EXPATRIATE

FAILURE
Presented by:-
Gursharan Kaur Mandeep Jaggi
Munish Kaul Robin Inderpal Singh
Sachul Jain Tanveer Nawaz
What is an expatriate?
 An employee who is working and temporarily residing
in a foreign country

 Some firms prefer to use the term “international assignees”

 Expatriates are PCNs from the parent country operations, TCNs

transferred to either HQ or another subsidiary, and HCNs
transferred into the parent country

 Global flow of HR: more complexity in activities and

more involvement in employees' lives
International Assignments Create Expatriates:
Different Stages of Stress Process of an Expatriate
Expatriate Failure : a broader definition
 Definition: (1) Premature return of an expatriate = a
selection error

 (2) Under-performance during an international

assignment : poor adjustment, inability to handle the
new responsibilities = a selection error and a lack of
pre-departure training

 (3) Retention upon completion : leaving the firm soon

after repatriation = an integration problem of
repatriates
The Expatriate Problem
 Relatively High Failure Rates

 Between 16% & 40% of all American employees

sent abroad to developed nations, and almost 70%
sent to less developed nations return home early

 Average cost per failure to the parent firm can be

as high as three times the expatriate’s annual
domestic salary plus the cost of relocation
General reasons for Expatriate Failure
 Inability of spouse to adjust

 Manager’s inability to adjust

 Other family problems

 Manager’s personal or emotional maturity

 Inability to cope with larger overseas responsibility

 Lack of technical competence

 Difficulties with new environment

Expatriate Failure Rates
International Assignments: Factors Moderating Performance
Specific reasons for Expatriate Failure

•US Firms •Japanese Firms

• Inability of spouse to • Inability to cope with
adjust larger overseas
responsibilities
• Manager’s inability to
• Difficulties with the new
adjust environment
• Other family problems • Personal or emotional
• Manager’s personal or problems
emotional immaturity • Lack of technical
• Inability to cope with competence
larger overseas • Inability of spouse to
responsibilities adjust

European Multinationals: Inability

Inability of
of spouse to adjust.
Costs of Expatriate Failure

•• Direct
Direct costs:
costs: •• Costs
Costs vary
vary according
according
•• Airfares
Airfares to::
to
•• Associated
Associatedrelocation
relocation •• Level
Level of
of position
position
expenses
expenses
•• Salary
Salaryand
andbenefits
benefits •• Country
Country of
of destination
destination
•• Training
Trainingand
and
development
development
•• Exchange
Exchange rates
rates

•• Averaged
Averaged $250,000
$250,000 == •• Whether
Whether ‘failed’
‘failed’
€207.000
€207.000 per
per early
early manager
manager isis replaced
replaced
return
return by
by another
another expatriate
expatriate
The cultural shock
 PCNs on foreign assignments may experience cultural shock.

 Cultural shock is a psychological phenomenon that may lead

to feelings of fear, helplessness, irritability, and
disorientation.

 Acculturation is the processes by which a person understands

a foreign culture and modifies their behaviour to fit into it.

 Acculturation typically proceeds through four phases.

The Phases of Cultural Adjustment
Differences in culture
 Giving Instructions

 Asking Questions

 Dealing with
Challenges

 Authority 

 Office Relationships

 Personal Status
Ctd…
 Punctuality

 Meaning of YES

 Hierarchies

 Reprimanding Staff 

 Privacy

 Accepting of Others
Tactics To Build Productivity or Reduce Expatriate Failure

 Training

 Follow-up

 Cultivate Independent Thinking

 Encourage Self-Sufficiency 

 Group Recognition
 Ctd…
 Understand Local Labour Laws

 Study

 Accommodate Differences

 Practice Good Manners

 Orientation
Conclusion
Thank You All !!!