Most multinational companies throughout The Netherlands have an expat constituency. And expat assignments are now more popular than ever; the influence of globalization has made companies place a great degree of importance on being “culturally fluent.” That said, there are some significant problems with expat assignments: many of them fail, and even if they succeed approximately 25% of employees leave the company upon reintegration. I will take a short look at some of the reasons why expat assignments fail, as well as present some possible ways to increase their likelihood of success. Due to space limitations, in the current post, I will only take up the issue of expat assignments fail, leaving the question of how to successfully reintegrate expats for a later posting.
First off, it is important to define what I mean by an “expat.” An expat is formally defined as an employee who is working in a country other than their home country. Most expat assignments have a limited duration, that is, almost all expats plan to reintegrate in their home country after a few years away. Most expats originate from the United States, followed by Great Britain, Germany, and then Italy. Some expats take an expat assignment for personal motivations but many take them upon encouragement by their employers. In fact, many companies require some work experience in another country in order to rise into an executive role. But despite the ubiquity of expatriation, there are a number of problems with expat assignments, first and foremost, assignment failure.
Failure is defined as coming home prematurely – before one’s overseas assignment contract has fully matured. The statistics vary for U.S.-based expats, but existing studies place U.S. expats at a failure rate of between 15-40%, meaning at the highest estimates, almost one out of every two expats go home early. In order to explore the greatest predictors of failed expat assignments, we should explore what leads expat assignments to be successful. First off, it is important for expats to possess a solid level of technical competence. Why? Because this will allow them to both feel self-confident in their ability to succeed and will help them to earn respect from their new colleagues. Second, expats should be open to and curious about cultures other than their own, as well as be flexible to new lifestyles. In comparison to U.S. expats, only about 5% of Europeans fail in their expat assignments. There are many possible reasons for this significant discrepancy, one of them being that Europeans are exposed to many more cultures while growing up and usually are fluent in more than one language (not to mention the fact that for a European, an expat assignment can mean going only a few hundred kilometers from one’s home!). A successful expat also needs to have good relationship-building skills. They need to be open and willing to forge ties in their new country.
But what is the number one predictor of expat assignment success? The family situation of the expat. Many expats go home early not because they are unhappy in their foreign post but because their spouse, partner, or children are unhappy. It is also possible that the expat has left their spouse or partner back at home and the expat is feeling lonely. So, if companies are trying to predict who will be the most successful expats or are trying to find ways to improve the experience of current expats, then perhaps, they should “focus on the family.” In other words, it might be best for companies to extensively ask people about their family situation before selecting them for an expat assignment – questions like, Is your partner willing to move with you? Could he/she get a job overseas? Has he/she ever lived overseas for an extensive period of time? Would he/she go with you if you went overseas? Of course, it also makes sense to provide spouses and partners with resources to help them integrate once they are overseas; however, only relying on these resources after the expat and his/her family are already overseas seems like a much more costly (and risky) strategy than merely selecting expats with favorable family situations to begin with.
Often times, attention is only placed on the potential expat him or herself, rather than on the familial situation surrounding the potential expat. Given the large expense that goes along with expat assignments, not to mention the loss in morale that occurs when an expat comes home prematurely, it might be a wise idea for companies to look beyond just the employee him/herself when choosing their next expats.