International Managerial Roles and Responsibilities

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International Managerial Roles and
Responsibilities

• Business Responsibilities
• Worldwide Strategist
• Resource allocator
• Cross-border coordinator
• Functional Responsibilities
• Intelligence Scanner
• Cross-Pollinator
• Champion of innovation

• Area Responsibilities
• Interpreter
• Defender of local values/interests
• Upholder of Corporate values/interests
• Frontline strategy implementors
• Stage Responsibilities
• Entrepreneurial
• Integration/Control
• Renewal/Revitalization

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Expatriates

• Why expatriates?
• Coordination Control
• Transmission of Corporate Values/Culture
• Technology Transfer
• Developing Organizational Capabilities (learning)
• Management Development
• Types of expatriates
• Home-country nationals
• Third-country nationals
• Local hires

3
Expatriate issues

• Pre-assignment
• Objectives of the assignment (length, clarity)
• Assessing the opportunity (responsibility,
  rewards, compensation)
• Dealing with problems (dual careers, families,
  health, safety)
• Preparation (reading, exploratory visits, meeting
  people)
• While there
• Learning/Adapting to the environment -- the
  heros journey
• Links to home -- mentors communication of effort
  and achievement, face-to-face contact,
  career-planning
• Attitudes -- Free agent/ Heart at home/
  Going Native/ Dual Citizen
• Post-assignment
• Reverse culture shock (also economic and social
  shocks)
• Irrelevance to company/ Depression
• Career issues

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Expatriate attitudes
Lo
Free agent
Going Native
Allegiance to parent company
Heart at home
Dual citizen
Hi
Lo
Hi
Allegiance to local operation
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The Foreign Job Assignment

• Individual Considerations
• Technical Competence
• Job-ability factors are a necessary attribute
• Adaptiveness
• Family adaptation is important
• Dual career issues
• Childrens education
• Language
• Fixed-term versus open-ended assignments
• Local Acceptance
• Prejudices
• From cultural differences
• From perceived needs to protect their livlihood
• Staff vs. line placement
• Securing a Successful Foreign Assignment

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The Foreign Job Assignment

• Post-Expatriate Situations
• Repatriation Problems
• Coming home can require adaptation in many areas,
  including
• Financial
• Job
• Familial
• Spouses relocation/ adaptation
• Childrens education
• Social
• Career Movements

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Compensation

• MNEs must pay enough to entice people to move but
  must not overpay
• Issues to consider
• Cost of Living
• Living is more expensive abroad because
• Habits change slowly
• People dont know how and where to buy
• Children may have to attend private schools
• MNEs use various cost-of-living indexes and
• Increase compensation when foreign cost is higher
• Do not decrease compensation when foreign cost is
  lower
• Remove the differential when the manager is
  repatriated
• Job-Status Payment
• A transfer is more attractive if employees see it
  as an advancement
• Spouses job
• MNE headhunters consortia

8
Compensation

• Foreign-Service Premiums and Hardship Allowances
• Employees may encounter living problems for which
  extra compensation is given
• Choice of Currency
• Salaries usually are paid in a mixture of
  home-and host-country currencies
• Remote Areas
• MNEs may have to provide more fringe benefits to
  employees in remote areas
• Cost of returning home receiving visitors
• Cost of securing comfort items
• Complications of Nationality Differences
• For expatriate and working spouse

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Figure 21.1 Comparative Apartment Costs (July 1,
1995)
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Comparative Labor Relations

• Sociopolitical Environment
• History and current attitude in a country affects
  how labor and management view each other and how
  labor will try to improve its lot
• Union Structure
• National versus local
• Industry versus company
• One versus several for the same company
• International Pressures on National Practices
• The ILO monitors labor conditions worldwide

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Figure 21.2 Changes in Union Membership in
Selected Industrial Countries
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Expatriate Failure Rates Recall rate
of Companies

• U.S. multinationals
• 20-40
• 10-20
• lt10
• European multinationals
• 11-15
• 6 -10
• lt5
• Japanese multinationals
• 11-19
• 6-10
• lt5

• U.S. multinationals
• 7
• 69
• 24
• European multinationals
• 3
• 38
• 59
• Japanese multinationals
• 14
• 10
• 76

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The Cost of Failure

• Direct U.S. 55,000-80,000
• Salary, training, travel relocation expenses
• Indirect (intangibles)
• Hard to quantify, but can be higher than direct
• Examples
• Loss of connections may lead to decreased market
  share
• Host country government may put pressure on to
  hire a host country national
• Possible effects on local staff