Part 1: Expats from domestic to international HRM

1. Introduction
Key function of INTERNATIONAL HRM: constantly provide the company with

 Qualified employees (expatriates/int. assignees)

 In required numbers (depends on staffing policy)
 At the right time (start of int. assignment)
 For the right duration (duration of assignment)
 At the right workplace (assignment destination)
Mission of IHRM: to ensure the successful completion of international work assignments

Underlying Questions

- In which way are domestic HR activities modified in an international environment

- Which factors make a differentiation between domestic and international HRM inevitable?
- Which activities unnecessary in a domestic environment do we need in IHRM

1. Expats: from Domestic to international HRM

1. Expatriates

Definition: People temporarily or permanently residing in a country and culture other than that of
the person’s upbringing or legal residence.

In business term: Expatriates are professionals sent abroad on a temporary work assignment by their
company

Key words: relocated to a foreign country, limited or indefinite period, sent by their employers

Companies do not go global – People do!  Expats are the “linking pins” of globalized economy

2. Inpats and Stealth Expatriates

Definition: Inpats are international assignees from the host country or a third country (TCN) to the
headquarters of an international country.

 Training or future management taks

What is a Stealth Expatriate?

 Players in international business who do not relocate but (partly) fulfil expat functions

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  Many HR-Departments are unaware of these “hidden” international commuters

 Number of international “stealth” assignments is likely to increase (business travel,

commuter)
IHRM should extend its focus to “stealth expatriates”, because (potential) problems can be
overlooked: Tax and social security liabilities

Work permit troubles

International Business Travellers

 International managers paying visits to international operations (e.g. business diplomats,

international sales staff)
 Flexpatriates (travel the world within the context of normal PC oblogations without
relocating  familiy unfriendly - alcohol, bars, bordels
 Focussed neither by the HR-Department nor by IHRM
International Commuters

 Commuter Expatriates live at home (PC)

 and commute to assignment location (HC)

 possible reason why expat do not want a full relocation: - children are in critical stage in their
education, spouse does not wish to give us his/her own employment
Management by “flying in and flying out”

 While continuing to live and work at home this type of international commuter is often
requested to work in another country

 Intermediate step between extended business travel and full expat relocation
3. Assignment Destination

Top assignment destination countries: US, China, UK, Singapore, Germany

What makes an assignment destination challenging?

Language barriers Culture differences High cost of living

Difficult housing situation Lack of adequate schools Food
Restrictive visa/ work permit legislation Lack of safety Climate
Environment: water and air pollution
Most challenging assignment destinations: China, Brazil, India, Argentina, Russia

Countries with the highest rates of international assignment failure (reason number 1: Family
problems (Unhappy wife)): China, UK, India, Brazil, US

4. Domestic HRM in a Nutshell

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Strategic Challenges of HRM

Effects of demographic decline (Germany)  War for talents (pressure on recruitment)

Effects of globalization

 transparency of world job markets (internet)

 decreasing emotional attachment (loyalty) of employees to their companies

 difference in labour

 Digitalization

5. Global HR Management

HRM: people in work environments

IHRM: staff moved across borders within a company’s international operations

 PCN – parent country nationals (classic expats)

 TCN – third country nationals (working for a foreign company that transfers you into a third
country)
 HCN – host country nationals (foreign personnel transferred into the parent country HQ of
the IC)

Basic Factors of differentiation

The people involved The countries involved The (HR-) activities involved
Different set of HR activities (examples)
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  Recruitment and selection for an assignment

 Predeparture training / intercultural preparation

 Health recruitments / medical care / health insurance

 Finding solutions for partners, pets and children of employees (new job, adequate childcare/
school)

 Tax equalization

Complexity of IHRM

The complexity of operating in different countries and employing different national categories of staff
is a key variable that differentiates domestic and international HRM.

Part 2: A broader perspective

1. Complexity of IHRM

 companies underestimate the complexities involved in inter. Operations

 business failures in the inter. Arena are often linked to poor management of HR

 recognition of the complexity of IHRM is a key to success in inter. Operations

 A broader perspective is needed!
Basic Factors contribute to IHRM Complexity:

1. People
2. Countries  Siehe 3 Dimensionen Modell
3. Activities

Other Factors:

1. Family considerations: need for deep involvement in employees’ personal lives

2. Cultural environment, intercultural differences, language barriers

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 3. Personal risks for expats and their families (health hazards, crime, terror, civil war, climate)
4. Equity issues (equal pay for P/H/T – CN)
Host country influences on (I)HRM

 Type of government and state administration (reliability, dependability, bureaucracy,

(in-)flexibility)

 Legal system, court system, legislation(employment law)

 Cost and organisation of labor

 Compliance with guidelines and laws

 Ethical standards of doing business (corruption)

 State of the economy (inflations)

 Finance and banking system

 Availability of housing, education and other infrastructure

 Health system and medical care

 Environmental issues (China?)

 Changes of politics and political climate (protectionist attitude of Trump administration

towards German car industry, production in Mexico for US market, etc…)
2. Specific IHRM Activities

Activities unknown in DHRM

1. Tax consultation & equalization

o Both domestic + host – country tax liabilities

o Wide variations of tax laws in different host countries

o Tax equalization policies

o High cost of intern. Taxation consultancy (core benefit)

2. International Relocation and Orientation

o Planning for working abroad

o Delivering predeparture training

o Managing immigration procedures (i.e. arranging necessary documents like visa,

long-term stay permissions, work permits etc.)
o Organizing travel and transport details

o Finding/providing (adequate) temporary accommodation at the target location

o Assisting the employee in selling his home in the departure location

o Providing health insurance and medical care

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 o Finding/providing recreation infrastructure

o Assisting job search for the spouse/partner

o Finding an adequate school for the children

o Clarifying compensation details: 1. Composing an expat package; 2. Delivery of salary

overseas; 3. Possibly divided salary; 4. Anticipating taxation treatment; ….
o Outsourcing of special IHRM activities

3. Administrative Services for Expatriates

o The company’s procedures and policies may conflict with host country conditions eg:

 Ethical & legal questions: a practice that is legal in the host-country may be
illegal or unethical in the home-country and vice versa
 Compliance issues (corruption, bribery,...)
o Expats run a high personal risk if they are involved and need help of their company

4. Host-Government Relations
o Government <-> Government = political level

o Enterprise <-> Government = direct contact

o Trade Association <-> Government = indirect contact

o Official levels and contacts

o Inofficial levels and contacts

5. (Observation)
o Particularly (but not only) important in some developing countries

o Maintaining a personal relationship with relevant government officials helps to avoid

or solve problems (obtaining work permit)
o Where danger lurks: payment or payment in kind(dinners, gifts) can violate both,
host-country and parent-country legislation
6. Language Translation Service
o No international business without foreign language translation and interpretation

o Translation groups may provide services to the HR department and all other foreign
operations departments within the company
o Dies English as the language of world business solve all communication problems?

3. Corporate Mindsets and Attitudes

International “Mindset” of a company

definition: degree of internationality in a company’s culture and thinking

Criteria for Measuring Internationality

 Company size (presence in many countries) matters, but is not the decisive factor
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  The company’s reliance on its parent-country domestic market is a much more
important, but often overlooked factor

 “Index of Transnationality” (TNI) developed by UNCTAD

UNCTAD Transnationality Intex (TNI)

TNI = Average of ratios of:

 Foreign assets to total assets

 Foreign sales to total sales
 Foreign employment to total employment
Reliance on Parent Country Market

 Very big PC markets influence all aspects of how an MNE organizes its activities

 MNE’s from small advanced economies (Irland, Switzerland, Netherlands, etc.) are in a very
different position

 These multifold differences often add up to very different degrees of internationalysation

and different international mindsets

 Frequent criticism of US companies, US managers and business schools is inward-looking and

ethnocentric may be justified and explained by the “Reliance on PC market factors”
Example:

MNEs from small advanced economy (Irland, Switzerland,..):

 Cannot afford to focus on their small PC markets – global mindset and managers

 Consequently, the transnationality index of MNE’s from small countries is much higher

Mindests of Senior Management

What if an MNE’s Senior Management does not have a strong international orientation?

 Focus on domestic issues

 Importance of international operations may be underemphasized (or even ignored)

 Differences between international and domestic environments are minimized

 Assumption of a great amount of transferability between domestic and intern. HRM practice

What works at home will work anywhere! Likely consequences:

 Little understanding of what the expats are doing out there

 (too) little appreciation of expats’ achievements

 Possibly major difficulties in intern. Operations

Words to remember
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„The primary causes of failure in multinational ventures stem from a lack of understanding of the
essential differences in managing human resources, at all levels, in foreign environments. “

Advice for the IHR Manager:

 Work as closely as possible with top management

 Foster the desired, global mindset’ of corporate decision makers

 Brace yourself for difficulties!

IHRD-challenge: adequate management training

 Global companies should have internationally minded (senior) managers with at least some
degree of:
o Intern. Experience

o Intercultural awareness

 Not all internationally operating companies have such a (senior) manager

Growing recognition of “developmental” aspect of assignments”

Companies are increasingly using

international assignments to further
their talent management objectives

Part 3: Staffing International Operations

1. Assignment Objectives & Types
Why companies send Expats?  3. Key organizational reasons

1. Position Filling/Getting a job done:

- Fill managerial skills gap
- Fill technical skill gap
- project work
- assimilation work
- launching new endeavours (Bemühungen)
2. Management/Talent Development:
- gaining int. mgmt. experience
- career development
3. Organization Development (building a talent pool):
- gaining int. mgmt. experience
- career development

*Reminder* - Core task of IHRM

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  Recruiting and selecting the right people

 Preparing them for their assignment in an optimal way

 Helping with all bureaucratic, factual and psychological problems of relocation

 Extending all this to the expats’ family member (in the frequent case of an accompanied
assignment)
Types of Assignments (by duration)

- under 6 month (short term)

Short term assignment
- 6 m. to 1 year (extended)
- 1 to 2 years
- 2 to 3 years Long term assignment
- 3 to 4 years
- over 4 years

Alternative assignment types

 Local hire

 Extended business travel (no relocation)

 Commuter assignments (no rel.)

 Rotational assignments (no rel.)

 Contractual assignments (hire for specific project work)

 One way (permanent) move

2. Expatriate Roles & Functions

1. Roles and functions of an expat depend on the assignment’s type and the assignment
objective
2. An Expat can hold multifold roles
3. The most obvious and prominent role of the expat is the one of kingpin(Zusammenspiel) in
the interplay between HQ and the local unit
Classic Expats Roles (modelled by A.W. Harzing)

 Agents of direct control  Bears

 Agents of socialization  Bumble-Bees
 Network builders  Spiders
 Boundary spanners
 Transfer of competence and knowledge
 Language node

Bears as an agent of direct control

 Transfer of PCN staff used as an effective bureaucratic control mechanism

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  Ensures subsidiary compliance
 Enable local operations to achieve strategic objectives
 German firms tend toward this form of control
Bumble-Bees as an agent of socialization
 Spread the corporate culture (transfer of shared values and beliefs)
 Elements of corporate culture
 Knowledge sharing
 Competence transfer
 Adoption of common work practice
 Corporate culture as an informal control mechanism
Spiders as weavers of networks at the host location
 Weaving and fostering personal linkages as a means for
 Informal control
 Communication purposes
 Personal networks are person-dependent (continuity problem when expats leave)
 Impact of the assignment duration on the expatriate’s ability to develop personal networks
Expats as “boundary spanners”
Expats gather information that bridges internal and external organizational contexts, e.g. :
 Collect host country information (first hand market intelligence)
 Act as representatives of their (parent) companies in the host country and promote the
firm’s profile at high levels
 Act as “influence agents by talking to government officials, the media, local V.I.P.s
Expats as transmitters of Know-How and competence
 A classic function of expatriates
 Expectations of HCNs can be extremely high, even excessive (potential for disappointment)
 Expats have to be especially prepared for this role and to be trained to be trainers
 Which includes the intercultural and language aspects of training/teaching
Expats as language nodes
 Potential dependency problem: everyone turns to the expat for help with translation etc.
Resulting IHRM/IHRD challenges
 As it is the core taks of IHRM to assure the successful completion of the assignment
 IHRM has the responsibility to enable the expat to play all the multifold roles expected from
him by:

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  Recruiting and selecting people with the according personal and professional
qualifications
 Preparing them for their roles in an optimal way (expat training, international HRM
development)

3. Staffing Policies
Various Factors influence the choice of a Company’s international staffing policy:
 Context specificities
 Company specific variables
 Local unit specificities
 IHRM practices
 Staffing approaches based on general mindsets and attitudes

International Staffing Approaches

 Predispositions of companies with regard to who (PCN/TCN/HCN) should hold hey positions
in HQ and subsidiaries
 Underlying HR-policies formulated to give guidance on how to decide certain matters
 Prof. Perlmutter described four staffing approach prototypes/categories: EPRG-Concept
1. Ethnocentric staffing
2. Polycentric staffing
3. Regiocentric staffing
4. Geocentric(globalist) staffing

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Ethnocentric staffing policy
Is a tendency to look at the world primarily from the perspective of one´s own culture
Is the belief that one´s own race or ethnic group is the most important
Some or all aspects of one´s own culture are seen as superior to those of other groups
Indicators of an ethno. Policy:
 Foreign subsidiaries have little autonomy
 Strategic decisions are made at headquarters
 Key positions in domestic and foreign operations are held by HQ personnel
 Subsidiaries are managed by PCNs
 What works at home will work anywhere!

Advantages + reasons Disadvantages

Quality: lack of qualifies HCNs limited promotion opportunities for HCNs
Coordination: need to maintain good adaptation of expats to host country takes time
communication, coordination and control links
with HQ
Control: reduction of high risk of foreign considerable income-gap between PCNs and
operation by strong elements of control HCNs can be viewed critically by HCNs (equity
problem)
Compliance: compliance of (new) subsidiary expatriates may lack the necessary sensitivity to
with overall corporate objectives and policies HCNs` needs and expectations
The “bear” is the champion of an ethnocentric high cost of maintaining expatriates in overseas
staffing policy locations

Polycentric staffing policy

Describes (in politology, architecture or city planning) a system with several centres
In the staffing context the term depicts an approach favoring decentralization and „federal“
structures
In the intercultural context polycentricism stands for openness towards other cultures, opinions and
different ways of doing things
Indicators of n poly. Staffing Policy:
 local management by HCNs is preferred
 no promotion of HCNs to positions at HQ
 no transfer of PCNs to subsidiary operations
 There is no one single best way of doing things!

Advantages + Reasons Disadvantages

- The company may wish to be - no „living link“between local subsidiary managers and
perceived as a local company in the headquarter managers in the parent country
host country - possible isolation of HQ staff from their various foreign
- The host country government may subsidiaries due to language barriers, conflicting
dictate that key managerial positions national loyalties, cultural differences etc.
have to be filled by its nationals - limited exposure of parent country managers to
- lower profile of MNE in sensitive international operations means limited opportunities to
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 political situations gain overseas experience
- elimination of language barriers in the (→ no international talent pool)
host country - company may run the risk of becoming a ‚federation‘
- lower cost of employing HCNs of independent national units with merely nominal links
- no family related expatriation to corporate headquarters
challenges - potential problems of control and loyalty
- no risk of assignment failure (→ need for adequate control systems, no „bears“)
- no repatriation problems - limited exposure of parent country managers to
international
- operations mean limited opportunities to gain
- overseas experience (→ no international talent pool)

Globalist staffing policy

The often used term „geocentricism“ doesn‘t make much sense here (history of astronomy: earth as
the center of the universe)
A globalist staffing approach stands for global open-mindedness, i.e. the unique contributions and
competences of both HQ and foreign subsidiaries are acknowledged
This approach is reflected by the concept of a worldwide integrated business
Indicators of n globalist Staffing Policy:
 create an international class of managers
 people close to one another
 sharing knowledges about solving business challenges
 developing international management capability

Advantages Disadvantages
- development of an - large numbers of PCN/HCN/TCNs have to be sent
international executive team abroad in order to build and maintain the
with a global perspective „international team“
- Development of an (→ development assignments)
international talent pool for - a longer lead time and more money are required
deployment throughout the (cost of recruitment/selection, pre-departure
global organization training, relocation etc.)
- The ‘federation’ drawback of - Need for compensation structure with a
the polycentric approach is standardized international base pay
overcome - Need for a more centralized control of the
- Cooperation and resource staffing progcess (HQ HR-Department acting on
sharing across the national global scale)
units of the global company - Loss of autonomy of subsidiary management
 might lead to local resistance

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Regiocentric staffing policy
Resembles the geocentric approach but stops short of an all-embracing (global) attitude
regiocentricism concentrates on world regions
→ globalism broken down to the regional level
Regiocentricism reflects the geographic strategy and structure of the international company
Indicators of n regiocentric Staffing Policy:
 a wider pool of managers is utilized, but only within a particular geographic region
(e.g.: Western Europe, Central and Eastern Europe, the Americas, APAC)
 regional managers enjoy a degree of regional autonomy in decision making
 local subsidiaries are staffed by HCNs and / or TCNs from within the region
 staff transfers from one region to another are rare
 transfers from the regions to HQ are rare

Advantages Disadvantages
regioncentricism can be a transition stage on regiocentricism may result in ‚federalism‘ at a
the way of a company from an ethnocentric or regional basis
polycentric approach to a geocentric staffing
policy
Development of an international talent pool for Regiocentricism may result in ‘federalism’ at a
deployment throughout the global organization regional basis
The ‘federation’ drawback of the polycentric Regiocentricism may constrain the company
approach is overcome from taking a truly global stance
Cooperation and resource sharing across the The barrier between HQ and local unit may be
national units of the global company moved to the regional level: no advance of
HCNs to positions at corporate HQ level

4. International HR-Policies

What is an “HR-Policy” in IHRM?

A system of codified decisions, established by a company, to support administrative personnel
functions, performance management, employee relations and resource planning in IHRM contexts
(personalpolitische Richtlinien)

As each company has a different set of circumstances (i.e. staffing approaches), it is likely to develop
an individual set of HR policies

Multinational’s HR policies will:

 depend upon the policies law
 and may need to address the requirements of multiple countries or jurisdictions
HR Policy Examples
 workforce diversity policy (domestic)
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  equal employment opportunity policy (d)
 expatriate compensation policy (intern)
 international tax policy
 expatriate localization policy (intern)

Purpose of HR-Policies
HR policies allow a company to be clear with international staff on:
 what they should expect (and not expect) from the company in certain situations (e.g.
payment of hardship premiums to expats)
 what the company expects of them (strict observation of compliance rules abroad)
 how policies and procedures work
 what is acceptable and unacceptable behaviour

Need for HR-Policies

If a company has no binding HR policies:
 every single question or problem arising in the context of international assignments has to be
decided on an individual case-to-case basis
 every single aspect of expatriation can become object of tedious and a time-consuming
negotiation process
 unequal treatment and inequality become inevitable and will result in discontent

Part 4: Expatriate Recruitment & Selection

1. The Sourcing Challenge
Staff Availability for foreign Assignments

 Enterprises may have become more global in their operations but their people have not!

 Staff availability, time and cost restraints can limit the company’s ability to deploy
international managers where they are needed
 That is what makes recruitment and selection in IHRM so crucial and difficult

Recruitment and Selection

two-phase sourcing process
1. Recruitment: identifying and obtaining potential candidates in sufficient numbers and quality so
that the organization can select the most appropriate people to fill its job needs
2. Selection: process of gathering information for the purposes of evaluation and deciding who
should be employed for the job in question

Double challenge for HR

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 in order to find the person with the right profile for the foreign assignment HR has to:
a) Define selection criteria (by identifying th predictors for assignment success)
b) Find candidates
c) Verify that candidates meet these selection criteria
 in order to make sure that the right person is willing to accept the assignment HR has to:
a) Identify impediments to mobility
b) Help and motivate to overcome them

Expat Recruiting
 Using suitable recruitment methods
 Defining the profile of the right candidate
 Finding the right candidates
Expat Selection
 Candidate assessment and selection
 Overcoming impediments to mobility

2. Recruiting Expatriates
Poaching of internationally qualified Staff  Easy Way
 Headhunting highly qualified (potential) expatriates of other employers
 In the parent country or at the assignment location
 Opportunity for recruiters/retention challenge
 Drawbacks
Classic Recruitment Sources  Hard way
Current Employees: 92%
New Hires: 8 %

Drawing on an assignee candidate pool

 Having a corporate talent pool of (internally
experienced) assignment candidates is an
obvious advantage
 Remember: talent and organization
development are an important reason
for developmental assignments

Defining career paths with international components

 Some bigger internationals have specific career management and planning processes
including international assignments (e.g. Bosch)
 Recruitment by self-nomination
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  In-house job advertisement system
 Recruitment by recommendation:
 Persuading managers to recommend and/or release their best employees for
international assignments is a key issue for international HR managers/recruiters
 Other informal recruitment approaches (e.g. coffee-machine recruitment)

Expat Profile: What are we looking for?

 Defining appropriate profile criteria and applying them recruitment and selection is key
predictor of expatriate success
 Never underestimate the threat of compromising on defined profile criteria in the
recruitment ans selection process under mounting pressure to succeed (HR has to deliver
asap! Basta!)
1. Profile: individual criteria
 Professional qualifications (technical/managerial abilities, specific knowledge, languages)
 Personal character (integrity, openness, etc.)
 Intercultural suitability (coping skills, diplomatic skills, language ability, stress resistance and
resilience, emotional stability, maturity, etc.)
 Family requirements
“When choosing a candidate we rely on HR to pick candidates with families who are open to new
experiences and can adjust to new surroundings ...“.
2. Profile: situational factors (HC requirements)
 Health requirements (e.g. PCNs have to be vaccinated, tropicalized); health requirements
extend to all accompanying family members
 host country legislation and/or practice of issuing visa, residence and work permits can block
transfer to HC (e.g. Turkey: Erdogan-critic); this, too, extends to family members
 HC cultural requirements, e.g. gender (no work permits issued to women), sexual orientation
(criminal liability for homosexual activity), etc.
3. Profile: company requirements
 Staffing philosophy, e.g. an ethnocentric orientation  should be a German(PCN) and a man
 Preferred assignment type
 Focus on certain expat functions (bear, bumble-bee, spider)
 Amount of intended knowledge transfer (training skills)
 Modus operandi, e.g. influence of joint-venture partner on staffing decisions
Selection: choosing Mr/Mrs/Divers Right
 If recruitment was successful IHR now has to assess who is the assignment candidate with
the best match to the defined profile criteria

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  Reprise: An adequate candidate selection is the key to assignment failure prevention
 Assessment processes and tools:
 career management processes (leading to the creation of an assignment candidate
pool)
 using formal assessment tools (e.g. interview, assessment center, personality and
psychological selection tests)
 using candidate self-assessment tools
 examination of domestic performance records informal assessment, e.g.
recommendations, „coffee-pot-recruitment“
 Overcoming impediments to mobility:
 recruitment & selection cannot be completed if the person identified as the best
candidate refuses to accept the assignment offer
 as the demand for expats is rising the number of assignment refusals seems to be
growing
 How can IHR prevent assignment refusal?

3. Impediments to Mobility
 Enhancing Staff’s Willingness to move:
 The willingness to move is an important predictor of assignment success
 Reluctance of the expat (and family members) to go abroad is a negative success
predictor
 Preparing the ground for successful recruitment & selection is a match winner
 The significant causal relationship between the (married or partnered) expat’s and
his spouse’s or partner’s willingness to relocate must not be overlooked
 The spouse/partner has a factual right of veto even if the candidate wants to go
 The company should:
 Communicate a general positive outlook on foreign assignments
 Stress the importance of assignments to employees’ careers (+ keep the promise)
 Offer financial and other incentives/rewards (+ keep the promise)
 Actively use successful repatriates as role models (heroes of the companies
international endeavours)
 Promise to effectively solve all relocation-related problems of the expatriate (family)
 Have an overview of the (potential) reasons for assignment refusal, develop
counterstrategies and prepare a catalogue of solutions for standard problems (e.g.
formulated in assignment policies)
Reasons for assignment refusal:

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  Partner and family related problems:
 Big reasons: 56% of assignment refusals
 Part 6 more details
 Reward uncertainty/career aspirations:
 This ist (not yet) about money but about anything that might have an incentive
function (promotion, prestige, appreciation, excitement, etc.)
 Career expectations are especially relevant here (e.g. promotion, pay rise after
assignment)
 If the prospect of an international assignment triggers career anxiety the candidate
will not go:
 will there be an adequate re-entry position?
 are there better job alternatives at home?
A killer-equation for expat recruitment:
Why should a candidate accept an assignment when he/she has reason to fear that it might mean
risking a career downturn?
Assignment candidates are bo idiots. Their risk assessment is based on personal observations within
the company:
 other expatriates are not being promoted upon their return but leave the firm shortly after
repatriation – candidate conclusion?
 Those who stay at home are promoted faster than those who agreed to working abroad –
candidate conclusion?
 Expat compensation:
 Candidate’s financial expectations are not met (offered compensation package does
not motivate the candidate to accept the hazards of an assignment)
 e.g. loss of spouse’s income during assignment; high schooling fees + high cost of
living (London)
 Expat-compensation-package can combine many elements
 e.g. base-salary, allowances, benefits, premiums etc.)
 Part 9 about the expat compensation issue
 Location related concerns:
 Locations with a low life quality (hardship assignments)
 E.g. poor and developing countries
 Locations with a bad ecological system (air pollution in Beijing), a bad health system,
extreme climate conditions
 Countries with an oppressive political system
 Discriminating policies or practices: gender rare or ethnical origin, sexual orientation

19
  Crime, terrorism, civil war
 Other concerns:
 Lacking practical support in international relocation:
 Immigration procedures
 Travel arrangements and shipping household
 Schooling of children
 Job assistance for spouse/partner
 Providing health insurance and medical care
 Taxation planning
 Personal safety: all kinds of risks to expats and their families
Overcoming Impediments to Mobility
 Most IHR activities are aimed at overcoming or alleviating (potential) reasons for assignment
refusal (part 2 &3):
 International relocation and orientation
 Tax consultation and equalization, administrative services
 Standard and individual solutions are offered to solve family related
problems(part6) or compensation issues (part9)

4. Int. Assignment Gender Gap

Female Expatriates
 Still a man’s world?
 While wives accompanying their expat husbands on international assignments
(trailing spouses) are a widely discussed issue in IHRM
 Slowly growing female part of the expatriate population (around 20%)
 1/3 single; 2/3 married or partnered
Sourcing Female Talent
 Why companies should recruit more females for international assignments:
 Given difficulties of recruiting qualified employees in times of demographic
downturn lead to increasing pressure to recruit female talent
 Growing potential: more female talent than ever leave universities and enter
companies
 Since international experience is becoming a must-have component for higher
managers
 A low number of female assignees will hinder creating a gender balanced senior
management team (gender diversity at top levels)

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  As as women seem to be facing greater obstacles to accepting assignments than
males companies must strive to better understand the drivers of this
underrepresentation
Impediments to female mobility
 Many external and self-established barriers to females accepting international assignments
reflect the hurdles women still face in domestic career advancement
 In the global mobility context, however, there may be additional factors at play
 Self-established factors: why so many women self-select out of consideration for an
international assignment (“assignments are not for me”)?
 Spouse/partner career concerns (trailing husband)
 Other family considerations (children, aged parents)
What companies can do
 Company communication can effectively encourage women to consider a foreign assignment
 Especially when its about early career opportunities for young female talent
 Making sure that women have early career access to programs opening avenues to
international assignments
 Offering more short-term assignments to women
 Establishing a maternity policy for female expats answering the classic questions:
 Where will I have the baby?
 How much time will I be out of work?
 Will I return home or remain on assignment?
 And how about single parent on assignment?

5. Assignment Failure Prevention

A Key to Assignment Success
 Poor candidate selection is seen as major reason for assignment failure
 Adequate candidate selection is key to assignment failure prevention
 Consequently, in recruitment & selection IHR must have a high degree of awareness of the
reason for expatriate failure

Resulting challenges
 Identifying the reasons for expatriate failure
 learning the lessons implied
 adjusting:
 selection criteria
 selection process

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  pre-departure preparation
 management of the complete expatriation cycle (preassignment on assignment /
after assignment)
 underlying assignment policies

Assignment Failure
A pseudo problem?
 2009 GRT-Survey: participating companies were asked to report the percentage of failed
assignments
 Respondents: 4% failed assignments
 So, either this much discussed issue is of marginal relevance
 Or Global HR is doing a phantastic job

What is assignment failure?

 Assignment failure = expatriate failure?
 Expatriate failure = premature return?
 Many companies define expat failure simply as premature re-entry (the foreign assignment is
not completed)
 Critique: this definition is very unspecific and could lead to unrealistically high failure rates
(but it doesn’t)
 we should have a more specific understanding of “assignment failure”
Elements of a more specific assignment failure definition:
 under-performance
 unmet business objectives
 problems at the assignment location
 unmet career development objectives
 repatriate turnover (retention upon completion)
 suboptimal expatriate cost return on investment (ROI)
Cost of Assignment Failure
direct costs (company):
 recruitment & selection cost
 training and pre-departure preparation
 relocation expenses
 expat administration and management by Global HR
 replacement cost
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indirect cost:
 loss of market share
 difficulties with local officials and key clients
 sinking morale and productivity of local staff
indirect costs (failed expat):
 decreased motivation
 lack of promotional opportunities (career breaker)
 pressure to leave the company
 marital and family problems
 health and drug problems

Analysis: Reasons for Refusal/Failure

Assignment Refusal Assignment Failure

1. Family concerns 1. Family related issues

2. Spouse/partner career 2. Poor candidate selection
3. Uncertain rewards 3. Cannot adapt to host location
4. Compensation 4. Job expectations not met
5. Location related concerns 5. Compensation dissatisfaction
6. other 6. Quality of life
7. Security/safety concerns

The underlying problems are largely identical. So are the lessons to be learned by Global HR and their
companies

6. R&S Lessons learned

From Analysis to action
Leftovers:
 the highly relevant issues relating to family and spouse/partner will be analyzed in lecture
part 6
 compensation-related issues will be analyzed in lecture part 9
 measures how to bridge the international assignment gender gap have already been
adressed in chapter 4 of this lecture part

What Companies can do

Uncertain rewards/career aspirations:
 offer a clear career perspective (no empty promises)

23
  integrate assignee candidates in a career development plan
Job security:
 give a job guarantee (if you can)
 include assignees in a mentorship and a repatriation program

Location quality of life in a host location

companies cannot improve the quality of life in a host location as such, but they can offer:
 financial compensation for different levels of the cost of living (so called allowances; COLA:
cost of living allowance)
 additional incentives to overcome candidates’ reluctance to accept an assignment (so called
hardship premiums)

Personal safety of expat and family

 introducing a safety management policy and taking corresponding measures (living in safety
complexes in certain countries  golden cages in south Africa)
 offering additional incentive (hardship premium)
 not sending female expatriates to certain locations (potential equal opportunity issue)
 not using accompanied assignments for hazardous host locations (case study Bulova part 8)

Offering adequate practical support

 don´t leave expats and their families alone with the multifold and complex problems of
international relocation
 ensure effective management of the assignment by the HQ unit responsible for global
mobility (information, contact, mentorship program etc.)
 if you can’t give the needed support yourself engage an international relocation provider
 if the candidate prefers money offer lump sum payments to cover relocation related costs

Inability to adapt to the host location

 select expats (and families) with international experience, relevant intercultural and
language competence (if you can)
 select expatriates with intercultural awareness and (some) command of foreign languages
 offer cultural awareness and cross-cultural trainings as well as language courses
 help families to settle in (schooling, social networks, practical help whenever needed)

Poor job performance at host location

24
  make sure you pick the people with the managerial or technical qualities needed in the
subsidiary
 don’t overlook the many other factors contributing to a good job performance:
 expat’s commitment to local company
 expat’s adjustment to interaction with HCNs
 -- adjustment to living conditions in HC
 -- jobs autonomy
 Level of organizational support (from home unit as well as from host unit)

Part 6: Spouse/ Partner & Family Considerations

1. Relevance in IHRM
Overview:

- Majority of expatriates: family men accompanied by spouses/ partners + children

- Family related issues are reasons no. 1 for:
 Assignment refusal in recruitment & selection
 Assignment failure during assignment

Consequence for GM:

- To overcome family- related barriers to mobility and prevent assignment failure GM MUST
 Identify critical challenges
 Find ways to solve problems/ find alternatives
 Deep involvement of HR in employees’ private lives

Critical family challenges:

- Children’s education (very critical/ important: 82%)

- Family adjustment (very critical/ important: 91 %)
- Spouse/ partner resistance to international assignment (very critical/ important: 85%)
- Degree of difficulty of destination location (very critical/ important: 79%)
- Intercultural adjustment (very critical/ important: 71%)
- Spouse/ partner career (very critical/ important: 66%)
- Support for other dependent family members (very critical/ important: 49%)
- Inability to speak language (very critical/ important: 49%)
- Length of assignment (very critical/ important: 40%)

- Deep involvement in expatriates’ private lives is unavoidable for effective selection, training
and management of PCN/ TCN personnel
- Provide expats with adequate support before, during and after assignment (GM needs much
information about employees’ family)  Patchwork constellations double challenges

Alternatives:

25
 - Sending single men/women without children | without partners/children
- Short-term, commuter, virtual assignment, extended business travel
 Growing number of unaccompanied assignments of married/ partnered expats (one
reason: spouse/ partner career is very important as well)
 Single men on assignments: 22%, Single women: 10%

2. Spouse/ Partner Perspective

- Relocating is more stressful for family than the employee (isolation and boredom)
 Leaving behind relatives, friends, social support networks
 Settling family into new home
 Ongoing concern for childrens’ well being
 Preventing disruption to childrens’ education
 Caring for aging of invalid parents/ relatives
 Singe parents’ problems of shared custody of children
 Legal constraints after divorce (obtaining consent of the other parent to take the child
out of the home country; sanctions for violation of visiting or access rights)
- Danger of spill-over effects (unhappy spouse affects expats ability to adjust)
- Family members may experience the phases of cultural adaptation curve differently and
different times

Dual career couples

Relevance:

 Partners career is the 2nd important reason for assignment refusal!

 Negative impact on assignment acceptance is growing

Reasons for unaccompanied assignment:

- Partners career concerns (55%)

- Host quality life (21%)

Employment situation of spouses/ partners at host location

 16% of partners find adequate jobs during partners assignment (although 49% had job
before assignment)
 33% loose occupation, income, career perspective, status,..

By sending a family on assignment, you need to see the WHOLE family situation, especially the
partners opportunities to work are essential!!

 Negative impact on partners’ careers has become a major factor hindering the R&S of
urgently needed talent
 Lack of spouse/ partner employment opportunities affects GM of highly skilled
international employees

Accepting dual career challenge:

Finding alternatives to accompanied long-term assignments for dual career couples

 Deploying local personnel instead of expats

 Unaccompanied assignments
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  Short term assignments
 Commuter assignments ( commuter marriages)
 Replacing assignments by (extended) business travel
 Virtual assignments

Making international assignments more spouse/ partner and family friendly

What partners want as assistance:

 Information on local opportunities

 Network contacts or vacancies
 Job search advice/ guidance
 Certainty that work permit will be granted

What partners get as assistance

 Language training (75%)

 Intercultural preparation (64%)
 Assistance with education/ training (41%)
 Work permit information/ advice (37%)
 Career- planning assistance (35%)
 Tax provider consultant/ assistance (31%)
 Employment search or job-finding fees (27%)
 Lump sum allowance for spousal support (23%)
 Identify volunteer activities (20%)
 Reimbursement for career enhancement activities (20%)
 Club memberships (17%)
 Identify employment opportunities with your company (15%)
 No support (6%)
 Compensation for partners income (1%)

Partner assistance

 Inter-company networking
 Job-hunting assistance
 Intra- company employment
 On-assignment career support

Helping avoid isolation at host location

 Experience sharing with repat wives

 Access to social networks
 Access to adequate leisure activities
 Access to language and intercultural training

Recommendations for good investment for companies

 Include partners as much as you can in recruitment & selection process (interview)
 Be also prepared to answer partners questions
 Assure to care for partner as much as for employee
 Provide lots of information
 Provide a trip to host location
 Offer language courses and intercultural training for partner

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 Expat Partner
- Has professional duties - Left career behind, has to operate in a
 Compensated cultural shock much different environment,
communicate in unknown language,
husband gone all day, stuck in
appartment
 is more affected by cultural shock
 prepare before: language and
activities

3. Accompanying children
50% of expats are accompanied by children (difficult to provide some level of normalcy to children)

Critical family challenges:

 Childrens education (very critical/ important: 82%)

 Degree of difficulty of destination location (very critical/ important: 79%)
 Family adjustment (very critical/ important: 91%)

Availability of adequate schooling (availability of good schooling is always a deal maker/breaker)

 Catering special needs of expatriate children (language, culture)

 Compatibility with parent country education system
 Preparation for smooth re-entry upon repatriation

Education assistance for expat families (big challenge!  Advise about the most suitable options a
the host location)

- Education assistance = financial assistance (cover school fees)

 Varies according to company culture, budgetary restrictions, employee expactations

Financial employer contributions

- Vary according to education stage

 May not cover certain cost categories (tuition, room and board, fees, books,..)

Policy examples:

 Basic tuition fees at acceptable local school

 All actual expenses or percentage up to certain limit
 All actual expenses minus corresponding cost at home
 Lump sum allowance regardless of actual cost

4. Maternity/ Paternity (important issue)

International Assignment Manager must be prepared for many questions: need to develop
maternity/ paternity policy

Policies on maternity/paternity:

What policies should cover:

28
  Medical care during pregnancy (insurance)
 Birth and problem treatment  home flight?
 Parental leave

Basic policy alternatives

 Adhering to home or host maternity/ paternity policy

 Or honouring the better of the two options

5. Dependant Parents
Relevance:

- Support of “other dependant family” (aged parents)

- Patchwork partner constellations double the likelihood of related impediments to mobility

Assistance for elderly family members

 Only small number of companies give special assistance to assignees with elderly family
members

Types of assistance

- Provisions to relocate the family member to the assignment location (100%)

- Provisions to visit the family member who remain in the home country (64%)
- Provisions to obtain elder- care in the assignment location (27%)
- Provisions to obtain elder- care in the home country (18%)

6. Pet relocation
Challenges:

- Different legislation for each destination country

 Import requirements
 Quarantine restrictions (Japan, UK,..)
 Questions of transport (plane travel?)
 Advance planning and attention to paperwork details are indispensable requirements

Assistance:

- Pet relocation specialist  independent pet and animal transportation association

- Overall costs must not be underestimated!
 Ground transportation to and from airports
 Documentation and import fees
 Air freight charges

7. Family support
Scope:

In order to assure recruitment & selection success and to prevent assignment failure companies are
well advised

 Have family support policy that covers the whole assignment life cycle (ALC)

29
  Help expats to meet their families needs is important cost factor (BUT: will benefit the
company on long run)

An ALC- oriented policy should address the level of family support provided:

 During recruitment and selection (INFORMATION)

 Before assignment (PERPARATION/ TRAINING)
 In the relocation phase (TRANSITION PROGRAM)
 Trainings: language & cultural
 Education consulting (providing information on schooling, screening and previewing
schools, helping with proper placement decision)
 Childrens programs: language training, making children understand the change, tips
and exercises for parents, help children feeling in control of situation  pack
suitcase
 Spousal assistance
 Host country orientation services: orientation trip, home finding, area orientation,
settling-in services, rental assistance, temporary living assistance, mortgage
assistance, household goods assistance)
 Hiring pet relocation company
 During assignment (ONGOING SUPPORT)
 Upon repatriation (REINTEGRATION)

Recherche:

in which way are the spouses represented here?

What kind of activities are expat spouses engaged in?

What role do spouses play in the community?

Possible questions:

Assess and explain in the reasons for the relevance of partner and family related issues in IHRM

Elaborate on the role of a spouse/ partner as a key success factor in IHRM

Elaborate on the role of children and “other dependant family” in IHRM

Give an overview over assistance measures companies can provide for spouses/ partners, children
and “other dependant family” during the different stages of the assignment life circle

Part 7: International HRD Expat Training & Development

1. International Talent Development

30
 HR Management Tasks:

1. Pre-entry
 HR planning
 Recruitment
2. Working Life
 Working Structures
 Mgt. & Leadership
 Compensation
 Training & Development
3. End of Work
 Release

Functions of HR Development

Organizational development

 General: making the organization more effective

IHRD:

 accumulation of relevant international business know- how

 building talent pool of internationally experienced management personnel

Career development

 General: designing career development plans and enabling employees to follow them
 IHRD: International assignments are perceived as drivers of career advancement

Training & Development (Training = teaching)

General:

 Improving the current knowledge, skills and attitudes of employees (technical training)
 Development: preparing for future responsibilities (management training, supervisor
development)

IHRD:

 International assignment itself is a vehicle for international/ intercultural training and

development  developmental assignments
 Expat training & development means preparing personnel for international assignments

Objectives:

1. Facilitate expat adjustment

 Reducing the impact of culture shock
 Enabling expat (and family) to adjust to a foreign environment quickly and effectively
2. Assure optimal on-assignment performance
 Equipping expat with relevant knowledge in areas such as leadership, hierarchy,
delegation, teambuilding, conflict resolution, motivation
3. Facilitate expat re-adjustment on repatriation
 Reduce impact of reverse culture shock
 Enable expat & family to re-adjust quickly and effectively to parent country environment
31
 4. Overall- objectives of expat training programs
 Reducing assignment failure rates
 Achieving higher repat retention rates (preventing expats from leaving their companies
after return from assignment)

Expat Training on a Timeline

1. Pre-departure training programs (Preparation)

 Delivered prior to dispatch to assignment destination
2. Measures during assignment
 Training delivered at assignment location (language courses)
 Holding personal contact through mentoring systems
 Periodic visits to parent company
3. Measures upon and after repatriation (after repatriation)
 Repatriation programs (Most frequently overlooked type of expat training)

The training cycle

Stage 1: Needs analysis (assessment of training needs)

1. Identification of job performance skills needed (training needs)

2. Assessment and prioritization of prospective trainees skills
3. Development and definition of objectives

Step 2: Training (instructional) design

- Producing the training program content

 Develop lesson plan
 Develop/ acquire materials (workbooks, presentation slides, exercises, activities)
 Select trainers
 Select methods and techniques
 Schedule the program

Step 3: training delivery (implementation of program)

32
Step 4: Programme evaluation

- Assessment of the programs successes or failures

 Select evaluation criteria (they should correspond to training objectives)
 Decide on evaluation design (questionnaire)
 Conduct evaluation
 Interpret results

Components of pre-departure training program

1. Cross cultural AWARENESS training

2. Cross cultural training (What is culture? How does culture express itself? What is a culture
shock? What are the alternatives to a clash of cultures?)
3. Language training
4. Preliminary visits (look and see trips)
5. Training for trainer role

6. Intercultural competence

Risks of ignoring cultural differences in international business

1. Business opportunities may be lost

2. Negotiations may fail
3. Business partnerships may break
4. Embarrassing mistakes may be made
5. Customer relations may stay underdeveloped
6. Corporate reputations may be damaged
7. Marketing campaigns may remain unsuccessful
8. International assignments may fail because expats return to their parent companies before
they got the job done
9. Interculturally insensitive people may even leave “scorched earth” in their wake (arrogance,
condescension, intolerance)

“Full” intercultural expertise goes deep:

1. Language
2. Literature, films
3. Music
4. Visual arts
5. History

Intercultural preparation of expatriates

(primary causes of failure: lack of understanding of the essential differences in managing human
resources at all levels in foreign environments)

1. Intercultural competence of expats is an essential precondition for the success of a foreign

assignment
2. Companies dedicate a big part of expat training and preparation to intercultural issues
3. Value of intercultural training for assignment success
 Intercultural competence of the expat is seen as one of the most important pre-
requisites for assignment success
33
  38% of Companies offer all formal intercultural preparation for international
assignments
 45% offer some assignments
 16% offer no assignments
 55% of companies offer trainings for whole family
 35% offer trainings only for partner
 7% offer only for assignee

4. Intercultural Preparation
The “Global Manager”

Companies dream of being able to draw on a talent pool of highly mobile multicultural and
multilingual managers

 Business knowledge and business skills

 Proficiency in spoken and written English, proficiency in other languages/ regions

High number of migrants and germans with different migrational backgrounds can be seen as a
“talent pool” for the staffing of international operations of German companies

 A truly global manager will reman a mirage (with how many different cultures can a
person be familiar)

Language Training

- Most companies see language courses as a highly desirable component of pre-departure

training (incl. partner, older children)
- Critical for success
 Improve expats effectiveness, negotiating ability and information access
 Contribute to cultural adjustment
 Key to deeper cultural understanding

English as language of international business

 Fluent proficiency in spoken and written English is expected!

Cross Cultural Awareness Training

Degrees of cultural awareness

1. Our way is the only way! What works at home will work anywhere!
2. We know their way, but our way is better!
3. Our way and their way – theres a choice!
4. Our common way! People from different cultural backgrounds create their new common
culture  corporate culture of a truly global company based on cultural diversity

Standard subjects of cultural awareness training

1. Developing cultural awareness

2. Cultural values and attitudes
3. Communication styles (verbal/ non verbal)
4. Cross cultural management skills
5. Business management structures
6. Decision making techniques
34
 7. Business etiquette and protocol
8. Culture shock and reverse culture shock

Culture Shock (= difficulty people have adjusting to a new culture that differs markedly from their
own)

Reverse Culture Shock

 Often underestimated by HR Departments

 Returning to ones home culture after growing accustomed to a new one can produce the
same effects as culture shock
 People often find this more surprising and difficult to deal with than the original culture
shock

Coping strategies

 Know what to expect: cultural awareness + CCT

Cross Cultural Training (CCT)

- CCT: country specific programs

- CCT: course for British expats preparing to live and work in Germany
 Germany and UK (history, breaking stereotypes, theoretical and practical cross cultural
models and examples, cross cultural communication)
 Contemporary analysis: politics, economy, society
 Communicating with Germans: Beliefs, culture, values, ethics, customs, national
character, interpersonal relations, building relationships, communication)
 Doing Business in Germany (Language, traditions, ethics, comparative analysis of
business ethics, making appointments, business etiquette, business entertaining,
negotiations, management)
 Relocating to Germany (Preparing for moving, British perceptions of Germany, German
attitudes to foreigners, family values, public behaviour and etiquette, food and drink,
transport, shopping and entertainment)

Model Expat Training Program

35
Train the trainer programs

 Very important is expat must engage direct know- transfer

 Focus on intercultural aspects of teaching in a foreign environment
 Language competence needed

Corporate constraints

 Time
 Personnel
 Budgetary limitations
 Facilities
 Attitude of senior management

Story of Wayne Bullova

Possible Exam questions:

Explain term international HRD

Elaborate on expat training & Development as key elements of a GTM

Describe typical elements of intercultural preparation of future expats

36
To elaborate on the importance and value of intercultural competence in international business

Discuss the effects of culture shock and reverse culture shock and adequate coping strategies

Part 8: Repatriation and Retention

1. Relevance in IHRM
Terminology

Repatriation = activity of bringing the expatriate back to the parent country, final stage of assignment

Practical experience of repats:

- Re-entry or reverse culture shock

37
 - Disillusionment: the rose-colored view of life back at home collides with reality
- Family re-adjustment difficult
- Unsure or vague career perspectives for the time after assignment undermine morale (career
anxiety)
- Life has moved on: former networks don’t exist/ function any more (professional/ private
life)
- “Homesickness” for the assignment location

2. Retention vs Repat Exodus

Attrition (Abnahme/ Verlust) rate of expats: doesn’t appear much/ doesn’t exceed total employee
turnover.

Assignee attrition timing: When do expats part from their company? (GMTS 2015)

 20%: while on assignment

 25%: within one year of repatriation
 26%: between one and two years
 29%: over two years following repatriation
 Attrition during assignment  expat retention challenge

Why do repats leave their company?

9. 30%: no appropriate job available in the home country

10. 30%: offered a better job in another organization
11. 10%: unable to apply new skills acquired on assignment

Post- repatriation attrition (repat retention challenge)

 51% of expats who part from companies leave during the first two years after
repatriation

Cost of expat attrition

- Significant losses for firm

- No full amortization of investment in the human capital of their international managers
- these negative effects are directly opposed to the goals of global talent development
- HR focus must lie on retaining expatriated and repatriated employees (talent retention)
- The Way MNE handle repatriation affects tis ability
.. to attract future expats (recruitment of global talent)
.. to create a pool of internationally experienced managers (selection from talent pool)
.. to have a full return of its investment in human capital (knowledge and competence
transfer upon re-entry of expat)

3. Repat Adjustment Challenges

Reasons for post assignment attrition

- New role expectations not met (34%)

- Employee more marketable (32%)
- No opportunity to use experience (16%)

Job related factors influencing repat adjustment

38
 - Career anxiety (unclear job perspective)
 Expectations of ingoing and outgoing expat are the same: career advancement, financial
gain
 Expats believe that their performance overseas warrants reward and promotion
 Expats expect to be compensated for sacrifices they and their families have made abroad
 If “psychological contract” is not fulfilled upon repatriation: repat might leave
 A re entry job/ promotion guarantee would remove all cause for career anxiety (only 14%
of companies guarantee a position upon completion of an assignment)
 Absence of career development plan is a decisive factor for career anxiety
 Career development planning is an IHRD challenge!

Work adjustment problems (personnel and organizational changes)

 3-5 years is a long time in the life of a company

 Changes in home, work place may leave the expat stranded upon his return
 Personnel changes at management level and colleagues’ level (job shedding, promotions)
 Organizational changes (M&A)
 Restructuring (closure of plants, divisions)

Out of sight, out of mind (loss of visibility: colleagues, superiors, friends)

 Longer period overseas can cause a loss of visibility at home (where career decisions are
made)
 Loss of formal and informal networks at home
 Lack of information about parent firm situation
 Absence of clear statement about the expats future
 Get a PROMOTION BEFORE! Return (you are forgotten while overseas)

Kingpin syndrome (loss of status and pay)

 PCNs tend to perceive the foreign assignment as a kind of promotion

 Greater autonomy
 Broader area of responsibility
 Prominent role in local community
 Repatriation REVERSES these effects
 Repat resumes position within the company
 Base pay is likely to be lower
 Loss of expatriate premiums
 Drop in standard of housing

Social factors

Family adjustment problems (partner, children, other dependant family)

 Partners career perspectives

 School adjustment problems for kids
 Disillusionment after glamorizing life back home
 Re entry shock
 People are less prepared for problems upon coming home and they are changed persons

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Loss of social networks

 Re-establishing social networks after repatriation can be difficult

 Transition from a very close expat community to a place where everyone is busy with
own lives
 People show little interest in expat life
 Homesickness for assignment location
 Loneliness, frustration, depression

4. Managing Repatriation

General objectives

- Multinationals should carefully manage the repatriation process in order to:

 Prevent expat/ repat attrition, loss of experience and know-how (competition)
 Maximize benefits of international assignments
 Create a larger internal labour market for future assignments (talent pool)

Benefits of repatriation management

1. Retention: Staff availability for future needs (talent pool)

2. Retention: Knowledge Sharing & Transfer
3. Retention: Full return on investment

Staff availability for future needs in expat recruitment & selection

 Pool of global talent

 Adequate re-entry positions signal the importance given to international experience by
the company
 Promotion of repats demonstrates that the international assignment really is a
positive career move (motivator for others)
 Unrewarded expatriate performance signals that the acceptance of a foreign
assignment is a high-risk decision (demotivator for others)

Knowledge transfer

 Cross-fertilization of ideas and practices that assist in developing and maintaining

competitive advantages
 Knowledge is person-bound: leaving repats take all their knowledge and skill with them:
 Market specific and network knowledge
 Personal, management and intercultural skills
 General management capacity (people grow on assignment)
 Consequently, MNEs should
 Endeavour to retain international experienced key staff
 Extract and build upon repats international experience

Return on Investment

 Expats are expensive and a considerable investment in human capital

 Expats exiting their company after repatriation
 Loss of financial capital
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  Loss of human capital
 Loss of skills
 Loss of knowledge
 Loss of experience

Repatriation

Dont’s:

1. Career advancement arguments used in expat recruitment are largely rhetoric

2. Knowledge and competence transfer is treated as one way activity
3. Absence of job guarantees or career perspectives
4. Repats are under-utilized resource
5. Benefits of an international assignment both to the firm and the individual expat are ignored

Lessons to be learned

1. MNEs cannot afford to ignore the problems related to repatriation

2. Repatriation needs careful managing
3. A successful integration of home and host experiences should be achieved
4. Repatriation programs should be installed to increase assignee retention

5. Repatriation Programs

Goals of repatriation program

- Prevent repatriates from leaving their company after the foreign assignment (retention rates
up/ attrition rates down)
- Prepare expats for the (unexpected) effects of reverse culture shock
- Assist expat (and family!) to successfully readjust in professional and private life

Components of repatriation program

Information gathering/ survey

- Ask former expatriates about their repatriation experiences (interview/ questionnaire)

- Start with a “big” survey to start as a standing procedure upon the return of all
expatriates
- Identify (all) relevant problems and issues
- Include partner and children
- Use information to continually optimize the repatriation management process

Treating repatriation as an integral part of the assignment cycle

- Managing the repatriation process means managing expectations (psychological

contact!)
- Pre-re-entry training should be aimed at
 Indentifying
 Discussing
 Defusing

Mismatches of expectations regarding the future

Discussion of reverse culture shock phenomena

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Installing mentoring relationships: Mentoring: supportive relationship, meaning guidance and
concrete assistance

Manages the relationship

Encourages
Nurtures
Teaches
Offers Mutual Respect
Responds to the mentee’s needs
Functions of expat mentoring
- Maintaining contact with the expat throughout the assignment
- Alleviating the “out of sight, out of mind” syndrome
- Ensuring the expat is kept up to date with developments in the home country/ company
- Ensuring the expatriate is retained in existing management development programs
- Assisting the expat (and his family) with repatriation process
- Helping with a repat position
Phases of expat mentoring process
1. Pre-departure mentoring (before start of assignment)
2. Foreign assignment mentoring (during assignment)
3. Repatriation mentoring (after assignment)
Profile of an ideal expat mentor
 Former expatriate (from the sending work unit)
 In a more senior position than mentee
 Has influence (two hierarchical levels further up than mentee) but not a direct superior
of the expat
 Knows expatriate personally
 Keeps confidentially, has excellent listening skills
 Can act as a role model
Developing career path systems
 Career anxiety hurts expat’s effectiveness
 Career path systems including international assignments entice talented employees and
prevent career anxiety
 Job guarantee?  give one if you can, make no promises that cant be kept!
 Be open about ambiguities and uncertainties
Providing practical repatriation assistance
Start: no later than 6 months prior repatriation
 Outsourcing to destination service providers (DSP)/ relocation & destination services
 One-stop shop: service given throughout the entire assignment (Pre-move, arrival,
repatriation)
 Scope of relocation & destination services
 Preparation, physical relocation and transition
 Advice on tax and benefit changes
 Financial and tax assistance
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  Schooling, housing,..
Establishing standard welcome back procedure
- Find formal and informal ways to make the repat feel himself “at home” again
- Find a forum for acknowledging the expats overseas contributions
- Reintroduce the expat to his former colleagues
- Introduce expat to new staff
- Celebrate
Offering an in-house repatriation program
- Group programs for expats and spouses
- Involvement of recent & former expat families
- Experience sharing (revere culture shock)
- Establishing new social contacts and networks at work and in private life
- Ideal trainers for outgoing expat personnel: staff with personal overseas assignment and
repatriation experience
Possible exam questions:

Explain relevance of repatriation issue in expat management

Describe the multifold challenges of expatriate repatriation

Name factors that may negatively influence repatriate adjustment

Ways in which expat repatriation should be managed

Elaborate on aims and elements of repatriation program

Key to international business success

Cross cultural competence: 70% of failures result from cross cultural misunderstandings
Increase success in international business: cross-cultural programs
- Intercultural training/ coaching: enhance intercultural competence
 develop effective strategies for international success
 acquire master cross-cultural skills (business simulations, case studies)
 expat & family training and coaching programs
- Intercultural consulting: cope with organizational challenges
 Integration and change
 Team development
 Executive development
 Project support: Intercultural project support
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  Integration and change process  intercultural change processes: reach your targets
faster
- Intercultural business events: competence through enjoyable learning experiences
 Framework programs for conferences
 Team building workshops
 Cross cultural dining
 Solving Cross cultural conflicts in international teams
 Development of high performance teams

HRM IHRM
- Mgt of employees of one country - Mgt of employees in the three
- Hiring, retaining people nation
- Negotiating salary  Parent country
- Same social community  Host country
Objectives:  Third country
- Ensure availability of right people - Control and coordination of foreign
for right jobs in order to achieve subsidiaries
right goals effectively - Adapt to local environment
- Provide job satisfaction and self- - Overcome multi cultural differences
actualization - Employing competent people
- Maintain standard of work life across all nations in which company
- Help practice ethical behaviour is active
- Utilize talent of human resources
- Knowing different hr policies in
different countries
Objectives:
- Management of diverse human
capital
- Ensure that all people that are
employed globally have the same
competencies and talents
- Minimizing risks

Sources of global mobility data

 GAPP/GMTS (engerer sinn) vs Expat Insider/Expat Explorer (wider sense)

 Survey design and underling expat definitions

 Use of survey types in different contexts (what survey to consult for what kind of question)

Policies on int assignments

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  What is a policy? Function? What should they cover in ihrm?

Women as expatriates (and in other roles: trailing spouse)

 International assignment gender gap

 Trailing spouses

IHRM research

 Why is there so much room for research in GM?

 Potential research topics relying on access to expats/ repats

Assignment failure

 Reasons for assignment failure

 Practical elevance of those reasons

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