Advantages And Disadvantages Of Depruiting Expatriate Staff Over Local Staff

Competing in global markets entail many factors and centralization of its human resource practices is certainly vital to improve global competitiveness and empower employees for global assignments. To achieve success in global marketplace, the challenge of all businesses regardless of their size is to understand global corporate cultural differences and invest in human resources which includes selecting and retaining talented employee, training and development whilst encouraging employees to be innovative and creative. Employees selected to work in foreign locations should be prepared beforehand with adequate cross-cultural training. For an organization to be successful in the international marketplace, it must be concerned with this fit from both an internal and

Productivity in the new culture is experienced to an extremely positive extent. Business dealings and negotiations become secondary nature to the expatriate, and the expatriate’s journey becomes a great success in the perspective of their employing company.

Due to the price of goods and cheap labor costs. Owing to the fact that if the cost of labor is high, the product has to be high which may cause the business to shut down. Outsourcing is a mischievous practice for the job market. While some good benefits can come from it, the ethical, legal, and business issues for the company's, employees, customers, and other external stakeholders outweighs them. For businesses that are small or big, there are both pros and cons to outsourcing HR functions.

Performance criteria and goals are best established by combining the values and norms of each local environment with the home-office’s performance standards. An individual country profile should be developed and should take into account the foreign subsidiary’s environment. This profile should be used to review any factors that may have an effect on the expatriate employee’s performance. Such factors include language, culture, politics, labor relations, economy, government, control, and communication.

GE has numerous expatriate employees in overseas positions. Catalanello and Redding (1989) argued that GE’s success with their human capital is based on the training they provide to them (as cited in Jain and Agrawal, 2005, P. 83). The training provided to its expatriate employees helps to build competitive advantages at GE. Expatriates, when visiting a foreign country on business would need a basic understanding of that nation’s culture, as it relates to business. Being able to say please and thank you in the native language can go a long way to building productive relationships with foreign nationals. Although, as business has become more global, business people understand there are cultural differences and are generally tolerant of visitors that do not understand, or have a working knowledge of their

Let’s talk about a positive aspect of outsourcing business. “Contractual Obligation: The liability of a service provider is higher than that of an in-house employee. This makes working with them a safer bet for businesses.” At least you can be at ease that the people you are working with overseas are well trained in the business that you are outsourcing.

In analyzing the second reason listed for why outsourcing is used; ‘inability to attract the highest caliber of employees to job functions that may be peripheral to the organization’s core discipline’, companies employ a different kind of outsourcing tactic. This reason leads to offshore outsourcing solutions. If a company cannot attract high caliber domestic employees to job functions secondary to their main function then they seek help where labor may be less expensive and more efficient.

The reality for most corporations is that they cannot assume the challenges that are brought about by the increased level of globalization. Repatriates have increased the level of cross-cultural diversity among employees in organizations (Black & Gregersen, 2000). The diversity has also been increased among suppliers, customers, creditors, and competitors. Employers are therefore required to put in place different mechanisms that can make it possible for the retention of repatriates. There is need to note that culture has a great impact on the behavior that is assumed by individuals. The paper sets out to discuss the various methods that can be used by employers as the most appropriate means through which they can effectively manage

Expats need to maintain proper distance and develop satisfied relationship with their local employees. (Patrick Rau et al., 2013)

Through the evolving process of globalisation, the global community grows increasingly interconnected and culturally diverse. Scholars such as Toh and DeNisi (2007) argued that HCNs have the ability to effect the success of expat integration and acceptance, by facilitating the expatriate with cultural and social support. If the HNC does not aid the expat in the transition, research has shown that this can hinder the expats success and adjustment to the different culture (Varma et al.,2012) as well as affecting their general professional performance (Caliguri et al.,2016).

In summary, the home culture of an expatriate predisposes them to certain behaviors and situations. It allows them to operate efficiently in that environment. However, moving to the host-culture changes that operating environment and makes their 'mental software ' less efficient and effective. Culture is clearly a relevant variable when expatriating employees and their families for international business assignments. Training can be applied to ameliorate these effects. Also, training provides insight into the procedural, substantive and informational aspects of their work and personal life in the host location.

One of the major corporate problems in the current century involves continuously soaring salaries and wages. In fact, some companies face up to 50 percent of their annual income being expended on staff compensation only. In several such cases, the highest number of employees are usually nationals of the host country within which the company operates. It thus follows that the numerous costly legalities involved in getting an expatriate into the country, coupled with getting to compensate them for their troubles away from home would amount to a significantly higher amount of staff compensation costs. Add this to the already compounding corporate problems and you land in a real nightmare of a situation.

There are also several disadvantages to outsourcing agreements, which include becoming dependent on an outside supplier for services, failing to realize the purported cost savings from outsourcing, locking into a negative relationship, losing control over critical functions, and lowering the morale of permanent employees.

The company can hire individuals from the country the headquarters are located (home country), hire individuals from the country the new location is in (host country), or hire individuals from other countries other than the home or host company (third country). Of course, the company could hire any combination of the three. When hiring from either the host or third country option, the person hired is considered an expatriate. The hiring decision for a multinational company opening in a new country could be an immense one for the Human Resources Department (HR). The HR department has to consider the cost to the company with hiring locally or hiring expatriates and the reliability and production of the new employees that they will hire. Each of these crucial choices has their pros and cons to each side of them. Recruiting locally, within the country, could benefit the company with many factors such as cost benefits, the new employees having knowledge of local professional customs and regulations, etc. Recruiting from the home or third country category, better known as expatriates, to work for the company has many advantages which could assist the company in many ways that local recruitment could not. The following pages go into greater detail on the processes and issues companies must complete when deciding between a local hire and an expatriate.

The importance of expatriates being able to interact and communicate with local nationals is emphasized by the contact theory assuming that interpersonal contacts between individuals from different cultures lead to understanding and adjustment. One of the ways that expatriate newcomers become aware of appropriate behaviours in the host country is interacting with host country nationals in a social setting, as local people would be the sources of information and help to understand. The successful expatriates are socially well-integrated. Therefore, expatriates who often communicate and interact with locals will be less surprised and frustrated by differences in non-work circumstances of the host country comparing with expatriates who are socially isolated from the host culture. In the host country, inappropriate behaviours are more likely to result in negative outcomes, leading the expatriate to make the wrong attributions about the culture of the host country and consequently to further withdraw from it. Avoiding interaction with the host country nationals in daily life outside work leads expatriates to ignore local thinking and mentality, which affects their ability to assess work situations and make them develop inaccurate assumptions about the people they are managing. However, others have argued that to bring about adjustment merely interacting with host nationals is not enough, suggesting that adjustment will be facilitated if the expatriates have the cultural empathy