Why Organizations Use Expatriates
Why do organizations use Expatriates?
Expatriates were used as a means of addressing agency issues as a result of the separation of ownership and management and their amplification through distance.
Edstrom and Gailbraith (1977) proposed three motives for using expatriates. Firstly, as position fillers when suitably qualified host country nationals (HCNs) were not available. Secondly, as a means of management development, aimed at developing the competence of the individual manager. Thirdly, as a means of organisational development, aimed at increasing knowledge transfer within the MNC and modifying and sustaining organizational structure and decision processes. Although it is important to note that assignments generally have more than one rationale (Sparrow et al., 2004)
More recently, Harzing (2001) identified three control specific roles of expatriates, namely: the bear, the bumble-bee, and the spider.
Bears act as a means of replacing the centralisation of decision-making in MNC and provide a direct means of surveillance over subsidiary operations. The title highlights the degree of dominance these assignees have over subsidiary operations.
Bumble bees fly “‘from plant to plant’ and create cross-pollination between the various offshoots” (Harzing, 2001: 369). These expatriates can be used to control subsidiaries through socialisation of host employees and the development of informal communication networks.
Finally spiders, as the name suggests control through the weaving of informal communication networks within the MNC
There is a growing debate as to the continued utility and viability of the conventional expatriate assignment.
5 key aspects of this issue: supply side issues*, demand side issues*, expatriate performance and expatriate failure, performance evaluation, and finally costs and career dynamics.
Supply side
There is growing recognition that shortages of international managers are a significant problem for international firms
Expatriates were used as a means of addressing agency issues as a result of the separation of ownership and management and their amplification through distance.
Edstrom and Gailbraith (1977) proposed three motives for using expatriates. Firstly, as position fillers when suitably qualified host country nationals (HCNs) were not available. Secondly, as a means of management development, aimed at developing the competence of the individual manager. Thirdly, as a means of organisational development, aimed at increasing knowledge transfer within the MNC and modifying and sustaining organizational structure and decision processes. Although it is important to note that assignments generally have more than one rationale (Sparrow et al., 2004)
More recently, Harzing (2001) identified three control specific roles of expatriates, namely: the bear, the bumble-bee, and the spider.
Bears act as a means of replacing the centralisation of decision-making in MNC and provide a direct means of surveillance over subsidiary operations. The title highlights the degree of dominance these assignees have over subsidiary operations.
Bumble bees fly “‘from plant to plant’ and create cross-pollination between the various offshoots” (Harzing, 2001: 369). These expatriates can be used to control subsidiaries through socialisation of host employees and the development of informal communication networks.
Finally spiders, as the name suggests control through the weaving of informal communication networks within the MNC
There is a growing debate as to the continued utility and viability of the conventional expatriate assignment.
5 key aspects of this issue: supply side issues*, demand side issues*, expatriate performance and expatriate failure, performance evaluation, and finally costs and career dynamics.
Supply side
There is growing recognition that shortages of international managers are a significant problem for international firms