Chapter Eight - Making the Changes
A lot of this book is simply about the need for country managers to be cleverer about the way they engage with their host country. And perhaps the most immediately profitable business case we’ll make is to argue that companies should be better at selecting, training and managing their expatriate managers. Improved performance in this field would lead to immediate savings in the costs of premature repatriation, under-performance in the job and high staff turnover. It would also lead to a new breed of expatriate managers being appointed who are sensitive to the needs of their host country and so better able to implement the type of recommendations we make on reducing poverty.
The statistics on expatriate performance are frightening. A significant percentage of expatriates cut their postings short. Many of those who stay under-perform. And those few who are any good and last the course then become unsatisfied back home and leave to join a competitor. It’s a bleak picture, but at least it offers hope for improvement. When we find examples of companies failing to contribute much to economic development or poverty alleviation, it may not be anything inherent in the nature of capitalism or globalisation, but simply that the people currently charged with implementing company strategy in developing countries are not up to the job.
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Chapter 8 – links and resources
‘The Right Way to Manage Expats’ by J. Stewart Black and Hal. B. Gregersen, in Harvard Business Review (March–April 1999) gives an excellent account of the expatriate management cycle. It is available for paid download at http://harvardbusinessonline.hbsp.harvard.edu.
‘Strategies That Fit Emerging Markets’ by Tarun Khanna, Krishna Palepu and Jayant Sinha in the June 2005 issue of Harvard Business Review discusses the need to adapt business models to local markets or to support the development of local infrastructure to fill the gaps. It is available for paid download at http://harvardbusinessonline.hbsp.harvard.edu
Global Champions from Emerging Markets by Jayant Sinha of McKinsey discusses the lessons on multinational operations that can be learnt from companies like HSBC.
