The reality of today's global marketplace requires companies to relocate staff to foreign locations in order to establish and nurture a business presence abroad. Many executives and managers sent to staff foreign operations are usually chosen for their skills and accomplishments within their native country. The assumption is that 'if they can do it at home, they can do it abroad'. Research suggests this is not the case – cross-cultural differences usually make such skills defunct in a new environment.
In 2009, 72% of companies reduced their expenses for foreign assignments in response to economic conditions.* Quite understandable, as the cost of sending an expatriate abroad on an international assignment ranges from $300,000 to $1 million. This is even more understandable when a failed expatriation can cost an employer an estimated $50,000 to $150,000. So, why the high cost? Part of the expense can include cultural training programs for expatriating specialists, executive staff, partners and families. Despite the cost, cultural training can be a worthwhile expense and protect from early repatriation.
A senior executive from a premier U.S. roaster and retailer of whole bean and ground coffee was relocated from northwestern United States to Amsterdam, Netherlands for a two‐year assignment. The senior executive was responsible for global development in Europe, the Middle East and Africa. To be successful in his new assignment and deliver on the company’s annual plan, the executive was expected to achieve alignment among his new Dutch team and cross‐functional leaders from throughout Europe and the U.S. He projected that his biggest challenges would be in the areas of management style, communication style and negotiating. These areas, he believed, could impact his ability to influence employees and partners, and produce results.