Research: How Companies Can Support Managers They Send Abroad

January 28, 2025 | 7:44 am

A study of general managers at global hotel chains found that certain structural elements predicted employee success in new countries.

January 27, 2025

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Common wisdom goes that the success or failure of an expatriate manager — an employee sent to a new country to handle their company’s initiatives there — depends on their possession of certain personal traits, like cultural intelligence and adaptability. But new research suggests that companies’ organizational structures may be better predictors of employee success. In a study of src92 expatriate general managers in charge of hotel properties in nine global hotel chains, researchers found that whether or not these employees succeeded in their new environment rested on the degree to which their organization offered them three key elements: high decentralization (empowering local managers to make decisions), high formalization (providing clear guidelines and policies), and ample global knowledge integration (tools and systems that enable cross-border collaboration). Those employees whose companies possessed all three were the most likely to successfully complete their assignment and reported the highest levels of commitment to their organization.

For multinational enterprises (MNEs), expatriate managers are vital to implementing strategy and driving success in global markets. These leaders, assigned to new locations to manage initiatives for their company, are tasked with bridging corporate objectives and local market needs, making their assignments critical to organizational success. Yet, high turnover and incomplete assignments among expatriates remain persistent and costly challenges. These failures can drain millions of dollars in productivity, rehiring costs, and strained stakeholder relationships. Conventional wisdom suggests that success hinges on selecting the “right” expatriates — those with extensive international experience and high cultural intelligence.

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Riki Takeuchi is a Dr. Joseph Picken Distinguished Professor in Innovation and Entrepreneurship at Naveen Jindal School of Management. He is an elected fellow of American Psychological Association, Association for Psychological Science, and Society for Industrial and Organizational Psychology. He is a recipient of Early Career Contribution Award from SIOP in 20src0. His current research revolves around strategic human resource management/human capital, international/cross-cultural adjustment, and social exchange relationships at work.

Jeffrey P. Shay is a Professor of Entrepreneurship at Babson College, Chair of the Board for the Global Entrepreneurship Monitor (GEM), and Co-leader of the GEM-USA Team. He also serves as a Director on the Bank of Montana’s Board. He is a Fellow of the North American Case Research Association and a recipient of the Western Academy of Management’s President’s and Ascendant Scholar awards.

Hwayoung Kim (hwayoung.kim@utdallas.edu) is a Ph.D. candidate in International Management Studies at the University of Texas at Dallas. Her research focuses on temporal change and dynamics, cognitive processes, and interpersonal interactions. She has published in leading management journals, including the Journal of International Business Studies.