Interview: Dr Michael Dickmann
International Human Resource Management:
A European Perspective
SM
Globalisation has brought with it problems and opportunities for
human resource management. To help explore this issue, I have in
the studio Dr Michael Dickmann who is the author and editor of
International Human Resource Management: A European
Perspective.
Now Michael, could you give me some context of why globalisation,
how important is it from a human resources perspective?
MD
Globalisation is extremely important, Steve. It is not a recent
phenomenon, it has existed for several thousand years – you know,
the Crusaders were international workers in one sense. It is just
that in this century globalisation has just ballooned, has become
very rapid for organisations. And with it the organisational
implications and HR implications are gigantic.
SM
So, give me some perspective on this then. First of all, let’s have a
look at this European context which is part of the title. Do you see
that as having a very distinctive look at globalisation?
MD
Well we have a lot of experience in Europe, exploring HR issues
within the global context. We have a strong sensitivity to cultural
differences, for example. Now when we wrote the book, the
European perspective works on several levels, on one level we
chose consciously European authors.
On another level, the ideas around how organisations and
individuals interact, this interaction is stronger; the academic history
is stronger in Europe. We also find that people go abroad and work
abroad for different reasons. The importance of these reasons
varies between the US, let’s say, and Europe. So there is a range
of implications that we wanted to explore using this book.
SM
Now, I know that you have a lot of conversations with human
resource managers and I know that you run a Masters in
International Human Resource Management. What are these
people telling you?
MD
In terms of what I find is of importance – interestingly, I do have lots
of conversations. It varies a bit from who I talk to. If I talk to
management directors or HR heads, their perspective is about, OK,
so how can we manage what is technically called the ‘global local
dilemma’? We want to create efficiencies internationally, but yet we
Dr Michael Dickmann
want to fit into the local environment and serve the local market.
These things then move into a discussion about what are the
suitable organisational structures, strategies and processes within.
And we would discuss things like knowledge management and the
creation and exploitation of new ideas. If I talk to people who are
more in the area of international mobility, training and development,
maybe compensation and benefits, then we would explore things
like how to select the best person for a job abroad. We would
explore how these individuals get prepared well, how they adjust to
a different environment, how the compensation structures might
work, how they perform well abroad.
If I talk to expatriates themselves, it’s all about what career impact
would I have? What happens when I return? What happens to my
career? What happens to the knowledge I acquired – how can I
use it when I come home or move on to the next location? How
can I use therefore my insights, my knowledge, my networks to be a
more resourceful and more effective employee?
SM
You covered quite a bit of ground there from these different
perspectives and I know a lot of these have been covered in your
book. Can we first of all then explore this whole issue of career
development and career management? What do you see as the
critical issues in this area?
MD
OK – it’s something very close to my heart because I also run a
research centre in that area. Now I believe that one of the critical
issues that is underexplored – remember our discussion about the
US and Europe – it’s underexplored, especially in the US, that
organisations have some career management and individuals
become increasingly more career capitalists. In the area of
international mobility, it means that the dependency of an individual
on the organisation, but also the dependency of the organisation on
that, let’s say high performing individual, is especially high.
So these are interactions that we would like to explore, which also
means that we are looking at the area in essence, looking at
individuals, what they gain in terms of knowledge, skills abilities;
what happens to their networks and these might be international
networks, these might be the new networks host and the old home
networks; and what happens with things that drive them on, that get
them out of bed. You know, the motivational energies that they
have, because these are highly impacted when people work abroad.
And crucially you asked me about career when they come back.
Again something that is underestimated by organisations is how
important is the time when people return from working abroad, when
they feel they have moved from being a big fish in a small pond to
being a small fish in a big pond. When they feel what is technically
called reverse culture shock. They are not special anymore; they
earn less, they do a less challenging job, they often fall off a cliff in
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Dr Michael Dickmann
terms of their motivation and fall into something that we call career
wobble.
So, all this we explore, and for the individual it is obviously very
important – what happens to my career? – but for the organisation
we know that retention figures go down for these people who return
especially in the year when they come back. What can they do to
manage people, so that they stay? That is key for us, given that
developmental assignment. So, Steve if we want to see you as our
future leader, we don’t want to lose you. That is the key for us. If
we send you abroad to acquire international insight and skills, you
are not extremely valuable by your output because you are learner.
You don’t do value add, not really, not much, but when you come
back over the time that we groom you to be our future leader, that is
when value add comes. So retention is extremely important.
SM
Yes, I can see that. So there is a kind of crunch time where people
can start to use that experience when they come back and that is
the very time that you are likely to lose them or demotivate them?
MD
Absolutely. So the career wobble. And we have done extensive
research and we have covered it in the book about what happens
then, what happens to individuals. How do organisations
mismanage it? How do some organisations – we have case
studies of HSBC in there, of Mars, and a few other organisations –
how some organisations actually use the insights and help
individuals through that process, that career wobble, to keep them.
SM
That is interesting. One of the things that I have got some personal
experience of is the notion of knowledge sharing and
communication and how barriers can get in the way. I used to work
for an international software company, an American company and
the amount of barriers that built up where people weren’t sharing
knowledge. Now in theory, best practice is freely shared and so on,
but that didn’t happen. Have you observed that in your
experience?
MD
Oh yes, definitely. OK, people say knowledge is power. There is a
‘not invented here’ syndrome which might be organisational barriers.
Some of my colleagues who wrote chapters in the book have done
dedicated research on it and essentially what it says is … just
imagine Steve, you are coming over, you are going to Nigeria and
you are being paid maybe five, six, seven times as much as a local.
so you try to explore what does that mean in terms of the locals
reacting to you because that is important for knowledge sharing.
For knowledge sharing it is important how they see you, how your
intercultural skills are, how their intercultural skills and openness is,
how willing you are to learn, how much time you have, how much
you are going to be seen as a corporate spy if you come from head
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Dr Michael Dickmann
office. So all things do flow in.
But it’s the key area when I talk to heads of organisations or HR
directors that they say they need to improve because competitive
environment is not simply around cost leadership and quality. It is
increasingly about innovation and that is intrinsically linked to
knowledge and the management of knowledge.
SM
So one of the issues that we have touched on is this idea of cultural
assimilation, of being able to fit into a cultural environment or the
local environment. Some people say training is very useful here.
Other people say there is nothing like actually getting there on the
ground and making some mistakes. Have you any views on that?
MD
I do. I would fight more with the second. I will tell you why. I do
believe training is important. We have data that companies don’t
use training a lot. If you use training, it is positive – people get
culturally adjusted more quickly. I tend to suggest to organisations
don’t just think about pre-departure training, think about post arrival
training as well because then you get immersed in your local
environment and the real questions pop up.
So while the first stuff is about intellectual adjustment – how to cope
with it – the emotional adjustment goes beyond the tolerance of
difference into the acceptance of difference. And that makes you
happier – I can tell you that – your well-being is better. But it
makes you perform better in a foreign environment as well.
So what then, in terms of selection, how can we find people who are
more capable of this sort of adjustment process and to cope in this
different environment? And some of the findings we will explore
and discuss in the book are about self confidence; the higher your
self confidence is, the more likely you are to adjust. But crucially
open mindedness, willingness to learn, willingness to explore a
different culture, a bit of adventure thrown in – that is quite positively
related to how you will adjust. And then there are certain other
things like job factors, your family, a host of other things that make it
more likely that you will be effective working abroad.
SM
Now we have talked about the past and a bit about the present. I
would like to look at the future – a brief glimpse of how you see
international human resource management developing?
MD
Again Steve, I am sorry, there might be a few levels. One level is
how will I see the structures of organisations? The chief executive
interest. I think the structure will be more fluid, there will be more
around tapping the resources of third countries. These might be
developing countries, they might be developed countries, but
outside the head office country of origin, and therefore companies
will intensify in patriations of people coming to the head office, they
will intensify the information flow across different borders. They will
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Dr Michael Dickmann
increase the appreciation of certain local subsidiaries.
On another level, I think therefore that you will find that over time
you will have a much more mixed background of global workers,
let’s say. Because the traditional ideas of expats might fade and
become much more global workers with global careers. There has
always been a cost focus in this field. Companies for a while now
are looking to reduce costs. Right now in the financial crisis this
focus is definitely increased, which means that certain levers that
companies have designed even before the crisis will be used more
often. For example, traditional expats will have more of a mission
to create local successes, to move that around. But don’t get me
wrong, all the indication is that expatriation, the numbers of
international workers will increase, but they will be different types
and there will be lots of more local managers, I think.
And unfortunately, I believe for the time being, for the next two or
three years, we will see that the types of expats will shift. So the
three key types we are having are those expats who fill a skills gap.
You simply cannot find local talent or skills to do this. So it might
be a driller for Shell in Nigeria – they can’t find a driller locally, so
you bring a drilling engineer in. That is going to stay, although it is
the most frequently used expatriation part, but companies will work
stronger on getting local skills.
You have the control and coordination expatriates. Those are
seasoned managers who go over into a subsidiary let’s say, to
either bring in a control system or to do a softer coordination part –
transfer the culture of the head office, for example. These again
might increase, maybe because of the crisis, maybe because of
other things, because there is much more pressure to be ethically
proper around the world and to use sustainable approaches to
business. Siemens recently has found to its detriment that they
have a bit of historical baggage. So you will see that these things
are increasing – they are increasing in Siemens, I think they will
increase across the line.
The third important part – and it was increasing until recently, quite
dramatically – is for developmental purposes. That is when you
Steve are meant to be the global leader of the future, we invest in
you, we bring you over not just to experience a bit of culture but to
really understand – to go through this adjustment and to come back
and to transfer your new insights, but also to be invigorated.
This third part of expatriation has become quite strong for big
organisations. HSBC’s official plan a year ago was eight per cent
of expatriates should be developmental. There are other
companies, quite a lot of fast moving consumer goods organisations
that have quite a high percentage of this. I fear that in this crisis
companies are trading the future with the present. Because
expatriation is costly they reduce these developmental assignments
I think to their detriment. It is a short sighted approach to business
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and there will be a dip, and, in a few years’ time it will be going up
again, but I fear that this is what is going to happen in the
marketplace.
SM
Michael, thank you very much.
MD
You are welcome Steve.
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