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Case 5: Local or International?
Transcript of Case 5: Local or International?
Managing Complex Employment Expectations
Abi Cristales, Taryn Gabbert, Olga Doroshenko, Matt Kollinger, Janet Franco
Akiko Nishimura is an employee of a German company who is on a home-based talent expatriate package in New Delhi.
She wanted to relocate because of her husband to Singapore and because of her esteemed qualifications thought this would be permissible.
After talking to HR manager, Akiko found out news that the company was changing its policies on how it initiated its overseas assignments for employees.
Pay decreases and less accommodating help follow with this transfer
HR manager makes note that it is imperative that employees understand the full consequences of the new contract and ample communication must be set between HR and the employee.
Tech venture established 120 years ago in Germany
Expanded internationally to increase profitability
Today is present in 60 countries, with 116,00 employees
Exec Board Recognition Process Creates a more user friendly policy of globalization
Why Did the German Multinational Change Policies?
Increased International Mobility
Favors a cost effective alternative
Key points going
Home finding & settling-in assistance
Spouse Career issues and counseling
Companies understand new skills acquired by expats
New skills NOT used in jobs upon repatriation
Willingness to take another expat assignment
Career support (mentor programs)
Information about how assignment ties into future career plans
Things to consider...
of expats were NOT offered any orientation training to facilitate adaptation
of spouses or families received any cultural orientation training
User Friendly Policy of Globalization
Main Objective of the Case
-Akiko is upset because many of the current benefits of her expat package will be lost if she decides to transfer to Singapore to follow her husband.
-It is unfair for some employees to get expat packages and others to receive the less appealing local international hire package?
- When the cost outweighs the benefit for the company then the employee should be given the international hire package.
-When the assignment is very short or the value of the employee being relocated outweighs the cost then they should be given the expat package.
New Delhi, India
From Tokyo, Japan
Married to Hiroshi and has two daughters 12 and 14 yrs old
Attended University of Tokyo and Wharton Business School in USA for MBA
Started in Manufacturing Controlling Department
Part of Talent Pool
Akiko has been an expat for 2 years. Her husband, Hiroshi has not been able to find a job all this time, he recently applied to a position in Singapore. Akiko would like to transfer her expat assignment to Singapore.
Explains to Akiko her alternatives if she decides to move to Singapore
1. Keep Home Based Expatriate Package
2.International Local Package
And mentions key changes in Expat Packages
Expats for 8 yrs not expats anymore
Home Base Expat International Policy
Local International Policy
Cost 3x base salary + benefits
New Flowchart of Expat Assignments
What should Akiko do
Our Solution for Akiko
Although, Hiroshi has been having a difficult time finding a job, Akiko should consider the big picture. In following Hiroshi to Singapore the family as a whole will experience a tremendous reduction of income, benefits and overall lifestyle.
We recommend Akiko to stay in New Delhi for one more year to finish her assignment, then return back home to Tokyo, and there Hiroshi can find a job with a more relevant pay and benefits.
Our Recommendation to the Company
To create a more standardized Global Expatriate Policy, that clearly defines key aspects of position, benefits and terms to eliminate any ambiguity of situations
To communicate more effectively the terms and conditions of every expatriate assignment with employee
To value the unique talent and skills acquired by expatriate
Provide more support to their expatriate employees
Reasons for Expat Assignments
1. To gain International Experience
2. On Job assignments to transfer knowledge across borders