Motive For Sending Managers Abroad As Expatriates

Multinational corporations today have recognized the critical role that human resources play in global competitiveness. In particular, a developed pool of global leaders is indispensable for operating successfully outside of the domestic market.

Many multinational companies (MNCs) use expatriate assignments as a leadership development tool. These MNCs often send their managers and executives internationally in an attempt to develop their knowledge of the international economic environment and their ability to work and

Manage effectively across national borders (Tung, 1998).

Repatriates, who have completed a global assignment, can help establish and expand an MNC’s international business because they possess first-hand knowledge of particular cultural contexts, including information about specific markets and customers. Repatriates understand how the company is perceived in another country and are part of a global social network that can advance the company’s business around.

1.2).Motive for sending managers abroad as expatriates

The three Swedish companies uses ethnocentric approach to their international hospitality operations are adopting a home country orientation. Home country operating systems and

Procedures are set up in their international subsidiaries (host country).

The first company uses the ethnocentric approach because they are targeting a domestic marker strategy which is applicable the host country and we can say this is the reason that they are using the ethnocentric method.

On the other hand their major motive is transfer of skills. The knowledge of SCA and how it operates is important to those are sent abroad.

While Handeisbanken’s major motive of sending managers abroad as expatriates is to support the establishment of the corporate culture and acquiring international experience managers can often hope to reach higher positions within the bank upon return. Also the main reason for sending managers abroad as expatriates in linked to the development of the Handeisbanken.

And that is why Handeisbanken is using the ethnocentric method to send their managers abroad.

Finally Electrolux is enlarging and motivating the mobility among it’s workers and luck of host country nation are the two major motives for sending managers abroad as expatriates and using the ethnocentric method.

According to Collings et al.(2007) there is more than one reason for this, it can be related to three basic reasons

There is no suitable HCN available

Developing managers through international experience

And developing organizations

Furthermore Dowling and Welch (2004) present five role of expatriates:

Agent of direct control

Agent of socialization

Network builder

Boundary spanner and language node

The Colligs et al (2007)’s their theory is recent and well established previous research. discovering the intended role of research will futher investigate MNC’s motive.

The ethnocentric approach has a lot of disadvantages.

Lack of promotional opportunities of host country nations which may reduce the productivity and higher labour turnover

It takes lots of time to understand the local dynamics which may result wrong decisions.

It is quite expensive to employee a an expatriates in foreign location

The motive for sending manager as expatriate depends on the company core policies and it is different from one other. Some sent as control mechanism while others send international experience.

Although expatriation is one of the “more informal and subtle” mechanisms of coordination being used increasingly by MNCs (1991).

The process has also been described in terms which reflect an awareness of

difference and local sensitivities.

2.0. Literature review

According to the Business

International Report (1991) (Developing Effective Global Managers for the

1990s), cited by Harris & Brewster (1999), the survey reveals that most MNCs’

international assignees are proposed by their immediate supervisor an.

2.1. The process of expatriate selection in MNCs

No matter how many specific phases the process is divided into the

process of managing and supporting expatriates on international assignments

can be divided into three broader phases; before the assignment, during the

assignment and after the assignment. The phase before the assignment

would usually contain identification, selection, training and development, and

compensation. The argument for putting compensation in the phase before

the assignment is that it is typically agreed upon before the expatriate go on

the assignment. During the assignment stages such as adjustment,

2.2. Comparing the case companies

in SCA the process of selecting expatriates does not too much differ from the process of normal selection employee, although they does not clearly defined but SCA consider has some criteria depending on the specific situation.

Although SCA does not have pool of possible candidate exist because when a need for an expatriate arise they did not openly advertise and there is some assessment of IQ competences of expatriate candidates.

At Handelsbanken vacancies are openly advertised internally they differ from SCA in aspect of family involvement which plays a major role in the success of the expatriates.

Moreover Electrolux they are giving chance for the younger people as expatriates, often identified as high potential. But they have a lot of weakness in their selection process like there is no specific training for those who appoint the expatriates even they does not determine expatriates candidates IQ competence,

Typology of international managers selection has been promoted by Hariss and Brewester (1999) where they described a four different ways of how MNC select their expatriates. It appoints the fact that the process can be either formal and informal and it can be conducted open and close manner these processes are being described by the following characteristics :

Degree of training for selectors

Degree of defined measures

Degree of defined criteria

Degree of advertising vacancies

Degree of panel discussion

View of nomination

According to Harvey and Novicevic (2004) have mentioned and eight steps process they argue that a manageable significant steps is needed in order to get information relating to the components of selection.

This assumption accounts for the fact that most studies of selection criteria for

expatriates find that current competence is the main focus. There is substantial

evidence in the literature that technical competence is seen as a crucial factor by

MNCs.

According to question the typology developed by Hariss and Brewester (1999) is very important because it is focused on how expatriate selection is actually done in MNCs.

3.0. The criteria of expatriate selection in MNCs

3.1. The relevant theories

Expatriate selection is considerably more difficult than the selection of personnel for a domestic position. Unfortunately, this is often not realised by companies involved in international personnel selection. Typically, companies look at the technical competence of the individual and that’s all. Human relations skills, understanding of host country culture, ability to adapt and language skills are ignored or treated as relatively minor issues. Yet, research suggests that the most important items that make for success in an expatriate assignment are human relations skills, an understanding of host country culture and an ability to adapt (Robinson 1979). Technical competence is way down on the list of required qualities. According to some expert opinion “failure of assignments… in up to 80% of cases is due to personal adjustment rather than a lack of technical skills” (Holmes and Piker 1980).

3.2. To compare the three companies

In SCA they believe that technical ability, cross-cultural suitability and family requirements are some of the most important factors to consider when selecting expatriates, also they consider the current job performance when selecting expatriates.

Meanwhile Handelsbanken the family of expatriate candidates are not looked at as a specific criterion. They believe having family should not be a disadvantage or advantage when selecting among expatriate which we can see that they are not see an important factor them.

Electrolux also put emphasis on the current job performance as the two above but they did not see more significant the host-country’s language which is the most important to them because of their market communication.

The ability to adopt

What is seen as the traditional MNC view of expatriation.

Lannier (1979) identified as typical the view that a good manager in one country

will be a good manager in all countries. The point has been made repeatedly but I don’t think this assumption is suitable for today’s world, because the of cultural difference and environmental factors effect.

Expatriates managers must be able to adopt to change. They also need to know a something about the host country’s culture.

Organizations examine a number of characteristics to determine whether an individual is sufficiently adaptable.

The importance of the language

This assumption accounts for the fact that most studies of selection criteria for

expatriates find that current competence is the main focus. There is substantial

evidence in the literature that technical competence is seen as a crucial factor by

MNCs

Cross cultural suitability

From past experience, hard to accept the new environment and difficult to operate effectively are main problems for most expatriates (Brewster and Harries, 1999).

Pre-departure training, like language and sensitive training is very important for improving expatriates’ culture awareness and cross-culture suitability (Dowling et al., 1999).

However, lots multinationals’ cross-culture training is not enough. Some are insufficient, some are incomplete ( Brewster,1995; Waxin et al.,1997, Selmer, 2000). Why these things happen? Because it’s very hard to evaluate the effectiveness of such training (Marie-France Waxin et al)

Teaching expatriate employees from one culture to coordinate with people of another culture is the goal of cross-culture training (Brislin and Peterson, 1986; Mendenhall and Oddou, 1991)

Cross-cultural personality assessment is usually combined with behavioral interviews to form a complete picture of individual competencies, weaknesses and strengths. Candidates should keep these desirable characteristics in mind when undergoing assessment.

In the cases of the three companies every company put an emphasis on their core values like SCA puts there emphasis on cross-cultural suitability, technical ability and family requirements while Handelsbanken puts there most emphasis on technical ability. This shows as that there criteria of expatriate selection depends on what is important to every company or what there focusing to achaive.

4.0. Recommendation and conclusion

The method to apply for selecting expatriates depends on the company’s core values or what is the most important to that company. Example if the company priority is to hire parent nations employee or when there is luck of qualified candidates for host nations employee or want to ensure that the company culture and values to be uniformed it is better to implement the ethnocentric approach although it is difficult to implement. This approach is useful if domestic market strategies are applicable in foreign countries or if the company is targeting home country customers

While polycentric approach is suitable if host country marketing strategies are targeting host countries customer. And it is when company employing host country nations in the subsidiary of MNC operating in that country and its basic premise is that parent country nationals will only hold positions in the corporate headquarters.