Dr. Joerg Bueechl, a professor of human resource management and an expert in the field of internationalization and expat strategies, answers seven questions about the risks of recruiting international talent and how to convert them into opportunities through the development of solid expat strategies.
1. What are the biggest risks of recruiting international talent?
Recruiting international talent should follow a specific staffing policy. However, companies often do not have a choice on how to staff. Take the IT sector in Germany as example. This sector is coined by an extensive shortage of specialists, which we are currently trying to bridge with people predominantly from India. Many of them relocate to Germany together with their family — for the most part unprepared with regards to the (working) culture.
If there is no proper onboarding, challenges are inevitable. It takes awareness, knowledge, and time to align different types of working cultures to ultimately perform as an individual and team. These differences include trust and relationship formation in the workspace, a common understanding of leadership and communication patterns, as well as a common approach to time and project management.
The risks here are twofold. On the one hand, it is the company that faces risks and challenges along all stages of the hiring process, such as looking at the right place for a candidate, establishing assessments to benchmark applicants, performing background checks to verify qualifications, negotiating the compensation and benefit package, completing immigration procedures, and then, of course, the onboarding process.
With international hires, particularly, there is a common risk that teams might not be able to perform on a certain level because the onboarding and integration processes take longer than expected. Furthermore, if expectations from multiple stakeholders at the workplace cannot be aligned, the working atmosphere could suffer. Ultimately, if proper selection, staffing, and integration processes are not in place, visible turnover will follow.
There are also significant risks involved from the perspective of foreign assignees: Just think about the implications to relocate the family and then canceling all arrangements if the collaboration does not seem to be promising after a couple of months.
Finally, there are also risks involved in terms of international recruiting on an internal basis in the form of inpatriates or expatriates. In this scenario, the risks mainly center around expatriate failure, including the inability for the foreign assignee and/or their family to adapt to a foreign culture, the assignee’s personal or emotional maturity, or the inability to cope with larger overseas responsibilities. From a company perspective, the risks include extensive costs and the challenge to find highly qualified personnel that are willing to go abroad once word gets out that previous assignments have failed.
2. How can international HR professionals turn these risks into opportunities?
From the perspective of international hires, it might be helpful to hire employees with previous international exposure, whether in the form of studies abroad or preliminary international working experience. Furthermore, sound onboarding, as well as an integration and mentoring program are crucial.
Foreign assignments do not fail because employees are not aware of how to extend business cards in a proper manner or how to eat with chopsticks. Cross-cultural collaboration fails in most instances because of a lack of awareness of others’ value systems and corresponding behaviors. Once this awareness is fostered for any team member (supervisor, colleague, or international employee), in most cases a gradual adjustment process is triggered.
The same aspects apply to internal hires such as expatriates and inpatriates. However, for this group of employees it is of utmost importance that they have an intrinsic interest to go abroad. Unfortunately, I have seen too many cases where foreign assignees were forced to commit to an assignment abroad, resulting in more damage than benefits.
3. What are the cornerstones of a good expat strategy?
Firstly, the expat strategy depends largely on how the company wants to position itself internationally. So, looking at whether the company strives to globalize or centralize — does it implement similar processes, policies, and a unified culture around the globe or does it aim to localize, where it sets up locally appropriate processes, rules, and sub-cultures.
Next, a company should send the right people for the right reasons. The right reasons cover the spectrum from addressing short-term business needs, such as knowledge-transfer, to medium-term strategic goals, such as developing talent, to long-term strategic goals, such as transferring and consolidating the corporate culture worldwide. The right people could include senior managers for high-level positions, young employees who try themselves at a first interim leadership position abroad before advancing their career at the headquarters, but also blue-collar workers who transfer technical knowledge. In any case, nothing is as important as sending assignees who are willing to go abroad and who are culturally literate.
Another cornerstone is a sound cost-benefit evaluation. The costs of expatriation are extremely high, so too are the risks of expatriation failure. Therefore, each and every assignment does not only have to make sense, but should be financially plausible.
Timely information and preparation are also essential. In big corporations, particularly, it happens quite frequently that the future assignee is being approached with the question of whether he or she could imagine going abroad for a couple of years with the result that relocation takes place only one or two months later. Relocation, training, and integration are pivotal for both the assignee and their family. This does not only include finding a new apartment, school, etc., but also getting in touch with a new circle of friends. For children, the integration efforts are usually the lowest, however the relocating spouse is often the person struggling most. Here, dual career programs and local clubs can help a lot with the integration journey.
Many companies also offer the assignee two mentors, one in the host country and one in the home country, so that the assignee stays in touch with the current affairs in the headquarters and can start planning his or her repatriation process, including finding a new position, early enough.
Finally, given the high number of repatriates who leave the company within one year after their return, a proper and holistic repatriation process is crucial.
4. Why is a solid expat strategy important?
Perhaps the most important aspect of a solid expat strategy for the interplay between employer and expat is transparent expectation management. A sound expat strategy enables the company to expand their pool of talent and thereby increase global task-to-talent-match flexibility, develop cross-culturally savvy future managers, and increase the understanding and commitment within headquarters-subsidiary relations.
In the best-case scenario, the expat knows what to expect before, during, and after the foreign assignment. The expat can develop his or her managerial qualifications, as well as character and personality, gain international experience, increase income, experience the challenge of greater responsibility and independence, and theoretically improve career opportunities. I use the word “theoretically” because the times are largely gone where repatriates got awarded with a higher position as soon as they returned. It seems to be more common now that the colleagues who stayed at the headquarters could use their presence and networks to boost their career. Therefore, it is the duty of the company, and the respective international HR management, to prepare the expat for what to expect upon return.
5. How do you define good onboarding and integration of global talent?
Before joining Aalen University, my last project at Daimler was setting up a new onboarding process, therefore, I am quite familiar with this topic. From the perspective of the international hire or foreign assignee, the most crucial time begins even before the first day in the new position, a time which is largely shaped by uncertainty. Therefore, the onboarding process should start soon enough for the assignee (and the family, if applicable) to get technically and emotionally prepared. Aspects include a look-and-see-trip to get an impression of the city, infrastructure, subsidiary, and team, and to hopefully get a first look at possible neighborhoods and apartments. It is definitely important to get a very concise understanding of what to expect in the new job.
Kick-off events, organized by former expats can also be helpful, where the future foreign assignees and their families listen to real-life-stories, get first impressions of what such an assignment abroad entails, and have a platform and opportunity for exchange. Furthermore, cross-cultural awareness trainings and country-specific technical trainings that focus on the future business function are non-negotiable must-haves, at the very least for those with no or very little foreign experience. A plus would be a language crash course for a couple of weeks. However, in this respect companies are not as generous as they used to be ten years ago.
If the expat is working in a large corporation, it is very helpful if there is one agent to take care of everything: working contract, rental contract, transportation — simply everything. I have experienced so much chaos and so many tears shed just because expats-to-be were stuck in a service line as they had no single contact person and nobody felt responsible for their issues. In many cases, these issues are attributed to organizational shortcomings of the international HR departments.
A buddy program can also be very helpful. This is a standardized part of the onboarding program where a “buddy”, namely a colleague, shows the expat around the workplace and the family around the city. This person really helps with the integration process.
6. You are an expert on China as a hub for global talent. Findings from our Expat Insider 2018 Business Edition Country Focus: China indicate that just over half (52%) of the international hires living there (of those participating in the survey) feel at home in the local culture and even less (35%) find it easy to make friends. What is your take on this?
I have lived in Beijing, Shanghai, and Wuhan and it was comparatively easy to make friends. The advantage, as well as disadvantage is that from our point of view the culture in China is so exotic that it accelerates the process to bond with other foreigners. This applies to foreign assignees, international hires, and relocating spouses.
Quite a lot of expats live in areas where other foreigners live. One might be skeptical about this notion because it leads to parallel worlds and in the end many expats and their families live in an expat bubble. However, this often helps them to find friends who are in similar situations and live nearby. Therefore, it is difficult for me to understand why it would be so challenging to find friends, at least in the bigger cities with quite a few foreign subsidiaries.
Regarding feeling at home, it can be quite challenging, especially if one does not speak Mandarin. There are just so many people who do not speak English yet, the food is different, and the activities and expectations are different. Everything is so exotic that in the first place it might trigger the curiosity of expats, but in order to feel at home one needs familiarity. When I lived in China, I always lived with Chinese because it was important for me to immerse myself into the local culture, to learn more about it, and to learn the language. However, even though I speak Mandarin, lived in China for several years, and have been treated hospitably, I have never felt entirely at home. Even though I enjoyed living in China very much and I felt very comfortable there, to feel at home is something different.
What helps are clubs, communities, etc. where people who share the same interests meet. I believe this helps quite a lot with integration and finding friends. For example, my wife is from San Francisco (USA) and the InterNations Community in Munich was a big help for her to get transitioned in Germany more quickly.
7. What does the future hold for international talent acquisition and retention?
Do you think HR will still exist as we know it? While this answer is highly philosophical, I can imagine that through the digitization of a lot of processes it will get easier and, more importantly, more transparent for both the employer and international talent.
I think it is important (whenever it makes sense) to build an attractive global employer brand. Via websites that share workplace insights, the working culture becomes so transparent that a lot of companies feel the urgency to act. I also believe that across generations, the workforce of today and tomorrow forms specific expectations that employing organizations must respond to in order to attract and retain talent.
In my opinion, it is the job of HR professionals to tease out the expectations of the target group of their preferred employees and to gradually shape a culture that creates a larger common denominator between the expectations of (future) talent and the employer. And with the ongoing digitization, global collaboration becomes so much easier, leading me to believe that the number of expats will continue to decrease. Personal contact will always remain important. However, I have the feeling that the world gets smaller and it is much easier to communicate and to align expectations on a global level in line with technological advancements.
About the Expert: Dr. Joerg Bueechl is a professor of human resource management at Aalen University and holds a PhD in international business from Tübingen University. Dr. Bueechl worked as a project manager, consultant, and executive assistant on specialist and management level in the fields of global strategy, digital transformation, human resource management, organizational development, and change management. He has worked at small and medium-sized enterprises, such as Kendrion GmbH and ICUnet.AG, as well as corporations such as Philips, Bosch, and Daimler in Germany, the USA, and East Asia. His research and teaching focus on innovation and design thinking in HR contexts, international leadership and negotiation, doing business in China, and economics.