Ch 17 Managing Human Resources in a Global Business
Key notes to know from Breakout session
-Different countries to work
-Understanding the factors of sending an employee overseas
Expatriate- Employees who are citizens of the country where the parent company
is based, who are sent to work in another country.
Globalization of businesses is now the norm.
Talent shortage- global phenomenon
Working population is aging in both developed and emerging economies. Lower
birthrates mean a reduced supply of workers in the coming decades.
China and India have no labour shortages, they have major shortages of talent.
Relocation specialists are becoming strategic partners in determining the need for
an assignment or relocation. Their jobs include identifying who is best suited to go,
and making sure that all supports are in place to make that assignment a success.
Truly competitive companies must recognize the value of mobility in terms of talent
development. Use assignments to strengthen leadership development.
Achieving global mobility is vital to achieving a true competitive advantage.
Workforce mobility programs have a direct impact on companies profits- 21 century
Expatriates doubled in the years 2005 to 2008.
Family issues ranks as the number one concern when it comes to employee
Employees need to know the working and living conditions in another country and
how it will affect their compensation and benefits. Along with what kind of
relocation assistance they will receive.
Challenges- techniques used to recruit, select, train, compensate, and provide
family support for employees who are based abroad.
1. Candidate identification, assessment and selection. Required business and
technical skills. Key traits to be identified are cultural sensitivity,
interpersonal skills, and flexibility.
2. Cost projections. The avg. cost of sending an employee and family overseas is
between 3 to 5 times the salaries. Quantifying total cost and deciding
whether expatriates or local employees will be used are essential to
3. Assignment letters. Specific job requirements, vacation, home leave, and
repatriation arrangements will have to be documented and formally
communicated in an assignment letter.
4. Compensation, benefits and tax programs. Many ways to compensate living
abroad, differences in living expenses. Usually deals with home-based pay
plus international supplement and destination pay. 5. Relocation assistance. Assisted with maintenance of home and other
belongings, shipment and storage of household goods etc. Avg cost of a
Canadian employee is between $50000 to $100000
6. Family support. Cultural orientation, educational assistance, emergency
provisions are some of the matters to be addressed before the family is
Why Expatriate Assignments Fail
Expatriate assignment failure- early return of a global assignment.
Can cost companies millions of dollars and employees there jobs.
Important that the employer understands how unhappy and cut off the spouse can
feel in a foreign environment.
Employer has to provide realistic job previews of what to expect. Careful screening,
improved orientation and improved benefits packages as well as other solutions.
Solutions are making the failure rate decline. Some examples are selecting better
expatriates, helping spouses get jobs abroad, and providing more on going support
to the expatriate and his or her family.
“Global Buddy” programs local managers assist new expatriates with advice on
things such as office policies, norms of behavior, and where to receive medical
Emotionally stability breeds success.
Failures have mainly related to emotional immaturity, inability of manager or
spouse to adjust, and an ability to cope with larger overseas responsibilities.
The technical skills are usually there. Failure is based on family and personal issues,
lack of cultural skills that haven’t bee