Mismanagement
of international assignments can lead to some assignees feeling they have been
dropped in at the deep end by employers. But, with better planning and support,
this doesn’t have to be the case. Dennis R Briscoe explains
Ever since firms first sent employees overseas to establish and run their
foreign operations, their HR planning has been limited – often because the
terminology used to describe the options for overseas assignments has also been
too limited.
Firms have operated as though there was only a limited set of options for
international assignments. Basically, the terminology used only included
expatriates (employees sent from headquarters to foreign subsidiaries) and
repatriates (expatriates when they return home) and recently, inpatriates
(employees posted to headquarters from foreign operations). Occasionally an
alternative terminology has been used: PCNs (parent-country nationals), HCNs
(host-country nationals) and TCNs (third-country nationals).
Recently, terms such as ‘international assignee’ and ‘transnationals’ have
been used in an effort to more accurately describe the types of employees on
overseas assignments. It also has been an effort to move away from the use of
the term expatriate, since some people either see it as being a negative
description or it is used so generically that it describes anyone who is living
in a country other than their own.
In the last few years, it has become obvious that these terms do not
adequately describe the many types of employees being used to conduct
international business, even though most of the literature in international HR
management continues to rely on only this limited set of terms.
Because all the HR planning and managing of employees on foreign assignment
has been oriented to the traditional concept of expatriate, it has made the
problem of deciding how to select, prepare, and manage these new types of
international employees increasingly difficult. In addition, managers who are
new to international HR are often constrained in their global staffing because
the limited terminology used in seminars, books, and articles, doesn’t clarify
the many possibilities.
However, as global business has become more pervasive and complex, so has
the management of the global workforce. It is clear that global firms are now
using many forms of ‘international employees’, to carry on their international
operations.
Making international assignments has become more complex and difficult.
People are increasingly turning down international assignments for reasons such
as potential negative impact on their families or on their spouse’s careers or
even on their own careers, recognising that such assignments have not always
resulted in better assignments when assignees return home.
Potential assignees look around their companies and realise their firms don’t
really value the overseas experience and don’t provide the necessary
preparation or support to help the assignee and their family cope with the
foreign experience.
And with the constant pressures to reduce the high costs of traditional
expatriate assignments, HR departments are being asked to find less-costly ways
to service the firm’s overseas business needs.
The box lists 21 types of international employees working in multinational
companies. Because of this large set of staffing, global HR managers need to
address a number of questions when making international staffing decisions:
– When is it appropriate to use whichever type of international employee?
– Do different recruiting and selection strategies and criteria apply to
varying staffing options? How do they differ and which strategies and hiring
criteria apply to the various types of international employees?
– Do all international employees require similar cross-cultural training and
preparation to work effectively in international business? Or can the training
and preparation be varied? According to what? Which type of training and/or
preparation is most appropriate for which type of international employee?
– For which business purposes (such as transfer of technology, management or
control, management development, project team membership, or contract
negotiation) are the types of international employees best suited?
– Which type of international employee delivers the best business results in
which international setting (such as subsidiary, joint venture, sub-contractor
or licensee, or alliance)?
– Are there generalisations that can be determined which can help IHR
managers make their global staffing decisions, as well as helping them decide
when to use which of the various staffing options listed?
The use of a wider set of staffing options will help global HR managers and
their multinational firms better utilise their global workforces. And answers
to these types of questions will go far towards helping global HR managers
carry out their responsibilities for contributing to the global business
success of their firms.
International employee options
1. Domestic internationalists –
employees who work at the home office but conduct international business (with
foreign customers or suppliers, via telephone, fax, and e-mail)
2. International commuters –
employees who live at home but make daily or weekly trips from home to
international sites for work or who live at foreign locations during the week
and commute home on weekends
3. Long-term business trips –
employees who travel for periods, from a few days to a few weeks, and even up
to a couple of months, to meet with suppliers or customers or to meet with
foreign subsidiary colleagues
4. Short-term foreign assignment
(less than a year) – typically involves relocation to foreign site (without
family) for technology transfer, contract negotiations, subsidiary start-ups,
or to gain international business exposure for management development
5. Intermediate-term (12 to 36
months) foreign assignments (the traditional PCN) – typically for subsidiary
general or functional management or control (eg, accountant), or for management
development or development of global business perspective
6. Long-term – for foreign
assignments lasting a minimum of 36 months and up to five years, usually for
subsidiary general management or posting to regional headquarters
7. Permanent transferee (often
referred to as localisation) – usually for expatriates that stay in foreign
assignment longer than five years, in which time an individual is converted to
‘local’ status
8. International transferee
(subsidiary to subsidiary) – used to develop foreign subsidiary employees and
to educate them about the culture and international business of the firm
(usually the transferee returns home)
9. Permanent cadre – individuals who
spend most or all of their careers on foreign assignments
10. Local hire (the traditional HCN)
– increasingly used at all levels of foreign subsidiaries to save costs and to
develop the local workforce
11. Immigrant (A) (traditional TCN) –
person from a third country hired to work in a foreign subsidiary
12. Immigrant (B) – person with work
visa or Green Card status hired on relatively permanent basis to work in parent
country (eg, nurses, doctors, professors, and IT professionals recruited in
foreign countries to fill workforce shortages in the country of the parent firm)
13. Internships – temporary
immigrants, primarily students, on short-term assignments (sometimes
preliminarily to possible later hiring)
14. Returnee – immigrant employee who is returned to home
country on assignment
15. Second-generation expatriate –
immigrant employee sent on assignment to third country to take advantage of
their expatriation learning from their original emigration
16. Just-in-time assignee – recruited
for just a specific limited-term assignment; hired as an independent
contractor; no long-term commitment, either in foreign assignment or back in
parent country
17. Self-initiated foreign work
experience (SFE) – usually describes students who look for work while travelling
18. ‘Reward’ or ‘Punishment’ foreign
assignments – reward assignments for senior employees near retirement to
increase their salary basis for pension (due to expatriate compensation
incentives); punishment assignments for individuals who’s firm wants to ‘get
rid of’ for a period of time
19. Outsourced – hiring of
temporaries from an employment agency or use of Global Employment Companies (firm-based
company used to employ all employees on international assignment in order to
centralise all compensation and assignment management)
20. Virtual foreign ‘assignments’ –
cross-border teams, increasingly used for product development, projects of many
kinds, etc. Employees meet primarily via e-mail, telephone, and video- and
audio-conferences
21. Retirees – for example,
International Executive Service Corps (retired executives who are willing to
take on international assignments, primarily in developing countries) and
former employees ‘called out’ of retirement specifically for foreign assignments
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The author
Dennis R Briscoe teaches
international HR management at the University of San Diego’s School of Business
Administration
