International business people who are sent abroad on temporary assignments face psychological challenges similar to sojourners. They must successfully interact with local counterparts to achieve work goals while adjusting to an unfamiliar culture. Expatriate effectiveness directly impacts international commerce, so selecting candidates with interpersonal and cross-cultural skills is important. However, cultural differences can negatively impact work practices, leadership styles, and group performance for expatriates working in foreign environments. Proper support, preparation, and consideration of cultural distance are keys to expatriate adjustment and success overseas.

1. International Business People
Sent by employers to work and live
temporarily abroad

2. Similar Psychologically to the Sojourn
• Work has finite limit
• Clear assignments that they are expected to
finish
• Must be able to interact successfully with local
counterparts to achieve goals
• Will experience dislocation associated with
unfamiliar cultural settings
• Career path may be affected by assignment

3. The expatriate experience--studies
managerial/professional roles
• Provide human link in international trade
• Effectiveness has a direct link to
international commerce
• Sojourn group most likely to receive pre-
departure training, cultural orientation
• Undergo psychological assessments as
part of selection process

4. Topics specific to expat experience
• Work-related cognitive styles/responses
(negotiations, influencing, leading)
• Managerial practices do not easily cross
cultural boundaries
• Role of the spouse
• Re-entry process, reintegration
• Problems specific to female expats
• Inpatriation

5. Cultural Distance
• Role is evident in ABC components
• Affects how people feel about life
and work abroad
• Adeptness in realizing
personal/professional goals
• Work-related perceptions and
decisions

6. Principle problems derived from North
American practices and assumptions
• Flexible working hours
• Consultative leadership style
• Egalitarian interpersonal relationships
• Emphasis on task achievement
• Direct performance feedback
• Reliance on written rules
• rewards

7. Principle problems (cont.)
• Negotiation practices (rational vs emotional
appeals)
• Selection, recruitment and advancement
based on merit
• Psychological contracts and formal
relationships, ‘a fair days work for a fair day’s
pay’
• Right of worker and employer to break
contract

8. “Nobody can think globally.”
(Hofstede, 1998)
• Problematic for expat managers who
are expected to put into effect
company-wide policies and practices
that may be lost on
subsidiaries, changes to
accommodate may dilute corporate
culture/centralization

9. Heterogeneous work groups
• More cultural distance among workers has
adverse affects on group performance, more
difficult to manage
• Less interpersonal harmony, increased stress
and turnover
• Advantages include more creativity (learning
how to manage diverse groups may provide
competitive advantage)

10. “Would you trust your foreign
manager?”
• Trust between managers and
supervisors was greater in
homogeneous than heterogeneous
work settings (Banai & Reisel, 1999)
• Increases with more cultural distance

11. Leadership Style
• Authoritarian/autocratic vs
participative/democratic (leaders make
all decisions vs share power with
subordinates)
• Task-oriented vs people-oriented styles
(structure vs consideration)
• Contingency theories (ignores
characteristics or personality of the
leader)

12. Transactional vs Transformational
Leadership (Bass, 1997)
• Makes explicit reference to characteristics of
the leader and leader-follower relationship
• Transactional leadership based on exchange
principle (rewards for compliance)
• Transformational leadership based on ability
of a leader to motivate followers to work for
goals that go beyond self-interest for benefit
of the group, inspire followers

13. Transformational Leaders
• According to Bass, transformational
leaders are more effective than leaders
who follow contingent-reward strategy
• Advantageous across cultures
• Transcends organizational boundaries

14. Collectivist Values
• Some evidence that transformational
leadership is consistent with collectivist
values, whereas individualist values are more
in line with transactional approach
• High power distance makes employees more
likely to accept their leaders’ vision
• Some studies support the idea that
individualists respond better to styles that are
consistent with cultural orientations

15. Work performance and Satisfaction
• Recent study by Eylon and Au (1999) looked at
high power distance (Asian) and low power
distance (Northern European, Canadian)
among ‘empowered’ workers
• All participants were more ‘satisfied’ when
working under empowered circumstances, but
high-power distance empowered workers
performed less well than empowered, low
power-distance workers

16. Self-managing teams
• Western idea that workers who are given
more freedom in decision-making will increase
productivity and satisfaction
• Similar to another modern trend, ‘semi-
autonomous work groups’ (organizational
structures with flattened hierarchies)—highly
effective in the right circumstances, but may
be counterproductive in some cultures

17. Joint ventures in China
• ‘China fever,’ many joint ventures have been
failures in financial terms (only 44% report
meeting profit targets)
• Cultural differences play a major role in
exacerbating market-related difficulties such
as guanxi relationships that are based on
mutual trust and willingness to enter into long
term commercial relationships

18. Guanxi
• Key element for successful commercial
transactions in China
• Westerners regard a business relationship as
short-term transactions where each party tries
to maximize its benefits
• Even if guanxi is accounted for, ‘outsider
status of Western companies may affect
success

19. Selecting International Managers
• Psychological literature emphasizes
interpersonal and cross-cultural skills as key
determinants of success, but technical ability
and job performance continue to be major
selection criteria
• ‘Coffee-machine system’ refers to candidates
being selected based on personal
recommendations

20. Motivation to undertake expat
assignments
• The decision to send executives abroad is
often made on an ad-hoc basis dictated
by market forces rather than staff career
development, motives of sojourners are
largely ignored, and their willingness to
go abroad taken for granted (Spiess and
Wittmann, 1999)

21. Expatriate Adjustment
• Cultural distance
• Extent of social support
• Actual or perceived treatment by host
society
• Extent of sojourn experience contributing
to career advancement

22. Cultural Distance
• Western expats based in Europe experience
fewer difficulties than those working in Africa
• German managers in U.S. report greater
cultural awareness, knowledge and work
satisfaction than their American counterparts
in Japan
• Mangers posted to similar cultures are less
sensitive to differences that do exist and may
attribute problems to personal deficiencies

23. Host Attitudes
• Greater perceived host ethnocentrism
(measured by items reflecting perceived
cultural superiority and intolerance) was
negatively associated with work
adjustment and commitment to the local
branch of the organization (Florkowski
and Fogel, 1999)

24. Expats Abroad
• Between 20 and 50% return prematurely, a
financial burden on companies
• ‘realistic job interview’ or preview, meant to
alert applicants to negative and positive
aspects of the job are not in regular use with
respect to international assignments

25. Expatriate Women
• Women are under-represented in expat
assignments due to myths that inhibit women
from being offered overseas assignments such as
assumptions by managers that women do not
want to work overseas (Adler, 1977)
• Studies show a reluctance by both men and
women when cultural distance is high (women
reluctant to accept assignments in Vietnam, Saudi
Arabia and Indonesia) Kogut and Singh, 1988

26. Expatriate Women
• Both men and women are equally successful
but adjustment is to some extent affected by
the work values of host culture
• Married females are better adjusted than
single females
• Company support has significant effect
• Women in higher level positions report more
positive experiences

27. Repatriation
• Up to 80% of expats suffer culture shock
during repatriation. Adler (1977) found that 1
in 5 employees want to leave organization
after returning; less than half receive
promotions; two-thirds feel sojourn had an
adverse affect on careers; nearly half believe
their re-entry position is less satisfying than
overseas assignment
• Expectations and outcomes strongly linked

28. Inpatriation
• Employing inpatriate managers is advantageous
based on their knowledge of local business; can
serve as informal mentors to expat managers;
provide local perspectives on business plans;
better position to communicate with local
suppliers and government officials; less expensive
• MNC reluctant to hire foreign managers based on
desire to maintain tight control, but the future
will see steady growth of inpatriation