Many companies deal with expatriate executives/personnel in a variety of ways. In determining an expatriate there is no right or wrong way. The difference is determined by how the company is trying to meet their goals. The selection process for an expatriate varies significantly from one company to another. When a company has entered the international/global market, it is vital for that company to decide upon which method to use for determining their expatriate executive/personnel. The two methods available are outsourcing and promoting internally. This paper will focus upon promoting internally.
Both outsourcing and promoting internally have their advantages and disadvantages. When trying to decide between outsourcing or promoting internally the company should consider these questions:
1.Have you looked at the cost of administering this function in house versus outsourcing? (Cook, 1999, p.177)
2.Have you done some preliminary recruiting to see if experienced HR staff with expatriate experience are available? What are the going salaries for these professionals? (Cook, 1999, p.177)
3.Will performing the daily administrative details of the expatriate function consume an inordinate amount of time, even if you have experienced staff? (Cook, 1999, p.177)
4.Do fluctuations in the company’s expatriate population make it difficult to maintain appropriate levels of HR staff assigned to get employees overseas, maintain them, and bring them home? (Cook, 1999, p.177)
5.Have you identified the specific expatriate activities you would want to outsource and which ones you might effectively maintain in-house? (Cook, 1999, p.177)
6.Have you discussed the pros and cons of outsourcing these services with other HR professionals or COs who are doing it now in order to get a better understanding of the issues? (Cook, 1999, p.177)
7.Do you know all of the compensation and benefits issues you face in each country where you plan to do business? (Cook, 1999, p.177)
Cook (1999, p.177) said, ‘Large established companies
that have multiple global operations; Companies that are just starting their international operations that may not have experienced staff to effectively handle international HR situations; and Companies whose business needs fluctuate as overseas projects are initiated and completed.’;
If your company has decided to outsource then there
are many sites on the web that are specifically geared towards outsourcing. Some of these locations are:
Many companies and organizations will decide to
internally promote and produce an expatriate executive rather than outsourcing the process. When a company or corporation does decide to promote internally many factors must be considered. The company will have to decide where to build the new facility, what products to produce, what resources to use, where to get the resources, what governmental policies must the facility adhere too, the size of the facility, and so on. The HR department will be responsible for developing the policies and procedures necessary for operating/running the plant. One of the first steps the HR department will be to develop the specific knowledge, skills, and attributes (KSA) and training necessary for success as an expatriate executive. However, Training will not be discussed but the process was mentioned because it is a vital ingredient to the success of the expatriate executive. Before selecting the individual, the company needs to take into consideration the family of the individual. The company will have to prepare not only the employee or executive but also their family. Once an individual has been selected, the expatriate will need to be rewarded some way. This will be discussed later.
When deciding on the executive/employee to promote to
an expatriate position, several KSA are desired. According to Desatnick and Bennet (1977, p.141-148) the areas that need to be considered for an expatriate executive in order of importance are adaptability/flexibility, high tolerance for frustration and patience, empathy/understanding, high intellectual capacity, ability to learn language, problem-solving ability, opportunity mindedness, results orientated, decision making ability, communication skills, integrity, priorities skills, and professionalism. An HR department will have to decide upon which areas are more important and applicable to their organizations in order to promote the right individual.
The individual will have to be flexible and patient
due to the cultural difference between the countries. What is standard in one nation might not be in the other. What could be considered a standard or norm here may be considered as rudeness or affectionate in another. A thorough understanding of the new culture is vital to the success of the expatriate in that country.
When an individual begins to understand the culture,
then they must be able to make decisions and solve problems within a timely matter. The person will need to have a high level of intelligence, perception, and imagination in order to succeed. The expatriate will have to be able to communicate efficiently with all forms of communications bases (writing, speaking, training, motivating, etc) and know when and what to prioritize. The expatriate should be aware that they are an extended image of the company/organization and should be professional and have integrity beyond reproach.
In determining who will be an expatriate, the company
will need to look at the family of the expatriate. ‘We not only have to deal with the employee’s ability to adapt to another culture, but most now add another variable: the spouse and family. It has been documented by countless researchers that spouses are a critically important aspect of a successful expatriate experience.’; (Schell & Solomon, 1997, p. 153) The family of the expatriate plays a vital role in how successful the expatriate will be.
Once an expatriate has been determined, then the
company must provide rewards or benefits to this individual. These perks or benefits should include some if not all of the following: ‘Salary, Annual incentives, Long-term incentives, Benefits, and Perquisites.’; (Cook, 1999, p.139) These areas could be broken down in to several areas. Some of these areas are known as allowances. Some of the most common allowances are Housing, Education, Relocation, Cost-of-living, and Exchange rate fluctuations as determined by Bennet & Desatnick (1977, p.211-218).
In conclusion once a company has selected the process
of determining an expatriate (outsourcing or internally) then they must decide on the HR policies and procedures in selecting an individual, and then providing that individual with compensation for being an expatriate. These processes and procedures developed by the HR department need to be specific. Most companies realize the importance of an expatriate executive in their foreign facilities. The foreign facility will only be as effective and efficient as the expatriate executive. The selection of the company’s expatriate executive is vitally important to the success of the company in a foreign country.
Arthur, Diana, ‘Recruiting, Interviewing, Selecting &
Orienting New Employees’; 3rd edition, AMACOM, 1998.
Bennett, M. L. ; Desatnick, R. L., (Human Resource
Management in the Multinational Company’; Nichols Publishing Company, 1977.
Cook, Mary F., ‘Outsourcing Human Resources Functions’;
Rhinesmith, Stephen H., ‘A Manager’s Guide to
Globalization’; ASTD, 1993.
Schell, Michael S. ; Solomon, Charlene M., ‘Capitalizing on
the Global Workforce: A strategic Guide to Expatriate Management’; McGraw-Hill, 1997.