Expatriate Performance Management in Global Business
This paper examines the challenges multinational companies face in managing expatriate performance across cultural boundaries. Drawing on Adler's stages of corporate internationalization, Perlmutter's ethnocentric-to-global evolution model, and a case study of ASIMCO Technologies in China, the paper argues that expatriate failure stems less from technical deficiencies than from inadequate cross-cultural training, weak organizational support, and poorly designed performance management systems. The paper also highlights Daimler-Benz Aerospace as a model of integrated cross-cultural human resource development. Key factors correlated with expatriate success — including performance appraisal transparency, pre-departure training, family support, and sustained organizational contact — are identified, and recommendations for building more effective international performance management systems are discussed.
- Introduction: The Expatriate Challenge in Global Business: Rationale for improved expatriate performance management systems
- Stages of Multinational Development and Cultural Awareness: Adler and Perlmutter's frameworks on corporate internationalization stages
- Cross-Cultural Competence and Performance Appraisal: Cultural diversity, appraisal challenges, and US–China leadership differences
- ASIMCO Case Study: Expatriate Failure in China: ASIMCO's low expatriate success rate and contributing causes
- Factors Influencing Expatriate Success: Nine personal and situational factors correlated with expatriate outcomes
- Corporate Models: Daimler-Benz and Others: Daimler-Benz cross-cultural HR programs as a positive model
- Conclusion: Building Effective Expatriate Management Systems: Need for home-away-from-home support and transparent performance systems
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What makes this paper effective
- Grounds theoretical frameworks (Adler's four stages, Perlmutter's ethnocentric evolution) in a concrete, detailed case study of ASIMCO Technologies, making abstract concepts tangible.
- Balances the diagnosis of a problem (high expatriate failure rates) with constructive examples of solutions, contrasting ASIMCO's shortcomings with Daimler-Benz's integrated cross-cultural programs.
- Uses multiple sources spanning strategy, human resources, and regional business to build a multidisciplinary argument about why performance management systems must be culturally adapted.
Key academic technique demonstrated
The paper exemplifies the use of a single organizational case study (ASIMCO) as an anchoring mechanism. Rather than relying on the case study alone, the author situates it within a broader theoretical context established in the opening sections, then uses the case findings to validate prior research. This technique — theory first, case as evidence, comparative example as solution — gives the argument a clear empirical grounding while maintaining analytical scope.
Structure breakdown
The paper opens with the business rationale for effective expatriate management, then moves through theoretical frameworks on internationalization and cultural competence. It transitions into the ASIMCO case study as primary evidence of failure, analyzes the nine personal and situational factors studied by Erbacher et al., and closes with positive counterexamples from Daimler-Benz and other corporations before reaching a prescriptive conclusion.
Introduction: The Expatriate Challenge in Global Business
With increasing numbers of American companies going global, it is essential that more emphasis be placed on establishing an effective performance management system designed specifically around the experience of the expatriate within his or her international corporate culture. Growing initiatives in global internationalism will necessitate finding creative ways for international staffing, such as better understanding of the position of the international management team, new strategies for personnel selection and training, and an overall acknowledgement of expatriates' relationships with two different organizational cultures.
Daimler-Benz Aerospace, for example, incorporates a number of different cultural aspects into its overall management performance structure. Such an individualized human resources approach is needed, as demonstrated by the case study of expatriates with ASIMCO and other supportive studies discussed below. This research emphasizes that the primary concern with expatriates is not their management skill level or business capabilities; rather, it is their inability to perform to their highest potential because of feelings of isolation from the parent organization.
While some progress has been made in selecting and training expatriates, many of the problems that have been present since the beginning of globalization persist today. These include ineffective hiring procedures, a dearth of appropriate training, unprepared transfer to foreign assignments, ineffectiveness of expatriates on the ground, and family problems that influence job performance. A truly effective international performance management system must be updated to handle the major changes in international human resource strategies. The "increasingly global nature of business activities has placed new demands on organizational and managerial performance and has called for new responses" (Mabey, Salaman, & Storey, 1998, p. 194).
For example, today's international assignments are utilized not only for reasons of staffing, control, and representation, but also as a means to develop managers' skills and education and to considerably improve organizational learning and capabilities. Managers in international settings handle highly sophisticated responsibilities, such as leading transnational joint ventures, working with multicultural teams in diverse environments, and balancing the variable responsibilities of global integration and local sensitivity (Mabey, Salaman, & Storey, 1998, p. 194). This multiplicity and complexity of job responsibilities create significant challenges for developing an effective international performance management system.
Evans and Lorange (1989, p. 144) question how a corporation operating in different product markets and socio-cultural environments can effectively determine human resource policies. In response, these authors suggest a socio-cultural logic relative to the diverse cultural, political, social, and legal situations that multinational companies (MNCs) face, along with workforce cultural diversity.
References
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. Journal of American Academy of Business, Cambridge, 8(2), 183–189.
Evans, P., & Lorange, P. (1989). The two logics behind human resource management. In P. Evans, Y. Doz, & A. Laurent (Eds.), Human resource management in international firms (pp. 169–190). New York: St. Martin's Press.
Forster, N. (1997). The persistent myth of high expatriate failure rates: A reappraisal. The International Journal of Human Resource Management, 8, 4–10.
Hailey, J. (1996). Breaking through the glass ceiling. People Management, 11, 4.
Mabey, C., Salaman, G., & Storey, J. (1998). Human resource management: A strategic introduction. New York: Wiley-Blackwell.
Perlmutter, H. V. (1969). The tortuous evolution of the multinational corporation. Columbia Journal of World Business, 9–18.
Stuttard, J. B. (2000). The new silk road: Secrets of business success in China today. New York: John Wiley & Sons.
Wu, L. (2007, October 23). Talent management insights for China. Retrieved February 3, 2009, from
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