International Career Management Case: Catskill Roads

Prof. Ruth V. Aguilera

College of Business & ILIR University of Illinois at Champaign-Urbana November 1st, 2006

Definitions of International Assignments

Expatriates - Managers from headquarters sent abroad Inpatriates - Host country managers sent to headquarters Transpatriates - Managers from different countries
sent to any other country International assignments do not come cheap: on average, expatriates cost a company two or three times what they would cost in equivalent positions back home.

Business Strategy & Nature of Global Assignments

Domestic Global Assignment None Who sent No One Multidomestic Expatriates Average performers Multinational Expatriates & Inpatriates Global E, I, & T

Good performers High potential managers & top executives

Purpose

---

To get a job done Project & career Project, career, abroad dvt organizational development Negative for domestic career Good for global Essential for career executive suite Easy Extensive

Career Impact Professional Reentry Global Organizational Learning

Adler (2002), p. 260

----None

Extremely difficult Somewhat difficult None Limited

Cross-Cultural Entry
Culture Shock - the frustration and confusion that
results from being bombarded by too many new and uninterpretable cues, p. 263.

Mood

Time in new culture

Cross-Cultural Entry (cont.)

Stress - caused by change and manifested by
psychological responses such as anxiety and impatience physiological responses such as headaches

Managing stress through

stability zones stress management mechanisms

Cross-Cultural Entry (cont.)

Adjustment - after 3 to 6 months in new culture
problem solving decisions made under uncertainty tendency to blame others finding reliable information role of the spouse SEE VIDEO!

Patience and creativity remain essential. Effective global managers know that they dont know.

Home Country Reentry and Professional Reentry

Many firms often underestimate this stage and do not have explicit repatriation mechanisms. Returnees come back neither to the world they left nor to the world they are anticipating (p. 272).

Problems:
organizational cultural shock effectiveness xenophobic response use of learned skills

Reentry Transition Strategies

Oriented toward home country

Re-socialized Returnees

Proactive Returnees

Alienated Returnees
Oriented toward foreign country
Adler (2002), p. 280

Transition Strategies
Managing reentry through:
Communication: keep in touch with home office. Extent of validation: recognizing and valuing global experiences.

Underutilized Global Managers

Anemic returns on their expat investments.

Coaching Women for Global Managerial Success

In 2000, 13% of expats are women (10% married). In 2005, 21 % women expats. (WSJ 2001). Myths: 1. Global experience is not that important. 2. Given my family commitments, I cannot take a global assignment. 3. For global managers, being a woman is a disadvantage. 4. Certain cultures make it impossible for woman executives to succeed. 5. Public is public, and private is private: To be taken seriously, a woman executive must hide her role as a wife and mother/grandmother

How to measure expat failure?

Return home early Finish assignment but dont perform as well as expected (many) leave their companies within a year of repatriation Most common reason for failure:
Partner dissatisfaction

Reasons for Expatriate Failure

by Tung, California Management Review
US Multinationals
1. 2. 3. 4. 5. Inability of spouse to adjust Managers inability to adjust Other family problems Managers personal or emotional maturity Inability to cope with larger overseas responsibilities

Japanese Firms
1. Inability to cope with larger overseas responsibilities 2. Difficulties with the new environment 3. Personal or emotional problems 4. Lack of technical competence 5. Inability of spouse to adjust

European Firms Only one consistent reason: Inability of managers

spouse to adapt to new environment

Reasons Young Managers Would Accept International Assignments

Percent of MBAs citing reason (N 1129): 52 Cross-cultural experience and personal growth 40 Job 28 Money 21 Career Advancement 16 Good Location 11 Satisfying Life 4 Spouse and Family 3 Short Term; Other

Reasons Young Managers Would Reject International Assignments

Percent of MBAs citing reason (N 1129): 59 Location 35 Job and Career 33 Spouse and Family 23 Money 19 Unpleasant Life Abroad 14 Disruption of Home Country Life 6 Contract Too Long; Other

The Right Way to Manage Expats

Black & Gregersen (1999) Harvard Business Review

Three General Practices from successful companies: 1. When they send people abroad, the goal is not just to put out fires. Once expats have doused the flames, they are expected to generate new knowledge for the organization or to acquire skills that will help them become leaders.

The Right Way to Manage Expats

2. They assign overseas posts to people whose technical skills are matched or exceeded by their cross-cultural skills. 3. They recognize that repatriation is a time of upheaval for most expats, and they use a variety of programs to help their people readjust.

Hofstedes Model
Differences across countries in work-related values. Sampled over 100,000 IBM employees across 40 countries. Four dimensions:
POWER DISTANCE INDIVIDUALISM VERSUS COLLECTIVISM UNCERTAINTY AVOIDANCE MASCULINITY VERSUS FEMININITY

Power distance:
Focuses on how a society deals with the fact that people are unequal in physical and intellectual capabilities. High power distance cultures are countries that let inequalities grow over time into inequalities of power and wealth (e.g. China). Low power distance cultures are societies that tried to play down such inequalities as much as possible (e.g. Denmark).

Individualism vs. Collectivism:

Focuses on the relationship btw the individual and his or her fellows. In individualistic societies, the ties btw individuals were loose and individual achievement and freedom were highly valued (e.g. U.S. & Australia). In collectivist societies, the ties btw individuals were tight and the collective interests is above the individual interest (e.g. China, Japan, Turkey, Indonesia)

Uncertainty Avoidance:
Measures the extent to which different cultures accept ambiguous situations and tolerate uncertainty. High uncertainty avoidance cultures place a premium on job security, internal career patterns, retirement benefits, and so on. They also have a strong need for rules and regulations; managers are expected to issue clear instructions, and subordinate initiatives are tightly controlled (e.g. Japan, France, Spain). Lower uncertainty avoidance cultures are characterized by greater readiness to take risks and less emotional resistance to change (Sweden).

Masculinity vs. Femininity:

Looked at the relationship between gender and work roles. In masculine cultures, sex roles are sharply differentiated and traditional masculine values, such as achievement and the effective exercise of power (e.g. Hungary, Iraq, Venezuela). In feminine cultures, sex roles are less sharply distinguished, and little differentiation is made btw men and women in the same job (e.g. Finland, Netherlands).

Country Hofstede Code Power Distance Individualism Masculinity Uncertainty Avoidance Arab_World (ARA) 80 38 52 68 Argentina (ARG) 49 46 56 86 Australia (AUL) 36 90 61 51 Austria (AUT) 11 55 79 70 Belgium (BEL) 65 75 54 94 Brazil (BRA) 69 38 49 76 Canada (CAN) 39 80 52 48 Chile (CHL) 63 23 28 86 Colombia (COL) 67 13 64 80 Costa_Rica (COS) 35 15 21 86 Denmark (DEN) 18 74 16 23 East_Africa (EAF) 64 27 41 52 Ecuador (ECA) 78 8 63 67 El_Salvador (SAL) 66 19 40 94 Finland (FIN) 33 63 26 59 France (FRA) 68 71 43 86 Germany (GER) 35 97 66 65 Great_Britain (GBR) 35 89 66 35 Greece (GRE) 60 35 57 112

Hofstede, Cultures Consequences

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Hofstede, Cultures Consequences

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Hofstede, Cultures Consequences

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M ln a u iy s it c 4 6 4 0 7 9 7 0 4 5 6 0 6 5 6 0 4 0 4 0 4 0 6 0 7 0 4 0 4 0 6 0 4 3 4 0 1 9 1 0 3 5 5 2 4 0 4 0 4 7 7 0 6 8

U r i t Ad c n tn v ae cay o n e i 4 8 6 5 8 3 8 5 6 5 5 0 5 5 7 0 5 0 4 5 4 0 5 5 5 5 9 5 7 5 8 0 9 2 5 0 8 8 4 5 8 0 6 0 5 0 5 0 8 1 7 5 1 3

Hofstede, Cultures Consequences

Individualism/Collectivism Collective
PAK TAI CHI

TUR BRA ARG JAP SPA IND

ISR

FIN

DEN

NZL GBR AUL

FRA CAN USA ITA BEL

Individual Small Power Distance Large

Catskills Roads
Issues: - Argentina, - Mexico, - New Jersey - Job changes