Expatriates management is one of the most important issues in international business. The most important issues related to Management of Expatriates are the following –
The Reasons for Expatriate Failure
In international companies, the high failure rate of expatriates can be contributed to six factors − career blockage, culture shock, lack of cross-cultural training, an overemphasis on technical qualifications, using international assignments to get rid of problematic employees, and family problems.
Expatriates and their families need time to become familiar with their new environment. The culture shock occurs when after some time, the expatriates find new job conditions unattractive. It usually takes three to six months after arrival, to get out of the culture shock.
After the expatriate completes his assignment and returns home, the work, people, and general environment becomes unfamiliar. The expatriate is generally unprepared to deal with reverse culture shock.
Selection of Expatriates
The choice of employee for an international assignment is a critical decision. To choose the best employee for the job, the management should −
● Make cultural sensitivity a selection criterion
● Have expatriates in selection board
● Look for international experience
● Hire foreign-born employees as “expatriates” in future
● Screen spouses and families too
Expatriates when trained to prepare for work abroad are more successful. Lack of training can lead to expatriate failure. Cross-cultural training (CCT) is very important. It prepares to live and work in a different culture because coping with a brand new environment can be challenging.
Expatriate Evaluation and Remuneration
There are three common aspects that determine the remuneration of expatriates. In a home-based policy, employees’ remuneration is according to their home countries. The host-based policy sets salaries according to the norms of the host country. Finally, region also effects in determining the remunerations.
Remuneration for foreign employees depends on their relocation − whether it is within their home region or in another region. With this approach, closer to home (within the region) jobs fetch lower remuneration than the away (outside the region) jobs.