Practice Makes Perfect? International Experience and Expatriate Adjustment (1)

Abstract * Western business expatriates assigned to Hong Kong were surveyed regarding their previous international experience and their degree of sociocultural and psychological adjustment. Being a quality increasingly sought after, it would be important for international business firms to find out whether previous international experience can reinforce their expatriates' ability to function and work on a foreign assignment. Key Results * Unexpectedly, results showed that experience from other Asian assignments had no effect on sociocultural adjustment in Hong Kong. For recently arrived expatriates however, there was a positive effect on work adjustment, but not on general adjustment and interaction adjustment. Previous postings to non-Asian countries had no effect on expatriates' sociocultural adjustment. As predicted, neither kind of international experience had any effect on psychological adjustment. The potentially far-reaching implications of these findings are discussed in detail. Introduction A wave of localization is impacting international business, not at least in Asia (cf. Goodwin 1999). At the same time, many globalizing business firms still regard it as a strategic imperative to try to develop their own internationally mobile expatriate managers (cf. Downes/Thomas 1997). It is generally recognized that international firms will not be able to effectively compete against major global competitors without world-class managers world-wide (cf. Harvey 1997). Multicultural, multi-lingual managers with previous international experience are management qualities increasingly sought by multinational employers (Goodwin 1999). Attempting to adjust to a new cultural environment, expatriate executives have to perform in an unfamiliar work context and they have to encounter a different way of life than in their own country. They do not only have to respond to the problems of motivation, leadership, and productivity in the foreign assignment, but many also have much greater responsibilities than in their previous domestic job. This can amount to a very stressful experience and not everyone is successful at their new tasks. Research has revealed that premature return rates are significantly high and that each failure gives rise to substantial direct and indirect costs. Additionally, a sizeable share of expatriate managers who "stick it out" are regarded as ineffective by their parent organizations and those underperforming managers also incur large direct and indirect costs (Black/Gregersen/Mendenhall 1992). Although the often quoted high premature return rate to the parent country has been challenged recently as a myth, it can easily be argued that expatriates who cannot adjust but remain on their assignments and fail to perform adequately, could be even more damaging to their firms than those who return prematurely (Harzing 1995). The purpose of this paper is to examine the relationship between expatriates' previous international experience and their international adjustment. As international experience seems to be a quality increasingly sought after by MNCs, it would be important for international business firms to find out whether such experience can facilitate their expatriates' ability to function and work in a foreign country. A clear finding in the literature on expatriate adjustment is that individuals who do not adjust properly to their international assignment will not perform as well, will be psychologically withdrawn, and will likely return early (cf. Shaffer/Harrison 1998). International Expatriate Adjustment Although the two components of expatriate international adjustment, psychological and sociocultural, are conceptually interrelated, recent literature suggests that they are distinct concepts (cf. Searle/Ward 1990). Psychological Adjustment Psychological adjustment deals with subjective well-being or mood states such as depression, anxiety and fatigue. …