Change Management Principles and the Impact on the Management of Global Human Capital

International Assignments

Wise selection of personnel for international deployment is key to the success of a firm abroad. Selecting an employee for assignment is not as intuitive as the leader may think. In fact, some of the very same factors that make for a successful career in the home country, such as the ability to get things done quickly or a task-focused perspective, can derail the employee abroad. All too often, emphasis is placed on the wrong qualifications in candidate assessment such as technical skills, and resilience in the face of complicating factors the international candidate will face is not given the weight it deserves.

Complicating elements in an international assignment include problems adjusting to a different culture, a new language, a totally different way of thinking, a sense of separation from the home country, and isolation from the home country office. If communications between corporate and global field offices are lacking, the international assignee may soon feel forgotten and that his or her career is sidelined. If the employee's spouse and children have prolonged problems adapting to life in another country, the expatriate's job performance will be affected, and the employee will be more likely to request a transfer home before completing the assignment.

To increase chances of expatriate success, evaluation criteria should include the following factors (Cultural Influences, n.d.):

· Technical, managerial, and diplomatic skills. In addition to required technical know-how, the candidate must possess strong interpersonal and negotiation skills. These skills require practice and experience. Home country leaders should not award an employee an international assignment until all the skills are evident and consistently displayed.

· Cultural empathy and adaptability. Each country has its unique cultural differences including business etiquette, greetings, and personal distance. The candidate should demonstrate willingness to recognize and accept the cultural practices of other countries. This adaptation can be evident from something as simple as greeting to receiving and acting in accord with the foreign standards of hospitality and obligation. If employees are not comfortable with these types of differences, they will not flourish in the environment and may become depressed and disgruntled.

· Language aptitude. An individual chosen for international assignment does not necessarily have to be fluent in the language of the host country, but he or she must study, practice, and seek some level of proficiency in the language. This will go a long way gaining the respect of the local employees.

· Motivation. The mere interest or desire to work abroad is not sufficient for deployment. In addition to this desire, the candidate should desire the adventure of the experience, want the chance to develop global skills, and possess the belief that the job itself is important and part of the path to career advancement. Many employees take international assignments to move up the ladder after the assignment. High motivation is essential for success because the employee has to make a lot of sacrifices during the assignment.

· Adaptability of family. Spouses and family are as important a consideration as the candidate when choosing a person for an overseas assignment. The spouse and family should be screened for their ability to adjust to a different physical and cultural environment.

Selecting the right evaluators will also improve the screening process. Human Resources should consider establishing a selection board of expatriates who cannot only help pick the right people but also share their experiences and answer questions (Graham, 2006). 

References

Cultural influences on expatriate managers' success and failures. (n.d.). Retrieved from Paul Herbig's Working Papers Web site: http://reocities.com/Athens/Delphi/9158/paper18.html

Graham, M. (2006, March 28). International HRM. Retrieved from Clarkson University Web site: http://people.clarkson.edu/~mgraham/class21_international_os352.ppt#300,1,OS 352 3/28/06

Global Staffing: Theories and Trends

Global staffing can be defined as the function of the human resources department to effectively fill key positions at an international level. Multinational corporations find themselves in a position to seek employees who can meet the requirements of employment at various international levels. The filling of these positions is a process that requires considerable knowledge of research conducted on how to globally staff when the need arises.

Several reasons exist as to why global staffing is considered a significant challenge to multinational corporations. One obvious trend is related to the increased mobility of today’s workforce. More and more employees are willing to take a risk and move to an international location. Employees may view these positions as an opportunity to move up more rapidly within the organizational structure. Another existing trend that is a major concern to the human capital resource manager is the ability to compete for human talent. For example, what advantages or benefits does one multinational organization hold as compared to another? The overall global staffing strategy must be inclusive of methods to motivate employees to attract them to their organization. (Scullion & Collings, 2006)

Other trepidations associated with global staffing are issues associated with the hiring of expatriates to fill these key international positions. An expatriate is defined as a national of a specific country that is hired to take a temporary or permanent key role in another country. Research has indicated that multiple problems and disadvantages associated with the expatriate must be well understood to ameliorate associated problems. For example, many multinational corporations underestimate the critical requirements of an expatriate’s functional role. By doing so, they may recruit individuals who do not have the appropriate leadership skills, technical competencies, and emotional intelligence required to be an effective and high performer within that role. With the rapid growth of markets in other countries, there is an absolute need for global staffers to find the right mix of competencies to meet the challenges associated with assimilating into another culture. It is clear that poor decision making in global staffing can lead to multiple losses to the organization at the financial, performance, and cultural levels. (Scullion & Collings, 2006)

Perlmutter’s Model

One of the earliest models regarding global staffing is Perlmutter’s model. Perlmutter posited that there was not one specific criterion that was related enough to multinationality for it to be effective. Perlmutter stated, “The orientation toward foreign people, ideas, resources in headquarters and subsidiaries, and in the host and home environments becomes crucial in estimating the multinationality of a firm” (Perlmutter, 1969). In other words, Perlmutter viewed the effectiveness of a multinational organization as one that holistically took into account all of the elements that were necessary to assimilate and work well within a global environment.

Perlmutter’s model provided insights into specific types of organizational orientations. A brief description of each of these are as follows:

· Ethnocentric orientation: This view of global staffing focuses on the placement of parent country nationals (PCN) or country citizens into key international positions. Typically, this staffing occurs at the early stages when a subsidiary needs the most guidance and support. “Quite clearly, the ethnocentric orientation does not fit well with the concept of a global mindset. In fact, managers in an ethnocentric organization would perceive home country knowledge and personnel as hegemonic and superior, and thus would have little interest in the views of those of other nationalities.” (Scullion & Collings, 2006). Disadvantages associated with this orientation can be correlated with the issues associated with the expatriate.

· Polycentric orientation: This view of global staffing focuses on the placement of host country nationals into key international positions. The overall advantage of this orientation is that cultural barriers are significantly reduced by employing host country nationals as opposed to parent country nationals. Another advantage is the reduction of potential political turmoil. A major disadvantage, however, is that the host country national will find it difficult to progress internationally outside of his or her borders. (Scullion & Collings, 2006)

· Geocentric orientation: This view of global staffing focuses on an interesting perspective. Simply stated, the employee who will be recruited for a key international position is the one who best meets the criteria for the job. “The skill of the person is more important than the passport” (Evans, Pucik, & Barsoux, 2002). The geocentric staffing policy is best for multinational companies where there is a strong alignment of objectives and projects (Scullion & Collings, 2006).

Why Multinational Corporations Favor Expatriates

There are multiple reasons why multinational corporations tend to favor the use of expatriates. According to Edstrom and Galbraith (1977), there are three key advantages associated with the choice of this group. The first benefit is the lack of qualified country nationals to fill critical roles. This tends to be a serious problem in third-world locations.

A second reason that expatriates are favored for these assignments is based upon the idea that they can be further developed in this new environment. They would have exposure to a new culture and multiple opportunities to establish strong relationships and consequent strong performance. This, however, does not hold true based upon research conducted on the performance evaluations of expatriates.

There are multiple reasons for the failure of expatriates. Briscoe and Schuler (2004) describe some of them as follows:

· Inability of the expatriate to adjust to change

· Inability of the expatriate to adjust to the new culture

· Inability to accept the diversity presented within the new culture

· Dissatisfaction with the country, the people, and the overall quality of life

· Competency level of the expatriate is inadequate on both a technical and emotional intelligence level

· Family issues associated with the move of the expatriate

· Financial costs associated with the move

· High levels of turnover in the role

The global human resource manager faces many obstacles associated with the use of expatriates within his or her multinational organization. Unfortunately, as previously discussed, there may be just as many concerns when other individuals are recruited. Again, a strategic plan must integrate the knowledge gained from research to ensure that all hiring risks are evaluated and that the most appropriate individuals are chosen for these key roles.

The third reason that Briscoe and Schuler (2004) provide in support of the use of expatriates is their ability to align objectives across organizations. Because the foundational mission and organizational goals are established at home, it is logical to posit that the expatriate is more knowledgeable with regard to the direction that the overall organization wants to take. Knowledge transfer and alignment across boundaries become less of a burden and more effective with the expatriate.

Return on Investments Using the Expatriate

According to McNulty and Tharenou (2004) there are four basic ways to analyze the return on investment (ROI) associated with the expatriate. The first step would be quite obvious to the financial department of any organization. In simple terms, it is the identification of all of the costs associated with the assignment. It is also necessary to determine the overall benefits of the expatriate assignment. The second step would consist of evaluating these elements to the overall purpose and value of the international assignment. The third way to analyze ROI, posited by McNulty and Tharenou (2004), would be to categorize predecessors of ROI from a holistic perspective. In other words, what other organizational gains preceded this assignment? The final step is one of logistics. When should the evaluation of the ROI be analyzed? This would be dependent upon the key deliverables and the timing to complete them.

References

Briscoe, D., & Schuler, R. (2004). International human resource management. New York, NY: Routledge.

Edstrom, A., & Galbraith, J. R. (1977). Transfer of managers as a coordination and control strategy in multinational organization. Administrative Science Quarterly, 22(2), 248–263.

Evans, P., Pucik, P., & Barsoux, J. L. (2002). The global challenge: Frameworks for international human resource management. New York, NY: McGraw-Hill.

McNulty, Y., & Tharenou, P. (2004). Expatriate return on investment. International Studies of Management and Organization, 34(3), 68–95.

Perlmutter, H. V. (1969). The tortuous evolution of the multinational corporation. Columbia Journal of World Business, 4(1), 9–18.

Scullion, H., & Collings, D. G. (2006). Global staffing. New York, MY: Routledge.