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HR should invest in the selection process for expatriate assignments to prevent costly failures down the road.
Selecting the wrong person for any job can lead to failure and cost the company money. But the stakes are higher for expatriate assignments. Global projects always require extra care in handling different cultures, politics and business practices. And critical to their success is sending the right people abroad.
Perhaps that’s why eight out of 10 respondents report candidate selection as a factor that may lead to assignment failure, according to a study co-sponsored by the Society for Human Resource Management’s (SHRM) Global Forum, GMAC Global Relocation Services (GRS) and the National Foreign Trade Council. And, respondents cited better candidate selection as the top initiative to improve return on investment (ROI) of assignments, according to the study.
A failed assignment can cost anywhere from two times to five times an assignee’s annual salary, according to experts interviewed for this story. “When you look at the time it takes to start the entire process over, the cost is only compounded,” adds Kathy Curtis, senior vice president of the western region at GMAC GRS in San Ramon, Calif.
Kellogg Co. learned that the hard way. “Turnover among expats was horrendous, about 40 percent at one point. We weren’t getting a good return on investment,” says Betty Hal-verson, director of global expat programs at Kellogg in Battle Creek, Mich. The company has since put a selection strategy in place, a move aimed at improving the company’s ROI.
“Mistakes are disruptive to employees and families and have both a financial and operational impact on business,” says Richard Hallock, executive vice president of HR at Occidental Petroleum Corp. in Los Angeles and a member of the Global Forum Board of Directors.
That’s why it’s important for HR professionals to step in and help their companies save money by getting involved in the selection process early on—and learning some key predictors of success as well as common mistakes that lead to failure.
“Research shows HR is increasingly involved in selection, but HR professionals are still not driving the process,” says Ian Payne, senior vice president and managing director of Cendant Intercultural, a consulting firm, in London.
One way to ensure that top management sees HR as a vital part of the selection process is to become indispensable. “Make it your business to have some familiarity with the countries where you send people,” says Pam Perraud, founder of Global Transitions, an international relocation consulting firm in New York.
Perraud also advises keeping track of the bottom line. HR professionals should understand the bottom line when it comes to expat assignments so they can argue in favor of a formal selection process over a “send ’em quick” philosophy that others may advocate.
For many companies, candidate selection consists of a manager pointing at a competent employee and saying, “We need him to go to X.” However, no one makes a good decision when under the gun. That’s why planning is so important in creating a successful international assignment program. Managers and HR people should be looking for and grooming candidates before a need arises.
In an effort to improve its success rate, Kellogg devised a pilot program intended to identify the best candidates for international assignments. The company asked managers to select possible candidates; then, HR and senior management reviewed the list and narrowed it down to 16 people. Those 16 people and their spouses were given assessment tests that looked at their work styles, values and interests. A comprehensive report on the findings was presented to the employees and their spouses, highlighting potential risks and areas of concern. To date, four of the 16 candidates have been placed on assignment abroad, and, Halverson reports, “No negative issues have come up at all with these people.”
Apache Corp., a natural gas and oil company based in Houston with operations in Egypt, China, Poland and Australia, also has implemented a formal process. Ted Hess, manager of international human resources, explains: “We ask each location manager to anticipate needs for the coming year so we can look ahead. We also ask them to quantify the need and explain why they will need to fill a position.”
In addition, every year the company sends a survey to all employees to gauge their level of interest in overseas assignments. “Based on this information we can identify hiring needs,” Hess says. “This tells us if we can expect to relocate someone already in the company or if we need to hire from outside.”
Key Predictors and Common Mistakes
Although advance planning is ideal, not all HR professionals have that luxury. But even for those in a hurry, there are ways to assess a candidate’s chance for success.
One fairly simple gauge is desire for an assignment. “Self-nomination is helpful. If someone is interested in a country and a culture, then that’s the best person to send. They’re appreciative of being sent and aren’t looking for other kinds of perks to make it worthwhile to go,” says Melanie Young, director of global talent management at NCR, a provider of international networking solutions, in Dayton, Ohio, and an SHRM Global Forum board member.
Still, desire is not a guarantee of success. Certain personality traits—such as flexibility, willingness to learn, openness, sense of humor, adaptability, ability to handle ambiguity and interest in others—are helpful characteristics to those working abroad.
In addition to those core traits, HR should try to find a good match between the management style of the person and the way business is conducted in the country. “When you’re selecting someone to go from Texas to Minnesota, you’re choosing them based on the skills. Marketing is marketing no matter what state you’re in,” says Perraud. “But it’s a whole different ballgame overseas.”
The differences between business cultures in the United States and some regions abroad can be stark. “You could have a top salesperson in the United States who is aggressive and a high achiever, but [who will] fail in Japan for the very reason he’s a success in the United States,” Curtis says.
Sheida Hodge, director of worldwide cross-cultural services at Berlitz International in Princeton, N.J., has seen this first-hand. “I have a client, a law firm, with an office in Singapore. One of the partners has been sent there from the United States. Most of the support staff wants to quit, and things are going very badly for that office. No one back in the United States understands what’s happening,” she explains. “The partner was such an achiever over here. It’s a different culture, and his work style isn’t effective there.”
What’s more, even when an employee has one successful expat assignment, it doesn’t mean he will find similar success in a different location. “Each place is different,” warns Perraud. “Just because someone did well in Korea does not mean they’ll do well in China.”
Some companies err when they choose employees for assignments based on race. “An employee may be a second-generation Japanese, and an HR person will think he’s great for an assignment in Japan,” Perraud says. “But culturally this person is an American and doesn’t necessarily have any better chance of fitting into that culture than anyone else at the company.”
Language proficiency is a must, but it should not be the only guiding factor. “Recently, I worked with a young Mexican-American woman who was going to be sent to Spain because she spoke Spanish. It looked like a good fit on the surface,” Perraud says. “Luckily, people in the local office warned us not to send her. It turns out that her parents had left Spain during a period of political strife and that would have been held against her.”
Religious views also could undermine assignments. “Problems with religions don’t come up very often, but when they do, they can be very dramatic,” Perraud says, recalling a client who had tapped a Jehovah’s Witness for an assignment in Germany. “This was a very bad idea because the German government doesn’t approve of this religion.”
Although it can be sticky delving into private matters with employees, Perraud maintains it is necessary. “Better you know before that person goes on assignment and runs into problems,” she says.
The top reasons cited for assignment failure in the Global Forum survey concerned family issues, an area that should be dealt with during the selection process. “It’s a big distraction if the family doesn’t want to be there,” notes Halverson. “We’ve had a couple of divorces occur while employees were on assignment,” she adds, and that can be disruptive to the company.
To assess the situation, invite the spouses of candidates in for interviews. “If the spouse isn’t willing to come in and talk, then that should be a big red flag,” notes Corinne Carlson, an international consultant at Watson Wyatt Worldwide in Chicago.
Kristi Shepak, now an international consultant at Watson Wyatt Worldwide in Chicago, suggests evaluating spouses together, which is something she did while working in the HR department of a compensation firm. “I established a spousal group and took the spouses of potential candidates out to lunch to find out who was really interested in going,” she recalls.
Apache sends the family to travel to the location prior to committing to selection because “The cost of the trip is nothing compared to a failed assignment,” maintains Hess.
Failing to screen a spouse can have a major impact. Perraud points to one client that sent an employee and his family to a small province in Japan without vetting the wife. She grew unhappy and the couple divorced while on assignment. Locally, it became a major scandal and one that rubbed off on the company.
Andrea C. Poe is a freelance writer based in Easton, Md., who specializes in human resource and management issues
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