Human Resource Management International Assignments

HumanResource Management: International Assignments

HumanResource management: International assignments

Executivesummary

MultinationalCorporations have to send their managers and staff on internationalassignments as part of their essential aspects of operation. As such,there has been research to ascertain the essence of internationalassignments, and efforts to assess their effectiveness. Internationalassignments have been said to be part of a long-term plan, which isdesigned for personal, professional and organizational development.This paper identifies a number of international assignments. They areexpatriation, inpatriation, short-term assignments, self-initiatedassignments and virtual assignments. Numerous researchers haveconducted erudite work to establish the advantages and disadvantagesof each form of international assignment. There are four classes ofinternational assignments identified, categorized into importance andnature of assignments. Additionally, a number of reasons have beenidentified for the motive of sending managers and staff oninternational assignments. The motives identified in the paper arefilling positions, management of development and organizationaldevelopment. Measuring the success level of international assignmentshas also been prioritized. Studies indicate that there is amultidimensional nature of assignment success. Given this, successcan be measured at personal level and organizational level. The toolsfor measuring this are individual benefits in the short-run andlong-run, and organizational benefits in the short-run and long-run.

Oneof the essential aspect of Multinational Corporations (MNC) isinternational assignments. According to Black et al. (1992), modernMNC Human Resource departments are engaged in a global playground,and are thus expected to keep up competing with other companies. Assuch, expatriation and other forms of international assignmentsbecomes a necessity. However, there have been questions raised byscholars and researchers regarding the rationale behind sendingmanagers and staff to international assignments. According to Blacket al.(1992),the reasons may be internal or based on company strategies. However,it is agreed by business specialists that the reasons are bothinternal and external, and that other factors such as competition andgrowth necessitate the move. Nevertheless, Black etal (1992)assert that international assignments are important aspects of MNC,regardless of the motives. This paper looks at the categories ofinternational assignment, other than expatriation, in an effort tobuild an argumentative base for their functions. Additionally, itexplains why HR departments of MNC send their managers and staff oninternational assignments, and finally provides criteria forevaluating the success of international assignments.

Typesof international assignments

Lucaset al. (2006) say that an international assignment is part of along-term plan, which is designed for personal, professional andorganizational development. According to Lucas et al. (2006), a MNCis always required to temporarily appoint managers and other staff todifferent places around the world. This is driven by the company’s’global approaches, strategic operations and business market dynamics.

Inpatriation

Analternative international assignment to expatriation is inpatriation.Stein (2011) says that inpatriation involves the transfer of managersand staff to the headquarters for a certain period. This allows thesubsidiary managers to learn about the operations of the main branchof the company, and in the process, get to understand the company’scommunication network. Inpatriation also allows the Human Resource atthe headquarters to coach the junior managers and staff about thecompany’s organizational culture in a more effective way (Stein,2011). This kind of international transfer is also important fortransferring knowledge from the headquarters to other subsidiaries byexposing the incoming managers about the international perspective ofbusiness operations (Terpstra et al. 2012). There are a fewsimilarities however between expatriates and inpatriates. Just asexpatriates receive a certain status of influence because of theirrole in the headquarters, the inpatriates are equally respected tothe same levels. Terpstra et al (2012) say that both the expatriatesand inpatriates share common cultural adjustment challenges. Finally,both are important to their organization in the context oforganizational growth.

Short-termassignments

Short-termassignments are another alternative to expatriation that have beenadopted by MNCs. According to Caligiuri and Dragoni (2014),short-term international assignments last between 1 and 12 months.One of the distinguishing features of short term assignments is thatthey are informal and hoc. They are useful to the MNCs when there arespecific skills that need to be transferred with urgency. Lucio(2013) says that such skills include multinational projects oroperations systems management. As such, employees, including managersand staff, are briefed on the assignments and sent abroad. Theshort-term international assignments have a number of positiveeffects, which influence HR departments of MNCs to use them. Forinstance, they are cost effective and logistically cheap to manage.The also require less bureaucracy, and are more flexible and timesaving. However, Lucio (2013) says that some of the negative aspectsof short-term international assignments are that they do not help inthe development to effective relationships and have negative personalimplications, such as marital problems.

Self-initiatedAssignments

Altmanand Baruch (2012) say that there has been a tradition of viewinginternational assignments as initiative of organizations. However,there is a rising trend on individuals sending themselves onself-initiated international assignments. These individuals seekemployment abroad, facilitated by the introduction of a number offree movement of labour pacts, like the European Union Free Movementof Labour Pact (Altman and Baruch, 2012). Unlike the above discussedinternational assignments, the self-initiated international assigneesare mostly employed on work contracts.

VirtualAssignments

Thereis a global trend for decentralization and international relations,which has compelled MNCs to put the concept of virtual assignmentsinto use. This kind of international assignment does not require themanager or the employee to be physically present in their country ofassignment Caligiuri and Dragoni (2014). This kind of internationalassignment has been facilitated by the growth in informationtechnology over the last 10 years. It has enabled the managers andstaff to interact through virtual technology such as videoconferencing. Lucio (2013) says that Virtual assignments areapplauded for the added advantages they have over short-termassignments. However, given the advantages of face-to-facecommunication in business, use of virtual international assignmentsin MNCs has been limited to a few purposes.

Scholarshave reviewed the nature and practice of a number of internationalassignments. Additionally, the paper has established a number ofadvantages and disadvantages of international assignments. These areto be used for justifying international assignments, and to measurethe success of the same in MNCs.

Reasonsfor International Assignments

Thereare a number of theoretical means of classifying the concept andmotives to explain international transfers by MNCs. Earlier, therewere studies that only explained the motive of manager’s transfer.These led to three general motives for making such internationaltransfers. Shaffer et al.(2012)say that there are four major categories/classes of internationalassignments. The first class of international assignment ishigh-priority assignment. This is where the assignee is ChiefExecutive Officer, and is responsible for overseeing organizationaloperations and directing of other elements of business (Shaffer etal,2012).

Secondly,there is the class of international assignment that is involved withthe establishment of functional departments in the foreign countries.This category of international assignment is involved withrestructuring of the foreign offices and adjustment of operations.Thirdly, there are international assignments that are carried out fortroubleshooting purposes, such as analysing certain businessoperations problems in the overseas offices (Shaffer et al,2012).The final class deals with deployment and re-assignment of managersand staff to the subsidiaries. Given this, major reasons forinternational assignments identified are filling of positions(managerial and staff), management of development and organizationaldevelopment.

FillingPositions

Sahfferet al. (2012) say that all MNCs share a common need of filling in allpositions in every subsidiary due the existence of numerous forms ofopportunity costs that an organization might incur due to leavingpositions unfilled. Additionally, the type and level of position tobe filled influences the urgency with which it has to be attended to.This therefore determines whether the Human Resource department hasto look for new employees to fill in the positions, or to send theexisting employees on international assignments. One of the mainobjectives of a research conducted by an independent businessresearch firm in 2002 was to find out the reasons why MNCs sent theirstaff on international assignments (Dowling et al. 2008). The mostcommon reason that was found was that the MNCs wanted to fill theskill gap that was created by some factors, such as retirement orrelocation of staff. New endeavors and general transfer of technologyclosely followed this (Dowling et al. 2008). The results were almostsimilar for a number of other researches that were carried out.

LeadingMNCs have the tendency of filling vacancies with expatriate staff,rather than investing in resources and time to train new individuals.The main reason is the challenges presented by socialization andorganizational culture building. Given this, the MNCs have been ableto solve the problem of staff availability. Dowling et al. (2008)identify the need for filling the gaps with people technical andmanagerial knowledge drives the need for international assignments. Additionally, by filling gaps through international assignments, theproblem of orienting the staff to get used to organizational cultureis solved. The motive for filling positions through internationalassignments is particularly crucial for developing countries thathave a shortage of qualified local personnel (Dowling et al 2008).However, this is not limited to just developing countries. In fact,even some of the developed nations, such as the United States ofAmerica and other Western countries require the best trained managersand staff to fill in the positions. Given this, the internationalassignees are considered to be key bearers of tacit organizationalknowledge and skills.

Managementof Development

Internationalorganizations have to embrace technology and growth within theirinstitutions. Additionally, several business market trends facilitatethe evolution of organizational structures worldwide (Dowling et al.2008). As such, every company’s Human Resource department has theresponsibility of ensuring that they embrace this developmentadequately. In the contemporary international business world,employees can be moved from one branch to another to help accommodategrowth. These employees are moved for the purposes of training anddevelopment. Additionally, they are moved to help in the developmentof certain corporate values. Dowling at al. (2008) assert that thisis the reason why many MNCs are these days moving headquarters’staff to subsidiaries to oversee operations. Managers and other staffare moved from one country to another to help the operationsmanagement department to deal with business and market development.

Wildet al. (2014) say that the motive of managing development in MNCsenables them to handle competition in the global market. Accordingly,increased staff mobility helps the MNCs to embrace global corporateculture and crossbreeding of ideas and practices. Study has revealedthat for a business to embrace global organization culture, there isneed to factor in cross-mobility in the organization’s operationcode. There is also the perception that international experience andcareer development are interlinked, which is a motivation for MNCs tosend their staff on international assignments. By going on theassignments, the assignees are in a position to gain experience,which benefits the entire organization, including the headquartersand their respective subsidiaries.

OrganizationalDevelopment

Thethird motive for sending managers and staff on internationalassignments is organizational development. In doing this, MNCs areexecuting strategic objectives for their organizational development(Dowling et al. 2008). The first objective is the need for control.Whenever an organization grows in size and scope, there are manyelements of operation, which grow too. For instance, marketing andsupply are two dynamic elements of organizational operation. Abusiness has to be in a position to maintain its market relevance,and the only way of doing this is going along with the marketdynamics (Carpenter et al, 2001). As such, when a business grows itinternational subsidiaries, it need the services of the experiencedand seasoned employees to keep up the pace of operations. This is thereason why many MNCs send their experienced managers and staff toserve in international subsidiaries.

Secondly,there is the transfer of knowledge. Carpenter et al.(2001)say that the upcoming and growing subsidiaries of an MNC maysometimes lack the necessary knowledge and skills to deliver theorganizational objectives. As such, there rises need for the HRdepartments of the MNC to send skilled work force to thesesubsidiaries as a way of providing knowledge and the technicalexpertise. Thirdly, the issue of competence comes to play wheneverthere is organizational growth. Carpenter et al (2001) say that allMNCs like to have competent work force operating in theirsubsidiaries, so not to have branches that drag organizationaldevelopment plan. Sending expatriates to occupy managerial positionstherefore is one of the most commonly practiced strategies by thecorporations.

Accordingto findings from researches, MNCs place themselves in a position ofcompeting in the global market by sending their most skilledemployees on international assignments. It has also been establishedthat greater staff mobility helped in supporting corporate cultureand assisted in cross-fertilization of ideas. The employees who aresent on international assignments help nurture their respectiveorganization’s corporate cultures, hence providing a platform forcontinuity of management and operational practices. Additionally,Stahl et al.(2002)says that there are two main motives behind internationalassignments, as far as organizational development is concerned. Thefirst one is socialization of the assignees. By socializing on theinternational level, the managers and staff sent on internationalmarkets help the other employees to understand the importance ofdiversity and cultural ambiguity. Secondly, the assignees help todevelop corporate culture and creation of better communicationnetworks between the subsidiaries.

Criteriafor Evaluating Success

Thereis a multidimensional nature of assignment success because ofproblems arising from a narrow dimension of expatriate failure.Suutari and Brewster (2001) say that there has been a problem inresearching the level of success of international assignments, mainlybecause failure at the corporate level does not automatically meanthat there is failure on the individual level. Additionally, there isneed to note that any type of failure of international assignment canbe regarded as a waste of resources and opportunities (Suutari andBrewster, 2001). This is the reason why there has been substantialeffort to build on the distinction between individual andorganizational success. The level to which the internationalassignment is measured to be a success depends on the following twocriteria from international transfer success:

  1. Individual benefits

  2. Organizational benefits

Boththese measures are considered during the assignment (short-term) andafter the assignment (long-term). The aim is to assess the successboth in the short-term and in the long-term.

Individualbenefits

Accordingto Briscoe (2015), during the short-term assignment, the individualtask performance ability can be assessed to tell whether theinternational assignment was a success or a failure. This entailsevaluating the improvement on the performance of certain tasks, suchas management and operational skills, to tell whether internationalassignment positively or negatively influenced the individual. Otherindicators of personal success after international assignments areskill building, individual capacity growth and learning of new ideas.Briscoe (2015) asserts that an individual’s adjustment to the newenvironment is another significant indicator of the success level.Finally, an individual’s job satisfaction can be used to tellwhether or not the international assignment was a success.

Afterthe assignment, the individual’s continued personal development canbe assessed to evaluate the international assignment’s level ofsuccess. The Human Resource management can also get direct feedbackfrom the employee regarding their wish to go on another internationalassignment. A positive feedback means that the previous internationalassignment was a success. Additionally, monitoring the assignees’progress at their jobs, for instance job promotion, can a significantindicator of assignment success (Briscoe, 2015). On the same note,enlargement of responsibility at their jobs means that the assigneehas had a successful engagement. Stroppa and Spiel (2011) say thatidentification of the value generating potential of an individualhelps the Human Resource and other departments to value theassignment’s success.

OrganizationalBenefits

Fromthe organizational perspective, the assignees’ accomplishment oforganizational tasks can be used to measure the success of theirrespective assignments. Jafari et al (2014 says add that duringshort-term assignment, the Human Resource department can tell whethertheir assignees are successful by evaluating achievement of keyorganizational objectives such as coordination and control, as wellas the transfer of knowledge within the organization (Jafari et al2014).In the long-term assessment, a successful international assignment isindicated by retention of the repatriated staff and utilization ofthe new expertize in service delivery. Another equally usefulindicator is the transfer of expertise to other departments andsubsidiaries, as well as readiness by the employees to engage inother international transfers (Stroppa and Spiel, 2011). This isclosely related with the encouragement of other employees toparticipate in the international assignment programs.

Conclusion

Thispaper has looked at various dimensions and issues that are related tointernational assignments as a practice by MultinationalCorporations. Specifically, the forms of international assignments inthe contemporary business world and other key elements of the samehave been reviewed. These, together with research and literature froma number of authors, created the platform for arguing out the motivesbehind the practice. It has been established that there are a numberof motives behind sending managers and other staff on internationalassignments. These included filling of positions, individualdevelopment and organizational development. However, there is stillroom for additional research to be conducted to point out facts scrapmyths regarding international assignments. Moreover, it wasestablished that there are two major ways of evaluating the successof international assignments. For the purposes of this paper, twoways were identified, which were at individual level andorganizational level. According to the information presented in thepaper, it can be conclude that one of the major challenges thatMultinational Corporations face is linking international assignmentsto their organizational career development. This is because changesin career development trends continue to rock Human Resourcedepartments every day in the contemporary international businessmarket.

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