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Since then, ASIMCO, with sales of over U.S. $500 million, has become one of the largest, independent components manufacturers in China. It supplies competitively priced, high-quality products to the Chinese as well as global automotive markets. Based in Beijing, the company makes a wide range of products, including all types of castings, brake systems and components, diesel fuel injection systems, a variety of NVH products, and key engine components such as piston rings and camshafts.
ASIMCO's management team oversees a far-reaching operation of 17 manufacturing facilities and 52 sales offices in China, as well as regional offices in the United States, the United Kingdom and Japan. Approximately 70% of the organization's yearly sales are made to Chinese customers, with the other 30% are made to American, European and Japanese consumers. ASIMCO is the first global components company to have originated in China.
ASIMCO has not been successful with its expatriate program. It estimates that just about 20% of the expatriates sent to China are successful. The management of ASIMCO believes that that the extra demands that are put on the expatriates in China, such as the local culture, language and communication problems, lack of local credibility, the need to train local staff and the requirement to perform operational duties, makes it difficult to find candidates who have the desired mix of senior management experience, patience, perseverance and willingness to perform operational tasks. Yet, the success of international operations with ASIMCO depends heavily on this expatriate performance. The question is what is causing the failure rate and what can be done to turn it around.
Erbacher, D'Netto, & Espana (2006) surveyed the ASIMCO expatriates to determine which of nine factors were to blame for the expatriate failure: 1) Personal factors, which are closely linked to an individual's values, beliefs, expectations and cultural background. These included perceived career path, willingness to relocate and degree of personal international orientation (cross-culture awareness and degree of internationality). And 2) Situational factors, which focused on the organization's role in impacting expatriate success for preparing expatriates for their oversea assignment and reduce culture shock. These included selection criteria, training, level of support, strength of relationship between the expatriate and the firm, such as length of time the expatriate has served the parent company and how long he/she has known the key executives in both home and host companies. These also included performance reviews that have not been successful.
According to the authors Erbacher, D'Netto & Espana, (2006, p. 185), "Performance appraisal and reward for expatriates is a neglected area in management research and practice," and "Assessing an expatriate's performance can be difficult when the transferee's role may include such disparate duties as ensuring that business units achieve numeric targets, implementing skills transfer, overseeing staff development and providing relationship management in a foreign environment." The authors (Erbacher, D'Netto, & Espana, 2006) found that the variables of Performance Management, Training, Organizational Support, Willingness to Relocate and Strength of Relationships are significantly correlated with Expatriate Success. Although these findings are based on a relatively small sample, the results of the data analysis and interviews with participants are consistent with earlier research, offering valuable directions for additional study into expatriate success in China.
While performance management was significantly correlated with expatriate success, almost 50% of the study's participants noted that their employers did not have explicit performance management systems in place to gauge and influence the expatriate assignment. In addition, most indicated that their performance management system was not transparent or equitable. In addition, the implementation of performance management systems for expatriates was poor. Inadequate performance management systems and consequent inappropriate rewards are likely to reduce motivation and enhance expatriate failure rates.
The authors Erbacher, D'Netto, & Espana (2006) express that the results of this research show that organizations must focus on pre-departure training for the expatriate and his or her family. Consistently, the authors found the importance of family members in expatriate success and the lack of ability of most organizations to incorporate these in expatriate management. This certainly represents a major area for improvement in expatriate management and the results of this study highlight this weakness. This study shows that in some cases, the performance management system is still in its infant stage, primarily in the area of cross-culture and communication, which were noted by Adler (1991) and Perlmutter (1989) to be so important to the company's overall success.
There are some companies that have recognized the importance of this aspect of performance management. For example, the Daimler-Benz Aerospace views cross-cultural human resources as a core skill. It has developed a variety of constructive programs, transnational management and organizational development programs for the further extension of cross-culture. An aerospace business, Daimler-Benz Aerospace has joined with universities and other business organizations in conducting intercultural research projects in order to develop high-potential international managers, exchange programs, seminars, meetings, cultural awareness, intercultural skills training and preparation for international assignments.
Specialist Daimler-Benz staff is trained at the European Consortium for Advanced Training in Aeronautics. System integrators receive training in the Network for Aerospace Management in Europe. Project and Program managers receive training in the European School for Aeronautical Sales, while potential GMs receive an MBA education through European Executive MBA consortium. Overall, the company avoids cross-cultural training. Instead, the company takes its learning business strategy and integrates it into regularly planned business activities that utilize a cross-cultural team of facilitators working in a cross-cultural learning environment.
Daimler-Benz is not alone by any means, there are other companies, such as Motorola, and Pepsi, that have developed special programs particularly for the expatriates that will make them more comfortable in another culture and be able to lend their management expertise. What this case study showed, as earlier studies support, cross-cultural training and diversity training of the expatriates is essential, just as is keeping in contact with the expatriates from the international office. As Erbacher, D'Netto, & Espana (2006, p. 186) noted, "The findings of the current research paper supported the need to maintain close links with the expatriate for the entire duration of the overseas assignment. Without this support, expatriates are likely to feel isolated and can often become detached from the organization." If additional organizations want to expand their competitive market through the work of expatriates in other countries, they will have to develop a performance management system that makes them feel "at home away from home."
Adler, N.J, 1991, International Dimensions of Organizational Behavior, Boston: PWS-Kent Publishing.
Erbacher, D., D'Netto, B., & Espana, J., 2006. Expatriate Success in China: Impact of Personal and Situational Factors..
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