Question 2: Offshoring has often been considered a major threat to employment in both quantitative and qualitative terms. Evaluate these concerns by critically considering different contributions on the benefits and costs of offshoring. (Maximum 1,000 Words)

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Question 2: Offshoring has often been considered a major threat to employment in both quantitative and qualitative terms. Evaluate these concerns by critically considering different contributions on the benefits and costs of offshoring. (Maximum 1,000 Words)

Required References:

1. Levy (2005)

2. Aroraa & Athreye (2002)

I have also included other references that may help. must have at least 3-4 references in the final assignment. Harvard style citation and format



Journal of World Business 42 (2007) 198–213 Changing patterns of global staffing in the multinational enterprise: Challenges to the conventional expatriate assignment and emerging alternatives David G. Collings a,*, Hugh Scullion b,1, Michael J. Morley c,2 a Sheffield University Management School, University of Sheffield, 9 Mappin Street, Sheffield S1 4DT, UK b Strathclyde International Business Unit, Strathclyde Business School, Sternhouse Building, 173 Cathedral Street, Glasgow G4 0RQ, Scotland, UK c Kemmy Business School, University of Limerick, Plassey Technological Park, Limerick, Ireland Abstract We argue that many MNCs continue to underestimate the complexities involved in global staffing and that organisations and academics must take a more strategic view of staffing arrangements in an international context. We suggest that the context for the management and handling of the international assignment has altered significantly, leading in some quarters to a fundamental reassessment of the contribution of, and prospects for, the international assignment as conventionally understood. We explore a variety of supply side issues, cost issues, demand side issues and career issues as triggers to this reassessment. Alongside the conventional expatriate assignment, we point to the emergence of a portfolio of alternatives to the traditional international assignment including short-term assignments, commuter assignments, international business travel and virtual assignments. In the context of these developments, we argue that a standardised approach to international assignments is untenable and that it is essential to develop HR policies and procedures that reflect differences in the various forms of emerging alternative international assignments and their associated complexities. Here recruitment and selection, training, reward, and occupational health and safety issues and implications are all explored. # 2007 Elsevier Inc. All rights reserved. 1. Introduction The topic of international assignments has an established pedigree in the international management literature and has in particular dominated the research agenda of international human resource management * Corresponding author. Tel.: +44 1142223453; fax: +44 1142223348. E-mail addresses: (D.G. Collings), (H. Scullion), (M.J. Morley). 1 Tel.: +44 1415483165, fax: +44 1415485848. 2 Tel.: +353 61 202273, fax: +353 61 202572. 1090-9516/$ – see front matter # 2007 Elsevier Inc. All rights reserved. doi:10.1016/j.jwb.2007.02.005 (IHRM) for over three decades. While the research focus of those investigating the IHRM field has expanded significantly in recent years, expatriate management issues remain a critical concern (Collings & Scullion, 2006; Lazarova, 2006; Stahl & Björkman, 2006). Staffing issues are complex in the international environment (Torbiorn, 1997), something which is attested to by a stream of research highlighting inter alia: the importance of effective staffing strategies for the successful implementation of international business strategies, especially strategic alliances and crossborder mergers in emerging and culturally distant markets; the decision points relating to different D.G. Collings et al. / Journal of World Business 42 (2007) 198–213 approaches to international staffing; the problem of shortages of international managers, particularly in emerging markets, where there is often fierce competition between MNCs and local organizations to recruit and retain high quality staff; the requisite supports necessary in order to ensure a satisfactory outcome from the organisational and individual perspective; and the management and utilisation of knowledge flows which may accrue (cf. Evans, Pucik, & Barsoux, 2002; Minbaeva & Michailova, 2004; Schuler, Jackson, & Luo, 2004). However research suggests that many MNCs continue to underestimate the complexities involved in global staffing (Tung, 1998). Concomitantly, the context for the managing of the international assignment has altered significantly, leading in some quarters to a fundamental reassessment of the contribution of, and prospects for, the international assignment as conventionally understood. The importance of this reassessment has been signalled by those who have questioned why multinationals continue to use conventional expatriate assignments to the extent that they do due to the high costs and continuing problems associated with such assignments (Morley & Heraty, 2004; Scullion & Brewster, 2001), and by the increasing prominence of alternative forms of international assignments and the emergence of a portfolio of assignments within the international firm (Fenwick, 2004; Roberts, Kossek, & Ozeki, 1998). We build on this emerging body of literature through exploring the issues surrounding the ongoing utility of the conventional expatriate assignment and the key issues around alternative forms of international assignments. The paper contributes to our understanding of international assignments by critically exploring the current context for international assignments in MNCs. First, we critically re-examine the reasons advanced for the utilisation of expatriates in the traditional assignment (usually three to five years and involving the relocation of the expatriate and their family) in view of changing patterns of global staffing. Much of the research on the management of expatriates available in the international literature until fairly recently has been drawn from research focused on North American MNCs. In this journal Scullion and Brewster (2001) advocated that research be conducted on countries other than in the US in order to develop a broader understanding of expatriation. This is reflected in our paper which draws heavily on recent research in Europe and elsewhere and we take up the challenge of developing this broader understanding by contributing to a deeper appreciation of the importance of the context 199 in which staffing takes place. Finally, our paper critically examines the growing importance of alternative forms of international assignments in the light of recent research which suggests that long-term assignments may become less dominant as new patterns of global staffing emerge (Scullion & Collings, 2006a). In particular we focus on four key questions with regard to these assignments, namely: (1) how can we classify alternative forms of international assignments; (2) in what circumstances are alternative forms of international assignments considered appropriate; (3) What evidence is there on levels of use of alternative forms of international assignments; (4) What operational issues emerge in the context of managing these assignments. 2. Why do organisations use expatriates? Before considering the challenges associated with the traditional expatriate assignment it is important to briefly outline the key strategic reasons why MNCs use expatriates, as the literature is characterised by a number of well-articulated advantages associated with the deployment of expatriates in the staffing of international subsidiaries and operations. Indeed, it has been argued that entrepreneurs have recognised the importance of physically relocating managers to foreign locations where business operations are based since approximately 1900 B.C. Indeed, even at this stage, locals were viewed as inferior and restricted to lower level jobs while parent country nationals (PCNs) were afforded superior conditions, similar to modern day expatriates (Moore & Lewis, 1999:66–67). Owners of international organisations thus realised the benefits of utilising people known to them and socialised into the organisation in minimising the agency problems (Jensen & Meckling, 1976) associated with managing spatially diverse organisations from an early stage. This is because these individuals had built a level of trust with their superiors and thus were considered to be more likely to act in the best interests of the organisation, relative to local managers from the host country who were largely an unknown quantity. Thus, expatriates were used as a means of addressing agency issues as a result of the separation of ownership and management and their amplification through distance. In their landmark study, Edström and Galbraith (1977) proposed three motives for using expatriates. Firstly, as position fillers when suitably qualified host country nationals (HCNs) were not available. Secondly, as a means of management development, aimed at developing the competence of the individual manager. 200 D.G. Collings et al. / Journal of World Business 42 (2007) 198–213 Thirdly, as a means of organisational development, aimed at increasing knowledge transfer within the MNC and modifying and sustaining organizational structure and decision processes. Although it is important to note that assignments generally have more than one rationale (Sparrow, Brewster, & Harris, 2004), Edstrom and Galbraith’s typology provides a useful point of departure for the consideration of why MNCs use expatriates. More recently, Harzing (2001) identified three control specific roles of expatriates, namely: the bear, the bumble-bee, and the spider. Bears act as a means of replacing the centralisation of decision-making in MNC and provide a direct means of surveillance over subsidiary operations. The title highlights the degree of dominance these assignees have over subsidiary operations. Bumble bees fly ‘‘from plant to plant’’ and create cross-pollination between the various offshoots’’ (Harzing, 2001:369). These expatriates can be used to control subsidiaries through socialisation of host employees and the development of informal communication networks. Finally spiders, as the name suggests control through the weaving of informal communication networks within the MNC. Harzing’s study is significant because it goes beyond the basic question of why MNCs use expatriates and sheds light on the potentially more significant question of whether these roles are equally important in different situations. Significantly, Harzing (2001) argues that although expatriates generally appear to perform their role as bears regardless of the situation, the study suggests that their roles as spiders and bumble bees tend to be more context specific. Specifically, the bumble bee and spider roles appeared to be more significant in longer established subsidiaries (longer than 50 years) while the bumble bee role appeared to be important in newly established subsidiaries also. Significantly, the level of localization of subsidiary operations and further lower levels of international integration, in that the subsidiary was not greatly reliant on the HQ for sales and purchases, were positively related to the likelihood of expatriates performing the bumble bee and spider roles. Perhaps unsurprisingly bumble bees and spiders were also more prevalent in greenfield than brownfield acquisitions. 3. The expatriate assignment in retreat? Linked to the debates reviewed above, there is a growing debate over the issue of the continued utility and viability of the conventional expatriate assignment (Dowling & Welch, 2004). We identify five key aspects of this debate, i.e. supply side issues, demand side issues, expatriate performance and expatriate ‘‘failure’’, performance evaluation, costs and finally career dynamics. Some of these (expatriate failure, costs and performance evaluation) can be considered older challenges, in that they have been associated with the field since the early academic studies emerged on the topic. Others (demand issues surrounding emerging markets and requirements for expatriates in a broader range of organizations; supply issues around career issues and specifically dual careers, the impact of 9/11, etc.) however can be considered newer challenges, in that they have gained increasing importance in recent years. Broadly we discuss these issues in order of significance based on our rating. 3.1. Supply side issues The first key challenge to the traditional expatriate assignment is the supply side issue of availability which has emerged as a key strategic HR issue facing MNCs (Scullion & Starkey, 2000). There is growing recognition that shortages of international managers are a significant problem for international firms and frequently constrain the implementation of global strategies in these firms (Evans et al., 2002; Scullion, 1994). Research indicates that the demand for experienced and competent global managers is growing rapidly and is greater than the current supply (Caligiuri & Cascio, 1998; Quelch & Bloom, 1999). Indeed, it has been argued that for US MNCs, the current international climate and continued concerns about terrorist attacks, post-9/11, mean that potential international assignees will remain reluctant to travel and relocate overseas in the future (Konopaske & Werner, 2005). Yet despite continued uncertainties and anxieties prevailing in the current international climate MNCs must more than ever before encourage staff to work abroad to better understand the global markets and to develop the skills required to work effectively across cultures. Under the heading of supply side issues, as they relate to the availability of expatriate employees, we highlight four key trends- dual careers issues, the limited participation of women in international management, repatriation issues, and weaknesses of talent management systems at the international level. Broadly these issues can be grouped as issues concerning the recruitment and retention of potential expatriate employees. 3.1.1. Issues related to recruitment of potential expatriate employees The increasing significance of dual career couples emerges as a key constraint on the ability of MNCs to D.G. Collings et al. / Journal of World Business 42 (2007) 198–213 attract and retain international management talent (Harvey, 1998). Due to increasing female participation rates in the labour force, particularly in developed countries, those targeted for expatriate assignments are no longer necessarily male sole-breadwinners, with spouses who are willing, and able, to follow their partners abroad for the period of the assignment. There is some evidence to suggest that families are less willing to accept the disruption of personal and social lives associated with international assignments than was the case in the past (Forster, 2000). In addition, dual career problems and disruption to children’s education are seen as major barriers to future international mobility in many different countries and pose considerable restrictions on the career development plans of multinationals (Mayrhofer & Scullion, 2002) and are now considered a worldwide trend that is posing a major dilemma for both multinationals and employees alike (Black, Morrison, & Gregersen, 2000; Harvey, 1998). A second key problem is that the participation of women in international management remains relatively low (Adler, 2002; Tung, 2004) despite growing shortages of international managers. Studies indicate a significant growth in female expatriates since the 1980s, when only about 3% of expatriates were female (Adler, 1984), to around 12–15% in the mid 1990s (Tung, 1998). The most recent available data however suggest that the female expatriate population has not risen significantly over the past decade and remains at approximately 10% (PricewaterhouseCoopers, 2005). The apparent lack of willingness to recruit and develop women as international managers is somewhat paradoxical, as recent research conducted on the outcome of women’s global assignments has indicated that female expatriates are generally successful in their global assignments (Caligiuri & Tung, 1999; Napier & Taylor, 2002; Tung, 2004). Yet as global competition intensifies, competition for global leaders to manage overseas operations will steadily intensify and MNCs must develop new ways to identify, attract and retain new pools of international executive talent (Black et al., 2000; Mayrhofer & Scullion, 2002). 3.1.2. Issues related to retention of expatriate employees The retention of expatriate employees is a major international talent management challenge for MNCs (Scullion & Collings, 2006c), yet research suggests that many MNCs continue to adopt an ad-hoc approach toward the repatriation process and that many expatriate managers continue to experience the repatriation process as falling far short of expectations (Stroh, 201 Gregerson, & Black, 2000). Repatriation has been identified as a major international HRM problem for multinational companies in Europe and North America (Stroh & Caliguiri, 1998). There is growing recognition that where companies are seen to deal unsympathetically with the problems faced by expatriates on re-entry managers will be more reluctant to accept the offer of international assignments (Lazarova & Tarique, 2005; Scullion, 2001). North American research indicates that 20% of all managers who complete foreign assignments wish to leave their company on return. Yet, while it is generally accepted that retention of expatriates is a growing problem and that the costs of expatriate turnover are considerable (Dowling & Welch, 2004), many international firms have failed to develop repatriation policies or programmes which effectively assist the career progression of the expatriate (Black et al., 2000). In the European context the repatriation problem has become particularly acute because internationalization had often taken place at the same time as downsizing of the domestic business which reduced opportunities for expatriate managers on re-entry (Scullion, 1994). Empirical studies confirm the requirement for MNCs to develop a more strategic approach to repatriation and international career management (Stroh & Caliguiri, 1998) which is becoming increasingly necessary in order to retain valuable employees and to encourage the acceptance of international positions (Forster, 2000). A final constraint on the supply of international management talent in many MNCs is the weaknesses of talent management systems, which may be defined as approaches to recruit, retain, develop and motivate a competent cohort of managerial talent with appropriate international experience in the global business environment (Briscoe & Schuler, 2004; Scullion & Collings, 2006b). In this context Scullion and Starkey (2000) demonstrated that a key integration role for the corporate HR function in the international firm was the strategic management of talent on an international basis. However, despite the rhetoric and hype about talent management, there is little evidence to suggest that many companies practice talent management in a co-ordinated and efficient way (Cohn, Khurana, & Reeves, 2005). Recent research highlighted that many MNCs are frequently unaware of where their best talent is located (Evans et al., 2002) and, in addition, many MNCs have difficulties in identifying their high performers (Michaels, Handfield-Jones, & Axelrod, 2001). In this section, we highlighted the key supply side issues which impact on the landscape of international 202 D.G. Collings et al. / Journal of World Business 42 (2007) 198–213 assignments in the international firm. We now turn to the impact of the significant costs attached to the international assignment, which we consider the next most significant challenge to the traditional expatriate assignment. 3.2. Costs As noted above, a major challenge for the continued use of expatriate assignments is the cost associated with them. While Sparrow et al. (2004:139) conclude on the basis of empirical study that few organisations had a true grasp of the costs associated with expatriate assignments, they also highlighted that generally MNCs had little knowledge of the benefits accruing from the various …
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