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Chapter 7

Chapter 7. Re-entry and Career Issues. Chapter Objectives. This chapter deals with the post-assignment stage, which raises issues for both the expatriate and the multinational. We treat this stage as part of the international assignment.

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Chapter 7

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  1. Chapter 7 Re-entry and Career Issues IBUS 618 Dr. Yang

  2. Chapter Objectives • This chapter deals with the post-assignment stage, which raises issues for both the expatriate and the multinational. We treat this stage as part of the international assignment. • Some of the issues may be connected to events that occurred during the international assignment. We examine: • The process of re-entry or repatriation • Job-related issues • Social factors, including family factors that affect re-entry and work adjustment • Multinational responses to repatriate concerns • Return on investment (ROI) and knowledge transfer • Designing a repatriation programme. IBUS 618 Dr. Yang

  3. Re-entry • Expatriation process also includes repatriation: • The activity of bringing the expatriate back to the home country. • Re-entry presents new challenges: • Expatriates may experience re-entry shock or reverse cultural shock. • Some exit the company. • The multinational’s ability to retain current and attract future expatriates is affected by the manner in which it handles repatriation. IBUS 618 Dr. Yang

  4. Expatriation Includes Repatriation IBUS 618 Dr. Yang

  5. The Repatriation Process IBUS 618 Dr. Yang

  6. Repatriation Phases • Preparation– Developing plans for the future, and gathering information about the new position • Physical relocation – Removing personal effects, breaking ties with colleagues and friends, and traveling to the next posting, usually the home country • Transition – Settling into temporary accommodation where necessary, making arrangements for housing and schooling, and carrying out other administrative tasks (e.g., renew driver’s license, applying for new health insurance, banking, etc.) • Readjustment– Coping with changes (e.g., company changes, reverse culture shock, career demands, etc.) IBUS 618 Dr. Yang

  7. Repatriation Challenges • Little evidence in the literature that multinationals view the preparation for repatriation as important as pre-departure training. • Readjustment is the least understood and most poorly handled. • 52% of 287 surveyed subsidiaries reported repatriate re-entry problems (Harzing, 1996). • 44% turnover rate among 181 multinationals surveyed by GMAC-GRS 2002 • 50% leave the firm within one year • 39% of surveyed firms did not know their turnover rates IBUS 618 Dr. Yang

  8. Career anxiety No post-assignment guarantee of employment Loss of visibility and isolation Changes in the home workplace Work adjustment The employment relationship and career expectation Re-entry position Devaluing of the international experience Coping with new role demands Role behavior Role clarity Role discretion Role conflict Loss of status and pay Autonomy Responsibility Lower pay in absolute terms Drop in housing conditions Individual Reactions: Job-related Factors IBUS 618 Dr. Yang

  9. The Repatriate’s Role IBUS 618 Dr. Yang

  10. UK Repatriate Study • Surveyed 124 recently repatriated employees • Indicated five predictors for repatriate maladjustment • In ranked order: • Length of time abroad • Unrealistic expectations of job opportunities in the home country • Downward job mobility • Reduced work status • Negative perceptions of employer’s support during and after repatriation IBUS 618 Dr. Yang

  11. The Readjustment Challenge IBUS 618 Dr. Yang

  12. Individual Reactions: Social Factors • International experience can distance the repatriate (and family) socially and psychologically (e.g., Kingpin syndrome, financial loss) • Each family member undergoing readjustment • Re-establishing social networks can be difficult • Effect on partner’s career • Recent research indicates a decrease in spousal assistance upon re-entry (e.g., job search, resume preparation and career counselling) IBUS 618 Dr. Yang

  13. Multinational Responses • Staff availability • How repatriation is handled is critical • Return on investment (ROI) • Defining ROI in terms of expatriation • Gains accruing through repatriated staff • Knowledge transfer • A one-way activity? • Tacit and person-bound? IBUS 618 Dr. Yang

  14. Measuring ROI • Expatriates are expensive, averaged $1m/per assignment by the U.S. multinational. • High turnover rates represent a substantial financial and human capital loss to the firm. • Difficulties in measuring ROI (GMAC-GRS 2002): • Receiving feedback from the business unit concerned • Tracking international assignments in a systematic way • No formal planning • Lack of objective measures • Too many decisions made without cost considerations of the international assignment IBUS 618 Dr. Yang

  15. Designing a Repatriate Program • Repatriation, physical relocation and transition information that the company will help with • Financial and tax assistance, e.g., benefit and tax changes, loss of overseas allowances, etc. • Re-entry position and career-path assistance • Reverse cultural shock, including family disorientation • School systems and children’s education and adaptation • Workplace changes, e.g., corporate culture, structure, decentralization, etc. • Stress management and communication-related training • Establishing networking opportunities • Help in forming new social contracts Topics covered by a repatriation program IBUS 618 Dr. Yang

  16. The Use of Mentors • Aims to alleviate the ‘out-of-sight, ‘out-of-mind’ feeling by keeping expatriate informed • Mentor should ensure that the expatriate is not forgotten when important decisions are made regarding positions and promotions • Effective mentoring needs managing • Mentoring duties include: • Maintaining contact with the expatriate throughout the assignment • Updating developments in the home country • Informing management developments • Providing assistance in the repatriation process IBUS 618 Dr. Yang

  17. Factors Affecting Mentoring • Size of expatriate workforce • Firms with over 250 expatriates are more likely to assign mentors. • Who is responsible for repatriates • Corporate HR or a separate international assignment unit is more likely to provide mentors than the divisional level. • Company nationality • European firms are more likely to use mentors than U.S. firms. IBUS 618 Dr. Yang

  18. Chapter Summary This chapter has been concerned with the repatriation process. We have covered: • The repatriation process. • Cultural novelty has been found to affect adjustment in the host country and, for the majority of repatriates, coming home to the familiar culture may assist in readjustment. • However, given the profound effect of job-related and social factors, re-entry shock or reverse cultural shock is likely to occur in the readjustment process upon repatriation. (cont.) IBUS 618 Dr. Yang

  19. Chapter Summary (cont.) • Job-related issues centered on career issues upon re-entry. • Factors that affect career anxiety include no post-assignment guarantee of employment, fear that the period overseas had caused a loss of visibility, changes in the home workplace that affect re-entry positions and the employment relationship. • The re-entry position is an important indicator of future career progression and the value placed on international experience. Coping with new role demands is another factor in readjustment, along with loss of status and pay. (cont.) IBUS 618 Dr. Yang

  20. Chapter Summary (cont.) • Social factors explored include loss of social standing and the accompanying loss of the expatriate lifestyle. • Family readjustment is also important. • A specific aspect is the effect of the international assignment on the spouse/partner’s career, such as being re-employed and having international experience recognized. (cont.) IBUS 618 Dr. Yang

  21. Chapter Summary (cont.) • Multinational responses to repatriates’ concerns focused on re-entry procedures. • How repatriation affect staff availability • Whether companies are measuring and obtaining a return on investment through international assignments, and • The contribution of repatriates to knowledge transfer, and • Designing effective repatriation programs, including the use of mentors. (cont.) IBUS 618 Dr. Yang

  22. Chapter Summary (cont.) • Although the focus of this chapter has been repatriation in the general sense, issues concerning expatriates’ post-assignment career should be raised. • Viewing repatriation as part of the expatriation process, as suggested in Figure 7-1, should remind those responsible for expatriation management of the need: • To prepare repatriates for re-entry and • To recognize the value of their international experience to both parties. • Firm and cultural factors should be understood in order to develop and manage an effective mentoring system. IBUS 618 Dr. Yang

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