THINK PIECE

Expatriate failure:time to abandon the concept?

Anne-Wil HarzingThe University of Melbourne, Parkville, Australia, and

Claus ChristensenCC Consult, Copenhagen, Denmark

Keywords Expatriates, International organizations, Multinational companies,Human resource management

Abstract This article reviews the established understanding of the concept of expatriate failure,discusses its associated problems and presents a more sophisticated and comprehensiveunderstanding of the concept. The article argues that it might well be time to abandon the conceptof expatriate failure altogether and instead draw on the general human resource literature toanalyse problems related to turnover and performance management in an expatriate context..

IntroductionExpatriate failure – usually measured as premature return from an internationalassignment – has taken up a very prominent position in the literature on expatriatemanagement. Even articles dealing with other areas of expatriate management oftenroutinely refer to (high levels of) expatriate failure to frame their arguments. Morerecently, several articles have attempted to discard the “myth of high expatriate failurerates” (Daniels and Insch, 1998; Forster, 1997; Harzing, 1995; Harzing, 2002; Insch andDaniels, 2002). Even though some contemporary authors still continue to support thismyth (see, e.g. Harvey et al., 2001), there is a growing acceptance that failure ratesmight never have been as high as originally claimed. However, this should not lead usto conclude that expatriate failure as such is not an important issue to investigate.What is still lacking is a systematic understanding of the concept of expatriate failure.In this article, we will first review the established understanding of the concept ofexpatriate failure and will show that this can be classified into five categories. We willidentify some problems with these established definitions and present a moresophisticated and comprehensive understanding of the concept of expatriate failure.This understanding leads us to the conclusion that it might well be time to abandon theconcept of expatriate failure altogether and instead draw on the general HR literatureto analyse problems of turnover and performance management in an expatriatecontext.

Evaluating the established understanding of expatriate failureIn the current literature, “expatriate failure” is a term encompassing a broad range ofthemes such as premature return, low performance, adjustment problems etc. Manyother terms are also used interchangeably, such as expatriate turnover and transfer(Naumann, 1992) and recall rates (Tung, 1981). In Table I[1] we present, in

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Received June 2004Revised July 2004Accepted August 2004

Career Development InternationalVol. 9 No. 7, 2004pp. 616-626q Emerald Group Publishing Limited1362-0436DOI 10.1108/13620430410570329

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chronological order, the most significant definitions of expatriate failure. Thecontributions are classified into five different categories, with some contributionsappearing in more than one category. The first column lists the contributions thatdefine expatriate failure as ending the international assignment before the contractexpires. The definitions in the second column resemble those in the first column interms of the assignment ending prematurely, but in addition to this element, all of themlink the premature return to one or more reasons for the outcome. Definitions in thethird column refer to expatriates who are underperforming. Here, we are dealing withproblems that the expatriate is facing or causing the organisation, but the consequenceis not a premature end to the assignment, i.e. we presume that the contract period isfulfilled. The last two columns relate to the time after the international assignment hasended (in one way or another) and deal with the end of the employment contract afterrepatriation or repatriation problems.

As can be seen the majority of studies simply define expatriate failure as thepremature end to the assignment, either with or without listing reasons. This is also thedefinition adopted by the two most important articles [measured in terms of citationsby other authors (Harzing, 1995)] in the literature about expatriate failure rates: Tung(1981) and Mendenhall and Oddou (1985). In conclusion, the established understandingof the term “expatriate failure” consists of a core made up of the categories of“premature end to an international assignment” and “premature end caused by areason”. Some authors do question the validity of this definition, even if they are notoffering alternatives. An understanding of expatriate failure as “underperformance, orsimilar, during the assignment” is also unfolding, and some contributions includerepatriate turnover (expatriate leaving the company shortly after repatriation) andrepatriation problems. However, what has been missing in the literature so far is acritical, systematic and integrated approach to these various definitions.

In order to evaluate the established understanding of expatriate failure, we need tolook more closely at what we call the international assignment cycle. We present twomodels that illustrate the possible scenarios for an international assignment. Figure 1depicts some of the human resource management processes that are involved in a“text-book” international assignment. In other words, Figure 1 is an “ideal” typescenario where the expatriate “life-cycle” is depicted as an unbroken circle, startingwith recruitment and selection, hiring, the actual assignment and finally therepatriation phase where the cycle ends. After repatriation the expatriate mightcontinue with his/her old job in the home organisation or the cycle may start over againwith the employee starting on a new international assignment. This is what mostacademics and practitioners in the field seem to have in mind when consideringinternational assignments and expatriate failure.

However, many cases do not resemble the ideal international assignment cycle atall. Expatriates may quit their assignment and leave for better job offers outside theorganisation, they might get transferred to other positions within the organisation, andsome might get fired because they do not perform according to expectations. Hence, theideal-type international assignment cycle is disrupted. Figure 2, therefore, illustratesall potential outcomes or scenarios for international assignments that we haveidentified from the literature and our contacts with professionals. By mapping out thepotential scenarios from international assignments, a range of outcomes or scenarios

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emerges that is much broader than the currently predominant understanding ofexpatriate failure.

In the context of Figure 1, premature return would be seen as an undesirableoutcome. However, as is depicted in Figure 2, this outcome can have many causes anddepending on the cause in question, premature return can in fact be a desirableoutcome. Most organisations would regard premature return because of the expatriates

Figure 1.The ideal internationalassignment cycle

Figure 2.Possible outcomes frominternational assignments

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inability to adjust (or the organisations inability to prepare the expatriate for the IA) asfailure, but premature return because of an internal transfer as organisationalflexibility i.e. success, and hence distinguish failure from success by the causes of theoutcome.

Towards a more comprehensive concept of expatriate failureIn providing some suggestions for a more comprehensive concept of expatriate failure,we start with a careful application of the dictionary definition of failure to theexpatriate context. Failure is defined as “the lack of success in doing or achievingsomething, especially something that you are expected to do” (Oxford AdvancedLearner’s Dictionary, 2000, p. 451). There seem to be two components to the Oxforddefinition:

(1) “the lack of success in doing or achieving something”; and

(2) “especially something that you are expected to do”.

What does this mean in the context of managing international assignments?Referring to the first part, it must cover the inability to do “something” relating to

the assignment. From an organisational perspective it is of great interest that a specificjob is done, that something is produced and value added to the organisation. However,it is also of concern to the company that the expatriate and his/her spouse and familyare thriving under the new circumstances. This is true in terms of social responsibilityof the company, but also stems from the assumption that the expatriate will probablyperform better under these circumstances.

From the causes mentioned in Table I, expatriate failure seems to be regarded assomething negative, mostly referring to issues relating to the expatriate him/herself,although a “selection mistake” can refer to issues relating to the organisation’sinability to select the “right” candidate. However, we must realise that what might beregarded as an expatriate failure from an organisational perspective, might not be anexpatriate failure to the expatriate and vice versa. In the expatriate managementliterature, it appears that in order to be called an expatriate failure, the negativeaspect needs to be damaging to the organisation and not necessarily the expatriate.For instance, if an organisation reorganises and a position is made redundant, thepremature end to an assignment will not be regarded as negative by manyorganisations, but will simply be seen a part of the restructuring, where it (theorganisation) may be better off terminating the position or dismissing the expatriate.Hence, the premature end of the assignment is not an expatriate failure from anorganisational perspective (even though it may be so to the expatriate). The oppositeexample is an expatriate who resigns from a position because of a better offer from acompetitor. Here, the expatriate is better off, but this development is most likely to bedamaging or dysfunctional to the company, and hence it should be called a failure.Naumann (1992) identified this dysfunctional element as a criterion for definingexpatriate failure, although he (intentionally?) did not use this term and referred todysfunctional turnover instead. Functional turnover is argued to be beneficial to theorganisation, e.g. a low-performing expatriate who quits or is fired, whereasdysfunctional turnover occurs when a high-performing employee quits or requests anearly transfer.

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The second part of the definition of failure in the Oxford dictionary, “the lack ofsuccess in doing or achieving something, especially something that you are expected todo” (our emphasis) (Oxford Advanced Learner’s Dictionary, 2000, p. 451), emphasisesthat failure occurs if what is expected to be done is not done. The consequence oftaking the organisational perspective is that the focus is then on what the organisationor employer expects from the expatriate/employee. If the expatriate does not succeed inachieving what is expected by the employer, he/she would be a failure according to thedictionary definition and our contextualisation in the area of expatriate failure. Thisopens up avenues for a further investigation into how these expectations areformulated and in what way they are communicated.

When an employment relationship is established either on “domestic” or expatriateconditions it must be assumed that both the employer and the employee holdexpectations to what the other party should do. Some of these expectations areincluded in the written contract, e.g. the duration of the contract, the salary, and thenumber of working hours. However, other expectations than the ones included in thewritten contract may very well exist and these expectations may or may not bemutually agreed on. Several managerial processes and phenomena such as theperformance appraisal, job description and the psychological contract include ordescribe these expectations.

Whether the expectations in the psychological contract are the organisation’s, theexpatriate’s or both is open to debate where, e.g. Morrison and Robinson define thepsychological contract as the “employee’s belief about the reciprocal obligationsbetween that employee and his or her organization” (Morrison and Robinson, 1997,p. 229), whereas, e.g. Sparrow regards it as what “. . . the individual and theorganization expect to give and to receive in return from the employment relationship”(Sparrow, 1999, p. 112). What the organisation expects from the expatriate, and what iscommunicated explicitly or just implicitly is crucial to the organisation’s perception ofwhether an expatriate is a failure or a success, and therefore whether the term“expatriate failure” can be applied or not.

Taking these two elements into account, a more appropriate definition of expatriatefailure might be: “the inability of the expatriate or repatriate to perform according tothe expectations of the organization”. This definition encompasses bothunder-performance during the assignment (which could lead to a premature end ofthe assignment, but this is not a necessary condition for failure) and dysfunctionalturnover after repatriation. As different organisations have different expectations andas expectations might change of time, this means that expatriate failure has to becontextually defined. Please also note that this definition does not give a “verdict” onwhether it is the expatriate or the organisation that is to blame for the failure. Anexpatriate might for instance fail to perform, because of a lack of cross-cultural abilitiesor support. The two main components of expatriate failure in this definition areperformance, and the associated concept of performance management, and turnover.Both concepts are well established in the general human resource literature. Wetherefore argue that it might be better to abandon the term expatriate failure altogetherand instead focus on how we can apply the general knowledge on performancemanagement and turnover to the domain of expatriate management. This is what wewill turn to in the next section, where we will provide some recommendations foreffective expatriate management in this context.

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Performance management and turnover in an expatriate contextDefined broadly, performance management comprises “any HRM activity, or bundle ofHRM activities, designed to improve employee performance” (Fenwick, 2004, p. 318).According to Armstrong (1994) an integrated performance management system wouldinclude the following aspects:

. Clearly communicated links to organizational strategy.

. Individual performance goals.

. Regular feedback on progress.

. Opportunities for performance improvement

. Links between performance and rewards.

Extending Fenwick’s (2004) application of the general performance managementliterature to a multinational context, we link each of these aspects to internationalassignments and suggest how they could be used to prevent expatriate failure.

First, international assignments need to be seen as an integral part of themultinational company’s (MNC’s) international strategy. Why is it necessary to sendout expatriates in the first place? If an organization cannot answer this question, it isunlikely to be able to successfully manage its expatriates. Reviewing the variousreasons for international transfers Harzing (2001) argued that expatriate managementshould be seen less as a one-size-fits-all function and that practices with regard toselection, training and appraisal and compensation need to be tailored to these differentreasons for international transfer. For instance, if expatriates are sent out to transferknowledge and train local managers in an overseas subsidiary, an inability to reachthat goal would consist expatriate failure. As we indicated above, it is also of crucialimportance that the multinational clearly communicates its expectations to theexpatriate and clarifies how individual performance goals (step 2) fit into the widerorganizational strategy. The SMART principle – providing performance goals that arespecific, measurable, achievable, realistic and timely – has become well-accepted inmany organizations. However, it is important to realize that very specifically definedgoals might not be realistic or achievable in a different cultural context. At the veryleast, they might need to be operationalised (measured) in different ways and moretime might need to be given to realize these goals. Some expatriate assignments mightbe considered failures when interpreted from the home country cultural context, butsuccesses when interpreted from the host country context. For instance, an expatriatemight have failed to improve the profitability of a particular subsidiary in the shortterm, but have succeeded in building up good relationships with local governmentofficials, which might improve the subsidiary’s performance in the long term.

Regular feedback is essential in managing performance (step 3), but might be moredifficult to provide when headquarters and subsidiaries are separated by time anddistance. Assigning a mentor at headquarters for each individual expatriate might gosome way towards alleviating this problem. This mentor should preferably be someonewho has international experience himself, so that he has an appreciation of thechallenges involved in working in a different cultural context. Regular feedback wouldallow the organization to signal problems in the expatriate’s performance at an earlystage and provide opportunities to improve this performance (step 4), hence preventinga potential expatriate failure. Although more and more organizations realize that

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cross-cultural adjustment is crucial to effective performance and provide somepredeparture cross-cultural training, training during the assignment is still relativelyrare (Tarique and Caligiuri, 2004).

Finally, expatriates are unlikely to function effectively if they do not perceive a clearlink between performance and rewards (step 5). At a basic level this means that ratherthan focusing narrowly on providing a compensation package that ensures theexpatriate is not financially disadvantaged by taking on an international assignment,MNCs should include expatriates in their overall performance-based reward system(Fenwick, 2004). However, even more important than direct financial rewards might berecognising the expatriate’s international experience after repatriation by makinginternational assignments part of a carefully career path development system. A lackof recognition of the value of international assignments is the major reason forrepatriate failure, i.e. repatriates leaving the company soon after repatriation.

A recent meta-analysis (Griffet et al., 2000) identified a multitude of antecedents toemployee turnover. However, two of the most important antecedents are generallyconsidered to be job satisfaction and organizational commitment. Measures to improvejob satisfaction and organizational commitment are very similar to those alreadyidentified above under integrated performance management. In the literature onemployee turnover, role clarity, role discretion and organizational support have beenidentified as important determinants of job satisfaction (e.g. Iverson and Deery, 1997).In an expatriate context job satisfaction will be higher when the expatriate has clearlydefined performance goals and is supported by the organization (e.g. through trainingand mentor support) to achieve these goals. Role clarity and organizational supporthave also been found to be important antecedents of expatriate adjustment (Black et al.,1991; Shaffer et al., 1999), which in turn will be likely to influence job satisfaction.

Role conflict, a variable that has been found to be an important predictor of jobdissatisfaction (e.g. Iverson and Deery, 1997) takes on a special meaning in anexpatriate context as expatriates have to reconcile the different demands of home andhost organizations. Black and Gregersen (1992) provide a typology of expatriateallegiance and argue that a dual commitment to both home and host organization ismost beneficial to the long-term success of the MNC. Dual allegiance was found to bepositively influenced by role clarity and role discretion, as well as clarity of repatriationprogrammes. Finally, the positive influence of promotional and career developmentopportunities on job satisfaction and organizational commitment is well established inthe literature on employee turnover. In the expatriate context, both job satisfaction andorganizational commitment after repatriation will be likely to be strongly influenced bythe extent to which the repatriate’s new job utilises the competencies acquired abroad,an aspect that was already identified as best practice performance management.

ConclusionIn this article we explored the established understanding of expatriate failure and haveprovided a more sophisticated discussion of the concept. By examining the nature ofinternational assignments and the possible outcomes from an assignment, we showedthat international assignments often do not turn out as planned. They do notnecessarily fulfil “the ideal expatriate life-cycle”, but often end prematurely. However,it can be argued that a premature end to an international assignment is not necessarilyan expatriate failure. Therefore, this specific understanding is not adequate when

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defining expatriate failure. Expatriate failure in itself can be regarded as an emptyterm, which can only be defined when specific outcomes are related to specific causeswithin the actual context.

In defining expatriate failure, it is important to realise that the perspective(organisation or expatriate) and expectations play a crucial role. Starting from a newgeneric definition: “the inability of the expatriate or repatriate to perform according tothe expectations of the organization”, we argued that it might be time to abandon theconcept of expatriate failure altogether and instead focus on its main constituentelements: performance (management) and turnover. We provided some indications ofhow the general HR literature on performance management and turnover could beapplied to the expatriate context. We hope that grounding the discussion of expatriatefailure in the general context of performance management and prevention ofdysfunctional turnover will lead to more meaningful and comprehensive research inthis area.

Note

1. We do not claim to have covered all publications that look at expatriate failure in this article.However, those that have been included in Table I are among the most referenced andinfluential ones.

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