaviour, Vol. 8, No. 4, pp. 504-520. Selmer, J 2004, Psychological barriers to adjustment of Western business expatriates in China: newcomers vs long stayers, International Journal of Human Resource Management, Vol. 15, No. 4, pp. 794-813. Selmer, J 2006, Language Ability and Adjustment: Western Expatriates in China, Thunderbird International Business Review, Vol. 48, No. 3, pp. 347–368. Wang, X, and Kanungo, RN 2004, Nationality, social network and psychological well-being: expatriates in China, International Journal of Human Resource Management, Vol. 15, No. 4, pp. 775-793. Read More