1. International Human Resources Management
Chapter 10, Part 2

2. Training and Development
Cross-cultural training: increases the relational abilities of future expatriates and their spouses and families
Training rigor: extent of effort by both trainees and trainers required to prepare the trainees for expatriate positions

3. Training and Development (cont.)
Low rigor training – used for short-term assignments
Short time period
Lectures and videos on local cultures
Briefings on company operations
High rigor training – for long-term assignments
Longer time period
Experiential learning
Extensive language training
Includes interactions with host country nationals

4. Exhibit 10.4: Training Rigor: Techniques and Objectives

5. Expatriate Performance Appraisal: Challenges
Fit of international operation in multinational strategy
Different business environment
Unreliable data
Complex and volatile environments
Time difference and distance separation
Local cultural situation
Home country managers may not understand the local situation

6. Steps to Improve the Expatriate Performance Appraisal
Fit the evaluation criteria to strategy
Fine-tune the evaluation criteria to the situation
Get evaluations from different people

7. The Expatriate Manager: Compensation
The balance-sheet approach
Provides a compensation package that gives the expatriate the same standard of living he/she would have at home
Allowances for cost of living, housing, food, recreation, personal care, clothing, education, home furnishing, transportation, and medical care

8. Exhibit 10.7: Balance Sheet Approach To Expatriate Compensation

9. Compensation Details
Base salary: the amount of money that an expatriate would receive for doing the same job in the home country
Used as a basis to establish salary in the host country
Salary may be paid in home country currency, host country currency, or a combination of the two

10. Compensation Details (2)
Benefits: a substantial portion of expatriate compensation
Is the home country or the host country responsible for the expatriate's social security benefits?
Should home-country benefits programs be available to host-country nationals?

11. Compensation Details (3)
Allowances
Relocation allowance
Cost-of-living allowances are paid when the employee must incur extra costs that he would not pay in the home country
Examples: housing allowance, and the costs of private schools for the employee's children
Hardship allowance: Often paid to employees who work in a country with difficult living conditions
Home-leave allowances: pays the cost of periodic trips home for the employee and family

12. Compensation Details (4)
Allowances (continued)
Foreign service premium
In the past, a foreign-service premium was often a monthly payment that continued as long as the employee worked overseas
Many firms have eliminated the ongoing foreign-service premium.
Today, a one-time, lump sum foreign service premium is often paid at the start of the overseas assignment to provide cash for immediate expenses.

13. Compensation Details (5)
Taxes
An expatriate may be required to pay income taxes to both the host country and his/her native country
The company compensates the employee for the extra amount of tax

14. Compensation Details Summary
The cost of an expatriate employee =
salary costs
+ benefit costs
+ allowance costs (goods and services + housing)
+ tax costs

15. Compensation Approaches
The compensation package must be cost-effective and should be seen as fair
Balance-sheet approach: ensure that the expatriate does not lose money from the foreign assignment
Negotiation approach: Negotiate compensation with each employee – may be used with top-level managers
Host-based compensation: Pay the expatriate a salary comparable to local nationals

16. Compensation Approaches (2)
Lump sum method: give expatriate a pre-determined amount of money. Employee decides how to spend it.
Cafeteria approach: Offer the employee a choice among various compensation options, with a limit on total costs

17. Compensation Approaches (2)
Regional system: Set up a compensation system for all expatriates who are assigned to a particular region
Global pay systems: worldwide job evaluations, performance appraisal methods, and salary scales are used

18. Repatriation Problem Difficulties faced coming back home
Three basic cultural problems—“reverse culture shocks”
Adapt to new work environment and culture of home
Expatriates must relearn own national and organization culture
Need to adapt to basic living environment

19. Strategies for Successful Repatriation
Provide a mentor at the home office to help the expatriate stay in touch during the overseas assignment.
Provide a home-leave policy to encourage expatriates to make regular visits to the home office
Provide a strategic purpose for the repatriation – the foreign experience should help the expatriate's career
Help the expatriate make good use of the foreign assignment.
Provide information and assistance for relocation.
Provide training and preparation for the return
Provide support for the expatriate and family on return

20. International Assignments for Women: Two Myths
Myth 1: Women do not wish to take international assignments.
Myth 2: Women will fail in international assignments because of the foreign culture’s prejudices against local women.
Successful women expatriates
Foreign not female—emphasize nationality not gender

21. International Assignments for Women: Advantages
More visible
Strong in relational skills

22. International Assignments for Women: Disadvantages
Face the glass ceiling
Isolation and loneliness
Constant proving of themselves, working harder than male
Need to balance work and family responsibilities
Need to worry about accompanying spouse

23. More Women in the Future?
Women expatriate managers are expected to grow
Acute shortage of high-quality managers
Increasing number of women provide role models

24. What Can Companies Do To Ensure Female Expatriate Success?
Provide mentors and networking opportunities
Remove sources of barriers – educate other employees about the role of women managers
Provide support to cope with dual-career issues