Cross-Cultural ManagementCross-Cultural Management1

GLOBAL HUMAN RESOURCES

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Global StaffingGlobal Staffing

Pressures Pressures

– Candidate selections– Assignment terms– Relocation– Immigration – Culture and language– Compensation– Tax administration– Handling spouse and dependent matters

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Sources of Human ResourcesSources of Human Resources

• Host-Country Nationals– Local managers who are hired by the MNC– Used in middle- and lower-level

management positions– Nativization

• Requirement of host-country government that mandates employment of host-country nationals

Cross-Cultural ManagementCross-Cultural Management4

Sources of Human Sources of Human ResourcesResources

• Third-Country Nationals (TCNs)– Citizens of countries other than the one in

which the MNC is headquartered or the one in which the managers are assigned to work by the MNC

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Failure Rates of International AssignmentsFailure Rates of International Assignments

International assignment failure can cost hundreds of thousands of euros

0 20 40 60

US

Japan

Europe

% Failure

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Why InternationalWhy InternationalAssignments FailAssignments Fail

• Personality• Person’s intentions• Family pressures• Lack of cultural skills• Other non-work conditions like living and

housing conditions, and health care

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Improving Failure Rates/SolutionsImproving Failure Rates/Solutions

• Provide realistic previews• Have a careful screening process• Improve orientation• Provide good benefits• Test employees fairly• Shorten assignment length

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SelectingSelectingInternational ManagersInternational Managers

• Test for traits that predict success in adapting to new environments

• Job knowledge and motivation• Relational skills• Flexibility and adaptability• Extra-cultural openness• Family situation

Predictive trait breakdown

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The New Workplace:The New Workplace:Sending Women AbroadSending Women Abroad

• In the US, only 6% filled overseas positions compared to 49% domestic

• One survey found inaccurate stereotypes:– Not as internationally mobile – Might have a tougher time building teams

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Culture Shock!Culture Shock!

• Disorientation upon entering a new cultural environment

• Normal use of own cultural filter fails– interpretation of perceptions– communication of intentions

• All people experience culture shock... Past experience and training can shorten its length

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SymptomsSymptoms

– homesickness– boredom– withdrawal (reading is an obsession, focus

on home nationals, avoid host nationals)– excessive sleep need, compulsive eating

and drinking – irritability– exaggerated cleanliness

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Symptoms (cont.)Symptoms (cont.)

– marital stress, family tension, conflict

– stereotyping host nationals

– hostility towards host nationals

– loss of ability to work effectively

– fits of weeping

– psychosomatic illnesses

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Repatriation of ExpatriatesRepatriation of Expatriates• Repatriation

– Return to one’s home country from an overseas management assignment

• Reasons for returning– Formally agreed-on tour of duty is over– Expats want their children educated in the home

country– Unhappiness with foreign assignment– Failure to perform well

• Readjustment problems– Permanent position upon return constitutes a

demotion– Lack opportunity to use skills learned abroad upon

return– Salary and benefits may decrease upon return

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Repatriation ProblemsRepatriation Problems

• Finding former colleagues promoted

• Reverse culture shock