Modelling and predicting the performance of cross border managers
| Published date | 08 June 2010 |
| DOI | https://doi.org/10.1108/00483481011045407 |
| Pages | 432-447 |
| Date | 08 June 2010 |
| Author | Julie Cogin,Alan Fish |
| Subject Matter | HR & organizational behaviour |
Modelling and predicting the
performance of cross border
managers
Julie Cogin
Australian School of Business, University of NSW, Kensington, Australia, and
Alan Fish
International School of Business, Charles Sturt University, Wagga Wagga,
Australia
Abstract
Purpose – Cross border managers are an important feature of the global economy.Despite this,
research evidence suggests that the primary selection criteria for cross border managers are technical
expertise and domestic business knowledge. This has resulted in insufficient numbers of high calibre
candidates to meet the demands of today’s global business context. This paper aims to argue that an
understanding of an individual’s value orientations is important for selecting cross border managers
and predicting subsequent performance.
Design/methodology/approach – The paper reports the testing of a multidimensional value
orientated taxonomy on a sample of 658 managers employed by three multinational organisations.
The model was tested via SEM. OLS multiple regression was carried out to identify whether the
dimensions of the taxonomy predict the performance of managers in cross border roles.
Findings – Results yielded sound factor structure of the taxonomy with a single factor solution
identified on each of the two individual value dimensions. SEM confirmed significant relationships
and a sound goodness-of-fit of the model. OLS regression results indicated that the model accurately
predicted the performance of managers during cross border assignments.
Research limitations/implications – Surveys were administered at one point in time and do not
account for any change in value orientations.
Practical implications – The model and results provide guidance to HRM professionals for
selecting candidates for cross border business roles.
Originality/value – The study addresses a limitation of earlier work by testing the efficacy of the
multi-dimensional taxonomy with a larger and more diverse sample. The paper evaluates the strength
of the taxonomy in predicting performance.
Keywords Globalization,Expatriates,Process analysis, Performancemanagement, Selection,Managers
Paper type Research paper
Effective selection of cross border managers is an important strategic issue considering
foreign direct investment by multinational corporations (MNC) in 2007 grew by 31 per
cent while real world gross domestic product increased by 5 per cent (OECD, 2009).
Some observers have noted an increase in expatriate managers to oversee MNC
burgeoning investment (Torres and Jasso, 2005). Despite this, the direct costs of
sending an expatriate overseas can be as high as US$220,000 per year (Birdseye and
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/0048-3486.htm
An earlier version of this paper was prepared for the 10th International Human Resource
Management Conference, Santa Fe, USA, June 21 –24, 2009.
PR
39,4
432
Personnel Review
Vol. 39 No. 4, 2010
pp. 432-447
qEmerald Group Publishing Limited
0048-3486
DOI 10.1108/00483481011045407
Hill, 1995), and may cost business more than US$2 billion annually (Morris and Robie,
2001; McNulty and Tharenou, 2005).
In addition to these direct expenses, the so-called expatriate failure rate continues to
be an ongoing problem. Various failure rates are reported in the literature, from 20 per
cent (Black and Mendenhall, 1990) to as much as 85 per cent (Walton, 1990). While
costs and failure estimates vary; all researchers agree that bringing in an expatriate
manager is an expensive proposition (McNulty and Tharenou, 2005) highlighting the
importance of effective selection practices.
The debate with respect to cross border assignment selection has raised a variety of
concerns (Fish et al., 2008) associated with:
.awareness that in-country legalities for foreign nationals working in a host
country have been attended to;
.that appropriate preparation and adjustment has taken place;
.the necessary personal attributes, technical, business and strategic skills for
effective performance have been identified;
.why differences in assignment performance occur;
.the organisational and individual career implications of accepting a cross bo rder
assignment are understood;
.appropriate compensation and rewards have been addressed; and
.understanding which managers are the most appropriate to represent businesses
in strategically significant cross border roles.
Each issue; and in combination, suggests that organisational success in cross bo rder
business environments can be compromised by ineffective and ill-informed human
resource management (HRM) practices (Cogin and Fish, 2008).
Despite the complexity of these issues, there has been a tendency for global
organisations to concentrate their selection decisions on the basis of sound technical
skills and successful performance at a domestic level (Porter and Tansky, 1999).
Clearly, such a focus is an anachronism to effective HRM practice. Understanding how
managers might/would respond to different social and business circumstances when
placed in a culturally distant location is an important source of additional information
that would assist organisations make informed selection and career management
decisions.
Little attention appears to have been paid by researchers to understand key
attributes of effective cross border managers;, e.g. personal values associate d with
effectively dealing with foreign social and business situations. Given the prevalence
and strategic importance of cross border business activity; ensuring that the most
appropriate manager is in situ, is a key strategic decision.
Manager success factors in cross border assignments
Although expatriation receives substantial attention in international management
textbooks and research journals, systematic empirical research on the determinants of
success in cross border roles is still relatively scarce. In order to understan d the success
factors for cross border assignments, Tung (1987) examined the expatriation policies of
European and Japanese multinational firms that experienced significantly lower
Performance of
cross border
managers
433
To continue reading
Request your trial