chapter 11

building an effective
international workforce

A STRATEGIC LOOK AT INTERNATIONAL HUMAN RESOURCE

MANAGEMENT 449

STAFFING FOREIGN OPERATIONS: A WORLD OF CHOICES 453

SELECTING AND DEVELOPING INTERNATIONAL EMPLOYEES 458

CULTURAL DIFFERENCES IN SELECTION AND DEVELOPMENT

PROCEDURES 462

EXPATRIATES: WORK A WORLD AWAY 464

RETURNING HOME: THE CHALLENGE OF REPATRIATION 476

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Learning Objectives

After reading this chapter, you should be able to:

„ explain why an international human resource management strategy is critical for achieving
international business goals;
„ identify global staffing options and their advantages and disadvantages;
„ discuss how cultural factors impact the selection and development of international
employees;
„ describe how firms can manage equal opportunity and diversity issues in their international
operations;
„ pinpoint the major factors associated with the effective use of expatriates.

International Challenge

Seoul-Searching a Work World Away: One U.S. Expatriate’s Cautionary Tale

Linda Meyers’s experience in South Korea is a cautionary tale for any expatriate. Meyers
welcomed the opportunity to become an expatriate by accepting a management position in
human resources at Seoul-based SK Telecom. The prospect of working in Asia’s fourth-largest
economy while helping SK Telecom become a more global company was exciting. Meyers
brought impressive credentials to her new employer, including years of experience as an
expatriate consultant helping executives from top U.S. multinationals such as ExxonMobil and
HP make successful transitions to their overseas assignments.
Yet, soon after arriving in Seoul Meyers began wondering if she had made a huge
Copyright © 2014. Taylor & Francis Group. All rights reserved.

mistake. Despite previous job experience that required considerable overseas travel (e.g.,
several months in the Czech Republic and Ecuador) and her expertise as an expatriate consul-
tant, Meyers was unable to fully grasp the situation, much less operate effectively, at SK
Telecom. During the next two years, Meyers came to realize that her direct Western style of
addressing situations clashed with the formal and polite style of her Korean colleagues. She
also learned that SK Telecom had few Western employees in general and only a handful of
women in senior positions. Meyers discovered that she was, in effect, a trailblazer—one of
the few U.S. women to serve in an executive capacity at any Korean company. Eventually,
Meyers concluded that she and SK Telecom had divergent views about her role in the company.
She had become frustrated, demoralized, and exhausted—an outsider who was marginalized
and precluded from having the impact she desired.
The signs of things to come started early, when Meyers was initially e-mailed by an SK
Telecom recruiter—who assumed she was male. These and other incidents gave her pause,

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but she eventually took the job feeling it was simply too good to pass up. Once in Seoul,
Meyers was surprised that she received no official orientation or even much specific help on
how to adapt to her new surroundings. She also noticed how homogeneous things were at
SK Telecom and South Korea more generally, where less than 3 percent of the population
has foreign roots (vs. roughly 20 percent or more in cities such as London, New York, and
Singapore).
But Meyers was completely shocked by the struggles she had communicating with her
colleagues inside the company’s hierarchical management structure. Her inability to speak
Korean was a major impediment, and Meyers felt that she had no choice but to ask for an
interpreter to attend certain meetings. Getting information from Korean colleagues who did
speak English was also difficult. Forced to ask questions to learn anything, Meyers felt that
even her polite questions were interpreted as criticisms.
Nevertheless, after just four months on the job, SK Telecom promoted Meyers, asking
her to lead SK Holding’s Global Talent group. Meyers became frustrated, however, at her
inability to push through any significant changes in HR policies and practices. This was espe-
cially vexing because Meyers saw herself as an agent of change for the company—a view
that senior leadership at SK Holdings apparently did not share. Meyers felt increasingly
ostracized in her new job, hamstrung by the language barrier and what seemed to be a
deliberate effort to exclude her from important conversations and meetings with top
executives.
Things eventually got so bad that many of her colleagues simply would not speak with
her. The other shoe finally dropped in 2009, when Meyers was told that her contract would
not be renewed. While disappointed that she did not have the impact on the company that
she would have liked, Meyers also felt a sense of relief that she would be leaving. As you
read this chapter, think about some of the experiences and insights that Meyers went through
and develop your own assessment of the situation. Her experience raises many questions:
Who is responsible for expatriate difficulties and adjustment? Why did Meyers encounter so
much trouble in Korea, especially considering her prior overseas experience? Think about
these and related questions concerning expatriate adjustment as you read this chapter. Then,
read the Up to the Challenge? feature at the end of the chapter to read about possible
Copyright © 2014. Taylor & Francis Group. All rights reserved.

answers to these important considerations.1

A Strategic Look at International

Human Resource Management
In the previous chapter, we looked at the motivation and leadership challenges facing
international managers. Here, we build upon that understanding and begin to consider
the broader role that human resource management plays in a global context. International
human resource management (IHRM) activities focus on selecting, training, developing,
appraising, and rewarding employees for firms operating in a global environment.
Granted, human resource professionals, even those working for domestically focused

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

companies, are “international” to the extent that they hire immigrants, assemble multi-
cultural teams, and compete against multinationals in their local markets. But, compared
to their domestic counterparts, a broader and deeper set of challenges face those respon-
sible for IHRM, especially in larger multinationals.
Some of these many challenges are outlined in Figure 11.1. These include HR com-
plications due to different legal systems and laws, currencies, cultures, compensation
packages and tax codes—among many others. Mistakes made in some of these areas
involve much bigger stakes than in a domestic setting. Moreover, IHRM professionals
must also contribute to the overall international strategic planning process for the firm
as well as think strategically within their own functional area.2 Ideally, human resource
executives should be involved in all phases of the development and implementation of
a company’s international goals.3
A strategic perspective on IHRM is essential because companies with a highly trained,
flexible, and motivated global workforce may have an advantage over competitors,
especially if that workforce directly supports corporate goals.4 As theorist Michael Porter
put it, “[h]uman resource management affects competitive advantage in any firm, through
its role in determining the skills and motivation of employees.”5
Porter is right in that developing an effective international workforce is more dif-
ficult for a competitor to emulate than buying some technology (or even securing capital)
and can mean the difference between success and failure.6 There are many positive
outcomes that result from the effective management of international human resources.
These can include outperforming competitors in terms of identifying new business oppor-
tunities, adapting to changing conditions, sharing knowledge throughout the firm, coor-
dinating acquisitions and subsidiaries well, and maintaining a high-performing, committed
overseas workforce.7

Possible Additional/Unique Responsibilities Description/Explanation

A wider variety of external variables that must Different cultures, laws, languages, currencies,
Copyright © 2014. Taylor & Francis Group. All rights reserved.

be taken into account when making decisions and governments influence IHRM and require
broad expertise
Need to manage a wider and more diverse mix May include parent-country, host-country, and
of employees third-country nationals
A larger portfolio of human resource activities IHRM professionals may be involved with
and functions international relocations, work visas, complex
and different pay and tax issues for employees
More direct exposure to international risk issues HR decisions involve greater liability potential
(e.g., mistakes made in supporting foreign
acquisitions, posting or repatriating managers
overseas who fail involve bigger stakes).

Figure 11.1 Additional Responsibilities Facing International Human Resource Management (IHRM)
Professionals.
Source: Adapted from Briscoe, D. R., Schuler, R. S., and Claus, L. (2009). International Human Resource Manage-
ment (3rd ed.). New York: Routledge.

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

In many multinationals, a key and common challenge is how to balance the need
to coordinate units scattered around the world against the need for those units to have
the control necessary to deal quickly and effectively with local issues.8 Getting the right
mix of control is tough. For example, consider a situation in which the parent firm’s
national culture differs dramatically from the cultures in its overseas subsidiaries. This
may make it harder for the parent firm to share information, technology, and innova-
tions between the home office and foreign outposts. It may also be more difficult to
promote needed organizational changes and manage any conflicts that come up between
employees in different countries.
Fortunately, IHRM strategies can help deal with such problems.9 Companies could
benefit from the development of an international human resource philosophy. These
both describe and guide corporate values about human resources. These strategies in
turn shape the broad outline of what constitutes acceptable IHRM practices for employees
all over the world. Under this “big tent,” individual units can then fine-tune and select
specific practices that best fit their local conditions. But this is easier said than done,
especially for firms operating in dozens of countries. For instance, multinationals usually
find it extremely difficult to design a compensation system that is sensitive to cultural
differences yet still meets general guidelines of being seen as fair by employees every-
where. Culture can also impact other “local” human resource management practices,
from how benefit packages are constructed to the hiring, firing, and promotion practices
that are used.10
So, for all of these reasons, the selection of the right IHRM strategy can pay off,
even if it is customized to a particular foreign market. Consider multinationals wanting
to quickly enter countries with transition economies as they continue to move from
being state-dominated to being market-based (e.g., former Russian republics, others).
Choosing to enter those markets by buying local firms, building new plants or establish-
ing joint ventures may create significant human resource challenges that undercut per-
formance if not handled well. Consequently, multinationals need to adopt an appropriate
human resource management strategy in order to meet transition economy challenges.
Figure 11.2 presents three possible strategies that might be used in transitional
markets. The social welfare approach is a “womb to tomb” perspective on employees
Copyright © 2014. Taylor & Francis Group. All rights reserved.

that was once characteristic of many state-dominated economies. In contrast, a cost-

containment approach is characteristic of some Western multinationals that believe in
minimizing employee costs in the face of changing business conditions. Neither of these,
however, may be the best options in transitional markets. Instead, an invest-in-employees
approach may be best for increasing employee motivation and subsequent firm perfor-
mance. This may be especially true for transition economies in which high uncertainty
avoidance and a strong desire for stability both prevail (e.g., Ukraine). Like the social
welfare approach, the invest-in-employees approach offers at least some stability to
employees—provided they perform. More importantly, it relies on human resource prac-
tices that reflect the idea of “investing” in the workforce (e.g., training that can help
employees’ careers). That being said, the degree to which multinationals should pursue
this approach depends on local conditions. Put simply, one size does not fit all—some
combination of the strategies in Figure 11.2 may be the best bet, depending on the coun-
try circumstances.11

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Types of IHR Strategies

Human Social Welfare Approach Cost-Containment Invest-in-Employees

Resource (e.g., used by some Approach (e.g., used Approach (e.g., used by
Issue state-owned firms in by U.S. firms with a Western firms with a high
China and Russia) cost-cutting mentality) commitment philosophy)

Employee Narrow, training tends to Minimize training Wide range of

training/ be technology-specific expenditures to the developmental training
development extent possible offered for new and existing
employees
Monetary Pay determined on a group Individual performance Both individual bonuses/
incentives basis and not performance- is the primary driver of incentives and unit/firm-
driven raises, bonuses based profit-sharing are
used
Employee Extensive subsidies for Cut back or eliminate Slowly phase out direct
health and housing, health, child subsidies for employee subsidies not directly linked
welfare care, other needs welfare needs to employee performance
provisions
Employee job Offers high job security No job security offered Moderate level of job
security security offered
Expected Negative—may result in Negative—may result in Positive—may result in
link to firm poorer performance poorer performance better performance
performance

Figure 11.2 Effectively Managing Human Resources in Transition Economies: Three Possible Strategies.
Source: Adapted from Buck, T., Filatotchev, I., Demina, N., and Wright, M. (2003). Inside ownership, human
resource strategies and performance in a transition economy. Journal of International Business Studies, 34,
530–549.

This caution underscores the idea that developing an effective IHRM system that
Copyright © 2014. Taylor & Francis Group. All rights reserved.

reflects broad principles while also allowing for some local flexibility is tough to do.
Moreover, it begs the question of how such systems are created in the first place. In
reality, a variety of developmental processes exist across firms—depending on their level
of internationalization, the nature of their industries, and other factors. Many firms
develop such systems over time as their international operations grow in size and
complexity—sometimes with professional help from experts at consulting firms.12
IHRM systems themselves also vary. In some firms, virtually all IHRM functions
are run out of corporate headquarters. Others set general policies while asking foreign
subsidiaries to customize those policies locally. Then there are firms that look for best
practices in IHRM worldwide in order to implement them everywhere that is practical,
regardless of origin. In other cases, specific IHRM responsibilities are divided up among
corporate headquarters, regional areas, and individual subsidiaries.13 Finally, some firms
organize IHRM functions around the type of employee. It is important to understand
how firms choose from among employee types to staff international operations.

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Staffing Foreign Operations: A World of Choices

This section explores the options for staffing international operations. For instance, some
multinationals reserve human resource responsibilities for parent-country nationals
(PCNs) and third-country nationals (TCNs), but delegate decisions about host-country
nationals (HCNs) to local units.14 As already suggested, the strategic choices among
these three options (and more) that firms make should be supported by their IHRM
philosophy and practices. For instance, a company that earns a significant chunk of its
revenue in foreign countries should be led by senior executives who have substantial
international experience, including a firsthand understanding of foreign markets, cultures,
and business practices.
U.S. multinationals have focused more in recent years upon hiring and promoting
top managers with international experience as well as offering international development
opportunities to managers lower in the ranks. And, one foreign posting these days is
not enough—especially for those who want to rise high within the organization. At
Novelis, a Georgia-based aluminum firm, the chief HR officer states that those with
high-level ambitions are required to have multiple overseas assignments before they enter
the C-suite. At Xerox, rising stars must pass the test of several years’ overseas assign-
ments (and eight of ten managers are promoted from within).15
Yet, many U.S. multinationals seem “multinational” in name only—at least when it
comes to the percentage of board members who are either foreign executives or Ameri-
cans experienced in running foreign outposts. Indeed, less than half of the firms in the
S&P 500 have even one foreign national on their boards. And some firms have boards
where only 4–5 percent of the members have significant foreign experience or are foreign
nationals, including companies earning over 50 percent of their revenues abroad (e.g.,
Adobe Systems, Halliburton, and Unisys). At the other end of the spectrum are companies
that seem to think that foreign experience matters a great deal when it comes to the
board. Consider Colgate-Palmolive and Schlumberger—both firms earn over 75 percent
of their revenues overseas and both have boards where at least half of the membership
has foreign experience or are foreign nationals.16
Staffing international operations can be complex, though, with IHRM professionals
Copyright © 2014. Taylor & Francis Group. All rights reserved.

facing a dizzying array of choices. Take a look at Figure 11.3—it summarizes many of
the different types of employees available to help firms run their international
operations.
A traditional staffing option is to recruit parent-country nationals (PCNs) for top
management and important technical positions in foreign subsidiaries. PCNs have citi-
zenship in the country in which the hiring multinational is headquartered. Once posted
abroad for at least one year, PCNs are referred to as expatriates. Among the most com-
mon reasons for sending a PCN on an expatriate assignment are:

■ the perceived lack of appropriate expertise in a foreign subsidiary

■ the belief that a PCN is the best way to monitor and control foreign operations
■ a desire to transfer know-how about local markets back home to the parent firm
■ a desire to provide opportunities for high-potential employees to develop their cross-
cultural expertise.17

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Types of Employees Description

Parent-country nationals Employees who are citizens in the nation where the multinational is
(PCNs) based
Traditional expatriates PCNs who are sent abroad on assignment for one year or more
Second-generation Immigrants who are naturalized citizens of the multinational’s home
expatriates country and who are then posted overseas for one year or longer to
a country other than where they were born
Just-in-time expatriates Expatriates hired outside the multinational on a one-time basis to
fill a specific role or particular assignment—hired on an as-needed
basis
Short-term international Employees sent on assignments lasting between a few weeks and a
assignees year; increasingly popular option that doesn’t require relocation
Frequent business travelers Employees who must make frequent international trips for their jobs,
usually lasting from a few days or weeks to a few months at most
Localized employees Employees posted to a foreign location and treated as a local
employee; the firm/individual may want to be permanently based
there
Permanent expatriates Employees who spend many years, if not their entire careers, in
international assignments, going from one foreign posting to
another
Host-country nationals Locals hired to staff foreign subsidiaries or operations
(HCNs)
Inpatriates Typically HCNs who are brought to the multinational’s parent country
to fill a temporary assignment lasting from months to two years
Third-country nationals Employees hired to work in a foreign subsidiary or the headquarters
(TCNs) of a multinational, but who are actually citizens of another country
Domestic internationals Stay in their home country, but perform “remote” international
work (e.g., interacting with foreign customers by phone, e-mail,
video, etc.)
International commuters Live in one country, but commute to work in another country
Boomerangs Employees who are hired or chosen to return to their home
countries to work for the multinational
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Outsourced employees “Employees” who actually work for global employment firms hired
by the multinational to provide workers/staffs for a foreign outpost

Figure 11.3 Types of International Employee Available to Multinational Firms.

Source: Adapted from Briscoe, D. R., Schuler, R. S., and Claus, L. (2009). International Human Resource Manage-
ment (3rd ed.). New York: Routledge.

A case in point here is CEMEX, a Mexican multinational that had about 100 managers
in expatriate roles in 2012. They were assigned overseas because the company decided
that local employees did not have the necessary skill level, or motivation level needed
to instill the CEMEX corporate culture in the company, of the home managers.18
On the other hand, however, sending a PCN abroad is typically the most expensive
staffing option. Adding to the expense is that failure rates for expatriate assignments

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are high. Although estimates for failure rates vary considerably (from under 5 percent
to some 70 percent), a rough rule of thumb is that around 25 percent of expatriate
postings end in some kind of failure (e.g., premature return or ineffective performance).19
Perhaps the biggest risk in sending PCNs overseas is their often limited grasp of local
cultures and business practices, especially early in the assignment.20 To offset this, some
firms recruit immigrants for positions in foreign subsidiaries back in their ancestral
homes. But such employees, sometimes referred to as “boomerangs,” can run into trouble,
causing issues for themselves and multinationals in the process. Read the following
Global Innovations feature to learn why this staffing option holds some great promise
yet is not as simple as it seems.

Global Innovations

Want an Alternative to Traditional Expatriates? Try “Boomerangs”

Instead of posting expatriates to foreign countries, some multinationals are experimenting
with so-called “boomerangs.” These firms are recruiting employees who emigrated abroad
and asking them to return to their home country to run the company’s business operations
there. Firms at the vanguard in the use of boomerangs seem to be more common in countries
with dissimilar cultures and languages. For instance, U.S. multinationals have frequently turned
to Chinese boomerangs in recent years—often recruiting them while they are living in the
U.S. and then sending them back to China to run business units.
It sounds like a terrific idea—in part because the appeal of boomerangs is simple.
Companies can fill key positions in important foreign markets with skilled professionals who
are on an equal footing with country nationals because of their grasp of the local culture,
business practices, and even language. Examples of U.S. firms using boomerangs include
Marriott, McDonald’s, and Payless Shoes—all of which have returned highly educated and
well-trained immigrants to their home nations to offer service support or to lead operations.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Payless Shoes sent a native El Salvadoran to run a store in that Central American country
and to lay the groundwork for further expansion in the region. This particular manager had
left El Salvador at the age of 15 and eventually became a U.S. citizen. By posting her back
to her birth country at the age of 35, Payless Shoes had a boomerang manager in place that
understood the local culture well and spoke Spanish fluently.
Yet, simple as this seems, there can be significant challenges. Experience shows that
boomerangs can struggle to adapt when they find themselves back in their “home” cultures.
The reasons for these struggles vary but can include an overestimation of their understanding
of the local culture after years spent elsewhere, as well as their inability to change aspects
of the local culture they might now find unappealing.
One Chinese executive who returned home after working in the West for a number of
different multinationals found the traditional behavior of his subordinates frustrating. When
he arrived to visit one branch office in China, the executive found employees waiting for him

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in a receiving line—a traditional courtesy designed to boost management egos. A little

annoyed and embarrassed, he asked the branch manager not to do that again. Likewise, he
experienced difficulty persuading his managers not to run to the airport to personally greet
him after a trip. His view of the airport scenario was blunt: “To me it’s wasting time—they
should be working in the office.”
Boomerangs can also be surprised at the treatment that they receive from local
employees who may not perceive them as locals after so much time away. Some of those
employees view the boomerangs’ attempts to “act local” as flimsy impersonations that
betray their status as overpaid interloper. For example, one executive went back to Japan
after more than two decades in the U.S. in order to run Apple Computer’s Japanese opera-
tions. His Japanese colleagues felt that he was “too American,” and he left in frustration
after just one year. Likewise, a management consultant returned to her Russian homeland
after living for years in the U.S. Despite her fluent Russian, she returned to the U.S. after
less than two years, tired of Russian women who found her ambition and accomplishments
off-putting.
Companies can help boomerangs overcome such obstacles and eventually succeed. One
tactic that works well is to assign locals to serve as “cultural translators” for boomerangs in
order to ease their adjustment back into their native cultures. Another option is cross-cultural
training designed to help reintegrate back into their local cultures. Apparel giant Levi Strauss
does this very thing. One Peruvian Levi Strauss employee was educated in the U.S. but ran
into trouble when she was sent to Mexico for a management position. During company
training, she realized that her failure to use formal titles when addressing her Mexican
colleagues was a key reason why they were being standoffish—they thought that she was
being rude.
Unfortunately, some companies seem only to be following or imitating the vanguard
firms in their use of boomerangs. They see the success of firms and jump on the band-
wagon with little planning, assuming that boomerangs will somehow automatically under-
stand and conquer the ropes in their native countries, even if they have spent years away.
Because of this, some estimates show that less than 20 percent of boomerangs receive any
cross-cultural training. Yet, the training received at the best companies shows that it would
Copyright © 2014. Taylor & Francis Group. All rights reserved.

be wise not to assume that boomerangs will automatically snap back into their native
cultural environments without any difficulty, especially if they have had a new home for
years now.21

Consequently, many companies turn to host-country nationals (HCNs), especially to

fill lower- and middle-level management jobs. HCNs are individuals from the foreign
country where a multinational has set up operations. Some firms are reluctant to put
HCNs in top management positions, fearing that it may dilute their control over
operations or corporate culture. Still, HCNs offer some potential advantages over
PCNs. Typically, HCNs have a superior grasp of the local culture, business practices,
and language. HCNs are also less expensive, because expatriates usually entail

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

expensive relocation costs and enticing pay packages. “Going local” to staff foreign
operations can also bring public relations benefits and relieve government pressures
to create jobs.
The giant Korean firm Samsung uses just this approach. With almost 100,000
employees outside of South Korea (up 300 percent over the last decade), the number of
HCNs continues to rise, approaching 70 percent in 2011. One of Samsung’s senior HR
executives said that “[t]his is a change from the past, when Samsung’s overseas opera-
tions were mainly run by Koreans.” While some firms will wonder if the HCN has the
appropriate knowledge to build corporate culture, the advantages of HCNs over PCNs
are clear: the former usually have a better understanding of local practices and culture.22
This seems to be especially true for Western companies doing business in Asia. In fact,
a leading HR consulting firm reports that three out of four senior executives hired in
Asia by multinationals were Asians already living in the region. It appears that firms
want someone who can directly make deals with local businesses and governments—who
are now more likely to be equals.23
Another popular staffing option is third-country nationals (TCNs), to work either
in foreign subsidiaries or at multinational headquarters. TCNs hold citizenship in a
country other than the one in which they are working: for example, if a multinational
wants someone with expertise in local culture and business practices to fill a manage-
ment position in a foreign subsidiary. PCNs may have plenty of management experience
but lack local knowledge. Likewise, HCNs understand local conditions, but may lack
relevant technical skills. A TCN may be the best option, especially if the goal is to
groom someone for top management positions in foreign subsidiaries or to effectively
run operations in countries that lack home-grown management talent. For instance,
an American firm setting up manufacturing operations in Costa Rica may find appro-
priate candidates in Mexico, a country with a large pool of Spanish-speaking manage-
ment talent.
Although PCNs, HCNs, and TCNs represent three major staffing categories, they
do not describe all staffing possibilities or situations. For instance, multinationals often
want a talented international cadre—a group of managers who can be plugged into any
country and successfully represent the company’s values. Doing this means selecting
Copyright © 2014. Taylor & Francis Group. All rights reserved.

managers based on potential and ability, regardless of nationality, and then exposing
them to a variety of international experiences. Indeed, some international cadre members
essentially spend their careers jumping from one foreign assignment to the next. These
people might best be described as permanent expatriates—employees who stay on at
one or more foreign assignments for an extended period of years. For example, during
a visit to China, an American executive working for a U.S. multinational in Shanghai
has been continuously working in various overseas subsidiaries for over 25 years. Devel-
oping an international cadre seems to pay off. Multinationals that use regional transfers
and TCNs extensively to build their international cadres tend to outperform multination-
als that rely on traditional expatriates.
Finally, consider a promising Chinese employee working in Beijing for an American
firm. The Chinese employee is sent to the U.S. to fill a temporary position at corporate
headquarters for as long as a few years. Such employees are sometimes referred to as

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

inpatriates. Sending foreign employees to the home country is often done to develop
skills and strengthen commitment to the parent firm. Likewise, companies can take
advantage of what inpatriates can teach them about doing business in particular
countries.24
Interestingly, some experts urge international firms to strive to have PCNs, HCNs,
TCNs, and other types of employees working side by side wherever possible. Their
rationale is that a diverse work environment improves innovation and learning, outcomes
that ultimately raise subsidiary performance. The role for IHRM professionals in this
context is to select the right people and ensure that the advantages of staff diversity are
not overwhelmed by its accompanying disadvantages (e.g., more conflict and coordina-
tion problems). This can be accomplished by appropriate selection, socialization, and
training efforts that make employees aware of staffing goals while improving their
international skills.25

Selecting and Developing International Employees

Identifying types of employees is one thing, but how do multinationals decide which
option is best for a specific overseas position? Experts suggest that such decisions should
be made with a firm’s international business strategy in mind, taking into account its
competitive environment, overseas sophistication, level of internationalization, and the
foreign market where the position will be based. One study of a U.S. financial services
firm found that overseas branches with higher proportions of American expatriates
offered more complex services. In these locations, expatriates could offer greater insights
about complex services than their local counterparts. On the other hand, however,
branches in foreign countries with fierce local competition—places in which local knowl-
edge was critical—had more HCNs and fewer expatriates.
But the degree to which IHRM is melded with a firm’s strategic decision-making, and
the specific selection tactics and training approaches used, varies across countries. This
suggests that national culture impacts human resource activities. One example is the Chi-
nese emphasis on business contacts that rely on reciprocal obligation (known as guanxi),
Copyright © 2014. Taylor & Francis Group. All rights reserved.

which seeps into the hiring practices, training approaches, and career development activities
of many firms in ways not seen elsewhere. There is pressure to reciprocate a favor, and
this could extend to one with human resource implications. This type of local, cultural
knowledge often needs to be developed in PNCs and even TCNs and should be part of
a firm’s development programs. The ability to put this knowledge into play can, as we
will see in the second part of this chapter, be included in a performance evaluation.
Figure 11.4 summarizes some of the skills that international managers need to suc-
ceed. As you can see, this is a formidable list of talents. Fortunately, research shows that
even mastering several of these skills goes a long way toward improving managerial
effectiveness across cultures.26 This skill set can help promote a wide understanding, to
be sure. Yet, at the same time, it is also important to recognize that stamina and a steady
hand play a role in managerial success. With this in mind, read the following Interna-
tional Insights feature on some of the more mundane, yet common, challenges facing
most of today’s international managers.

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Skill Area Thumbnail Sketch of Desired Competencies

Multidimensional Has extensive multi-functional, multi-country, and multi-environment

perspective experience
Line management A successful track record in overseas projects and assignments
proficiency
Decision making Successful in making strategic decisions across a variety of situations
Resourcefulness Has skills to be accepted by host country’s government and business elite
Cultural adaptability Can quickly adapt to foreign cultures, with diverse cross-cultural experience
Cultural sensitivity Deals effectively with people from many cultures, races, nationalities, religions
Team-building Can create culturally diverse working groups that achieve organizational
goals
Mental maturity Has the endurance needed for the rigors of foreign posts
Negotiation Has track record of successful business negotiations in multicultural contexts
Delegation Has track record of ability to delegate in cross-cultural contexts
Business practices Can conduct business across borders successfully in a global environment
Change agent Has track record of successfully initiating/implementing organizational
changes
Vision Can quickly spot and respond to threats and opportunities in the host
country

Figure 11.4 Think You Have the Right Stuff? A Skill Profile for International Managers.
Sources: Adapted from Briscoe, D. R., Schuler, R. S., and Claus, L. (2009). International Human Resource Manage-
ment (3rd ed.). New York: Routledge; and Howard, C. G. (1992). Profile of the 21st-century expatriate manager.
HR Magazine, June, 93–100.

I nternational Insights
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Glamour, Grunge, or Both? In the Trenches with International Managers

International management is a term that conjures up a romantic image of travel to exotic
locales, generous perks, and a pampered life abroad. But, as is too often the case, this image
can contrast with actual experience. At the minimum, the perks are not what they used to
be. Companies are putting the brakes on the rising costs of sending expatriates overseas.
One way has been through the use of shorter overseas assignments, often to tackle oppor-
tunities in growing markets such as in Latin America and Asia, whose firms in turn are sending
their employees out to extend their global reach.
Shorter assignments can mean frenetic and exhausting trips. One manager’s 11-day trip
included stops in six countries. Hardly sleeping, the manager got sick and canceled his final
Moscow stop. Another manager earned 17,000 frequent flyer miles on just a four-day trip
spanning three continents. Yet, do not assume that jet lag is a small price to pay for going
to flashy cities such as Paris or Hong Kong. Managers are increasingly finding themselves in

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

underdeveloped and risky locations where they may travel on dirt roads, stay in lousy hotels,
and deal with challenges such as disease, polluted air, bad water, and security threats ranging
from street crime to terrorism. One American manager ended up using buckets of sea water
for washing (and flushing) in Papua New Guinea after the hotel’s water main was blown up
by local guerrillas. Another manager found himself in the middle of 500,000 chanting Egyp-
tians in a march protesting U.S. involvement in Iraq on the way to a Cairo business meeting.
Today, companies often restrict travel after a terrorist incident. But, temporary restrictions
typically fade, even in the face of terrorism. The reason is simple—fast-growing markets
demand attention. On November 26, 2008, 12 coordinated terrorist attacks occurred in the
city of Mumbai, India. Several of these targeted locations were favored by foreign business
travelers, including the Taj Mahal luxury hotel. Over 100 people were killed by members of
a Pakistani extremist group, although hotel employees showed tremendous heroism in saving
many customers. Despite the destruction and tragic loss of life (something that has repeatedly
occurred in Mumbai since 1993), many companies continued to send employees there, even
as they took additional precautions. After the Mumbai attacks, one marketing executive from
a Western firm said that his company was undeterred and “would not even think of changing”
travel plans to India.
More mundane travel concerns that affect international managers include an often
grueling lifestyle and family hardships. One executive at a Boston-based firm spent three out
of every four weeks on the road, mainly abroad. When asked what he wanted for Christmas,
the executive’s son said he “wanted his Dad to be home.” Likewise, the children of a manager
making ten trips a year to China for a Pittsburgh-based company endured schoolyard taunts
about having an absent parent. A Ford expatriate in China with his family saw them struggle
with isolation and culture shock in the massive city of Chongqing. The urbanization of many
cities has been remarkable, as has the growth of amenities and sights to see. Yet, it can be
a difficult adjustment for some.
There are many positives, however, associated with all of this globetrotting, whether it be
short term or long term. The Ford manager referenced previously felt that his posting to China
helped strengthen family ties, improved his children’s education (they attended an excellent
school for expatriate children), and provided opportunities for travel within China and Asia. The
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Pittsburgh-based manager felt that making ten trips to China a year put him “on the frontier”
in perhaps the key world market where he was able to make decisions on the spot.
Balancing the pluses and challenges of frequent international travel requires flexibility and
adaptability. One BellSouth manager spent much of his time shuttling between Atlanta and
various South American countries. He learned to adapt early when his Cuban parents sent him
to live in the U.S. at the age of 9. His secret to survival was being able to adapt his style to
whatever culture he was in. Over time, he learned to handle big differences in business styles
across continents. Also important are foreign language skills, having a mentor, and resilience to
travel stress. More mundane survival tactics for assignments include doing whatever is necessary
to get enough sleep and exercise—which includes turning off laptops, cell phones, and all other
“24–7” technology products in order to protect sleep time. It may also mean not over-scheduling
meetings and letting go of the home office. As one PricewaterhouseCoopers veteran put it,
when on business overseas, “forget about home” and “focus on why you’re there.”27

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Cultural Values and Staffing Needs

Researchers are focusing more than ever on the connections between cultural values and
staffing—information that would be valuable for HR practitioners who need to make
staffing decisions. For instance, Japanese multinationals tend to use PCNs to run foreign
subsidiaries to a greater extent than American and European firms. But, this tendency
can change depending on the business conditions in play. For instance, Japanese firms
in industries where global integration and control are important tend to be especially
heavy users of expatriates. As their experience grows overseas, Japanese multinationals
tend to shift toward using more HCNs in subsidiaries. Generally, when higher power
distance and assertiveness are valued in their home countries, multinationals tend to use
expatriates more often. These decisions reflect the belief that higher levels of control are
needed in foreign outposts, tipping the balance in favor of the high-cost expatriate
option.28

General Staffing Models

There are likely many situations that call for different employee types. It might be
helpful, however, to consider some broad perspectives that can guide multinationals’
international staffing efforts—even if they are modified later by prevailing conditions.
For instance, a geocentric philosophy means that the firm stresses ability and perfor-
mance when selecting international staff, without regard to nationality. The goal is to
develop and train managers who can be good corporate citizens anywhere in the world.
Standards for performance are determined collaboratively between headquarters and
foreign operations. At the other extreme is an ethnocentric philosophy. In this case,
headquarters makes all key decisions and foreign subsidiaries have little autonomy or
input. Most or even all important jobs at headquarters and in all foreign operations
are held by PCNs.
In between these two extremes are two other philosophies. A polycentric philosophy
gives HRM control to the foreign subsidiary, although headquarters still makes broad
strategic decisions. Each subsidiary is a semi-independent entity that controls its own
Copyright © 2014. Taylor & Francis Group. All rights reserved.

staffing needs. As a result, HCNs usually hold top jobs in foreign subsidiaries. These
same HCNs, however, rarely move beyond their local subsidiary to headquarters or
other foreign locations. Similarly, with a regiocentric philosophy, most foreign employees
will not move into headquarters positions. Nevertheless, employees can move from
country to country in a particular region.29

Developing Managers with International Skills

Many firms embrace the geocentric philosophy as they become more experienced in
international business. It can take years to build an international workforce where
employees are flexible, open-minded, and expert in several cultures and languages. And
because large multinationals operate in dozens of countries, virtually all aspects of the
business involve international contact. For these firms, relying on just a small handful
of managers with international experience is a recipe for trouble. Ideally, all employees

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

must recognize how differences in cultures, laws, and business practices across borders
impact international communications and relationships (see Figure 11.4).

Options for Developing International Managers

But how should firms go about developing employees with appropriate international
skills? While there is no clear recipe, many companies rotate promising managers through
different foreign assignments over several years. This strategy produces managers with
experience across a variety of countries and organizational circumstances, such as man-
aging a start-up operation, an ongoing joint venture, a restructuring, and so on. Indeed,
some companies go about this from the ground up. Procter & Gamble, for instance,
emphasizes identifying and cultivating talent at local levels worldwide. Promising employ-
ees are then plugged into regional talent pools as they develop—eventually, they gain
the experiences and abilities needed to fill critical assignments anywhere in the world.
This also promotes diversity throughout the P&G global workforce as employees from
countries around the globe are fed into the system. To keep track of it all, P&G uses a
computerized system that tracks promising employees worldwide by experiences, skills,
and success in prior assignments, making it quicker and easier to select someone for an
international position when an opening occurs.30
Another option is to recruit foreign students who want to work in their home country
after graduation—where their language and cultural skills can be put to good use. Like-
wise, some firms will focus on potential employees who are fluent in multiple languages,
open to other cultures, and willing to tackle overseas assignments. Finally, some U.S.
companies have had success with training programs that bring high-potential managers
from all over the world to work together on a variety of projects in a simulated envi-
ronment. Such programs build cross-national relationships and improve cross-cultural
problem-solving skills. For example, Motorola annually puts up-and-coming international
managers through a business simulation that can last weeks. As one manager who went
through the simulation said, “[i]t’s surprising how realistic and demanding it is.” Using
such tools can also save firms money. French food giant Danone SA cut its failure rate
among expatriate managers from 35 percent to 3 percent in three years by using simula-
Copyright © 2014. Taylor & Francis Group. All rights reserved.

tions to evaluate international talent.31

In fact, some firms with extensive overseas operations have developed global training
programs for employees. Sometimes this includes training for expatriates going to specific
countries. Global training programs, however, usually have broader goals, such as devel-
oping cultural awareness, working effectively in cross-cultural teams, and building cross-
cultural communication skills. Procter & Gamble and Intel Corporation are examples
of U.S. firms that have successfully implemented global training programs.32

Cultural Differences in Selection and

Development Procedures
So far, the chapter has explained that cultural values shape how firms select, develop,
and place international staff. For instance, American and British multinationals have
used different procedures to select and manage expatriates than their German and

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Japanese counterparts.33 When these cultures and their unique methods interact, conflict
can emerge. Consider what an American experienced when he was hired by Samsung
to help set up a plant in New Jersey:

The hiring process was unique. Many people attended the interviews. Side conver-
sations in Korean were the norm. Decision making inched forward as consensus
was painstakingly achieved. The senior people did not commit themselves to a
position until their respective staffs had fully and freely expressed their support
or concerns for my candidacy. Personal issues were critical. Those items went
beyond my wife and me. They penetrated into realms of what my father had done
for a living, whether or not my mother worked outside of the home, and what
my brothers and sister were doing. They all seemed to have a significance I could
not fathom.34

This American was surprised by a hiring process that differed from that normally used
within the U.S. To his credit, his professed ignorance of Korean culture and hiring
practices prevented him from really understanding what was happening at the time.
Likewise, Samsung’s Korean managers were clearly unaware that Americans would find
the personal questions that they asked shocking and off-limits. In the U.S., such ques-
tions are perceived as irrelevant, discriminatory, or both. Plus, some of these questions
would be illegal in the U.S., where anti-discrimination laws are extensive and strictly
enforced. Many other countries either do not have the same type of legal protections in
place when it comes to forms of discrimination (e.g., Thailand) or do not enforce them
consistently if they do (e.g., Mexico). In any case, it is no surprise that foreign managers
may be unaware of U.S. legal and cultural restrictions on interview questions nor grasp
that what is seen as fair with respect to selection procedures can vary greatly. From their
perspective, the Korean managers in this example likely felt that they could not make
a good hire without understanding the candidate’s home life, religious orientation, and
family.35 They may be puzzled if such questions were not asked of them if they were
interviewing with a U.S. firm.
Selection procedures can be modified to fit the situation, though. For example,
Copyright © 2014. Taylor & Francis Group. All rights reserved.

traditional American selection and job analysis procedures can be adapted to better
fit cultural values that Japanese firms often want to emphasize in their U.S. plants. In
one auto parts plant, Japanese management wanted to stress team skills, consensus
building, harmonious relationships, and other “Japanese values” when hiring American
workers. Yet, these values make the common U.S. practice of openly comparing indi-
vidual applicants uncomfortable for some Japanese. American managers generally feel
that their role is to pick the best candidate for a job, making comparisons between
people necessary. Clearly, American and Japanese approaches to selection are
different.
Fortunately, the selection system developed at the American plant cleverly blended
both approaches. At the plant, groups of job applicants assembled windshield wiper
motors. Individual performance within groups was assessed by trained evaluators who
arrived at a final score for each person using a consensus decision process. All appli-
cants who reached a predetermined cutoff score were considered qualified and hired

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

to staff the plant. This system cleverly combined individual assessment (American)
with consensus decision making for overall evaluation (Japanese). It also allowed
Japanese managers to assess issues critical to them, including an applicant’s ability to
work well in a team.36
Finally, the success of any selection or training program depends on how well it
matches the values and culture of those employees being trained. For most U.S. manag-
ers, self-focused training improves performance more than group-focused training. The
opposite is true for many Chinese managers. To Americans, information about their
ability to succeed at a task (self-focused training) seems more useful than information
about the ability of a group they belong to (group-focused training). Self-focused infor-
mation is valued in individualistic cultures where performance is usually viewed at the
level of an individual employee. In contrast, Chinese managers may pay more attention
to information that describes how a group that they belong to should approach a task.
As you know, in collectivistic cultures people tend to view themselves as members of a
group first and as individuals second. As a result, “performance” is a function of shared
responsibilities, which in turn makes information about group behavior more valuable.
In a nutshell, firms should take the cultural values of employees into account when
designing training programs.

Expatriates: Work a World Away

In this section, we focus on selection and development issues for expatriates in more
detail. For a decade or more now, American multinationals have been hiring more locals
in foreign subsidiaries, sending headquarters staff out on more short-term overseas trips,
and using technology (e.g., e-mail, teleconferencing) to keep people connected worldwide.
In part, this might reflect a change to more of a geo- or polycentric philosophy by the
multinationals. But, it is also likely that the high cost of sending expatriates abroad is
a concern in tough economic times. Increased safety concerns and political turmoil abroad
are other considerations that weigh on the minds of managers.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

The Need and Presence of Expatriates

Nevertheless, despite these trends, expatriates are not going to disappear anytime
soon. Indeed, they have played valuable roles (and will continue to do so) for mul-
tinationals as technical experts, international managers, relationship builders—or all
three. In many cases, there is simply no better option than to send someone overseas
for multiyear assignments. If anything, the expatriate population has actually been
increasing in very recent years. This may be due to more companies engaging in
international business than ever before, including multinationals rising up from devel-
oping markets such as Brazil, China, and India. Moreover, many established multi-
nationals have expanded the number of countries in which they do business and have
pushed heavily into emerging markets. This expanded need for expatriates can also
explain their rising numbers—which are staggering. In China, over 90 percent of

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

companies on the Global Fortune 500 list operate there. Moreover, the number of
foreign employees posted to China (more than 300,000) has doubled over the past
several years.37
As you might guess, a good portion of those 300,000 foreigners working in China
are U.S. expatriates. Indeed, the overall number of Americans who work in foreign
countries or travel abroad for business is astounding. Roughly 6 million Americans work
abroad in some capacity, and 7.5 million more go on business trips to foreign countries
each year. Roughly 1.3 million expatriates work for U.S. multinationals, 80 percent of
whom have a partner or spouse that will accompany them. So, if we also count children
who accompany an expatriate parent, nearly 3 million people are somehow “involved”
in expatriate assignments for U.S. multinationals alone. Some of the big multinationals
support huge expatriate populations. For instance, energy giant Royal Dutch/Shell has
over 5,000 expatriates posted to 120 countries, while German conglomerate Siemens
has roughly 2,000 expatriates posted to over 100 countries.38
While it is important to remember that expatriates represent only a small slice of
the overseas workforce in most multinationals, there is little doubt that expatriate assign-
ments will continue to be important.39 Indeed, in one recent survey, Japanese firms were
the most likely to report that they were moving toward longer expatriate stints overseas.
The bottom line is that expatriates often fulfill a variety of critical roles for multination-
als, ranging from technical experts to subsidiary managers to relationship builders, either
alone or in combination. At times, there is no substitute for a long-term international
assignment.40

Expatriates: Balancing Risks with Rewards

The role of an expatriate can be a risky proposition. When firms make mistakes in
selecting and managing expatriates, the consequences of failure can be expensive for the
company as well as for the expatriate. Figure 11.5 summarizes some of these conse-
quences. By failure, we mean expatriates have either returned early, finished the assign-
ment but were ineffective, or left the company soon after coming home—all costly
Copyright © 2014. Taylor & Francis Group. All rights reserved.

outcomes. As explained earlier, failure estimates vary considerably, with 20 percent being
a reasonably accurate value. Failure rates, however, may be creeping upward. A recent
survey found that 34 percent of expatriates in 180 multinationals failed—perhaps because
larger numbers were posted to challenging places such as Russia, India, and Indonesia.
Moreover, U.S. firms tend to experienced higher expatriate failure (common estimates
around 20–30 percent) more than either their European or Japanese counterparts (com-
mon estimates are around 10 percent). Europeans may do better because they are exposed
to a variety of languages and cultures while the Japanese tend to have longer overseas
assignments, which may help their adjustment.41 Likewise, failure rates depend on the
location as well. For example, U.S. failure rates are lower in Europe than in more cul-
turally challenging areas.42
Expatriates are very expensive, however, even when things go well. Add up all the
costs (e.g., higher pay, airfare for family members, moving expenses, housing allowances,
education benefits for any children, company cars, taxes, home leave, extensive

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Failure Consequence Description/Implication

Premature return Estimates of the percentages of expatriates who are asked to come
home (or request it) vary on the assignment and situation. Yet,
premature return can jeopardize a firm’s ability to compete effectively.
Wasted relocation costs Sending expatriates abroad (plus partner, spouse, children), is very
expensive. Wasted costs on relocation can easily top $100,000.
Wasted preparation and Failure means the firm loses the direct (e.g., training, overseas pay)
support costs and indirect costs (e.g., not getting the job done) spent on preparing/
supporting an expatriate.
Other indirect costs Failure hurts the career/confidence of the expatriate and damages
relations with local employees, officials, customers, and suppliers
(which take time to repair).
Ineffective performance Even if expatriates stick out their assignments, they may not be
performing well (e.g., making poor decisions, hurting local relations,
not meeting firm goals).
Turnover after repatriation When expatriates return from a foreign assignment, it leaves the firm
with no return on its $1 million-plus investment for a typical three-
year posting.
Negative momentum As word spreads of the problems expatriates have (e.g., failure, “out
of sight, out of mind” issues, lousy repatriation prospects), recruiting
becomes harder, making it more difficult to capitalize on overseas
opportunities.

Figure 11.5 Expatriates and the Consequences of Failure.

Sources: Adapted from Birdseye, M. G., and Hill, J. S. (1995). Individual, organizational/work and environmental
influences on expatriate turnover tendencies: An empirical study. Journal of International Business Studies, 41,
787–806; Black, J. S., Gregersen, H. B., and Mendenhall, M. E. (1992). Global Assignments: Successfully Expatriat-
ing and Repatriating International Managers. San Francisco, CA: Jossey-Bass; Carpenter, S. (2001). Battling the
overseas blues. Monitor on Psychology, July/August, 48–49; Hauser, J. (1999). Managing expatriates’ careers. HR
Focus, February, 11–12; Poe, A. C. (2000). Destination everywhere. HR Magazine, October, 67–75.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

training, etc.) and the first year abroad can cost 300 percent of the expatriate’s base
salary. The tab to post a professional overseas for three years can easily top $1 million
(see Chapter 13).43
Of course, one might not find a three-year foreign assignment appealing anyway—
perhaps because of worries about terrorism, political upheavals, or personal safety.
Indeed, the perception is that the world has become a more dangerous place in recent
years. Of some 240 foreign locations examined, nearly 30 percent are ranked as high
risk, compared to just over 20 percent in 1998. Or, perhaps one is just not the sort
of person who would thrive in a challenging foreign environment regardless. If you
think you are the kind of person who could succeed as an expatriate, multinationals
may be interested. Increasingly, multinationals want their top executives to have exten-
sive foreign experience, making an expatriate assignment essential for reaching the
corner office. Figure 11.6 outlines some tips if landing a job overseas is part of your
career plan.44

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Tips for Snaring a Job Abroad Explanation/Description

Learn additional languages Multilingual professionals are always in demand

For lower-level jobs, leverage Specialized skills can provide an edge in lower-level jobs if
any specialized skills marketed correctly
For higher-level jobs, network Focus on people who have clout where you want to go and
like crazy with key players develop long-term relationships with executive recruiters
Get involved in international Attend international meetings, participate in global bulletin
professional groups to raise boards, and speak at international conventions—these
your visibility provide opportunities to meet and pitch people who might
hire you for an overseas job
Get noticed in the press about Volunteer to write articles, give reporters quotes for their stories
international issues to raise about international business topics in newspapers or business
your profile as an expert publications—a reader with authority may notice and hire you
Seek introductions from foreign These people may be in a position to hire you or to steer you to
suppliers, customers, and someone who can in your desired location
officials
Keep track of former colleagues They may now be working for a new employer in a foreign
country and may be in a position to help
Offer to pay for recruiting costs Offering to cover interview or even relocation costs is expensive,
but it may impress a hiring manager overseas and help you
compete against local talent that is cheaper to recruit

Figure 11.6 Want an Overseas Job? Better Get Busy.

Source: Adapted from Lublin, J. S. (2005). Job hopping overseas can enhance a career, but it takes fortitude. The
Wall Street Journal, June 7, B1.

Choosing People for Expatriate Assignments

In choosing expatriates, many factors should be considered in the selection and training
process, including the assignment itself (e.g., which competencies are needed and how
Copyright © 2014. Taylor & Francis Group. All rights reserved.

much interaction is required with local employees or customers), and features about the
assignment location (e.g., cultural and socio-economic differences present). Of course,
important features of the potential expatriate—including motivation, skills, experience,
and family situation—should also matter a great deal.

National Differences in Expatriate Criteria

Across countries and regions, multinationals weigh such features differently and sometimes
diverge altogether regarding the factors that they use in selecting expatriates. For instance,
U.S. firms tend to emphasize previous performance, technical skills, and a desire to be
assigned overseas when choosing expatriates, often because the assignment itself is aimed
at fixing problems in overseas subsidiaries. Recently, U.S. multinationals have been paying
more attention to personal fit and family circumstances in their selection process. Screening
personal factors such as resilience and openness, as well as consideration of family

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

motivation to travel, has become an important tool in the process. On the other hand,
in Chinese firms, while managers take skills and performance into account when choosing
expatriates, they may place greater emphasis on their relationships with candidates.
Chinese firms seem to be less interested in employee development when dealing with
expatriate assignments. As a result, expatriate selection is driven by managerial authority,
if not favoritism, in many Chinese firms.45
European and Scandinavian firms tend to stress flexibility and cultural competencies
more than do multinationals from other parts of the world. They also tend to rely on
a wider variety of evaluation methods than U.S.-based firms. This suggests that European
and Scandinavian firms place more weight on the alignment of candidate skills and
attributes with the needs of a specific assignment. Many U.S. firms fail to systematically
assess the extent to which location and assignment demands fit with a candidate’s family
situation, personal attributes, and “soft” skills. The most important factors for expatriate
success include certain personal attributes (e.g., tolerance and emotional stability), soft
competencies (e.g., motivation and the ability to bridge cultural differences in building
relationships), and family context (e.g., the accompanying spouse’s or partner’s ability
or motivation to adapt).46

Get to “Yes” and Success

But how do multinationals actually evaluate candidates for expatriate assignments? As
you might suspect, evaluation practices can vary, independent of the selection criteria
used. Sophisticated Western multinationals may use talent information systems to track
large groups of employees and build a pool of potential expatriates. P&G uses just such
a database to keep track of 13,000 managers all over the world, with variables that
capture experiences in foreign or cross-cultural contexts. From there, a variety of addi-
tional techniques can be employed to identify the best individual candidate for the
expatriate position, including interviews (ideally including spouses and partners), psy-
chometric tests (measuring such traits as adaptability and emotional maturity), perfor-
mance in assessment-center training (where candidates are put through various real-world
scenarios), and intensive reviews of past accomplishments relevant to the assignment.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

U.S. companies often use in-depth interviewing when picking expatriates. In addition to
any job-relevant qualifications, the interviews are most productive if they examine indi-
vidual attributes related to expatriate success. The key goal is to pick the person who
best fits the requirements of the expatriate assignment.47
Getting a handle on the precise factors that lead to success in expatriate assign-
ments will also require some analysis. Much will depend on how well expatriates
adjust to their new cultural environment, the nature of the work they are doing over-
seas, and the interaction needs of their foreign colleagues. Individuals, however, bring
different talents, skills, and experiences to the workplace and firms will also differ in
how much support is provided to expatriates before and after they leave for an assign-
ment. Consequently, we should expect variance in how expatriates adjust to foreign
assignments, perhaps a good amount of it. These variations in adjustment approaches
may reflect differences in home cultures as well as the HR practices companies use to
support expatriates.48

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Regardless of how rigorous the selection process has been, an expatriate candidate
may, at the end of the day, simply decline the assignment offer. To secure a “yes” from
potential expatriates, the financial package will need to be attractive and the job itself
interesting and rewarding, offering the potential for advancement rather than a high risk
of failure. Expatriate candidates may also decline assignments if their concerns (or those
of their family) about the location are not assuaged. Few individuals would want to be
assigned to a location that is viewed as politically unstable or physically unsafe.
If there are few job opportunities available for partners or spouses planning to
accompany an expatriate, or a lack of strong schools and education programs for any
accompanying children, little incentive exists. Issues such as these can be particularly
vexing. Not surprisingly, it is often difficult to convince employees to consider an
expatriate posting if the culture overseas does not provide for his or her family. Another
deterrent is that expatriates themselves are more likely to be demoted rather than
promoted after they finish an overseas assignment. Multinationals typically refuse (or
are unable) to promise expatriates their old jobs back and instead often place them
into open positions that are available after they return (often a de facto demotion).
Firms should be clear about how expatriate assignments will develop an employee’s
career and specify how expatriates will be assigned a new position once they return
home.49
Some forward-thinking companies have been taking additional steps to tackle these
common concerns of potential expatriates. About 25 percent of multinationals factor in
the potential loss of a trailing spouse’s or partner’s job by including job search help,
career counseling, or a cash bonus in the expatriate’s assignment package. Approximately
90 percent of multinationals offer location visits before employees accept an assignment,
and roughly 50 percent offer language or other training for family members who are
accompanying the expatriate. For some of the most dangerous locations, extreme offers
are made to lure expatriates. Several years ago, a U.S. company offered expatriates an
annual $75,000 hardship bonus for working in Iraq. Firms may also give expatriates
safety training before leaving, and otherwise address emergency procedures, personal
safety, and local politics. If needed, others may provide high-security housing within
walled complexes guarded 24/7 by security personnel.50
Copyright © 2014. Taylor & Francis Group. All rights reserved.

A Selection and Evaluation Process

Regardless of what package is needed by the employee to accept an expatriate position,
multinationals should have a systematic process for choosing and evaluating expatriates
relative to the requirements of a particular foreign assignment. Firms would do well to
follow the recommended process laid out in Figure 11.7—which begins by putting
together a selection team and ends with the chosen expatriates preparing for their over-
seas assignments.
Selection teams should consist of home-country, host-country, and international HR
professionals. The role of HR experts is to identify expatriate candidates and help the
team use appropriate selection methods. Home- and host-country managers on the team
are there to represent the needs of the parent company and foreign subsidiary, respec-
tively. Once formed, the team should determine the job factors (e.g., nature of the work

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

Create Team to Select and Evaluate Candidates

(team should include home and host country representatives, IHRM experts)

Analyze Job, Firm Factors Relevant to Assignment Analyze Location Factors Relevant to Assignment
● Nature of work, fit to firm strategy ● Extent of cultural differences with home context
● Technical, managerial skills needed to succeed ● Nature of political/social/business environment
● Level of interaction job required with locals ● Level of development and standard of living
● Nature/extent of training available ● Proximity to home country
● Nature/extent of on-site support available ● Attitudes toward foreigners

Establish Selection Criteria, Then Recruit Candidates

Consider Candidate Factors That May Impact Expatriate Success or Failure

● Ability, need, and desire to go (e.g., for career or personal development purposes)
● Family situation and dynamics (are trailing spouse/partner, children in the mix?)
● Educational background, international experience, technical skills, and language proficiency
● Personality attributes: Tolerant, flexible, open, emotionally stable, extroverted, agreeableness
● “Soft” competencies: Task-oriented, relationship-oriented, able to bridge home-host country practices

Apply Multiple Selection and Evaluation Methods to Assess Candidates

● Use assessment instruments that evaluate personality attributes and/or learned skills and competencies
● Conduct formal reviews of past performance and experiences, especially in overseas contexts
● Interview candidate and family members (by home/host country representatives and IHRM experts)
● Use assessment centers that put candidates through simulations/exercises to evaluate suitability

Potential Expatriate Accepts Assignment Offer

Transition New Expatriate into Training and Preparation Programs/Activities

Copyright © 2014. Taylor & Francis Group. All rights reserved.

Figure 11.7 A Recommended Process for Effective Selection and Evaluation of Potential Expatriates.
Sources: Adapted from Black, J. S. Gregersen, H. B., and Mendenhall, M. E. (1992). Global Assignments: Suc-
cessfully Expatriating and Repatriating International Managers. San Francisco, CA: Jossey-Bass; Briscoe, D. R.,
Schuler, R. S., and Claus, L. (2009). International Human Resource Management (3rd ed.). New York: Routledge;
Downes, M., and Thomas, A. S. (2000). Managing overseas assignments to build organizational knowledge.
Human Resource Planning, 20, 33–48; and Shaffer, M. A., Harrison, D. A., Gregersen, H., Black, J. S., and Fer-
zandi, L. A. (2006). You can take it with you: Individual differences and expatriate effectiveness. Journal of Applied
Psychology, 91, 109–125.

and skills required) and location factors (for example, cultural differences) most relevant
to the assignment. Next, the team should establish criteria for judging assignment suc-
cess and then begin to build a pool of candidates (such as through job postings). Can-
didates should be carefully assessed on factors known to predict expatriate success and
failure, including motivation to go, family dynamics, cross-cultural experience, personal

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

attributes (such as tolerance), and appropriate competencies (such as technical and lin-
guistic requirements). The team should use multiple methods and tools to conduct
candidate screening (for example, tests, interviews, exercises).51
After the candidate pool has been reduced to a handful of finalists, another set of
interviews can be conducted that focus on assignment issues in greater depth. It would
be wise at this point to include detailed information about what work and home life
will be like in the host country as well as the specific implications of successful assign-
ment completion for expatriates’ careers. It is absolutely vital at this point to interview
any trailing spouses, partners, or family members. Sending candidates and any trailing
family members on pre-assignment trips to the host country may also help them grasp
what life abroad will be like. This is also a good mechanism for fleshing out any potential
lingering concerns held by the candidate or family members—these should be discussed
at length and taken seriously. Once the selection team has had its assignment offer
accepted (hopefully by the best-fitting candidate), the next step is to begin efforts to
prepare the expatriate to succeed abroad.52

Training, Preparation, and Adjustment of Expatriates

Preparing Expatriates
But what constitutes effective preparation for an overseas assignment? First, training
and preparation should be an ongoing process, with rigorous efforts made before,
during, and even after repatriation. After all, expatriates often experience a culture
shock of sorts when they return home, not just at the beginning of their assignment.
While a variety of approaches exist, all preparation and training programs should have
two basic goals: (1) help expatriates be effective in their assignments as quickly as
possible; and (2) minimize adjustment difficulties expatriates and their families face,
in both their new environment and after they return. In addition to cultural training
and language instruction programs, preparation efforts may also include briefings and
counseling on:
Copyright © 2014. Taylor & Francis Group. All rights reserved.

■ completing the physical relocation (e.g., travel, shipping possessions);

■ daily life overseas (e.g., housing, shopping, living conditions);
■ family issues (trailing spouse/partner opportunities, educational for kids);
■ acclimating to business overseas (e.g., business practices, maintaining relationships,
legal issues, political/economic conditions);
■ health, safety, and security issues; and
■ company history, policies, and personnel in the foreign location.

Unfortunately, many firms provide no significant preparation or training prior to depar-

ture (estimates are that between 40 and 70 percent of firms with expatriates fall into
this category). And when it comes to small to mid-sized companies, the figure may be
on the high end of this range, if not exceed it. Given that evidence shows that training
improves the ability to adjust to new cultural environments as well as boost job perfor-
mance, this training gap is unfortunate.53

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

Cross- Cultural Training

Cross-cultural preparation is a very important component of most expatriate training
efforts. So, what should cross-cultural training look like and include? Learning from
cross-cultural training involves a three-step process. The first step involves paying atten-
tion to cultural differences that explain why foreigners think and behave the way that
they do. Next, expatriates must retain knowledge about behavior that is culturally
appropriate. In other words, expatriates must think about the new cultural knowledge
that they receive and use it to develop a mental framework for their own behavior. This
tactic helps expatriates remember how to behave in foreign settings and the consequences
of mistakes. The last step involves practicing culturally appropriate behavior that is
consistent with expatriates’ mental frameworks. This trying-it-out process helps expatri-
ates fine-tune culturally appropriate behaviors and increases their confidence when
interacting with foreign colleagues, clients, and suppliers.54
Cross-cultural training itself can range from superficial activities that can be covered
in a few days to rigorous efforts spanning across months. Figure 11.8 displays the range
of training rigor possible and some associated activities. Determining the right mix of
rigor and activities is critical. In making this determination, firms should consider how
important the assignment is, how long it will last, and the extent to which an expatriate
must interact with locals. For instance, if an expatriate’s job requires extensive interac-
tion with locals and communication norms in the foreign country are different, then
more rigorous training is advisable. This example also underscores the importance of
assessing cultural toughness. Said differently, this raises the question of how different
the culture is in one assignment location from the home culture of the expatriate.
Everything else being equal, the greater the difference from the home culture, the
more difficult the expatriate’s adjustment process in a foreign country will be. Conse-
quently, more rigorous training is needed for expatriates headed to countries that, to
them, are high in cultural toughness. For instance, Americans typically have less trouble
adjusting in Europe than they would in Africa, the Middle East, or Asia—all places
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Level of Rigor Time Duration Activities Included

Low 4–20 hours Lectures, films, books, area

briefings
Moderate 20–60 hours Everything above, plus role-plays,
cases, survival-level language
training
High 60–180 hours Everything above, plus
assessment centers, simulations,
field trips, in-depth language
training

Figure 11.8 Levels of Cross-Cultural Training Rigor.

Source: Black, J. S., Gregersen, H. B., and Mendenhall, M. E. (1992). Global Assignments: Successfully Expatriat-
ing and Repatriating International Managers. San Francisco, CA: Jossey-Bass), 97. Copyright © Jossey-Bass Inc. By
permission of the publisher.

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

where the cultural values encountered may seem more “foreign.” Overall, cultural tough-
ness can negatively affect expatriates’ adjustment and even their willingness to accept a
foreign assignment in the first place.55 See the accompanying International Insights
feature, which takes a close look at the issue of cultural toughness.

International Insights

Hardship Post or Comfortable Sojourn? Chinese Expats in the West

Things are looking up for Western expatriates in China. Well-worn hotels, poor food, and
weak education and hospitality services have given way to glitzy housing developments, fancy
restaurants, and high-priced private schools and a university system on its way to the top for
children. Rapid growth has made China the place to be for foreign expatriates, who are
increasingly accepted within society and are less likely to attract stares, even in far-flung
inland Chinese provinces such as Sichuan. Like nearly everywhere, however, not everything
is perfect. Air quality and traffic can be big problems in some cities. Likewise, censorship,
opaque government rules, and cultural differences present hassles for Western expatriates.
The movement of Western expatriates into China, however, is no longer a one-way
street. Thanks to enormous economic clout, Chinese companies are setting up shop and
making deals all over the world. As a result, a flood of Chinese expatriates has been sent
into Africa, Europe, and the U.S. Yet, the contrast between the shifts made by Western
expatriates and their Chinese counterparts could not be starker. Westerners landing in China
have left modern democracies with individualist values and slow-growing economies for a
more collectivist place with rapid growth, governed by a controlling and bureaucratic regime.
And, Chinese expatriates have done exactly the reverse. So, are there differences in what
each group of expatriates generally experiences? And, which group might have the greater
challenge making the adjustment?
While the answers to these questions are less than precise, anecdotally Chinese expatri-
Copyright © 2014. Taylor & Francis Group. All rights reserved.

ates seem to have the more difficult challenge. This is partly because for most Chinese
expatriates, the perks and pay fall short of that rewarded to Westerners. As a result, the
higher prices that they often encounter in Western cities create hardships. Instead of having
maids to cook and clean as they do at home, Chinese expatriates in the West find themselves
having “to clean their own toilets,” as one expatriate so aptly put it. And, without a generous
package to lean on, most Chinese leave their families behind to cut costs. Many Chinese
find their time in Western countries lonely—unless they are extroverted, single, are able to
communicate easily.
Beyond these challenges, Chinese expatriates may encounter other difficulties. Back
home, they tend to be waited on and shown tremendous deference and respect, both in
and out of the office. In Western countries, however, they are more likely to be greeted with
just a smile, especially outside of work. The entire atmosphere abroad as an expatriate may
also be different by group. In Western multinationals, being picked for a stint in China is

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often highly motivating—an opportunity to learn a fascinating culture, make more money,
and receive an indirect acknowledgement of being on the fast track to the top. But in China,
winning promotions is often a function of cultivating close relations with key superiors and
that is hard to do when you are an expat on the other side of the world. Indeed, when some
Chinese managers are tagged for an expatriate assignment, it may signal that they are not
well regarded, or that they have some weaknesses that could harm the company. Yet, unlike
in most Western firms, Chinese who are employed by state-owned companies cannot refuse
an expatriate assignment.
Then there are differences in attitudes and practices that Chinese expatriates must deal
with, including the fact that strikes can strand people at train stations and airports, particu-
larly in Europe. While China has labor unrest, it does not extend to public services because
of government control. Also, Chinese expatriates often start from behind because Chinese
companies are not well-known brands in most Western countries, making it tough to
penetrate Western markets. Western directness also tends to throw some Chinese expatri-
ates for a loop. Being peppered with questions by potential customers in China could
mortify a Chinese manager making a sales presentation. Yet, such behavior in Western
countries is common and may reflect a desire for more information, not negative percep-
tions of the presenter.
Postings to Western countries also have big pluses for Chinese expats. First, society
is relatively transparent and business regulations are clearer. For example, instead of having
to tap into your network of contacts to get a business license, one Chinese expatriate
marveled that “you just download a form from the Internet and apply.” People in Western
countries also tend to be friendly toward Chinese expatriates, with little evidence of
hostility. So, overall, both types of expatriates have the opportunity to develop their skills
and to even enjoy themselves. The latter two outcomes, however, are importantly deter-
mined by preparation and mindset—two things good in any business venture and discussed
next.56
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Trends in Expatriate Preparation

Wider and Deeper Training

Some multinationals are going to great lengths to create sophisticated training programs
for expatriates. Royal Dutch/Shell, for instance, sent surveys to 17,000 former, current,
and potential expatriates, as well as family members, to systematically assess the issues
confronting employees in foreign assignments. The company used the results to develop
better training and career-management programs. Indeed, such extensive efforts are most
likely to appear in companies such as Royal Dutch/Shell, IBM, Unilever, and others that
have made expatriate preparation and global management development a board-level
priority.57
Recently, cross-cultural training programs have focused more on improving open-
mindedness by challenging expatriates’ prejudices, assumptions, and attitudes about

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

different cultures. This goes beyond the short, superficial courses on overseas business
etiquette and dress often used in the past. Instead, the training emphasis today is likely
to be on understanding and respecting all cultures. That is the goal that Motorola had
in mind when it built a cultural training center to help company managers be more
effective in whatever cultural context they found themselves.58

Involvement of Families
It was noted earlier that many firms are doing more to address safety, family, and dual-
career issues. In part, this is because many of these issues are causing recurring problems.
For instance, nearly 90 percent of Fortune 500 firms in one survey stated that dual-career
complications will continue to create expatriate selection and performance headaches in
the future. Often, the expatriate’s family situation is the most important predictor of
success or failure—even more important than cultural skills, adaptability, or job
knowledge.59 The good news is that involving spouses, partners, and children in pre-
departure cultural training can improve the adjustment of expatriates and their families,
especially when combined with other forms of assistance (e.g., help with spouse/partner
job searches or lost income replacement).60

Training Will Continue to Improve

In the years ahead, companies may step into new areas when it comes to expatriate
training and preparation, especially if research shows that they improve success rates.
For instance, providing mentors is a promising area. Specifically, companies should
consider creating programs that partner expatriates with both a home-country and host-
country mentor throughout their assignments. Having a home-country mentor who
consistently provides long-distance support, communication, and updates about the home
office appears to improve expatriates’ knowledge of the organization as well as their
promotion chances and job performance.
Likewise, a host-country mentor provides similar benefits. Host-country mentors
also appear to facilitate organizational knowledge sharing and teamwork. In other words,
Copyright © 2014. Taylor & Francis Group. All rights reserved.

expatriates learn to appreciate the host-country assignment more, feel more integrated
into host-country staff, and are more likely to share what they know. All of these posi-
tive effects are potentially career enhancing—particularly important because expatriates
often report that their careers stall or take a step backward after returning home. For
companies, it increases the odds that expatriates will be motivated knowledge transmit-
ters who improve the flow of critical knowledge across national boundaries in the markets
they serve.61

Self- Preparation and Training

Nevertheless, when it comes to training and preparation, expatriates would be wise to
look out for themselves. As one expert observed, “[i]t would still be rare to find a
company that is using everything that research has shown us about selecting, training,
developing, and supporting expatriates.” This suggests that expatriates should also help
themselves prepare for overseas assignments. For instance, they can sign up for college

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courses to help build skills and abilities not included in company training. Expatriates
can also seek independent advice from firms that specialize in cross-cultural training
and relocation (such as from the U.S.-based Cartus Corporation). Soliciting insights
from other expatriates is another good option. Finally, if not already provided by the
employer, a pre-departure visit to the host country (with the family) can help ease the
settling-in process. Once abroad, expatriates can also seek out groups that offer support
(such as trip planning, blog and message boards, advice, and, in some cases, expat
camaraderie).62

Returning Home: The Challenge of Repatriation

Unfortunately, the need for preparation, planning, and training does not end when
expatriates leave to return home. A bevy of potential problems also awaits expatriates
when once home. These repatriation problems explain the high turnover rate among
expatriates. Consider these common repatriation challenges:

■ Changes in the home country and in the expatriate’s values after several years abroad
make “home” seem more “foreign”.
■ Changes at the home office require major adjustments and new learning.
■ New jobs after return can be disappointing (this may be due to a demotion, a discon-
nect from the overseas job, or an unclear career track).
■ There may be problems of reorientation to living conditions in the home country.
■ The expatriate may experience feelings of under-appreciation by the firm after per-
forming well overseas.
■ Returning home may mean adjustment to a lower standard of living (with no more
pay premiums or fancy benefits).63

Many companies now realize how expensive it is to neglect these repatriation issues. To
the contrary, there is growing recognition that expatriates represent a unique and valued
resource once they return—they are individuals who can help the firm because of the
Copyright © 2014. Taylor & Francis Group. All rights reserved.

important information they have collected, the new competencies that they developed,
and the new knowledge that they created during their overseas assignment. Without
successful repatriation, all of this will be lost, which could end up being a competitive
disadvantage for the firm (and consequently a plus to a competitor!). 64
Thus, some firms address repatriation issues in depth even before the expatriate
leaves for an assignment. For instance, Monsanto, the pharmaceutical, chemical, and
agricultural giant, started a repatriation program to combat high turnover among its
expatriates. In a nutshell, they found that expatriates’ dashed expectations for advance-
ment upon return home were a big part of the turnover problem. Monsanto instituted
pre-departure planning for the role that expatriates would have once they returned. The
firm also now gives returning expatriates opportunities to showcase their overseas
accomplishments publicly and provides counselors to help with readjustment problems.
Programs such as these can improve the performance and adjustment of expatriates after
they return.65

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Attacking the “out of sight, out of mind” problem is another key issue. Some com-
panies deliberately bring expatriates back home several times a year to give them visibility
and express appreciation for their work. Expatriates can meet with important managers
and, ideally, a designated mentor. Return trips also serve to jump-start the adjustment
process. The longer that expatriates are away, the more difficult they will find it to
return. To combat this, firms can increase the frequency of home visits as the final return
date approaches, especially for employees who are gone for more than two years. Con-
sider what happens at Coherent, Inc., a California-based manufacturer of lasers and
other high-tech equipment with offices in several countries, including China. The company
brings expatriates home for short stints of a few months before their final return. During
this time, expatriates complete modest projects. They then return to their foreign post-
ings to conclude their affairs before coming home for good. This months-long period in
the U.S. helps reacquaint expatriates with the office, their (new) colleagues, and ongoing
projects. It also gives expatriates an extended taste of life back home. Overall, the pro-
gram has helped cut down the repatriation adjustment period. Figure 11.9 lists some
additional steps that firms can take to ease the repatriation process.66

Time Frame Suggestions/Description

Before departure • Clearly communicate reentry job options, establish career development
plan
• Appoint home- and host-country mentors to support expatriate
• Arrange home visits for visibility
6–9 months before • Narrow list of reentry job options, send expatriate job openings/listings
return • Conduct home office visits to facilitate adjustment, schedule job
interviews
3–6 months before • Conduct briefings with employee/family about what they’ve learned
return • Explain home-country changes that may impact their return
• Ask expatriate to list return expectations to minimize misunderstandings
Copyright © 2014. Taylor & Francis Group. All rights reserved.

• Explain firm’s moving policies and repatriation programs

Immediately on • Assign employee/family to a welcome home group of former expatriates
return • Provide a home sponsor to review changes in firm (e.g., policies,
products)
• Provide returning spouse with career-related assistance
• Offer counseling for more serious problems
3–6 months after • Provide training for reentry shock, or any negative feelings about return
return • Ask employee how new skills and experience can be better used by the
firm
• Reassess adjustment process to identify outstanding problems and offer
assistance

Figure 11.9 Before, During, and After: Suggestions for Improving the Repatriation Process.
Sources: Adapted from Shilling, M. (1993). How to win at repatriation, Personnel Journal (September), 40–46;
Solomon, C. M. (1995). Repatriation: Up, down, or out? Personnel Journal, January, 28–37.

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

Chapter Summary

This chapter discussed the challenges of managing human resources globally as well as the
strategic value of international human resource management (IHRM). Aligning IHRM with firm
goals is important. Consequently, companies may want to develop approaches to IHRM that
both reflect broad principles while also including tactics tailored for use in specific markets.
We also considered the basic options for staffing foreign operations. These include
PCNs, HCNs, and TCNs. Some firms are trying to develop an international cadre of managers
who can be sent anywhere in the world. Companies are increasingly using boomerangs to
improve their effectiveness in foreign markets. Likewise, firms continue to designate valued
foreign employees as inpatriates, bringing them to the parent country for various develop-
mental assignments to increase their commitment.
Sometimes firms embrace a particular selection philosophy in making staffing decisions.
At one extreme is a geocentric approach, where ability is all that matters. An ethnocentric
approach, in contrast, means that only PCNs will be posted in key overseas positions. Poly-
centric and regiocentric approaches fall between these two extremes. In a polycentric
approach, human resource management control is in the hands of the foreign subsidiary,
although headquarters still makes key decisions. Likewise, under a regiocentric approach,
most foreign employees will not move into headquarters positions. Employees, however, can
move from country to country in a particular region.
The chapter concluded with a focus on expatriates, where the consequences of failed
assignments are often severe. Firms need to develop a rigorous selection process and use
criteria that accurately predict success. Expatriates also need to be prepared to deal with all
of the cultural and lifestyle changes that will be encountered abroad. The exact nature and
level of training needed should be driven, in part, by the cultural toughness of the foreign
location. Preparation is also needed if employees are to be successfully repatriated back to
their home countries. Fortunately, companies are moving toward more sophisticated repatria-
tion programs that kick in before the expatriate has even begun the foreign assignment.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Discussion Questions

1. What are some of the unique challenges facing international human resource management
professionals?

2. What are some of the pros and cons associated with using PCNs, TCNs, and HCNs? How
does culture impact selection and development of international employees?

3. What are the elements of a successful program to select, prepare, and repatriate employees
destined for foreign assignments? How can cultural toughness and family issues be managed
effectively?

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

Up to the Challenge?

Trying Fitting in Across an Ocean of Differences

At the beginning of this chapter, we told you about the real-life experiences of a seasoned
international business professional, Ms. Linda Meyers. In particular, we relayed her observa-
tions about the various interactions and styles of management in South Korea and her (self-
acknowledged) lack of preparation for the many cultural differences between managing in
the U.S. and Korea. Plus, Meyers was hardly a novice as she had other extensive assignments
that ended successfully and was a consultant to other firms about expatriate deployment.
So, what happened in Seoul?
On reflection, Meyers felt that she had made some important mistakes. One lesson was
summarized by the phrase “easier said than done.” The extensive experience that she had
in prepping others for expatriate roles did not make it any easier to implement that advice
herself. Moreover, much of the training she provided to other soon-to-be expatriates did not
have much specific applicability to the SK Telecom environment in Seoul. Despite her own
personal preparation efforts to read about and to understand Korean business culture, Meyers
judged that her efforts were superficial and that she missed about 80 percent of what she
actually needed to know. Another realization was that Meyers’s view of progress and change
did not align with her more conservative Korean bosses, something that she should have
done more work on to clarify in advance.
In terms of her own management style, Meyers also concluded that she should have
been more patient when introducing changes to her Korean subordinates. For example, soon
after arriving in Seoul, she tried to create a more informal environment by telling her Korean
subordinates to stop using her title and instead to address her by her first name. Unfortu-
nately, this backfired and caused her subordinates to lose respect for her and to perceive her
as weak. Likewise, Meyers admitted that she tended to jump to the conclusion that every
misunderstanding that she had with her Korean colleagues was due to cultural differences
or poor treatment because she was a foreigner. After one disagreement with a Korean
manager, which she chalked up to a cultural misinterpretation, Meyers spoke to another
Copyright © 2014. Taylor & Francis Group. All rights reserved.

colleague about how to handle the situation. The Korean manager was very embarrassed
and upset when he found out that Meyers had consulted with another colleague about their
misunderstanding.
After leaving SK, Meyers returned to her roots, again serving as a consultant to help
other people prepare for their expatriate assignments. Her experience in Korea, Meyers
believes, ended up making her a better consultant. As she put it, “those years in Seoul taught
me to question my own actions and assumptions. I realized that my leadership style had
been shaped by a particular environment and that my way was not always best.”
As you reflect on this situation, does it surprise you that she encountered so much
trouble in Korea, especially given her prior experiences and positions? What are some addi-
tional steps that she could have taken to better prepare for her role at SK Telecom (both
before she accepted the job as well as after)?

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

International Development

What Is Your International Orientation?

Purpose

To develop self-insight and knowledge about your level of experience with, and interest in,
other countries and cultures. This may help provide guidance about whether you would be
attracted to and likely succeed in a foreign work environment.

Instructions

The following items are from the International Orientation Scale. Answer each question and
give yourself a score fo each dimension. The highest possible score for any dimension is 20
points.

Dimension 1: International Attitudes

Use the following scale to answer questions Q1 through Q4, placing the appropriate number
next to each question.

1 2 3 4 5

Strongly disagree Somewhat disagree Unsure Somewhat agree Strongly agree

Q1. ___ Foreign language skills should be taught (as early as) elementary school.
Q2. ___ Traveling the world is a priority in my life.
Q3. ___ A year-long overseas assignment (from my company) would be a fantastic opportunity
for my family and me.
Q4. ___ Other countries fascinate me.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Add up total score for Dimension 1 (scores will range from 4 to 20).

Dimension 2: Foreign Experiences

Q1. ___ I have studied a foreign language.

1. Never
2. For less than a year
3. For a year
4. For a few years
5. For several years.
Q2. ___ I am fluent in another language.
1. I don’t know another language.
2. I am limited to very short and simple phrases.

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

3. I know basic grammatical structure and speak with a limited vocabulary.

4. I understand conversation on most topics.
5. I am very fluent in another language.
Q3. ___ I have spent time overseas (traveling, studying abroad, etc.).
1. Never
2. About a week
3. A few weeks
4. A few months
5. Several months or years.
Q4. ___ I was overseas before the age of 18.
1. Never
2. About a week
3. A few weeks
4. A few months
5. Several months or years.

___ Add up total score for Dimension 2 (scores will range from 4 to 20).

Dimension 3: Comfort with Differences

Use the following scale for questions Q1 through Q4, placing the appropriate number next
to each question.

1 2 3 4 5

Quite similar Mostly similar Somewhat Quite different Extremely different

different

Q1. ___ My friends’ career goals, interests, and educations are _________ to mine.
Q2. ___ My friends’ ethnic backgrounds are _________ to mine.
Q3. ___ My friends’ religious affiliations are _________ to mine.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

Q4. ___ My friends’ first languages are _________ to mine.

___ Add up total score for Dimension 3 (scores will range from 4 to 20).

Dimension 4: Participation in Cultural Events

Use the following scale to answer questions Q1 through Q4, placing the appropriate number
next to each question.

1 2 3 4 5

Never Rarely Sometimes Often Always

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Q1. ___ I eat at a variety of ethnic restaurants (e.g. Greek, Indian, Thai, German).
Q2. ___ I watch the major networks’ world news programs.
Q3. ___ I attend ethnic festivals.
Q4. ___ I visit art galleries and museums.

___ Add up total score for Dimension 4 (scores will range from 4 to 20)

Self-Assessment Discussion Questions

1. First, lay out your total scores on each of the four dimensions. Also, add together your
scores on each dimension for a total score (should range from 16 to 80). The higher your
score on each dimension (and the higher your total score), the greater your experience
with and interest in other countries and cultures.
2. On what dimension is your highest score? Your lowest score? Your instructor may provide
comparative data from other students. If so, how do your dimension totals and your overall
total score compare to other students?
3. Would you like to improve your international orientation? If so, what could you do to
change various aspects of your life? What dimension would you tackle first? Which one
would be the hardest to improve?
4. Is an overseas assignment something that is attractive to you? Why or why not? Are there
specific places in the world that you would be interested in going to as an expatriate?
Places that you would not? Why?
Source: This exercise was prepared by Paula Caligiuri, School of Management and Labor Relations,
Rutgers University. Used with permission. As appeared in Management International: Cases, Exercises,
and Readings by Dorothy Marcic and Sheila Puffer. Copyright © 1994 by West Publishing Company,
Minneapolis/St. Paul, Minn., a division of International Thomson Publishing Inc. Reprinted by permission.

From Theory to International Practice

Copyright © 2014. Taylor & Francis Group. All rights reserved.

International Human Resource Management in Specific Firms

Purpose

To learn more about the international human resource management challenges facing compa-
nies and how they try to cope with them.

Instructions

Your instructor will divide the class into groups of three to six students. Each group should
interview at least two managers with human resource management responsibility who work

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

for companies engaged in significant international business activity that requires staff abroad.
Examples of activities requiring overseas staff (i.e., expatriates, local employees, or third-country
nationals, either alone or in combination) include:

• having offices in foreign countries to help market and sell products or services;

• running foreign subsidiaries that deliver services or manufacture products; and

• joining ventures overseas or forming international alliances to develop technology, build a

product, share information, or make international deals.

The goal of the interviews is to assess the international human resource challenges facing
the company and to determine what the company is doing to cope with them. Some good
general questions to ask might include the following:

• How do you support the company’s international business operations?

• What are the key human resources challenges facing your company in its international
operations (e.g., staffing foreign operations, not having enough control to deal with local
issues)? Why do these challenges exist? To what extent do they reflect cultural, legal, or
political differences across countries?

• What human resource strategies, policies, and practices have been developed to overcome
these challenges? Have they been successful? Why or why not?

Naturally, other, more specific questions can be developed that are tailored to the specific
managers being interviewed. Your instructor may also ask you to research specific international
human resource management issues and develop questions aimed at examining how local
companies have responded. If interviewing managers is impractical for any reason, your
instructor may treat this activity as an Internet research assignment.

Deliverable
Copyright © 2014. Taylor & Francis Group. All rights reserved.

To conclude the exercise, each student group should make a 15-minute class presentation
about their findings. Alternatively, your instructor may set up this activity as an individual
assignment. There are a variety of Internet information sources available for doing research
on international human resource management issues. For instance, the following websites
may be useful for generating questions, better understanding the employee side of inter-
national human resource management, or learning more about specific company
practices:

• www.expatriates.com (offers an extensive directory of expatriate-oriented links)

• www.shrm.org (site of the Society for Human Resource Management, a professional

organization that provides a wealth of information and links).

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 M A N A G I N G P E O P L E I N T H E I N T E R N A T I O N A L A R E N A

After all groups have presented, the instructor will lead a class discussion (15–20 minutes)
that focuses on three issues:

• To what extent do the human resource challenges reported reflect the type of international
operations companies are engaged in?

• To what extent do the human resource challenges reported reflect country-specific factors,
such as culture?

• What about the quality and appropriateness of the international human resource strategies
being pursued by various companies?

Notes
1. Green, S. (2011). The would-be-pioneer. Harvard Business Review, April, 124–126.
2. Briscoe, D. R., Schuler, R. S., and Claus, L. (2009). International Human Resource Management
(3rd ed.). New York: Routledge; Truss, C., and Gratton, L. (1994). Strategic human resource
management: A conceptual approach. International Journal of Human Resource Management,
5, 662–686.
3. Briscoe, Schuler, and Claus, International Human Resource Management; Roberts, K., Kossek,
E. E., and Ozeki, C. (1998). Managing the global workforce: Challenges and strategies. The
Academy of Management Executive, 12, 93–106.
4. Briscoe, Schuler, and Claus, International Human Resource Management; Carpenter, M. A.,
Sanders, W. G., and Gregersen, H. B. (2000). International assignment experience at the top
can make a bottom-line difference. Human Resource Management, 39, 277–285.
5. Porter, M. E. (1985). Competitive Advantage: Creating and Sustaining Competitive Advantage.
New York: Free Press, 43.
6. Briscoe, Schuler, and Claus, International Human Resource Management.
7. Brannen, M. Y., and Peterson, M. F. (2009). Merging without alienating: Interventions pro-
moting cross-cultural organizational integration and their limitations. Journal of International
Business Studies, 40, 468–489; Gong, Y. (2003). Toward a dynamic process model of staffing
Copyright © 2014. Taylor & Francis Group. All rights reserved.

composition and subsidiary outcomes in multinational enterprises. Journal of Management, 29,

259–280; Minbaeva, D., Pedersen, T., Bjorkman, I., Fey, C. F., and Park, H. J. (2003). MNC
knowledge transfer, subsidiary absorptive capacity, and HRM. Journal of International Business
Studies, 34, 586–599; Oddou, G., Osland, J. S., and Blakeney, R. N. (2009). Repatriating
knowledge: Variables influencing the “transfer” process. Journal of International Business
Studies, 40, 181–199.
8. Schuler, R. S., and Florkowski, G. W. (1996). International human resources management.
In B. J. Punnett and O. Shenkar (eds) Handbook for International Management Research,
351–401. Cambridge, MA: Blackwell.
9. Briscoe, Schuler, and Claus, International Human Resource Management; Fey, C. F., and
Bjorkman, I. (2001). The effect of human resource management practices on MNC subsidiary
performance in Russia. Journal of International Business Studies, 32, 59–75.
10. Briscoe, Schuler, and Claus, International Human Resource Management.
11. Buck, T., Filatotchev, I., Demina, N., and Wright, M. (2003). Inside ownership, human resource
strategies and performance in a transition economy. Journal of International Business Studies,
34, 530–549; Fey, C. F., Margulis-Yakushev, S., Park, H. J., and Bjorkman, I. (2009). Opening
the black box of the relationship between HRM practices and firm performance: A comparison

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 B U I L D I N G A N E F F E C T I V E W O R K F O R C E

of MNE subsidiaries in the USA, Finland, and Russia. Journal of International Business Studies,
40, 690–712.
12. Brewster, C., and Mayrhofer, W. (2008). Comparative human resource management policies
and practices. In Smith, P. B., Peterson, M. S., and Thomas, D. C. (eds) Handbook of Cross-
Cultural Management Research, 353–366. Thousand Oaks, CA: Sage; Briscoe Schuler, and
Claus, International Human Resource Management.
13. Beechler, S., and Yang, J. Z. (1994). The transfer of Japanese-style management to American
subsidiaries: Contingencies, constraints, and competencies. Journal of International Business
Studies, 25, 467–491.
14. Bartlett, C., and Ghoshal, S. (1989). Managing Across Borders: The Transnational Solution.
Boston: Harvard Business School Press; Schuler, R. S., and Florkowski, G. W. (1996).
International human resources management. In B. J. Punnett and O. Shenkar (eds) Handbook
for International Management Research, 351–401; Taylor, S., Beechler, S., and Napier, N.
(1996). Toward an integrative model of strategic international human resource management.
Academy of Management Review, 21, 959–985.
15. Kwoh, L. (2012). Don’t unpack that suitcase. The Wall Street Journal, B10; Cascio, W., and
Bailey, E. E. (1995). International human resource management: The state of research and
practice. In O. Shenkar (ed.) Global Perspectives of Human Resource Management, 15–36.
Englewood Cliffs, NJ: Prentice-Hall.
16. BusinessWeek (2008). How global are you? December 8, 12.
17. Downes, M., and Thomas, A. S. (2000). Managing overseas assignments to build organiza-
tional knowledge. Human Resource Planning, 20, 33–48.
18. Geissler, C., Kuhn, L., and McGinn, D. (2011). Developing your global know-how. Harvard
Business Review, March, 71–75.
19. Carraher, S. M., Sullivan, S. E., and Crocitto, M. M. (2008). Mentoring across global bound-
aries: An empirical examination of home- and host-country mentors on expatriate career out-
comes. Journal of International Business Studies, 39, 1310–1326; Hsieh, T. Y., Lavoie, J., and
Sarnek, R. A. P. (1999). Are you taking your expatriate talent seriously? McKinsey Quarterly,
3, 71–83.
20. Briscoe, Schuler, and Claus, International Human Resource Management; Ready, D. A., and
Conger, J. A. (2007). How to fill the talent gap. The Wall Street Journal, September 15–16, R4.
21. Browne, A. (2004). Chinese recruit top executives from abroad. The Wall Street Journal,
November 30, B1, B8; Lublin, J. S. (2006). Is transfer to native land a passport to trouble? The
Wall Street Journal, June 3, B1, B5; Millman, J., and Zimmerman, A. (2003). ‘Repats’ help
Payless Shoes branch out in Latin America. The Wall Street Journal, December 24, B1, B2.
22. Briscoe, Schuler, and Claus, International Human Resource Management.
Copyright © 2014. Taylor & Francis Group. All rights reserved.

23. Kwoh, L. (2012). Asia’s endangered species: The expat. The Wall Street Journal, March 28, B6.
24. Latta, G. W. (1998). Global staffing: Are expatriates the only answer? HR Focus, July, S1,
S2; Woodruff, D. (2000). Distractions make global manager a difficult role. The Wall Street
Journal, November 21, B1, B18.
25. Gong, Y. (2003). Toward a dynamic process model of staffing composition and subsidiary
outcomes in multinational enterprises. Journal of Management, 29, 259–280.
26. Brewster, C., and Mayrhofer, W. (2008). Comparative human resource management policies
and practices. In Smith, Peterson, and Thomas, Handbook of Cross-Cultural Management
Research, 353–366; Peterson, R. B., Sargent, J., Napier, N. K., and Shim, W. S. (1996). Corporate
expatriate HRM policies, internationalization, and performance in the world’s largest MNCs.
Management International Review, 36, 215–230.
27. Going Global. (2009). Global relocation trends show future expat growth, available at: www.
goinglobal.com/newsletter/march09corp_general_global.asp; The Economist. (2006). Traveling
more lightly, June 24, 77–79; The Economist. (2000). International assignments: Nasty, brut-
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Feng, S. (2009). Expatriate localization: A Chinese solution, available at: www.mercer.com;

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Cooper, C. L. (2000). Adapting to a boundaryless world: A developmental expatriate model.

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unit intellectual capital: A cross-level model. Journal of International Business Studies, 40,
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