The Role of Effective Recruitment and Selection for Potential Expatriates - Essay Example

Essay Name: Institute: Why Establishing Competencies and More Effective Recruitment and Selection Processes for Potential Expatriates Has Become Increasingly Important Introduction Global crises facing multinational corporations (MNCs) include the premature return of expatriates attributed by unsuccessful assignments as well as the poor retention strategies of returned expatriates thanks to unsuccessful repatriation (Chew, 2004). To lessen the both indirect and direct costs intrinsic with expatriate failure, MNCs are determined to better their competence in managing their expatriates prior to, during and subsequent to international assignments. As business enterprises become globalised, there is a mounting setback to make use of expatriates on international assignments so as to tactically finish critical undertakings. MNCs make use of expatriates, not just for corporate expertise and control reasons in very important international markets, but as well to promote penetration into new markets or to build up competencies for international management (Santoso & Loosemore, 2013). Whereas it is acknowledged that issues associated with Human Resource Management (HRM) are far more multifaceted in the global setting, there is as well heightened proof to advocate that the international human resources management (IHRM) is progressively being recognized as the main determinant of failure or success in global business. Therefore, for well-known and famous MNCs, failure to coordinate as well as communicate their activities in global business can sink them into a crisis. Some of the crises facing MNCs consist of failed assignments caused by early return of expatriates as well as inability to retain returned expatriates attributed by pitiable repatriation (Chew, 2004). Such crises, owing to incompetent management of expatriates, can, for that reason, imperil the competencies and performance of the organisation in the international context. For that reason, the essay seeks to discuss why establishing competencies and more effective recruitment and selection processes for potential expatriates has become increasingly important. Discussion Owing to the rapid globalization development, activities related to the conventional HRM, which includes but not limited to benefits and compensation, education and training, management of performance, staffing, HR planning, as well as employee relations embarked on by companies to use its human resources efficiently has developed IHRM (Hurn, 2014). In consequence of IHRM development, the associated HRM activities have become more multifaceted and tactical to encompass additional functions like inter-government relations, appraising and training host and home countries’ workers, managerial services to expatriates, global relocation, international taxation, and so forth. International human resource management uniquely are different from the home HRM because of the intricacies related to expatriates’ international assignments like participation with expatriates exposure to risk, that is terrorism threat, external pressure from the economic as well as political dimension in addition to the host country intricacy where the top management attitudes can to a great extent be at variance in different countries and degree of their dependence from international companies. Therefore, an IHRM approach that is more strategic is considered important so as to balance MNC’s globalization objectives as well as in making certain that its expatriates succeed in international assignment (Donnelly, 2003). In essence, the main crisis management responsibilities of international human resource (IHR) experts are those of emergency plan contributing writer, communicator, team members of crisis management, and custodian of records. This complicated IHR responsibility entails offering specialized counseling to assist workers together with their families to handle the psychological setbacks related to a captive or an emigration circumstance, so as to focus on the happiness of their labor force. Besides that, IHR also handle issues related to benefits and compensation, security and safety, health, legal and reassignment. Key Issues Arising From Operating In an International Context During the early 2000s, scores of corporations capitalized on the global market that was gradually more exposed worldwide expansion as well as trade. Through the North American Free Trade Agreement (NAFTA), General Agreement on Tariffs and Trade (GATT), as well as the Association of South East Asian Nations (ASEAN) barriers to free trade were eased; thus, resulting in opening of economies (Mason, 2004). Thanks to technological advancements in finance, transportation, as well as communication, there were lesser complexities with the practical issues of carrying out business internationally. Technology in communication exhibited increasing development, counting innovations which created the ability to do business remotely. Thanks to these changes, the need for managing people in the international context increased, especially in comprehending cultural and business issues sufficiently well to grow and manage an intentional business successfully. Some of the key issues arising from operating in an international context include: business culture, competition, employment and labor forces, and culture. Based on business culture, an international manager is mandated with the reopening the business in an environment that is radically different. In this case, the manager have to determine the business overall structure together with its workflow. Mason (2004) posits that in a functional-established business (that is, the new location must be in a position to carry out standardized undertakings that abide by general practices of the company), competent workers as well as capability to carry out these undertakings are fundamental. Competition is another issue experienced while operating in an international context bearing in mind completion is still growing in the global marketplace, especially between the Asian nations such as China and India, European Union, as well as the United States (Ball et al., 2003). Therefore, international companies must analyze the competitive environment of the host country. Foremost, it is useful to comprehend that the competition nature differs by industry and region. A number of countries back an environment of pure competition; for. Therefore, comprehending the environment type wherein a company will take part in its host country guarantees the utilisation of suitable business practices. Precisely, threats to MNCs arise from fresh competitors penetrating the international market, existing competitors as well as the buyers and suppliers’ bargaining power in the host region or country. The last noteworthy issues in operating in an international context is ‘employment and labour forces’: When IHR managers are staffing global operations, they have to fill vacant positions from a labour pool f with the needed skills, competencies, and education so as to grow and maintain the business (Mason, 2004). Options for hiring entails selecting people from the home nation, from a local subsidiary, or host country, bust mostly immigrants are usually drawn into operations. Still, they could be lacking the needed skills and competencies or education to labour. Impact of Culture on management in the international context Culture can be defined as the body of values, norms, and beliefs shared by certain individuals. Without doubt culture brings forth the key setback to businesses operating globally. Culture as mentioned by Kessapidou and Varsakelis (2002) is the main factor in how every other business areas function mutually. Still, culture is time and again the source of disagreement in most companies, and differences in culture are a bother and frequently a catastrophic (Kessapidou & Varsakelis, 2002). Basically, international operations’ managers must be conscious of the context significance in a range of countries. Context points out the level through which communication takes place outside of oral communication. Besides that, high-context communication relies much on body language, gestures, in addition to other nonverbal signs. International managers must understand that low-context communication is precise and clear, depending little on embellishment of nonverbal communication for meaning (Mason, 2004). Scores of these, as well as other cultural practices, can be learned through socialisation considering that language barrier is key barrier for much business operating internationally. Culture has an effect on international management practices, which includes tactics for negotiation, making of decisions, as well as recognition and rewards programs (Mason, 2004; Kessapidou & Varsakelis, 2002). For instance, when carrying out international business, members of numerous cultures, particularly in Asian countries begin business operations subsequent to shaking hands. Furthermore, other soft skills of management, like rewarding workforce, decision making, and motivation rely on cultural factors. Managing Expatriate Crises As mentioned in the introduction, international crises facing many international businesses include expatriates’ premature return attributed by unsuccessful assignments as well as poor retention strategies thanks to failed repatriation. The basis of these failure in international assignments have been analyzed extensively by scholars and researchers such as Chew (2004) and Petison and Johri (2008) who as a result have proposed HR practices that may assist international businesses to select as well as retain expatriates based on their competencies. As a result, MNCs are determined to advance their competence in managing employees globally. These initiatives have vital features, which includes (i) the planning length and nature for expatriates selection as well as training for international assignments, (ii) the expatriate return, and (iii) the ensuing allocated assignments for these repatriates in the parent nation (Chew, 2004). Unsuccessful Assignments caused by Untimely Return of Expatriates Undoubtedly, the expatriate failure has become a top worry in the international recruitment as well as selection literature, and this expatriate failure has turned out to be a global crisis for international businesses. A number of studies such as Harzing and Christensen (2004) have discerned the main reasons causing failure. They include untimely return of expatriates as well as the expatriates’ insufficient cross-cultural change, poor performances cause by expatriates’ family or spouse inability to adapt to the new country during the international assignments. In fact, research carried out by Chew (2004) points out that almost 20% of expatriates in U.S. sent abroad come back too soon by reason of job frustration or the effects of culture upset. Almost 33% of those who returned after completing their assignments failed to perform satisfactory to their organizations’ expectation. Furthermore, when an oversea assignment is finished partially, it creates the need to replace the expatriate, so the failure costs to the multinational company will be both direct and indirect. In this case, the direct cost will consist of relocation and travel cost, training costs as well as salary. While the indirect may include a market share loss, problems with government of the host country as well as demands that nationals of the host country nationals replaced the parent country nationals. Without doubt, expatriate failure is above all attributed by selection error. In the past, expatriates selection has been anchored in technical competence, disregarding other vital interpersonal features of expatriates. For example, Yamazaki (2010) established that interpersonal skills help in expatriate adjusting hastily to a new culture together with his/her family, so this is a management competency that must be greatly considered. Expatriate Selection In the existing rich research on expatriate managers, particular traits or characteristics of selection have been acknowledged as expatriate success predictors. They include family adaptableness, maturity, emotional stability, positive attitude, language competence, diplomacy, adaptableness, cultural understanding, management skills, and technical competency (Yamazaki, 2010; Chew, 2004). Besides that, factors that result in expatriate success as mentioned by Wang et al. (2014) include relational competencies or personality traits, job technical competence, variables within the environment, and situation of the family. In simple terms, success attributes of expatriates include: language skills, family situation, motivational state, relational dimensions, and job factors. In this case, MNCs’ IHRM professionals must be well-trained in espousing a wider frame of mind to back the globalization plans. Furthermore, it is imperative for IHRM professionals to completely comprehend the predicaments endured by the expatriate together with the spouse as well as family and offer strategic IHRM support rather than playing a knee-jerk role (Chew, 2004). In contradiction of the well-liked misbelieve, a number of the reasonably priced yet essential plans like offering suitable contact list for relocating emergency support, help in process of looking for job in host nation for the partner or spouse, offering help for application of spouse’s work permit, are believed to be very useful support in facilitating their needed adjustments. Still, a selection approach that is more strategic must be espoused by IHRM professionals where expatriates have to go through an interview process together with required test (Petison & Johri, 2008). Managing people in international context Whereas it is irrefutable that a number of common traits like entrepreneurship, adaptability, motivation and intelligence as cited by Donnelly (2003) as well as experience can lead to a higher success rate of an IHRM professionals in host country, this exclusively cannot be presumed to be the lone causative factor towards triumphant overseas assignment given that individuals respond in a different way in overseas country, under distinct condition therefore, when workers are sent by their companies to a different country, it takes more than the basic functions of HRM (Petison & Johri, 2008). For instance, the basic HRM functions includes hiring, training, development and retention, but for IRHM the functions involve more than handling the selection of the competent workers to work as expatriates, rather they must be knowledgeable of the expatriate’s the whole family needs in case they go with the expatriate to the novel cultural setting. Lots of persons taking up overseas assignments fail because their families or spouses fail to become accustomed to their new environment. Therefore, it is vital to systematize training in the alien language for the expatriate together with his/her family a number of months prior to departure. Additionally, it is as well essential to get ready their new house in the new environment, and to promise quality health services as well as school enrolment for those having school-going children. Importantly, companies may make use of one of the three distinct approaches in staffing and managing their workers: Ethnocentric approach is used where home nation practices prevail, such that H.Q. from the home nation make important decisions, workers who hold important jobs are from home countries, and HRM practice followed by workers is from home country (Paul, 2011). Polycentric approach is used where all subsidiaries manage locally, that is to say a local member of staff heads a subsidiary for the reason that managers from the headquarters are considered to lack sufficient local knowledge (Paul, 2011). Therefore, in subsidiaries HRM practices are normally create locally. The final approach is global or geocentric; wherein the business that uses the international integrated business strategy staffs as well as manages workers globally. Conclusion In conclusion, it has been argued that IHRM concentrates on the management of workers on an international context, but the strategy of the organisation on a globalization setting strongly impacts the approach it takes to IHRM. As a consequence, the approach to IHRM influences the execution of the key IHRM functions of recruitment as well as selection, training and development, evaluation of performance, benefits and remuneration, in addition to labour relations. The argument discussed in this paper supports a well-acknowledged saying that every company must seek to avert a crisis from taking placing. In this case, MNCs are being confronted by crises such as unsuccessful assignments caused by untimely expatriates’ return as well inability to retain competent as a result of poor repatriation. Without doubt, expatriate management crises can considerably endanger a company’s performance as well as capabilities in the host country. Moreover, the high rate of repatriates’ attrition is expensive and generates a negative net return on the company’s HR investment. Therefore, a proactive and well-managed response to an expatriate management predicament could help a MNC retain skilled and competent international workers as well as lessen the chance of legal and public relations problems in the host nation. The aforementioned setbacks with regard to expatriate failure in assigned assignments as well as poor IHRM approaches proves why establishing competencies and more effective recruitment and selection processes for potential expatriates has become increasingly important. References Ball, D., Geringer, M., Geringer, M., & McNett, J. (2003). International Business: The Challenge of Global Competition. New York: Irwin/McGraw-Hill. Chew, J. (2004). Managing MNC Expatriates through Crises: A Challenge for International Human Resource Management. Research and Practice in Human Resource Management, 12(2), 1-30. Donnelly, N. (2003). International Human Resource Management and Expatriate Transfers: Irish Experiences. Industrial Relations Journal, 34(5), 543 - 554. Harzing, A.-W., & Christensen, C. (2004). Expatriate failure: time to abandon the concept? Career Development International, 9(7), 616 - 626. Hurn, 7. J. (2014). 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