Managing Performance Abroad

A New Model for Understanding Expatriate Adjustment

Arno Haslberger,Chris Brewster,Thomas Hippler

• Editorial: Routledge
• Año: 2014
• ISBN:
  9781136278617
• Edición: 1
• Categoría: Commerce
• Categoría: Comportement organisationnel

In a global economy full of multinational firms, international human resource management (including expatriation, career management, and talent management) is a growing topic in the business and management literature and in universities. A thorough understanding of the adjustment of expatriates to their new environment is critical not only for selection and preparation of potential expatriates, but also for the management of expatriate performance. Managed well, expatriates can be key contributors to organizational success while abroad and even after repatriation. Poor understanding and management of expatriate issues, on the other hand, may lead to underperformance and increased turnover of expatriates and repatriates. Managing Performance Abroad summarizes and extends what is known about the topic of expatriate management and adjustment, covering all the major authors and presenting a new approach to the adjustment process.

At present, expatriate adjustment is only covered as a chapter in books on international HRM and HRD. Much of this literature relies on outdated concepts and evidence. Furthermore, most business research and management publications use an expatriate adjustment model that was originally published about two decades ago. This book is the first dedicated solely to the subject of expatriate adjustment, enabling readers to formulate research questions and hypotheses and to develop expatriation policies and support systems that optimize the performance of expatriates. It presents a re-formulation of the model underlying management research about expatriate adjustment, providing guidance for researchers and practitioners alike.

1 Expatriate Adjustment

This is a book about the adjustment of expatriates to their new environment while they are on assignment. The success of any such assignment—from an organizational point of view, from the point of view of work colleagues in that location, from the expatriate’s point of view and as far as her or his family is concerned—is influenced by how well the expatriate adjusts. It is this process that we examine in detail here. The perhaps rather ambitious aim of the book is to present a wider model of expatriate adjustment and a more comprehensive picture of the adjustment process in all its facets.

Why is Adjustment Important?

International business is now ubiquitous and in many cases is accompanied by expatriation—the transfer of people from one country to another. In some ways this is surprising; the growth of electronic means of communication, of Skype and of teleconferencing and videoconferencing, combined with short-term business trips, might have led to the assumption that the use of expatriates would become unnecessary. In fact, despite a small consolidation during the early stages of the economic crisis that began in 2008, there seems to be substantial persistent growth in the numbers of people sent abroad by their organizations. In some industries, such as telecommunications or oil and gas, the volume of international assignments continued to rise unabated throughout the crisis. A recent PricewaterhouseCoopers report (PricewaterhouseCoopers, 2010) predicts a 50% increase in international assignments by 2020. Given that expatriates are among the most expensive people organizations employ, there is pressure to ensure that they are managed cost-effectively. That involves ensuring that they adjust to their new environment as quickly as possible and that the time to proficiency is short. It is for this reason that a substantial segment of the international human resource management (IHRM) literature is devoted to the subject of expatriate adjustment.

Already, the discerning reader will be raising questions. What is an expatriate? What about the apparently increasing numbers of people who work internationally but are not expatriates? What precisely is ‘adjustment’? What about acculturation, acclimatization, adaptation? What about the fact that organizations may not want their expatriates to adjust too much; aren’t they there to bring in new practices rather than adjust to those already in place? What about the range of differences between, say, expatriate roles, organizational objectives and structures, locations, HRM support, and so on? And, on a different level, what about all the work that has been done up to now on this topic? There is a lot of literature out there. We address these topics throughout the book, but the focus of this introductory chapter is successively on definitions and on introducing the model that will be the basis for our analysis and provide the structural framework for the book.

Definitions

An expatriate is someone who takes a job in a country other than his or her own for a period of time, intending not to stay in that country after that period of time. Definitions here are clear in theory but blurry in practice. Thus:

• Many expatriates will be sent by their organization to the job in the foreign country, but many others are self-initiated expatriates who have chosen to move abroad for work or to apply for foreign jobs directly. We focus on organizationally assigned expatriates, but much of the analysis here will also apply to self-initiated expatriates (Dorsch, Suutari, & Brewster, 2012; Vaiman & Haslberger, 2013), and, where appropriate, we will point out differences between them.
• The period of time will usually be more than six months and certainly long enough that the expatriate who has a family would expect to be accompanied by them. However, some expatriates stay for less time than that, and some never bring their families to their new country. Other forms of international assignment—such as short-term assignments (less than six months) or project work (Starr & Currie, 2009; Suutari, Riusala, Brewster, & Syrjakari, 2013); commuter assignments (Meyskens, Von Glinow, Werther, & Clarke, 2009); frequent travelling (Westman & Etzion, 2002; Westman, Etzion, & Gattenio, 2008); and even electronically provided international experiences (Mayrhofer, Reichel, & Sparrow, 2012)—will all have their own requirements for adjustment, but they are not the focus of this book, although we will occasionally refer to them.
• The period of time will usually last for around three years, but it will generally be shorter for employees assigned by USA-based companies and longer for assignees from European-based companies (Brewster, 1991). They may even last a decade or more for some Japanese expatriates (Delios & Björkman, 2000). We will note the time dimension as a key aspect of our model.
• The intention not to stay in the country is a defining characteristic of expatriation and one that distinguishes them from immigrants. Yet some expatriates stay on in their new home country, some retire there; and some immigrants move on or return home within a few months. We are focused on expatriates, those who arrive with the intention of moving on in a few years, but we will also draw on the literature on migrants—a general term that includes expatriates and immigrants alike (see Andresen, Bergdolt, & Margenfeld, 2012; Haslberger & Vaiman, 2013)—and will refer to their similarities and their differences at various points in the text.

Within this broad rubric of ‘expatriate’ there are, of course, many different ways of categorizing different groupings. They may be grouped by country of origin or by country of destination; they may be grouped by status within the organization (managers, specialists, labourers, etc.); they may be grouped by function (general manager, technician, IT, finance, academic, etc.); they may be grouped by age or gender or family standing. Later in the book, we will come back to some of these categories and examine the literature that covers them. We include both genders in our analyses. Female expatriates are an important part of the international workforce, and, as with other groupings, research has shown that there are some differences in the adjustment processes of men and women. But we do not want to fall into the trap of separating out female expatriates as an atypical group to study or relegating them to a separate chapter; we believe that the model itself applies independently of gender and that it is time to stop treating women in business as special cases.

We avoid the use of the term overseas, which may be appropriate for a few countries (the UK, Japan, Australia) but is simply inaccurate for very many foreign countries that people can reach by land.

Adjustment is another word that seems relatively clear but contains hidden complications. Indeed, it has been argued that the construct has been often so ill-defined as to limit its value (Lazarova & Thomas, 2012). Adjustment, adaptation and acculturation are often used interchangeably in the literature (Harrison, Shaffer, & Bhaskar-Shrinivas, 2004) to mean the process and result of change induced in individuals by the move into an unfamiliar cultural environment (Aycan, 1997; Bhaskar-Shrinivas, Harrison, Shaffer, & Luk, 2005; Black & Mendenhall, 1990, 1991; Church, 1982; Evans, Pucik, & Barsoux, 2002; Grove & Torbiörn, 1985; Kim, 1988; Kim & Gudykunst, 1988a; Schütz, 1944; Taft, 1977; Ward, Okura, Kennedy, & Kojima, 1998; Yamazaki & Kayes, 2004). Acculturation implies the wholesale adoption of another culture that, given the limited time that most such individuals spend in any particular country, is unlikely to happen to expatriates. We can make a distinction between adjustment, resulting in minor changes to cope with new situations, and adaptation, which indicates largescale change and major realignment following a serious crisis (Patterson, 1988; 2002). Most expatriates will manage to cope with the changes an international move entails. A minority will suffer a crisis, resulting in more profound realignment or adaptation. We will use adjustment as the standard term.

Adjustment implies adjustment to something. We adopt the psychologists’ view that adjustment is about the person–environment (p–e) relationship (Haslberger, Brewster, & Hippler, 2013). Adjustment has both an external (demands) and an internal (needs) element. Adequacy standards for the external requirements are set by the environment (Takeuchi, 2010, has emphasized the importance of a variety of stakeholders), whereas internal adequacy standards are set by the individual, i.e. the expatriate. Of course, these mutual needs and demands are interdependent (Brammer & Abrego, 1981). An individual’s attempts to meet an environmental demand can have a bearing on that demand. For example, expatriates who are seen to be serious about learning the local language may find that locals are more tolerant of their language inadequacies during that process than they were before. Thus the demand might change in response to the efforts of individuals to adjust. So the nature of the p–e relationship is a dynamic, interactional one. The individual (in our case the expatriate), the environment and a concrete situation that requires adjustive behaviour are the three constituting elements of any p–e interaction. For expatriates, with the intention to leave the foreign country always in their minds, adjustment will be a process that may never lead to an outcome of ‘full’ or even adequate adjustment. Indeed, arguably, some of their value to their organization would be reduced if they adjusted too much. What expatriates need is a level of adjustment that enables them to live comfortably in their situation and to work effectively in the new environment in which they find themselves while maintaining sufficient distance from it to complete the tasks that the head office expects them to perform.

But what is the environment in this case? Is it the foreign country in which the expatriates now reside? Or is it the social milieu in which they operate? A question for researchers is whether expatriates can or should adjust to the country as a whole (and, if yes, whether this is a useful delineation) or just to the social groups with which they come into contact? Some expatriates (typically military personnel, workers in remotely located industries such as oil extraction or workers in certain ‘difficult’ parts of the world) will live in an ‘environmental bubble’ (Cohen, 1977), living and working in a different country but residing in an expatriate compound, spending their working and leisure time with people from home or at least other expatriates and having very little contact with local people or the local environment. They may have to adjust to some local laws and to the weather, but otherwise they will adjust very little. Others (typically, aid and development workers in up-country locations or urban slums, living and working with very poor people) will be very much absorbed in the local environment and will have to make considerable adjustments. Adjusting to some aspects of the environment may be easier or more difficult—and more or less important—than adjusting to other aspects of the environment. We build this discussion into our model and the book.

For completeness, we also define our use of terms covering the various kinds of organizations that have expatriates. Much of the literature to date has been focused on private-sector multinational corporations (MNCs). This is perhaps part of the so-called managerialism for which HRM is sometimes attacked (Batt & Banerjee, 2012; Budd, 2004; Delbridge, Hauptmeier, & Sengupta, 2011; Legge, 2005; Thompson, 2011), or perhaps because of an assumption that most expatriates will work for MNCs, or perhaps because most of the research to date has been carried out through MNCs. We will state clearly when we believe that our analysis applies to MNCs only. However, many other organizations operate internationally. There are governmental organizations—the diplomatic services that nearly all governments have, and the armed forces that some of them have, in foreign countries; there are intergovernmental organizations, such as the United Nations organizations, the international financial institutions and banks, the European Union and ASEAN; there are nongovernmental organizations with an astonishing variety of purposes and sizes, from the world football federation (FIFA) to small charities run by individuals who are trying to assist with particular problems in particular countries; there are religious organizations; there are universities hosting or sending academics on sabbatical in other countries. All will have expatriates, all of whom will be in the process of adjustment. And that process can be analysed using the same tools as for the other organizations. We will refer to all these as internationally operating organizations. It is true that the adjustment of a charity worker dealing with a crisis in some distant corner of an underdeveloped country will be different from that of a senior bank official working in the capital city of the same country, and we will be clear when we are making specific points about adjustment in one kind of organization rather than another.

Introducing our 3-D Model

In this book, we introduce a new model for analysing expatriate adjustment (see Figure 1.1). We call it the 3-D model because it covers the dimensions of adjustment, the domains of adjustment and the dynamics of adjustment. Our discussion will also cover antecedents and outcomes of adjustment abroad, as well as repatriation adjustment.

Frameworks and models can be differentiated from theory (e.g. Dörner, 1994; Klimoski, 1991; Weick, 1995), although some authors (see e.g. Klimoski, 1991; Sutton & Staw, 1995) see them as closely related. Bacharach (1989) states that the main goal of a theory is to answer how, when and

Figure 1.1 A multiple static view of adjustment

why, unlike the goal of description, which is to answer what. Models are a part of the theorizing process. Their value lies partly in the “discovery of underlying tensions and inconsistencies, and a heightened awareness of their potential” (Poole & Van de Ven, 1989: 571). Models focus our attention on aspects of a problem that have been neglected before (Klimecki & Gmür, 2001) and allow the theorist—and sometimes also the practicing manager— to decide what steps to take next. We have therefore attempted to put the elements we wish to discuss into a more comprehensive model of expatriate adjustment.

It is difficult to get the ...