(Originally Published in Intercultural Management Quarterly, Spring 2001 Edition - A quarterly publication produced by the Intercultural Management Quarterly and the Intercultural Management Institute, School of International Service at American University)
A Strategic Role for International Human Resource Professionals
by Tsila Zalcman, Ph.D.
With the rapid pace of globalization and the phenomenal expansion in the number of expatriates worldwide, international human resource (IHR) professionals are facing unprecedented challenges. They need to assist their organizations in selecting and preparing employees for international assignments, facilitate their relocation, provide them with ongoing support and repatriate them effectively at the end of their assignments. IHR professionals must accomplish all of this in a climate of cost containment, dire shortage of talent, and fierce competition for qualified employees.
Currently, the primary goal of IHR professionals is to facilitate and expedite the relocation of employees and to ensure ongoing support throughout their assignment period. As the global marketplace continues to expand, IHR must shift its role form these immediate needs to a more strategic, long-term focus. IHR should play a proactive role in helping their organizations set global deployment strategies and assist in maintaining and nurturing a pool of valuable global employees.
To fulfill this strategic mandate, IHR professionals should be prepared to deal with deployment challenges and the conditions that impede assignment success. They must therefore establish an ongoing dialog with expatriates. This will allow them to develop an awareness and knowledge about expatriates' experiences, needs and concerns. The lack of feedback may create a disparity between IHR's perceptions of required services and the true needs of expatriates. This disparity may not only result in a loss of productivity, but ultimately in costly mistakes and assignment failure.
With proper feedback, the IHR professional can then serve the important role of liaison between their organization's business objectives and expatriates' goals and expectations. They can help establish and maintain enhanced international assignment programs that have realistic goals with respect to the selection, preparation, and destination support and career management of expatriates.
In facilitating these goals we rely on two sources of research data, survey data of international managers (The Employee Relocation Council's Center for International Assignment Management - 2000 International Survey) and the proprietary long-term database of expatriate feedback, collected over the past six years, by Dynamic Systems Design (DSD), a relocation research firm.
Selection of Expatriates
The difficulty in staffing international positions is common knowledge. According to the ERC report, 80 percent of managers surveyed indicated that recruiting for international assignments is a challenge for their firms. Despite this, very few organizations have established a systematic approach for identifying prospective candidates for international assignments. The majority of companies, 78 percent typically wait until the need for staffing arises before attempting to locate suitable candidates.
While the vast majority of multinational organizations base their international selection on the candidate's technical expertise, most, as would be expected, also consider the employee's overall interest in the assignment. It is surprising, therefore, that only 22 percent of organizations surveyed by ERC, questioned an employee's willingness to accept an international transfer during the initial hiring process.
DSD's database shows that an overwhelming majority (85 percent) of expatriates is willing to accept future positions. Yet, most of these expatriates are not actively encouraged to reapply for future international assignments or to become mentors for the employees accepting these assignments. Many of these repatriated employees indicate a willingness to mentor future candidates. Unfortunately, as one expatriate put it: "We are overlooked as a resource for mentoring and our unique experience is not recognized and not used to benefit the company."
Clearly IHR professionals can help to shape a strategy that utilizes the skills and experiences of these repatriated employees. IHR professionals are in a strong position to help their companies develop a pool of prospective candidates. They can influence hiring practices by maintaining a roster of qualified employees interested in these postings.
According to the ERC 2000 International survey, 80 percent of organizations offer at least some type of cross-cultural preparation to employees departing for international assignments. Even though these cross-cultural programs are pervasive, their utilization by the expatriate population tends to be very low. Managers estimate that, on average, 47 percent of the expatriates take advantage of cross-cultural programs. However, DSD's data, based on expatriates' responses, reveal a much lower participation of only 18 percent. When DSD inquired about the low participation in cross-cultural programs, the three most typical reasons given by expatriates were: 1) "I found out about these programs too late" 2) "I had no time to participate before I left for the assignment" 3) "My manager was not supportive of my participation in the program"
A major resistance to these programs often comes from the business unit managers who do not appreciate the value of cross-cultural training and discourage employees from taking time out to participate in them. Yet those expatriates who have participated in cross-cultural programs, tend to value them and to report that they have helped them overcome cultural shock by better preparing them to live and work in foreign cultures.
IHR professionals can provide the data to educate business managers and to demonstrate the corporate benefits of these training programs. They also need to advocate the use of these programs as a tool for preparing employees to succeed on international assignments. But IHR needs, through feedback obtained from expatriates, to ensure the quality of the cross-cultural programs available to employees.
The majority of organizations now offer extensive destination services to their expatriates. These services typically help expatriates locate suitable neighborhoods, provide general area familiarization and offer assistance with day-to-day settling-in issues. While expatriates generally rate their companies' financial assistance favorably, they give poor ratings to the so-called "soft" services, including destination support. For example, in the DSD database, the following are typical average expatriate ratings (on a scale of 1-5, where 1 represent "very poor" and 5, "very good") for several services provided: move of household goods (4.3); temporary living allowance (4.0); spouse employment assistance (2.4); and destination support (2.2).
After being transferred, it takes the average expatriate nine weeks to resume full productivity. Expatriates feel that this adjustment period could be shortened with better-coordinated support.
Said one expatriate, "Our post arrival daily living was very difficult and only minimally supported by the company. The most difficult aspect was the sheer length of time it took to get organized and the number of people we had to deal with. It would have helped immensely and could have saved valuable time to know in advance what to do and whom to contact."
Many expatriates regard destination services as "insufficient". Moreover, a large number of expatriates claim that they were not properly notified about the availability of many destination services being offered. Clearly a better means of communication between expatriates and IHR professionals is essential to the effective utilization and success of these important support services.
Expatriates generally face more obstacles in their career development than their domestic counterparts. Prior to their departure, many expatriates feel optimistic about their international assignment as a step toward career growth. Over the course of the assignment, many come to feel "out of sight, out of mind" - disconnected from the organizational culture and left out of consideration for career advancement. Only 26 percent of expatriates said they had the opportunity to learn about other job openings while on assignment.
A distinct gap exists between expatriates' perceptions of their international assignments and how managers view these same assignments. For example, 72 percent of expatriates consider international assignments essential to their careers. Only 19 percent of the IHR managers from the ERC survey view these assignments as essential to career advancement in their firms.
The widely quoted industry two-year, post assignment, attrition rate of 12 percent is underestimated, as companies do not typically track attrition of repatriated employees. Nevertheless, as IHR expands its focus from the immediate need of relocating employees to retaining a talent pool, this 12 percent attrition rate can be improved.
It is clear that an important strategic consideration would be the enhancement of a company's ability to recruit new candidates for international assignments and that career development is very important to these candidates. Currently, the disparity between expatriates' expectations and IHR practices weakens the company's ability to optimize its international assignment program. IHR professionals are in a unique position to provide their companies with credible data and procedures that can enhance expatriates' career satisfaction and performance.
IHR professionals can and should serve a pivotal role in establishing and nurturing an international workforce. They can and should be a liaison between expatriates and their business-unit managers and they can and should mediate between their companies' immediate objectives and the long-range goals of the expatriates.
To do this, IHR needs to establish effective communication mechanisms with expatriates to fully understand their needs and concerns. An ongoing dialogue with expatriates will help companies keep abreast of issues that, if not handled properly, could jeopardize the global agenda. IHR professionals need to keep in touch and be responsive to expatriated employees and convert these expatriates into compelling advocates for international assignments.
Tsila Zalcman, Ph.D., is a partner and Executive Vice President of Dynamic Systems Design (DSD), an independent research and consulting firm specializing in relocation.