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What are the international management challenges confronting managers of multi-

national operations?
The global market has facilitated the consolidation of national economies that were
previously separated by distance, trade and cultural divides with g. Globalisation has
necessitated necessitating the international expansion of organisations. Due to its global
nature, managers of multinational corporations are faced with significant international
management challenges. This essay seeks to elucidate the arguments behind the lack of
attention provided by multinationals and thus their consequent expatriate failure and
repatriate retention rates. It further argues that cultural awareness is required of these
managers to avoid foreign hostility toward international subsidiaries. To ensure a firms
successful growth into the multinational sector, the use of expatriates is essential. These
employees live and work in foreign countries on short-term and long-term international
assignments. Expatriates are strategic players within a broad corporation, providing a
competitive edge through their experience as culturally aware managers with truly
global horizons and interpersonal networks of global contacts (Schermerhorn et al.,
2014, p. 111). Repatriation occurs when an expatriate of a multinational corporation
returns home to their country of origin from an international assignment. Repatriates are
considered to be excellent assets to any cosmopolitan enterprise due to their wealth of
international experience and cultivated managerial capabilities. In saying this, anAn
issue faced by many multinational operations is the retention of both expatriates and
repatriates. One may ask why many of these successful corporations have been
subjected to both expatriate failurefailuress resulting in premature repatriation, and
unsuccessful staff retention for repatriates. It seems that multinational enterprises
(MNEs) do not pay sufficient attention to or provide adequate cross-cultural training
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(CCT) for expatriates (Shen & Lang, 2009, p. 372). If multinational companies were to
deliver suitable training, studies have shown that an expatriates satisfaction and
performance could increase, whilst their risk of failure decreases. (source?). This lack
of understanding and ignorance of successful global companies extends to the retention
of repatriates. Their(Repatriates whose?) needs are often unrecognised by many
companies policies and they end upeventually experiencing experience a similar de-
identification to those working as expatriates. In approaching the challenge of retaining
repatriates McPhail, Fisher, Harvey and Moeller (2012) suggest that companies should
put delegate resources into the supervision and tracking of a managers evolution, to
better meet their needs and thus retain them as a valuable asset. To ensure the successful
international expansion of any multinational corporation, these global managers need to
be provided with the experience and tools to bridge cultural and national differences.
Thus it is vital that companies are making the right decisions when it comes to choosing
cultured expatriates. Ghemewat (2011) believes that a cultivated leader eliminates the
vulnerability faced by many corporations when dealing with cultural division and the
threat of protectionism. This paper seekstrives to argue three main positions concerning
the lack of attention provided by international management concerning expatriate
failure, repatriate retention and the subsequent cultivation of these managers.
This essay seeks to elucidate the arguments behind the lack of attention provided by
multinationals and thus their consequent expatriate failure and repatriate retention rates.
The cultural awareness required of these managers to avoid foreign hostility toward
international subsidiaries is also highlighted in order to provide a better understanding
of the challenges faced by international management.
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It seems that iInternational firms often disregard training that is essential for the
successful development of an expatriate in terms of both their performance and failure
rate. Duppada and Aryasri (2011) believed that effective expatriate assignments provide
revenue, value and growth to an organisation and that it is important that expatriates are
provided with the necessary skills required for adjustment and integration into a new
culture. This often requires a significant amount of analysis, planning and selection of
suitable candidates to ensure the success of the venture. Through past studies it has been
shown that under-qualified expatriates are more likely to be ineffective and
unsuccessful in their conduct of international assignments (Shen & Lang, 2009, p.
372). Despite many researchers highlighting the importance of training and appropriate
selection of candidates for their success on foreign assignments, Shen and Lang (2009)
described that many multinational corporations fail to provide adequate training because
corporate leaders have arebeen cynical about its effectiveness. If this is the case,This
being the case, then perhaps international firms should look closer into the predominate
reasons behind expatriate failure. For any cosmopolitan corporation, the cultivation of
managers into leaders who have the ability to bridge differences is essential to any
successful international subsidiary, .although Ghemawat (2011) warnsed that potential
candidates often resisted leaving their home countries for family reasons or out of fear
of it taking longer to be promoted if they were are distant from the home base. In light
of this, cultural adjustment along with personal issues can may be attributed to
expatriate failure. Shen and Lang (2009) investigated an incident concerning an
Australian male expatriate who relocated upon a one-year assignment to China with his
wife and children. Although the children were sent to an international English speaking
school, the workload placed upon the children was too strict by Australian standards.
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The children struggled to keep up with thebalance copious amounts of extreme amount
of homework and and in the process still find time to participate in extracurricular
activities. In consequence Consequently, , they returned home two months later with
their mother. This The added stress undermined the expatriates ability to work
effectively and he returned home soon thereafter. All things considered,This example
demonstrates that the company should have taken this into consideration, and either
culturally prepared the family for the expectations of the Chinese education system or
provided a short-term assignment first first to assess whether the venture was viable.
Taking this into account, it seems that companies often tend to neglect the needs of an
expatriates family when considering overseas assignment, provided that they are
integral to an expatriates success. This example of a multinational corporations
mismanagement of expatriation links to a companys responsibility for providing the
tools for the successful adaptation to new cultural environments while assessing all
facets of a candidates suitability to an international position. Multinational enterprises
and their senior executives must provide managers with the right incentives to ensure
that any reservations about their prospects of promotion are rendered redundant. This
reinforces the idea that in order toTherefore to improve the success of an expatriate
through performance and retention, the lack of attention provided toward their
requirements needs to be accentuated in order to better discourage the possibility of
failure in the future.
In further highlighting the lack of consideration given by multinationals in the process
of expatriation, the common problems with repatriation that are often overlooked by
international corporations should also be examined. Although significantly more
attention has been provided to the challenges of expatriation in the past, Chew and
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Debowski (2008) believe that repatriation is a complex process, generating similar
issues to those encountered when managing expatriation (p. 4). Numerous companies
trust that when an expatriate moves back to their home country the transition is simple
because the language and the culture is the repatriates own and the conditions are
similar to those left behind. This simplistic mindset is the one main reason repatriate
retention is proving to be a major concern, resulting in extensive costs to multinational
firms who must replace these executives that have acquired valuable cultured
international experience. This ignorance requires companies to maintain an improved
understanding of the framework dictated by their leading, global managers. De-
identification is a significant concept in the world of international management and is
predominantly associated with positive assimilation of a successful expatriate within the
company culture of the host country. McPhail et al. (2012) believed that an extensive
assignment allowed allows an expatriate to experience significant cultural identity loss
and the uncertainty of re-entry contributed contributes to their de-identification from the
socio-cultural environment of the home country. McPhail et al. (2012) noteds that
British soldiers returned to their adopted cultures after serving 15 to 20 years abroad in
India and Africa. Due to the lack of Britains role in providing support as their surrogate
culture, the soldiers lost their original cultural identity and were subjected to culture
shock upon re-entry. In its entirety, Britain may have avoided the situation given the
correct approach. In parity to repatriation from an extended assignment, de-
identification would signify a lack of comprehensive international human resource
practices such as mentoring or a lack of a repatriation program upon re-entry. McPhail
et al. (2012)It is further suggesteds that the identification of the types of expatriates
employed by corporations is useful in studying staffing implications as de-identification
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is associated with a continuum of managers at various stages (McPhail et al., 2012). An
understanding of where a company managers career path falls is advantageous to in
retaining them as international assets. For expatriates returning from shorter
assignments, Crew and Debowski (2008) highlight that managersthoseat managers often
return from high profile, autonomous positions to a station of less influence and
responsibility in their parent company. Repatriates often feel bored and dissatisfied
upon return. Due to under-utilisation, their work performance may be severely affected.
Coupled with a possible reduction in salary and benefits, repatriates must often adjust to
a lower standard of living than they were previously accustomed to during their stay on
overseas assignment. This can also be difficult for the expatriates family in terms of
readjustment in housing and schooling. The amalgamation of issues often leads the
repatriate to feel disillusioned and jaded upon their return to their parent company.
Chew and Debowski (2008) expanded upon this, highlighting asserting thatthe fact that
many expatriates return to a hostile environment and feel ostracised in the process due
to their international experience. The lack of company intervention in many of these
cases, dictates the need for firms to revaluate their relaxed attitude toward the re-entry
of expatriates. This reinforces the idea that due Due to the competitive advantage that
these global managers bring to international organisations, they become an expensive
asset to lose and thus their expectations must be met prior to their return.
In light of the culture shock often experienced by expatriates and repatriates and the
lack of the provision of tools for adaptation, , it is important to keep in mind that an
asset to any multinational enterprise is a cultivated leader who has the education and
experience to bridge cultural and national differences while on international assignment.
For the multinational corporation, these managers are essential in order to combat such
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issues such as cultural division and the threat of protectionism. Therefore the correct
selection and immersion of these expatriates is integral for both the success of the
company and the manager. Ghemawat (2011) highlighted argues that most of the
management writing on globalisation depicts a world based upon the En-lightenment-
era ideal proposed by Immanuel Kant. The 18
th
century philosophers idealistic belief
embodied the abandonment of all allegiances to nation, race and ethnos in favour of
adopting world citizenship. However, although companies may embrace these ideals
today, Ghemawat (2011) asserts that unfortunately, enticing though they may be, such
beliefs dont bear up upon closer examination (Ghemawat, 2011 p. 94). This is just one
of the challenges global managers face and as Ghemawat (2011) acknowledges d,
travelling abroad does not simply raise the awareness of cultural division present in
international subsidiaries. In effect it takes at least three months to become immersed
within a place and appreciate how the culture, politics and history of a region affect
business there (Ghemawat, 2011 p. 99). Schermerhorn et al. (2014) paraphrases that
the The disregard of existing culture is a mistake that only successful corporations can
make due to their influential status. mistake of disregarding existing cultures is
something that only successful corporations can make. If multinational enterprises are
to be efficacious they must ensure their managers are culturally aware. This
management theory of cultural relativism is an idealisation that needs to be
implemented by current corporations and their executives if they truly desire successful
global expansion (Schermerhorn et al., 2014). Ghemawat (2011) suggests that
companies should embrace an amalgamation of adjusting to, overcoming and exploiting
cultural differences between countries. Depending upon the global climate and the
predicted evolution of a company, an international firm should treat this theory with
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caution. Given the current hostility toward globalisation, emphasis toward adaption to
difference is likely preferable. If an international manager is culturally aware and thus
more respectful of differences, the country may be less inclined to demand
protectionism. An organisational example is the emerging markets within China and
India. Ghemawat (2011) highlights asserts that Western companies can no longer target
elite international customers but must adapt to the shifting markets and approach
customers of a second and third tier nature. As elite customers have similarities in
culture, these second and third tier customers in smaller cities have their own internal
diversity that Western companies must adapt to. In light of this,Therefore, it should be
considered that not every market can be approached by adaptation to difference and
these differences may need to be exploited in order to create value across borders. It is
more than likely that inIn the shifting markets of today and the rapid adoption of
globalisation, regard for the cultural diversity and uniqueness of foreign markets is
essential for the improvement of the reputation and working environment of any
multinational corporation.
It can be seen that anAn importantintegral part of global staffing is to ensure that the
selection of expatriates meet the criteria of a cosmopolitan corporation. Managers with
international experience are valuable assets as they understand and are aware of the
cultural division present within the host country. Firms must recognise their importance
in allowing them to use adaptation strategies in order to adjust to the difference between
countries and thus to respond to local needs. The cultivation of these managers cannot
be completed from the home base; as living abroad allows one to expand their mental
horizons, immersion in the culture of a place is vital in order to better appreciate the
business conducted there. Subsequently, expatriates are vital to the international success
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and expansion of the global borders of a multinational company, although
mismanagement of expatriates by international human resources appears to be common
theme. Despite the amount of literature provided, it seems that multinational enterprises
fail to understand the primary needs of their global staff by not providing them with the
necessary tools and training required for expatriation. In saying this, repatriation has
become even more of an international management issue, as many firms fail to
recognise that repatriation can sometimes be just as emotionally burdening as
expatriation in terms of culture shock and in particular, de-identification from the home
country. Companies are failing to provide repatriates with the incentives required to
keep their employment upon their return, initiating repatriates to look for more
stimulating opportunities elsewhere. The cost of expatriate failure and the decrease in
repatriate retention calls for international firms to revaluate their priorities and thus
acknowledge these as crucial issues in management. Therefore multinational
corporations fail to acknowledge the importance of meeting the requirements of their
expatriates and in particular their repatriates. In recognising this, international
companies must also ensure that these global managers have the experience necessary to
become cultivated leaders in order to drive the success of foreign ventures by bridging
cultural differences.
Thus, multinational corporations fail to acknowledge the importance of meeting the
requirements of their expatriates and in particular their repatriates. In recognising this,
international companies must also ensure that these global managers have the
experience necessary to become cultivated leaders to drive the success of foreign
ventures by bridging cultural differences.
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MNC: A model and tools for international human resource management.
Journal of Comparative International Management, 11(2), 3-21.
Duppada, S., & Aryasri, R. C. (2011). Human Resources Transformation Beyond
Boundaries in Outsourcing Business Model - Expatriate Benchmarking.
Electronic Journal of Information Systems Evaluation, 14(2), 204-215.
Ghemawat, P. (2011). The Cosmopolitan Corporation. Havard Business Review, 89(5),
92-99.
McPhail, R., Fisher, R., Harvey, M., & Moeller, M. (2012). Staffing the Global
Organization: Cultural Nomads. Human Resource Development Quarterly,
23(2). 259-276. doi: 10.1002/hrdq.21133
Schermerhorn, J. R., Davidson, P., Poole, D., Woods, P., Simon, A., & McBarron, E.
(2014). Management (5th Asia Pacific ed.). Queensland, Australia: John Wiley
& Sons Australia, Ltd.
Shen, J., & Lang, B. (2009). Cross-cultural training and its impact on expatriate
performance in Australian MNEs. Human Resource Development International,
12(4), 371-386. doi: 10.1080/13678860903135763