- Veritude

<p>With companies moving aggressively into international markets, there is a growing demand for executives with specialized skills and expertise to oversee operations around the world. This globalization of the talent war challenges human resources chiefs to recruit the best international team to do the job.<br /><br />"More companies are looking to source talent from outside their home countries," says Scott T. Sullivan, senior vice president of global sales and marketing at GMAC Global Relocation Services in Woodbridge, Ill. Many U.S.-based firms are also expatriating American executives to ramp up foreign operations.<br /><br />Global recruiting is still a relatively new phenomenon, but it's gaining momentum among companies in sectors such as financial services and technology.<br /><br />EMC, a leading storage technology vendor headquartered in Hopkinton, Mass., casts a wide net in hiring. "EMC's mission is to find the best people; there are no boundaries to that process," says Michael Cullen, senior director of worldwide staffing and executive search.<br /><br />The company's strategy is to fill senior management positions at overseas offices with Americans, often recruited from the company's top talent, and mid-level positions with foreign nationals. This approach has long been followed by multinational companies and globalization hasn't changed it, says Belkis Muldoon, director of the global resources group at Littler Global, a Phoenix law firm that provides visa and immigration services.<br /><br /><strong>Expatriate Assignments Are Expensive and Prone to Failure.</strong><br />In sending professionals abroad, companies need to be mindful of costs, which can reach $1 million per employee per assignment, according to the Price Consulting Group, a Newport, N.C.-based HR consulting firm. With first-year costs for relocating employees abroad at least three times the base salaries of domestic employees, employee costs must be weighed against revenues from international operations.<br /><br />EMC staffs most of its overseas operations with nationals because "it's a better way to run a business," says Cullen. Cost isn't the only consideration; locals bring an invaluable understanding of their country's market and business practices.<br /><br />Attrition is another high cost of the strategy of expatriating managers. The attrition rate for expats is 21 percent, compared to 10 percent among the general employee population, reports the annual Global Relocation Trends Survey from GMAC and the National Foreign Trade Council. Spouse or partner dissatisfaction is the top reason for assignment failure followed by cultural adjustment problems.<br /><br />But an increasing number of professionals are interested in global postings, particularly younger workers and women. At some big multinationals, such as Coca Cola and General Electric, international exposure is a requirement for reaching the executive suite.<br /><br />"People who can understand and work across cultures will advance their own careers and the businesses they're in, and that will only increase in the next five to ten years," says Timothy D. Warmath, senior manager of worldwide recruiting and executive search at AOL Europe, a Time Warner company. Foreign professionals are also eager to work in the United States to gain business acumen in the world's leading economy that they can apply back in their home country, Warmath says.<br /><br /><strong>U.S. Companies Take Great Care to Screen Expatriate Candidates.<br /></strong>Careful screening of candidates is key to a successful expatriate assignment. At Ciba Vision, a contact lens care products subsidiary of pharmaceuticals and consumer health leader Novartis AG, the assessment process for international candidates includes an online questionnaire, personality profile and in-person evaluation with occupational psychologists.<br /><br />Based on this data, Ciba Vision has identified the personal qualities that enable employees to succeed in a different culture. Most critical is the ability to quickly adapt and learn about a new environment. "A person needs a true desire to live in a different country and get to know its culture. If you live in Japan and don't like raw fish, it's tough," says Martin Filippides, vice president of human resources for the Americas.<br /><br />"Integrity is the number one trait that leads to success or failure" in overseas placements, says Alan Jaramillo, principal of Jaramillo & Associates, a Denver-based human resources consulting and recruitment firm. In many countries, building business relationships is a slow process that involves considerable personal contact. Often, expats have to deal with local corruption and requests for bribes to get essential services, such as utilities. The demands on ethical judgment are daunting.<br /><br />Beyond personal qualities, cultural and national relationships need to be considered. Filippides cites the example of Japan and Korea, two historically unfriendly countries. Placing a Japanese professional in Korea or vice versa won't work, no matter how adaptable the employee, says Filippides. On the other hand, the Novartis manager of Chinese operations is a Swiss citizen fluent in Mandarin who "creates incredible bridges," says Filippides.<br /><br />Corporate compatibility is as important as cultural fit. The expat is the corporate ambassador who communicates the company's values and mission. Unlike other multinationals, Ciba Vision tries to fill top management positions with nationals to take advantage of their local business experience and places American expats in second-tier management positions, especially marketing, to enable them to learn first hand about global markets and align the operation with corporate strategy.<br /><br /><strong>Foreign Recruitment Strategies Vary By Company and Country.<br /></strong>Recruitment methods for foreign nationals vary by country. AOL-Europe has the internal resources to do its own recruiting, but most firms use local agencies for at least some positions. "European laws and the job market are very different from those of the U.S. American HR managers very often fail in handling global hiring without local support," says Ingrid Lips, managing director of HRM Outsourcing Germany in Frankfurt.<br /><br />EMC uses a mix of internal recruiting and local experts, particularly in Asia, where "the marketplace is more fragmented and there's a language barrier," says Cullen. "The direct recruiting model isn't acceptable overseas. But the endgame is always the same: hire the best people out there and make sure we have a thorough penetration of a very competitive marketplace."<br /><br />With some European countries losing population and Asian nations developing a large pool of highly skilled workers, international recruiting will be essential to maintaining an adequate workforce. While terrorism and the fear of communicable diseases such as bird flu can temporarily slow global movement, the pace of relocation continues to accelerate.<br /><br />"The global exchange of labor is a huge trend in the 21st century," says Sullivan. "The next big thing is the reduction of barriers to the free flow of labor."</p><p> </p><hr /><p><strong>Elaine Gottlieb</strong> is a freelance writer in Cambridge, Mass. She writes about workplace and business issues, health and technology. Elaine regularly contributes to <em><a href="http://veritude.com/ResourceCenter/Home.aspx"><strong>Workforce Insights</strong></a>,</em> an online resource about emerging labor trends and issues produced by <a href="http://www.veritude.com/"><strong>Veritude.</strong></a></p><p>The article originally appeared in <em><a href="http://www.veritude.com/ResourceCenter/Home.aspx"><strong><em>Workforce Insights</em></strong></a></em> on <a href="http://www.veritude.com/"><strong>Veritude.com</strong></a>. <strong>Veritude</strong> provides strategic human resources - the talent, technology and tactics that growing firms need in order to anticipate and adapt to changes in the workplace. Veritude is a wholly owned subsidiary of Fidelity Investments. Headquartered in Boston, the company serves clients throughout the United States and Canada and is part of Fidelity s ongoing investment and leadership in outsourced HR services. <em>To review other articles, research and expert analysis relevant to HR professionals seeking to stay informed, please visit <a href="http://www.veritude.com/"><strong>www.veritude.com</strong></a>.<strong> </strong> For more information, contact: <a href="mailto:inquiry@veritude.com"><strong>inquiry@veritude.com</strong></a> or call:1-800-597-5537. </em></p><p>^©2006 Veritude,LLC.  Reprinted with permission.</p>