Tung identified 5 main reasons for failure they are listed below : 1/ Inability of spouse to adjust 2/Managers inability to adjust 3/ Other family reasons 4/ Managers personal or emotional state 5/ Inability to cope with larger overseas responsibility Sufficient measures must be built into the HR strategy to reduce the chances of expatriate failure. One of the easiest methods is to improve the selection of expatriates various literatures has stressed the importance of not only managerial and technical competence but also effectiveness and coping skills.
Mendenhall and Oddou believed expatriate success depended on four dimensions: The self-oriented, the others-oriented, the perceptual and the cultural toughness. Mendenhall and Oddou recommend two main ideas to firms firstly that selection is based on a multi-dimensional approach and that comprehensive acculturation training programs incorporating the four main dimensions are designed.
Another method how expatriate failure can be reduced is by involving the expatriate’s family in the selection procedure, this is one of the biggest reasons for failure with the spouse or children often failing to settle in. However many companies do are reluctant to intrude in matters outside their domain so are unable to include the family in selection. However the company can include the family in see-in visits, perhaps even training and development before during and after their visit to make sure they do not suffer from culture shock. Companies should try and bear the families in mind when relocating expatriates things like a safe community, good school, good health care and access to shops are all measures the company can use to smooth the transition over for the family.
Repatriation Another vital aspect which must be included within the HR strategy is sufficient training, I have already mentioned expatriate training earlier so I will now deal with training for the HCNs and TCNs. Technical training can often be passed down onto the HCNs and TCNs quite easily through on the job training at the particular subsidy once cultural and language barriers have been broken down. Another cost-effective method of teaching technological issues is by using satellite technology to deliver custom-designed training courses from home country locations. As for managers the company often try and develop HCN and TCN’S people skills as they want them to lead, motivate and develop employees in their own country.
One of the most successful training methods is to send the staff to corporate HQ , Fiat and Ericsson are just two of the companies which use this approach. While this approach improves management skills it also exposes them to corporate culture which should help them develop a corporate perspective as well as their own interests. In contrast some firms send in overseas managers to train the HCHs and TCNs in their own subsidiary. A more radical approach is to use off the job training by sending managers on the global leadership programme at the University of Michigan to improve their global business skills through action learning which is a mixture of seminars and lectures, adventure based exercises and field trips to various countries.
The issue of appraisal must also be incorporated into ones international HR strategy, however in doing this firms often encounter many problems. When workers are working in several different countries it is very hard to compare and comment on their success as the environments and the economies are completely different. This non-comparable data makes appraisal extremely difficult especially when it comes to financial data due to currency conversions.
Despite these problems there are certain methods open to the firm one being the use of transfer pricing and other financial tools to try and reduce the complexities of the international environment. Another approach used by firms is to ignore the financial implications and try and assess the workers of a division by the achievement of long term goals such as market share growth or health and safety improvements.
Many firms even just carry out their domestic appraisal methods although they can not always be applied to HCNs and TCNs as they cannot be linked to their jobs. Whatever method firms choose they must be careful not to upset workers as performance appraisal itself conflicts the issue of cultural applicability. Unfortunately appraisal can be interpreted as a signal of distrust or even an insult in some cultures for example the Japanese never directly talk about failure but just mention the possible implications. Firm’s must remember that evaluation requires cultural sensitivity which can be overcome by devising a suitable system with the guidance of HCNs.