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Chapter: Business Science - International Business Management - Production, Marketing, Financial and Human Resource Management of Global Business

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International Training and Development

International training and management development are always closely associated in the management literature. Gregerson et al. (1998) proposed four strategies for developing global managers: international travel; the formation of diversified teams; international assignments and training.

INTERNATIONAL TRAINING AND DEVELOPMENT:

 

International training and management development are always closely associated in the management literature. Gregerson et al. (1998) proposed four strategies for developing global managers: international travel; the formation of diversified teams; international assignments and training.

 

These four strategies relate to expatriation management, particularly integrating international training and management development. Training aims to improve current work skills and behavior, whereas development aims to increase abilities in relation to some future position or job, usually a managerial one (Dowling et al., 1999, p. 155). A truly global manager needs a set of context-specific abilities, such as industry-specific knowledge, and a core of certain characteristics, such as cultural sensitivity, ability to handle responsibility, ability to

 

Develop subordinates and ability to exhibit and demonstrate (Baumgarten, 1992). These characteristics and skills are considered as important international competencies and all can be developed through effective international training and management development. International training refers to training for international assignments.

 

There are three broad types of international trainings in MNEs.

 

They are:

 

(1) Preparatory training for expatriates: once a person has been appointed for an international assignment, pre-departure training is normally used to ensure the candidate has adequate skills and knowledge that are necessary for working abroad effectively.

 

             Post-arrival training for expatriates: after an expatriate has gone abroad, further on-site training is often used to familiarize the expatriate with the local working environment and procedures.

 

             Training for host-country nationals (HCNs) and third-country nationals (TCNs): Training should be provided to HCNs and TCNs to facilitate understanding of corporate strategy, corporate culture and socialization.

 

Preparatory training for expatriates has received most attention in the international literature as expatriate failure (i.e. the premature return of an expatriate manager before the period of assignment is completed) is always regarded as due to a lack of adequate training for expatriates and their spouses.

 

            The expatriate failure rate is an important indicator for measuring the effectiveness of expatriation management.

 

            The costs of expatriate failure are high and involve both direct and indirect elements. In the case of expatriate recalls, the direct costs include salary, training costs and travel and relocation expenses. Mendenhall and Oddou (1985) stated that the average cost per failure to the parent company ranges between US$55,000 and US$80,000, depending on currency exchange rates and location of assignment.

 

            Indirect costs may be considerable and un-quantified, such as damaging relations with the host country government and other local organizations and customers, as well as loss of market share, damage to corporate reputation and lost business opportunities. The literature indicates that expatriate failure is a persistent and recurring problem and failure rates remain high.

 

International management development can also be expected to play a central role in MNEs because of its importance in developing a cross-national corporate culture and integrating international operations.

 

According to Bartlett and Ghoshal (2000), global firms can enhance their inter-unit linkages by creating a pool of global managers from anywhere in the world. Management development in MNEs is the “glue” bonding together otherwise loose and separate entities.

 

Pucik (1984) argued that probably the most formidable task facing many multinational firms is the development of a cadre of managers and executives who have an understanding of the global market environment deep enough to enable them to survive and come out ahead.

 

International training provision although many have highlighted the importance of international training, international training is often neglected or poorly handled in MNEs. McEnery and DesHarnais’s (1990) survey shows that between 50 and 60 percent of US companies operating abroad at that time did not provide any pre-departure training. Tung (1981) also observed that only 32 percent of the US companies surveyed provided some international training.

 

The 1997-1998 Price Waterhouse survey revealed that only 13 percent of European firms surveyed always provided their expatriates with access to

 

cultural awareness courses, though a further 47 percent provided briefings for culturally “challenging” postings.

 

To aggravate the situation even further, most training is of very short duration, generally lasting only a few days (Baumgarten, 1995). Torbiorn (1982) and Tung (1982) confirmed that European MNEs provide more training than US companies.

 

About half of European corporations provide formal training. Taking China as an example of a developing country, there is generally low awareness of the importance of training for expatriates in Chinese MNEs.

 

The majority of Chinese MNEs tend to provide very limited or ad hoc pre-departure training for expatriates. Most Chinese companies provide only irregular briefings or do not provide training programs for expatriates at all. Where training is offered, the training duration is usually short, such as two days or one to two weeks, due to the limited training programs provided.

 

Normally, expatriates are often not given adequate preparation time between notification of the posting and relocation. No formal and compulsory policy about post-arrival training for expatriates is made at the corporate level in any the selected Chinese firm.

 

Headquarters normally leave local managers to decide if there is a need to provide such post-arrival training. Chinese firms are also very weak in providing training for HCNs, spouses and families. The majority of International training and MD 659Chinese MNEs provide only job briefings for HCN employees instead of proper training. Reasons for not providing adequate training

 

Scarcity of cross-national comparative research may be attributed to a number of reasons including:

 

            The large quantity of effort, skills, and resources required to develop, translate, and back-translate surveys while achieving functional item equivalence;

 

            The challenge of acquiring multiple-data collection sites in multiple nations;

 

             The high-touch approach required to obtain data sites in many countries reduces sample comparability which contributes to an inability to publish research in the “best” journals;

 

            The issue of expatriate compensation is in debate and has overshadowed issues of the larger workforce;

 

              Ethnocentrism has resulted in the exportation of compensation programs (Hyer,

1993);

 

              Multinationals find it convenient to assume that duplicating local practice will maximally motivate workers (Abdullah & Gallagher, 1995).

 

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