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Expatriation has been prevalent in the European and American continents since the industrial revolution era. The paper delves into the expatriation management practices in various developing and developed nations. An extensive literature review reveals that there is no fixed template for expatriate management which can be replicated across organizations or countries. The paper contends that „one size fits all‟ approach fails on account of differences in culture, family situation, language skills, support during an international assignment, and so on. It highlights the challenges in dealing with issues like diverse cultures; family adjustments etc. International crises experienced by multinational corporations include both the premature return of expatriates due to failed assignments and the poor retention of returned expatriates due to failed repatriation. To reduce the direct and indirect costs inherent with expatriate failure, multinational corporations are striving to improve their capability to manage their expatriates before, during and after international assignments. This article highlights these issues and discusses the challenges for human resource professionals when managing expatriates. The results of the study presented in this paper suggest that the management of international human resources is increasingly being acknowledged as a major determinant of success or failure in international business. It concludes by proposing that a well-managed and proactive response to an international crisis may help an organisation retain experienced international employees.
“Voyagers discover that the world can never be larger than the person that is in the world; but it is impossible to foresee this, it is impossible to be warned.” -James Baldwin A MNC can deploy two types of human resources to top managerial positions in its foreign operations – expatriates and local hires. “An expatriate is a highly skilled worker with unique expertise who is sent to work in another unit of the same company located in a foreign country, generally on a temporary basis” (Romero, 2002). “On the other hand, local hires are host country employees” (Daniels and Radebaugh, 2001). Expatriates are professionals who on a temporary basis live in an outside country usually for more than a year. Apart from monitoring and controlling an expatriate is expected to extend their knowledge and skills in technology transfer (Shephard 1996). The role of expatriates is considered significant since the main task is to act upon maintaining the structure of the MNC while following the rules and regulations of work within the host country. In the public sector, the expatriates mainly hold diplomatic posts in foreign embassies or as consultants for government agencies; while in the private sector, the expatriate managers are mostly positioned in MNCs that run business operations. The need to „export‟ managerial personnel across the globe is because of the internationalization of the business (Bamber and Lansbury 1987). Expatriates typically have developed firm-specific knowledge and firm-specific relationships. In contrast, local hires typically have local market knowledge and local business connections (Tan and Mahoney 2002). Moreover expatriates are more familiar with management techniques and methods than local employees. Thus, the
1986). Dowling 1999. Downes& Thomas 1999). Shaffer. These crises. Boyacigiller 1991. there is also increased evidence to suggest that the management of international human resources is increasingly being acknowledged as a major determinant of success or failure in international business (Tung 1984. therefore. Brewster 1998. Hiltrop 1999). LITERATURE REVIEW As organisations become globalised. Harrison & Gilley 1999. For renowned and established MNCs. Forster 2000). failure to be able to communicate and coordinate their activities in international business has the potential to plunge them into a crisis. there is an increasing challenge to use expatriates on international assignments to complete strategically critical tasks (Gregersen& Black 1996. can. due to poor expatriate management. The second. The crises confronting MNCs include failed assignments due to premature return of expatriates and the loss of their returned expatriates due to poor repatriation. Rosenzweig 1994. Hence. to avoid a crisis in expatriate management is threefold.expatriates may guarantee a good job performance and follow company policy which is used in every part of MNCs (Ronen. threaten the organisation‟s performance and capabilities in the international arena. Multinational corporations (MNCs) use expatriates. but also to facilitate entry into new markets or to develop international management competencies (Bird & Dunbar 1991. return of expatriates has to be attended and the subsequent job . The first challenge for international human resource is planning effectively for the selection of expatriates for overseas assignments. While it is recognised that Human Resource Management (HRM) problems are more complex in the international environment. not only for corporate control and expertise reasons in vital global markets.
communicator.assignment for returned expatriate in their home country is a priority for managerial attention. which follows the Responsiveness phase. crisis management team member. and contributing writer to the emergency plan (Williamson 1991). legal issues. and Recovery. . and security issues. safety. Essentially. Responsiveness. also precedes the Preparedness phase. Hickman & Crandall 1997. It is widely acknowledged in the relevant literature (Smith &Sipika 1993. to concentrate on the well-being of their workforce. but they also addressed compensation and benefits issues. the primary crisis management roles of international human resource (IHR) professionals are those of record custodian. Coombs 2001) that the process of crisis management entails three main phases: Preparedness. This multifaceted role of IHR includes providing professional counselling to help employees and their families to deal with the psychological problems associated with a hostage or an evacuation situation. which is the period of preparing plans and procedures for addressing a crisis. health. or the actual dealing with the crisis. These three phases are considered as sequential phenomena in a continuous cycle so that the Recovery phase. during which the organisation returns to normal operations as quickly as possible. reassignment issues.
They include: Understanding why organizations employ expatriates in India. Understanding what expatriates want from their employers and others so that they can work productively in India. Evaluating whether there are any country or cultural level factors that can explain expatriate success in India (For example. do British people do better than Americans in India?) Understanding the assistance organization provides to expatriates to settle down deal with problems Analyzing why individuals‟ take up assignment in India. . Investigating problems faced by expatriates in India.Research Objective There are a number of key issues that one could investigate about expatriates in India. given the low cost of trained manpower in the country.
foreign universities are sending their students to work in India so that they can have an understanding of the Indian markets an environment. Not only are the middle and senior level expats coming to India. Job portals like Timesjobs and MonsterIndia are now having more than 3. telecom and hospitality.000 expats are working in India presently and the number is still growing.MANAGEMENT OF EXPATRIATES The Indian job market is full of attractive opportunities. not only for domestic talents but for foreign workforce as well. work practices and culture of the Indian organizations. The number of foreigners seeking jobs in India is increasing every year. Even major IT companies like Infosys are having special programs for getting students for premier universities like Stanford and Harvard to work with them. . Around 30. in their databases. retail. who look for jobs in India.000 to 40. who are on the threshold of beginning a new career are taking up jobs in Indian sectors other than IT like pharma.000 resumes of foreigners. Recognizing the fact that India is a growing economy. young graduates.
Expats with specialized skills which are unavailable in India. More expats seek jobs in India on account of job cuts. . being one of the fastest growing economies in the world. Attractive Positions: Companies are offering attractive leadership positions to experienced expatriates. offers a large number of growth opportunities to expats. and high taxes in western nations. outsourcing. Compensation: The compensation provided by Indian companies maintains external equity and are almost at par with what is being paid in foreign countries. due to financial and technology constraint like molecular research are being offered highly attractive packages.Why are expats ready to work in India? Some of the reasons that add to the trend of expats looking for more jobs in India are as follows: Growth Opportunities: India. Key roles ranging from middle level managerial roles to Departmental Heads are also being offered to specialized expat.
The diagram below shows all the reasons behind why a firm hires expatriates: . there are certain factors that reduce the chance of an expat to become successful in India. It reflects an individual's hard work and ability to adapt and deal with diversity. many expats who have saturation in their careers in their countries are heading towards Indian markets to grab the opportunities here and move ahead in their careers. Difficulties in communication and difference in cultures are two main factors for the same. improve networking skills. Increasing Unemployment: The rate of unemployment is increasing in industrialized economies while the growth opportunities are increasing in South Asian countries. As a result of this fact. Apart for the advantages of working in India. Adds value to resume: There are no second thoughts about how Indian experience adds value to ones resume. One gets to know the different cultures. and knows how to deal with people.
many expatriates have a hard time getting things done in the beginning adapting to their new life abroad. 2008): Learning the local language Finding a place to live Making new friends Sorting out finances and healthcare Finding a school for the children Younger expatriates have fewer problems with learning the local language. but they have a harder time learning the local language. but have a harder time making friends and settling the practical issues of their move. including the move itself. The most common problems faced by expatriates include (HSBC Expat Explorer Survey.Challenges faced by the expatriates: Expatriates moving countries are faced with a wide range of challenges. Though the move to a new country might seem a great experience at first. On the other hand. older expatriates often move abroad with significant expatriate benefits that solve most of the practical problems like the search for accommodation. the search for accommodation and the integration into a new society. .
As a general rule. many expatriates seem to underestimate the challenges of moving abroad. The biggest problems mentioned of German expatriates were: Adapting to the local culture (85%) Finding new friends (72%) Learning the local language (42%) Finding accommodation (38%) . 68% of expatriates found the move abroad “more difficult than expected”. while only 8% found it “easier than expected”. According to a survey of Just Landed among German expatriates in 2008.
many companies offer special expatriate benefits and other financial incentives for those who are willing to relocate. .Expatriate benefits: Since very few employers like the idea of being sent abroad for a limited time.
the assignment abroad is accompanied by a significant salary increase. Expatriate salaries and benefits also reflect the higher cost of living abroad. In addition. So many expatriates receive expatriate salaries that are considerably higher than the salaries they earn at home. they normally also receive a considerable amount of expatriate benefits. many major expatriate destinations like Paris. Dubai or Hong Kong are often as expensive (or more) expensive than home. Of course. Expatriates working abroad normally have less corporate support than at home and often have to take more decisions on their own. . In addition. This makes it easier to justify different expatriate packages for different employees and also prepares expatriates for potential salary decreases upon the return to their home country. but also usually reflect a significant increase in responsibility assigned to the employee. eg. Besides direct relocation costs. the cost of living should be adapted to the special needs of expatriates instead of locals. many expatriates have to pay for additional expenses abroad. When evaluating expatriate salaries. When evaluating expatriate salaries. private education for children or health insurance. companies should clearly communicate which part of a salary increase reflects an increase in responsibility and which part reflect the different cost of living. as well as travel home. it is important to remember that salary increases represent not only an incentive for overcoming the problems of moving abroad.In many cases. London.
i. These expatriate benefits reflect the special situation of expatriates and often include the following: Relocation benefits: Besides covering the cost of the actual move. Most expatriates receive a range of benefits that goes significantly beyond the benefits of other employees. Accommodation benefits: If accommodation costs are significantly higher in the destination country. since the search for accommodation is generally on of the most stressful and time-consuming challenges of the move. Besides financial incentives. most companies pay their expatriates special benefits or provide subsidized or free housing. companies often offer support and financial help in finding schooling for kids. . Language training: Expatriate benefits for language training not only increase the professional capabilities of expatriates sent abroad. Ideally. To ease the family relocation and tensions that go along with moving abroad. relocation benefits often cover special assistance abroad. direct help to find accommodation is appreciated by most expatriates. Expatriate family benefits: When sending expatriates abroad. especially the spouse. Family problems are therefore one of the most common reason for expatriates to break off their assignment earlier than planned. Non-working expatriate spouses might receive help in finding unpaid activities (such as volunteer work or studies).and there are quite a few companies providing comparison data to make a sound judgement on those. through a relocation agent. If the expatriate‟s spouse has been working before. it is important to remember that the relocation affects the whole family. the language training should start well in advance of the relocation. but also help them integrate better in their new environment. some companies may also help them obtain a work visa and a job to compensate for potential loss of income.e.
After their assignment abroad. Since the move back is often even more challenging than the move abroad. training and counselling are an important part of expatriate benefits. expatriates should receive cross-cultural training to help prepare for the challenges abroad. expatriates could receive repatriation assistance to help them readjust back home. Before departure. Expatriate training and counselling: Although these are less common. many companies try to provide a challenging assignment upon return. .
As a result this city has experienced a lot of growth. there has not been much research done on this front. . Moreover as compared to the other cities of the country this city is more commercialized and has a greater amount of accessibility which was not present 2-3 years ago. The citywhere I conducted the interviews wasPune. In the recent years as the Indian economy has been growing and Mumbai has experienced the setting up of various subsidiaries of the MNCs. the hotel industry and the power generation industry. Mumbai is the financial hub of the country while Pune happens to be a student‟s hub with all sought of promising fields. Hence I use a qualitative and exploratory approach to understanding the phenomenon of managing expatriates in India. The MNCs I studied belonged to the financial services and investment industry. Expatriates enjoy living in this city because of the "lively" night life which offers many options.DESIGN OF THE STUDY Research and Methodology Since this study is primarily focused on the experience of expatriates in India and the influx of MNCs has come mainly since the mid 1990's. Location and Duration of the Study I collected primary data for this dissertation from various MNCs which have subsidiaries in India. Creswell (1994) suggests that a qualitative approach may be more appropriate to generate and analyse data if the topic is new with little existing literature.
Unlike the questionnaire and structured interview. In qualitative research interviews may be classified as structured. Interviews were preferred over questionnaires as it could provide deeper understanding of people experiences. I spent the second and the third week interviewing therespondents. Burgess (1993) defines them as “conversations with purpose” as they aim to establish a rapport between the interviewee and interviewer. I spent much of the first week planning for the primary data collection and for research of secondary sourcesat the University of Nottingham. bringing to life their thoughts. Primary Data According to Ghauni and Gronhaug (2002) primary data maybe defined as “original data collected by us for the research problem at hand. perceptions and emotions (Darlington. They are considered one of the most fundamental methods of qualitative inquiry and can reveal what guides and determines peoples‟ actions. perceptions. This is the most essential feature of the interview as it builds a relationship between the interviewee and the interviewer. emotions and value of people can beestablished. predetermined questions and are thus informal and flexible in nature. interactions. Interviews were used as the primary source of data collection. Aggregated and quantifiable data is examined by the quantitative approach while the qualitative research considers "individual voices" to be of great importance. The in-depth analysis and the careful attention are the strengths of the qualitative research. Selecting one method over the other requires a trade off between breadth and depth.” The main advantage of primary data is that it is consistent with the research purpose and research questions as the researcher gets first hand information while collecting the data. Scott. semistructured.This study was carried out over a period of one month. if any. how their expectations . the qualitative method is a tool by which an understanding regarding the subjective experiences. their adjustment process. Interviews are one of the most common instruments used to conduct qualitative research. England. Furthermore. 2002). The last after returning to Nottingham was used for analysing the datacollected and completing this report. In a foreign country the insight to one‟s experience. unstructured and group-based. knowledge values and feelings (Buchanan and Huczynski 1997). these require few.
. the host country nationals and their new job. Interviews consisted of predetermined set of questions. 2004). capitalising on “richness”. Telephone interviews were carried out in those cases where it was difficult to conduct face to face interviews due to the constraint of time and distance. Conducting Interviews: The interviews were semi-structured face-to face and telephone interviews. Moreover additional questions were asked in order to explore the research objectives. giving respondents an opportunity to answer in their own words. Thus the aim was to gain a thorough understanding. validity is related with the soundness or „truth‟ of theexplanations the research provides (Joppe 2003)." My interview consisted mainly of open-ended questions as they could help me get a detail understanding about my research questions. through compromising on “reach” (Patton 2002).” Close ended: On the other hand a “Closed-ended questions have a finite set of answers from which the respondent chooses. emotional and psychological conditions require an in-depth inquiry.developed. It is also essential to understand the experience of expatriates regarding the feelings towards the host country. This provided the researcher with greater flexibility to include and skip few questions depending upon the nature of events which were faced during the interview. The question can be of two different types in nature: Open ended: Fink (1995) defines an open ended question as. speed and low cost (Lin. Open-ended questions may be a good way to break the ice with a survey. One of the choices may be "Other. but the order of them was not rigid as it may vary during the process of the interview." It is a good idea to allow respondents to write in an optional response if they choose "Other. Advantages of telephone interviews are associated with access. Reliability can be described as the extent to which the research would produce the same outcome or findings even when carried out by different independentindividuals. Whereas. While doing a qualitative research importance should be given to the reliability and validity of the research. “questions to which there is not one definite answer.
Interviews tend to have a conversational nature the outcome of it to a great extent depends upon the conversational skills. the interviewee‟s perspective should not be ignored. The main concern before conducting the interview was to attain appointments with the expatriates or their secretaries to arrange for an interview. All interviews lasted an hour on an average. Since I am an Indian and am well acquainted long-term resident of the city Kolkata few complaints and problems the expatriates pointed out were not visible to me. The interviewees either led me to their personal work area or to a meeting and presentation room. Another problem which occurs while conducting interviews is although the interviewees are keen on participating they might choose not to reveal all issues related to the research questions. personality and spontaneity of the researcher. The trendamongst most expatriates was that they did not oppose to it. This method is also criticized for their low degree of generalizability because the findings concluded from them cannot be applied to the entire population. Problems in interviews: According to Bell (1999) the interview „is a highly subjective technique and therefore there is always a danger of bias‟. The duration ranged from between 45 minutes to an hour and fifteen minutes. Qualitative research demands a lot of time and planning along with reliability validity and keeping the objective intact. This is because they might feel either confused due to lack of knowledge on the topic and confusion or have a feeling of embarrassment (Bell 1999). It is essential for the researcher to ensure that while conducting interviews. In order to ensure to get honest and straightforward responses from the interviewee it is essential that the research should come across as approachable and trustworthy but not overfriendly (Burgess1993). attitude. Interviews began with reiterating the questions which were emailed to the interviewees prior to the interview as a prerequisite so that they would get a brief picture if the kind of questions I wanted to ask them. All the interviews were conducted at the expatriate‟s work place. . Interviews were transcribed word-for-word as they were recorded.The first step in data collection was to make contact with the expatriates of different industries. Permission was asked of each as to whether they approved of being recorded on the Dictaphone.
The duration of their stay in India ranged from 3months. The nationalities represented in the sample and the proportions are depicted in figure below: . “information collected by others for purpose that can be different from ours” (Ghauri and Gronhaug 2002). Secondary research has also been applied as a research methodology for thisstudy in order to support the information collected through interviews. I gathered my secondary data by accessing the journals which were at my disposal in the library and on theinternet. background information. 17 expatriates were interviewed in all.Secondary data Secondary data maybe defined as. The information from secondary sources as assisted the results and findings drawn from the primary research used for this study. Sample Size Qualitative research is very time consuming. the sample sizes are generally smaller for semistructures than those for questionnaire (Mason 2002). encourages creativity. It is essential to apply secondary research as it helps in accumulating further information which might have been overlooked during the primary research and also to incorporate data which has been gathered by other authors and publications over the years. clarifies and redefines the problem. The secondary data aid in primary research design. The advantage of secondary data is that as data bases and library research is involved in gathering this data it makes it more economic and less time consuming. This type of research helped me in giving an insight about the growth of the Indian economy which encouraged the influx of MNCs which had a lot of expatriate managers.10 years.
More than 50% of the sample constituted expatriates of European origin. including young assistants or head of the department to managing directors. The designation and role varied in their organizations. The distribution of interviews over the different sectors is summarized in the figure below: . Out of the 17 expatriates 15 were males in their thirties to fifties while the other 2 were females in their late 20‟s to early 30‟s. Most of the expatriates were PCN‟s however there were 3 expatriates who were TCN‟s.
The lack of being able to gain the trust of the interviewees could result in getting short. They can express about their opinions feelings and experiences more freely. vague answers. Trust is established during the interview process. how my interest developed in the field of IHRM. Seeing my genuine interest in this field the interest of the interviewee also enhanced. . Before each interview. It is very essential to create a friendly atmosphere which could be done by a researcher by sharing information. they might give answers based on what they feel the researcher wants to hear. Moreover. they could avoid answering questions or even terminate the interview (Easterby-smith2002). It is essential to build a rapport with the interviewees which would enable them to be comfortable and can conversation can be built without any hesitation.Gaining Trust The fundamental credibility of the research is to obtain the trust of the interviewees. about 2-3 minutes were spent explaining my background. though the most vital part is the introduction or the first few minutes. the participants were willing to share and contribute to the research. this helped in creating an informal atmosphere.
some interviews had a more formal approach while some were more casual. “are you living on campus?” For this reason sharing of information about oneself is a way of establishing a conversation and is quiet effective in gaining trust. Moreover few others inquired about my living and studying transition to UK for a master‟s degree. However it is essential to ensure that the responses derived from the interviewee should not be manipulated. One of the expatriates asked me about my experience in the UK as a student has been. . The anonymity of all persons interviewed is maintained throughout the dissertation. while Europeans came across to be friendlier and the interview process was like a conversation as there was a lot of interaction. Interviews with Asians and Americans were rather serious. I was often asked few questions like “how are you adjusting with the English weather?”.As my interview sample consisted of people of different nationals.
Therefore. covering various sectors helped in understanding their experience.ANALYSIS In this section I analyze the results obtained from the interviews and present the findings. . Why do firms hire expatriates? In my interviews there were mainly three factors which the interviewees pointed out as the main reasons for firms to hire expatriates which also coincides with the literature review as given in the diagram below. hotel industry and the power generation industry. The different sectors involved are the investment and financial sector. Out of 17 respondents 11 of them agreed to pursue business opportunities and 6 agreed to facilitate information between PCN and subsidiary. According to one of the respondents who came during 2002 said that many of the difficulties arose during this period. Sample based research technique along with a qualitative approach is adopted to analyze the results. Moreover. People were very pessimistic about India during this period and his colleagues discouraged him to take up the assignment. 9 of these respondents shared a common stand that the main reason was to gain experience and exposure towards the cross cultural business. Problems faced at a corporate level Expatriation involves a lot of adjustments in the personal and corporate front. However. However expatriates often face more problems in the personal life rather than the corporate level. The diagram also categorizes the interviewees on the basis of percentage in which they choose the three different factors. The names of the expatriates and the organization to which they belong were disclosed by them in the interview however it has been eliminated from this research to ensure confidentiality. This is because most of the MNCs have a standardized form of conducting and managing their business. this section reviews the results obtained from the interviews by taking each question at a time and concluding by discussing the feedbacks received along with the findings.
According to one of the expatriates who have been transferred to two main cities of the country namely Mumbai and Pune expressed that it has been an “exciting experience and has been extremely positive”. Thus there is no contradiction between my findings and the findings of extant literature on the topic. Although some of the Asian expatriates who have been relocated at Pune did complain of the monsoon season but at a corporate level has expressed their experience to be great.Overall Work experience When the interviewees were asked to comment about their overall experience at a corporate level in India they all had a similar answer. The problems which they face at a corporate level deal more with the external factors rather than the internal factors. Summary From the above analysis it is clear that.e. The problems that expatriate face in India are also not unique in that they are not seen specific to India. the individual‟s perspective about the firm from the interviews and the findings from the expatriate literature coincide to a remarkable degree. to maintain coordination between home country and host country their experience plays a major role for the firm to consider them or not. The results of the interviews indicates that India is not a special case and that expatriates are used here for the same reasons as they are used in other countries i. The MNCs are very good at standardising their operations hence . Moreover they are hired to implement the basic thinking and philosophy of the parent company in the subsidiary company. Though 4 out of 9 expatriates immediately came from the west they confessed that the experience they gained in India was worth giving up the lifestyles they had previously.
expatriates do not face difficulties at a corporate level while they are on an international assignment. Overall the results suggest that the prescriptions that are offered by HR managers and specialists based on their study and experience of expatriates in other countries is applicable in the Indian context also. Also the work culture in India is considered to be very professional and with the efficiency in English expatriates do not face a lot of problem in communication with their colleagues. . Along with this since these organizations are big they have their own networks which help the expatriates to overcome the external factors to a great extent.
interview process to gather data Seventeen expatriates all across India were interviewed in sessions lasting approximately one hour. procedures. interview process. The analysis and conclusions of this study is based on both the existing literature reviewed and research work done. and data analysis had been presented. The study thus employed the qualitative research methodology. sample selection. This research involves the experience of expatriates working in India and thus needed review of data combined with the gaining individual perspectives on the issues. Primary data and secondary data both were used to present a balanced argument that compares and contrasts theoretical considerations with what respondents had to say.CONCLUSION In this report detailed information about research design. data collection. .
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