Inpatriates are seen as a viable staffing alternative in global organizations. As discussed in my last year’s post, the value of inpatriates is high, as they fulfil the role of connectors or so-called linking pins between subsidiaries and the headquarters (HQ). Thus, staffing organizations with inpatriate managers is likely to be beneficial in the sense of creating intra-organizational relationships.
Given my continuous interest in the topic of inpatriates, I co-authored a recently published article ‘Developing effective global relationships through staffing with inpatriate managers: The role of interpersonal trust’. Together with my colleagues Michael Harvey and Miriam Moeller, we examine inpatriates and their trust building as a means to develop effective global relationships. The question we raise is the following: How can global organizations manage inpatriates by building strong and committed relationships, keeping in mind the temporary and at times short-term nature of their assignments?
We find that one of the key elements of effective global relationships lies within building trust among individual inpatriates and their counterparts at the corporate headquarters (HQ). Having familiarity with both global and local organizations, inpatriate managers are a valuable source of facilitating change and bringing differences to global decision-making processes. However, to do so inpatriate managers need to become part of the HQ management team, which will require them to be perceived as trustworthy.
Elaborating on the importance of reciprocal trust building between the inpatriate and the organization, we conceptualize three main outcomes of trust building for both the organization and the individual inpatriate. Specifically, we propose that trustworthy relationships can improve organizational capabilities of global talent management, inpatriate commitment and loyalty, and inpatriates’ career progression.
First, we argue that trust between inpatriates and HQ staff will positively influence a global organization’s ability to develop its talent globally. Specifically, the successful management of inpatriates sends an important message for prospective assignees, indicating that accepting inpatriation is worthwhile. Drawing on practical implications for organizations, it is important to note that current inpatriates may serve as mentors for new inpatriates in the future. Moreover, mentoring is highlighted as a tool for creating acceptance among HQ colleagues, thus making integration for inpatriates easier.
Second, we argue that from an organizational perspective, trust between inpatriates and HQ staff as representatives of the parent organization may help to increase inpatriate loyalty and commitment to the global organization and, in turn, maintain interpersonal trust over time. Keeping inpatriates in the organization long-term is especially important taking into account the economic consequences of turnover and effective knowledge retention.
Finally, from the inpatriates’ perspective, we argue that trust relationships may entail career benefits for the individual. Good and trustworthy relationships stimulate the exchange of job-related information and recommendations. Perceived possibilities for career progression are again needed for retaining inpatriates within the organization, especially upon repatriation.
To conclude, we argue that the pivotal role of inpatriate managers requires a higher level of trust by and for the inpatriate manager. The discussed outcomes of trustworthy relationships imply the long-term benefits for both the organization, through inpatriates’ role as boundary spanners; and the inpatriate, through increased career opportunities. Thus, keeping the long-term perspective in mind, the development of such competencies as trust building becomes vital.
Further reading:
Harvey, M., Reiche, B. S. and Moeller, M. (2011). ‘Developing effective global relationships through staffing with inpatriate managers: The role of interpersonal trust’, Journal of International Management, 17, 2, 150-161.
My English is not very fluent, but I could understand what I think is a very wise comment.
I think confidence is the backbone that defines a company as a great place to work.
To my understanding, trust is based on three basic principles are credibility, respect and fairness.
I couldn’t agree more. Managers should be trustworthy in the eyes of their subordinates. Trust is important as employees will not respect rules if trust is nonexistent.
Interpersonal trust is an even bigger issue where foreign managers are hired into executive roles by local organizations. Such foreign executives in local organizations (FELOs) are exposed to heightened local scrutiny as they supervise host-country nationals and make decisions on headquarter operations. Host-country nationals attribute a ‘local’ national identity to organizations (we all do, to an extent), and expect that FELOs demonstrate their loyalty to local interests. This differs from other types of expatriates within the established headquarters / subsidiary structures of global multinationals (in-house careers, including “inpatriates”).
Other differences include that FELOs are appointed through executive search firms or following prior consulting engagements. Some FELOs are self-initiated and organizational expatriates that avoid the “reverse culture shock” of repatriation after long assignments in culturally distant host-countries. In addition, FELO incomes are often the subject of assumptions by host-country nationals and the local media, which can lead to resentment. In general, FELOs do not have the safety-net of other expatriates who work for established multinational organizations. Further information on this interesting phenomenon can be found here.
Interpersonal trust, and the reciprocity of trust that you mention, is therefore absolutely crucial. The three main outcomes are the same: interpersonal trust improves the ability of organizations to develop and manage global talent. It increases the commitment and loyalty of international employees, and can further their career progression. Overall, both FELO appointments and in-house international careers have the potential to greatly benefit organizations in their internationalization.
Best wishes
Frithjof Arp