Antecedents and outcomes of expatriate adjustment - The influence of motivation and acculturation attitude on adjustment and performance

Antecedents and outcomes of expatriate adjustment:

The influence of motivation and acculturation
attitude on adjustment and performance

Diploma Thesis

Department 06: Psychology and Sports Science
Section Work and Organiational Psychology
Justus-Liebig-University Gießen

Submitted by:
Elizabeth Schibli-Lazzaro
4. October 2006

Content

Abstract ... 1

1. Introduction ... 2

2. Antecedents of Adjustment... 6

2.1. The concept of Adjustment ... 6

2.2. The concept of Motivation ... 7

2.3. The concept of Acculturation ... 8

3. Outcomes of Adjustment ... 14

3.1 Adjustment and Strain ... 14

3.2. Spouse adjustment ... 15

3.3. The concept of performance ... 16

3.4. Performance and Strain ... 16

3.5. Adjustment and performance ... 17

4. Method  ... 20

4.1 Sample and data collection ... 20

4.2 Measure ... 25
4.2.1 Motivation ... 27
4.2.2 Acculturation attitude ... 27
4.2.3 Adjustment ... 27
4.2.4 Performance ... 28
4.2.5 Intention to leave ... 28
4.2.6 Strain ... 29
4.2.7 Control variable ... 29

4.3 Analyse ... 30

5. Result ... 31

5.1. Descriptive result ... 31

5.2 Motivation and Mainstream culture orientation (Hypothesis 1) ... 34

5.3. Mainstream culture orientation and adjustment (Hypothesis 2) ... 35

5.4. Acculturation types and adjustment (Hypothesis 3) ... 36

5.5. Adjustment and strain (Hypothesis 4) ... 37

5.6. Adjustment, strain and performance (Hypothesis 5) ... 38

5.7. Strain, spouse adjustment and intention to leave the IA prematurely (H6) ... 39

6. Discussion ... 41

6.1. General Discussion ... 41

Motivation ... 41
Acculturation attitude and adjustment ... 42
Adjustment and strain ... 43
Adjustment, strain and performance ... 44
Intention to leave ... 45
Language ability ... 45

6.2. Limitation ... 46

6.3. Practical implication ... 47

6.4. Further research ... 48

6.5. Conclusion ... 49

Bibliography ... 51

1. Introduction

The opening of new market opportunities and challenges for corporations in the past years have resulted in steadily increasing interconnections between countries and culture (House, Hanges, Javidan, Dorfman, & Gupta, 2004; Stroh, Dennis, & Cramer, 1994). With the increasing intercultural global economy, it has become essential for internationally operating corporations to foster intercultural knowledge and global perspectives. An effective way to acquire intercultural knowledge is to relocate employees to another country for a period of one to five years on international assignment (IA) (Takeuchi, Yun, & Russell, 2002). By this method, the employee may gain international knowledge through his or her experience and become a potential key resource for the company’s competitive advantage (Takeuchi et al., 2002). Acting as a link between the corporation and its subsidiaries, the expatriate develops decisive knowledge of the market in a specific country. Creating valuable bonds across cultures, he ensures the continuity of the corporation’s philosophy (Au & Fukuda, 2002; Aycan, 1997; Black & Gregersen, 1991). As a consequence, a growing number of employees are sent abroad on IA every year. Researchers suggest that their number will increase in the future (Kühlmann, 2004). The IA has, therefore, become a valued instrument for human resources development (Kühlmann, 2004; Mendenhall, Kühlmann, Stahl, & Osland, 2002).

The efficient positioning of an expatriate in an IA is a critical step in human resource management (Stroh et al., 1994). The expatriate is an investment for the company, according to Wederspahn (as cited in Shaffer, Harrison, & Gilley, 1999), costing at least three times more in the first year than a manager in the same position in the home country. Thus, the expatriate can become a financial risk. High direct and indirect costs are associated with expatriate ineffectiveness, rising even more when the expatriate returns prematurely from the IA and a substitute needs to be found and trained (Black & Stephens, 1989). Direct costs can emerge by inadequate expatriate performance and inefficient productivity of the subsidiary (Aycan, 1997; Foster, 1992; Takeuchi et al., 2002). Indirectly, the company’s reputation and customer relations in the host country may suffer and market opportunities can be missed (Aycan, 1997). As a consequence, other potential expatriates may refuse their relocation (Stroh, 1995).

For the expatriate a failure can result in low self-esteem, career repercussions, loss of face in front of peers and supervisor, and strain on the family (Mendenhall & Oddou, 1985; Takeuchi et al., 2002). The literature is not very clear about the expatriate failure rates. Some authors talk about significant failure rates (Aryee & Stone, 1996; Mendenhall & Oddou, 1985), while others point out that no accurate data on expatriate psychological withdrawal rate or premature return is available (Forster, 1997; Kühlmann, 2004).

The adjustment of the expatriate to his or her host country has been detected as one of the most crucial factors influencing the success or failure of the IA (Aryee & Stone, 1996; Black & Gregersen, 1991; Black & Stephens, 1989). Maladjustment to the host country is cited as the second most important reason for expatriates to return prematurely from their assignment (Black & Stephens, 1989). According to surveys, 80 per cent of the expatriates are married and most of them take their children with them to the host country (Ali, Van der Zee, & Sanders, 2003). Companies need to be aware that in many cases they are not only sending an expatriate abroad but a whole family-system. Relocation to another country represents a great challenge for the employees and their families. Shifted from their known environments, expatriates and their families have to adjust to a new culture, a different climate, different customs, another language, and a myriad of altered life conditions (Black & Gregersen, 1991; Caligiuri, Hyland, & Joshi, 1998). They need to get accustomed to reactions that differ from what they had expected and possibly develop a new non-verbal communication skill. Accordingly, expatriates and their families have to adjust on many different levels. Maladjustment of the spouse and family is, correspondingly, cited as the most frequent reason for premature expatriate return and failed IA (Black & Stephens, 1989).

Past research has shown that adjustment is influenced by factors such as personality characteristics, predeparture training, and diverse work factors like role clarity and role novelty (Black, Mendenhall, & Oddou, 1991; Caligiuri, 2000; Shaffer et al., 1999). Although the qualitative literature (McCollum, 1990; Osland, 1995; Selmer, 1998) has often argued for an influence of the expatriates’ motivation to accept the IA on adjustment, no formal quantitative analyses has been conducted yet. Accordingly, the present study aims to explore the role of motivation on the adjustment process. A second proposed antecedent is the acculturation attitude. Acculturation is the process by which, persons from one cultural background adapt to people from another cultural background (Tung, 1998).

Individuals vary in their attitudes depending on how strongly they retain their own cultural identity and how strongly they relate to a new culture (Berry, Kim, Power, Young, & Bujak, 1989). This study explores the relationship between motivation to accept the IA, acculturation attitude and adjustment.
Furthermore this study expands the model of adjustment by exploring its role as mediator between antecedents and important outcomes. A great part of the expatriate literature has focused on adjustment and its antecedents, while the outcomes have mainly been neglected. Whenever outcomes were addressed, they were often more hypothesized than actually empirically tested (Aycan, 1997; Hechanova, Beehr, & Christiansen, 2003; Mol, Born, & van der Molen, 2005; Tucker, Bonial, & Lahti, 2004), although it has been suggested that only an adjusted expatriate can actually succeed (Mendenhall et al., 2002). There are in particular two measures for the outcomes of adjustment. One outcome is performance and the other is the intention to leave the IA prematurely. For expatriates the performance in the home country is not automatically comparable to the performance in the host country. Not all expatriates are as effective abroad as they had been at home. Lanier (1979) referred to those ineffective expatriates as “brownouts”. He applies this term to expatriates who are not able to adjust and consequently are not performing on the same level as they would at home but who refuse to return home prematurely. This study analyzes both the influence of adjustment on job performance and on the intention to leave the assignment prematurely.

Moreover, the assumed influence of the adjustment of the expatriate’s spouse on the expatriate’s performance is investigated. Explaining the importance of the expatriate spouse’s adjustment, authors often refer to the influence of the spouse on performance of the expatriate (Caligiuri et al., 1998) but this often assumed relationship has not been empirically tested yet (Mol et al., 2005). The link between adjustment and performance is based on a stress theory, arguing that maladjustment leads to strain (Hechanova et al., 2003). Also the maladjustment of the spouse is theorized to bring strain to the expatriate. The present study investigates how adjustment leads to strain and the effect of strain on performance. Figure 1 gives an overview of the model presented.

[...]