Report on Expatriation, Challenges, and Staffing in Global Business

This report examines the concept of expatriation in multinational companies, exploring its advantages and disadvantages, and delving into the causes of expatriate failure. It discusses the challenges of doing business in Delhi, India, and analyzes why expatriation remains prevalent in a globalized economy. The report further outlines various staffing approaches, including ethnocentric, polycentric, regiocentric, and geocentric methods, and considers the implications for HR directors in planning for new international projects. The report highlights factors for expatriate selection and the benefits of expatriation to the global economy, such as financial gains, skill development, job creation, and the provision of international health insurance. It also provides insights into standardizing the recruiting and selection processes for effective international staffing.

International Management

Table of contents
MAIN BODY.............................................................................................................................3
Expatriation................................................................................................................................3
Causes of expatriate failure........................................................................................................4
Challenges of doing business in Delhi, India.............................................................................5
Why Expatriation is still so widely used in a globalised economy............................................5
Implications and HR Director’s planning for staffing the new project......................................7
CONCLUSION..........................................................................................................................9

INTRODUCTION
In this report the expatriation is discussed along with the advantages and the
disadvantages of using the expat employees by the company are discussed. The causes are
discussed that are leading towards the expatriate failure for the international business. The
reason is discussed why the expatriation is still so widely used in the globalised economy
when currently the cases of expatriate failure are on hike. The staffing approaches are
discussed in the report and the planning of the staff for the new project in abroad. Different
approaches like the ethnocentric, polycentric, regiocentric and geocentric approaches are used
for staffing purpose by the company.
MAIN BODY
Expatriation
The term expatriation is used by the multinational companies. The person is called
expatriate or expat, who is a temporary resident of a country that is not their native country.
The companies send the employees who have skills and talented to the new countries. The
expatriate earn more than they earn in the native country. The factors for the selection of the
expatriate from the company are:
 Suitability of cross culture (Zheng and Smith, 2019).
 Language skills.
 Requirements of the company.
 Requirement of the MNE.
 Technical ability.
 Requirement of family.
Advantages of using the expatriate employees by the company are:
 They can be used to fulfil the strategic need of the company.
 They are capable of implementing the parent organisation in the management style of
the business cross the seas.
 They are able to coordinate as well as control along with the subsidiary operations of
the business.

 Their performances can be improved.
 They are able to provide the better supervision along with the fine expertise.
 The operation held at the foreign country can be ensured to be of the standards of the
native country market (Ali and et.al, 2021).
Disadvantages of using the expatriate employees by the company are:
 Employing an expat for the company is expensive and problematic. The expat
themselves are problematic but the expenses of the travelling and paying them extra is
an issue for the company. The company have to look for the different tax and
relocation allowances of the expat. The company have to pay two to three times more
to the expat in comparison with the local employees at the company.
 The burnout rates of the expat who are completing very demanding jobs are high.
This can be due to the stress due to several factors like living away from friends and
family, language barrier, feeling of isolation and problem with adapting the new
culture.
 The companies face certain issues regarding the legal risks of the foreign countries.
The company can get banned from the certain countries for not respecting the
requirements of the immigration and obligation to the permit. The problem with the
expat can be more as they can be imprisoned for extending their work in the cross
country after the expiration date permit. The company can suffer from the non-
compliance penalties that are avoidable when the expat is sending (Skomars, 2020).
Causes of expatriate failure
The employee when begins the international assignment there are many challenges faced
by them during the completion of the assignment. The expat failure can be due to many
reasons that include:
 The employees have to deal with the difficulties even when they are providing with
careful recruited and training. The number one cause is the due to the family reasons.
The pressure on the employee is more when the family cannot adjust accordingly.
The employees can also experiences problem due to the difference in the culture, new
responsibilities and additional stress caused by coping with the new location and
position. All this leads to decrease in the performance, not meeting the expectation of
the company and early repatriation this cause the expatriate failure.

 The purpose of the international assignment is to achieve the particular goal or
business purpose. When the business objectives are not by the employee the company
choose the wrong employee for the assignment and the expatriate fails. Choosing the
right employee with the skills and talent is necessary part.
 The multinational company have to deal with the laws and the regulation of the
foreign company. The company have to follow the rules of the non –compliance for
the business in different country. The failure can be caused by the improper or lack in
the work permits, location and the activity scope (Wang and Varma, 2019).
The expatriate failure can be prevented by the multinational company by taking proper
and appropriate steps for the success of the assignment or the business purpose.
Challenges of doing business in Delhi, India
Ease of doing the business
India is still lacking in the areas like starting a business, registering property and
enforcing contracts. It can take up to 68 days for registering a business and it is costlier as
compared to the OECD high-income economies. If any kind of dispute arises it takes a long
period of 1445 days to resolve the issues in the local court that is three times higher in
comparison with the other countries.
High tariffs and protectionist policies
The tariff and the trade regulation of India is non-transparent along with being unpredictable.
It has the high tariff rates in the World Trade Organisation (WTO) and has the highest
average tariff in the G20 country.
Why Expatriation is still so widely used in a globalised economy
There has been a global rise in the expat along with the international citizens. Many
people move as an expatriate to abroad and change their lifestyle accordingly. This is
happening because the shift provides the employees with various types of benefits. The
employees get benefits like the development in their career, cultural enrichment and tax
saving. There many more benefits to the expat lifestyle (Groves and O'Connor, 2018). The
benefits to the global economy by the expats are given below:

Money
The expats are provided with more money than they get in their home countries, they
get 25% more money. The employees looking for higher income can opt for the company’s
expat. Globally the expat save more money than the normal employees. Large income flows
to the home country and accounts for the improved economy of the country.
The expat’s chances of investing the wealth are more. The expat are investing at the
host country and at the home country. Due to the investment in the host and the home
countries they are in more need for the relationships with the global banks. The financial
gains in the life of expats create them full of healthy prospects. They are full of positivity.
The factors that attract them to move overseas includes better employment opportunities,
better lifestyle, s better income with better prospects (Okere and et.al, 2019).
Skills
The expat are able to gain skills and gets the opportunity to diversify their talents. The
expats get good position in the management, technology, engineering, information, banking
and science departments all over the globe. In these ways the expats are helping the different
businesses worldwide (Tahir and Egleston, 2019).
Jobs and taxes
The expats add to the business economy and along with that they are hiring the locals
and providing employment for the locals. The expat are setting business like recreation,
media and food sector, this is increasing the local economy. The expats also introduce the
host countries with their services, products and talents of their home country. The expat are
helping generously in the contribution to the economy of the destination by income taxes and
corporate.
International health insurance
It is necessary for the expats to have an international health insurance for the working
in the abroad, this also added to the economy and the health condition of the expats can affect
the travel of the individual employee.

Implications and HR Director’s planning for staffing the new project
There are four approaches for the planning the staffing in the international project:
Ethnocentric staffing
In this staffing approach the HR can hire the staff from the parent company or parent
country that can be recruited all over the world. For example: if the company has a job role of
the executive in the host country then:
 The company will relocate the senior employees of the parent company who is
permanent residence of the parent country.
 The company can also hire an individual who is interest in working abroad and wants
to live there (Caligiuri and et.al, 2020).
This approach can be used by the company when they are opening a new branch in the
host country. The expat need to comprise less than 20% of the abroad offices so as to
minimise the cost of hiring as well as avoid missing the local community’s pulse.
Polycentric staffing
In this approach the HR can hire the locals from the parent company to fill the job
role. For example: the company can post or advertise the recruitment for the needs. The
company can also make contract with the local agency for the recruitment purpose. This
approach can be used by the company when in need of the skills of the local individuals to
conduct the company’s business for them. The company can hire a local professional with
specific skills and fulfil the company’s objectives (Lakshman, Lakshman and Estay, 2017).
Regiocentric staffing
In this approach the company hire the people form the same region to fulfil the job
position in the host country. The same region includes the group of countries from where the
employee can be hired. For example if the country is hiring for the job position in Sweden
then the employee can be hired from the neighbouring countries like Denmark. This approach
can be used by the company when the cost of relocation of the employee form the parent
country is higher than the cost of relocation from the neighbouring country.
Geocentric staffing

In this approach the company opt for the individuals that have pool of talent and best
suit for company’s objectives, while hiring them the company do not make particular region
to hire from. In this approach the company can chose from any country. This concludes that:
 Hiring remote employees
This approach is used when the company hire the individual from the places where they
do not own offices. For example: the company can hire the customer support agent from the
remote area to manage the customers of host country in their time zone.
 Relocating the employees
In this approach the company can relocate the foreign talents to the parent country and
also the talent form the parent country to the host country. This approach can be chosen when
the company requires an individual to be physically present at the specific location and the
best suitable person for the job is living elsewhere (Furusawa and Brewster, 2019).
The company can standardise the recruiting and selection process by:
 The company need to decide which staffing process will be affective for the current
needs and objectives of the company. In this the HR can decide from the regiocentric,
polycentric or ethnocentric approaches to choose from. The budget with the finances
should be discussed in order to apply the chosen approach. The company can also
choose from the approach that is lower in the cost and effective. If the company find
that none of the approaches are working for the company then the company can opt
for the geocentric approach.
 The company have to determine the methods of recruitment for the chosen approach.
For example: the company chose the polycentric approach from the approaches then
the company have to consider the recruiter based locally in the host country and the
local job boards (Stachová and et.al, 2019).
 The company need to look for the budget for the recruitment activities to be done. For
example: if the company chose the ethnocentric approach then the company need to
look for the relocation expenses of the hired employee.
 The candidates chosen need to be evaluated for the by checking the self-motivation,
independently working, communication with the language and cultural barrier, global
mind-set and is tech savvy.

 After the hiring process the HR need to clarify the legal procedures that include the
immigration policies, visas or the taxes. The HR need to be in close contact with the
hire until everything is completed.
CONCLUSION
It can be concluded from the report that the use of expatriation can be used by the
multinational companies for setting new business project in host countries. The process
carries various advantages and disadvantages for the company. The employees stress and
family expectation can lead to expatriate failure. The cultural differences and stress with the
settlement in the new place adds to the failure. The expatriation is widely used in the
globalised economy because the expat are investing their money in both the host and the
parent countries hence improving the economy of both the countries. The different
approaches for the implication of plans for staffing the new project in host country are
discussed.
REFERNCES
Ali and et.al, 2021. How do job insecurity and perceived well-being affect expatriate
employees’ willingness to share or hide knowledge?. International Entrepreneurship and
Management Journal. 17(1). pp.185-210.
Groves and O'Connor, 2018. Negotiating global citizenship, protecting privilege: western
expatriates choosing local schools in Hong Kong. British Journal of Sociology of
Education. 39(3). pp.381-395.
Okere and et.al, 2019. Foreign expatriates on board and financial performance: A study of
listed deposit money banks in Nigeria. The Journal of Social Sciences Research. 5(2).
pp.418-423.

Skomars, 2020. Expatriate Compensation and its Impact on Employee Satisfaction: A Single
Case Study from a Finnish Multinational Company.
Tahir and Egleston, 2019. Expatriation management process. Journal of Workplace Learning.
Wang and Varma, 2019. Cultural distance and expatriate failure rates: the moderating role of
expatriate management practices. The International Journal of Human Resource
Management. 30(15). pp.2211-2230.
Zheng and Smith, 2019. Tiered expatriation: A social relations approach to staffing
multinationals. Human Resource Management. 58(5). pp.489-502.
REFERENCES
Books and journals