IBS

Managing International Careers:
Mastering Expatriation

Learning outcomes

• Understanding major pitfalls of expatriation management.
• Identifying the most important success factors of selecting and developing expatriates.

§         To become aware of different career planning systems.

§         To consider new trends in management careers.

• To consider problems of dual careers, work –life balance

Seminar Tasks

Case analysis and discussion on expatriation.

Exercise in setting SMART career goals.

Reading

·       Evans, Paul and Pucik, Vladimir (2002): The Global Challenge: Frameworks for International Human Resource Management, McGraw Hill, Chapter 3

·      Brewster, Chris and Harris, Hilary, Ed. (1999) : International Human Resource Management: Contemporary Issues in Europe, Routledge. Part III. P 161 – 277

·      Case 2: Stahl, G and Chua, CH (2003): From Jaguar to Bluebird: Mark Chan Returns Home After His Expatriate Assignment (A) and (B). INSEAD

Questions to answer:

1.      Should Mark accept the position offered in Singapore and return home? (Case A)

2.      What are his options? If Mark accepts the position offered in Singapore, what should his career plan be? (Case A)

3.      Who is to blame for the current situation? What factors contributed to Mark’s reentry problems and to those of his family? (Case A and B)

4.      What can the organization do to avoid the kind of problems illustrated in the case? From an HR perspective, what would be a more systematic approach to repatriation planning and international career development? (Case A and B)

Chapter 3. Managing International Careers: Mastering Expatriation

• Global integration means centralized control over key resources and operations that are strategic in the value chain. Decisions are made from a global perspective – in the extreme, the mega-national firm operates as if the world were a single market. Expatriation (e Auswanderug) is a principal tool of global integration.
  • The levers of global integration are centralization, or personal control
  • Standardization, based on control through formalization
  • Contracting, focused on control of outputs
  • Socialization, focused on control of norms and values
  • and mutual adjustment or control through informal interaction.

The business advantages of global integration

• Global integration can provide a firm operating internationally with a number of important benefits derived from a worldwide optimizations of resources:
  • Economies of scale (a company can lower its unit costs by centralizing critical value chain activities, such as manufacturing or logistics.)
  • Value chain linkages
  • Serving global customers (to the extent that customers are integrated an operate on a global basis, their suppliers may be forced to adopt similar structure)
  • Global branding (consumers product companies such as coca cola or Gillette promote a unified brand image around the world)
  • Leveraging capabilities
  • World-class standardization (key processes are standardized and centrally controlled)
  • Competitive platforms (tighter control of local subsidiaries by central headquarters)
  • Information advantage (sogo shosha)

The tools for global integration

• Five ways of exercising control
  • Centralization or personal control
  • Standardization, based on control through formalization
  • Contracting, focused on control of outputs
  • Socialization, built around control over norms and values
  • Mutual adjustment, or control through informal interaction.

Implementing global integration

• There are three complementary ways to implement globally integrated strategies:
  • Alignment of decision making to ensure that local decisions reflect a global perspective, particularly through personal control exercised by expatriates and performance management
  • Standardization of work processes using formalized control
  • And the socialization of key individuals who will occupy key positions both at the centre and in subsidiaries.
• There are two key types of international assignments – demand-driven and learning-driven. The former are driven primarily by corporate agency requirements (control and knowledge transfer) or by problem solving needs; the latter focus on organizational competence development and/or personal career enhancement.

Mastering expatriation

• Making an expatriate assignment into a success for the individual, the family and the firm requires paying attention to many factors from the time of initial selection until repatriation. A stating point is the recognition that expatriation is a process, not an event.

• Which personal traits and skills are the most relevant depends on the role the expatriates is expected to assume, for agency-type assignments, clear managerial qualifications together with the relevant professional skills and leadership skills are the essential foundation. In contrast, for learning-oriented assignments and relationship abilities and cultural awareness may be more important.
• The focus of research has shifted from explaining expatriate failure to understanding intercultural adjustments:
  • Adjustment to work,
  • The general environment abroad,
  • And (most difficult of all) to interacting with locale people
  • As well as to other factors such as conflicting allegiances.
• Family well-being is a critical element in expatriate effectiveness. The inability of the family to adjust to the new country is often the reason for assignment failure. Dual career couples are also more likely to experience stress in international assignments because of the expected negative effects of a career interruption.
• Tensions embedded in the expatriation process together with the changing demographics of the expatriate population – the growing number of women, third country nationals, and younger expatriates, and the need to adjust to dual careers – are changing the way in which companies approach international assignments.
• Global integration strategies may have a negative impact on the firm’s ability to be responsive to local needs and demands, be it those of customers, host governments, or the local employees. A big challenge facing many mega-national firms is a widespread perception that they are insensitive to local social issues.