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May 31, 2017
(First published on September 12, 2016)

Business Matters: Global

Why Repatriation Matters (Part One)

Gareth Monteath

In 2010, I entered a doctoral program at the University of Manchester so that I could study and research the impact of globalization on Japanese business people and HR systems. Five years later, I was awarded my doctorate based on a thesis that investigated repatriation and Japanese human resource management (HRM). In this series of articles, I will share in bite-sized pieces some of my observations and conclusions. After all, it is hardly fair to ask anyone other than my supervisor, examiners, and (long-suffering) mother to read the entire thesis.

Why did I become interested in this topic, and why do I think that you might be? Every year, the number of business people who have worked overseas and returned to their home country grows larger. It is highly likely that you know at least one of their number. These people can be referred to as “repatriates,” as opposed to “expatriates,” which is what they were when they went overseas to work, or “inpatriates,” the label given to people brought from other countries to work at a company’s headquarters.

It seems intuitive that of these three processes (repatriation, expatriation, and inpatriation), repatriation would be the easiest to handle. After all, a repatriate is returning to her own country. Unlike when she was an expatriate, she does not have to deal with the potential challenges of an unknown language or business practices. An inpatriate, of course, faces similar hurdles to those of an expatriate, including dealing with unfamiliar food, new customs, and possibly a different climate.

Surely, then, repatriation should be relatively simple, right? As it turns out, this is not the case. In 1945, Alfred Schütz described the gap between the person going back and the people who greet him: “In the beginning it is not only the homeland that shows to the homecomer an unaccustomed face. The homecomer appears equally strange to those who expect him, and the thick air about him will keep him unknown” (quoted from “The Homecomer” in the American Journal of Sociology, volume 50, issue 5, pages 369-76).

Alfred Schütz is not alone in noticing the unexpected difficulties of repatriation. Nancy Adler, professor of Organizational Behavior at McGill University in Canada, is perhaps the most famous in a long line of academics to have written on the topic. Repatriates themselves underestimate the challenges, as do their families, friends, and employers. More money is spent by companies on an employee’s expatriation than on repatriation, for instance (see Mark Bolino, “Expatriate assignments and intra-organizational career success: implications for individuals and organizations” in the Journal of International Business Studies, volume 38, pages 819-35). Academic research, too, has tended to focus more on expatriation than repatriation, but there is a growing awareness that repatriates are important for the future success of companies.

Let’s take a closer look at that last statement: “Repatriates are important for the future success of companies.” This makes more sense if we consider why they were sent overseas in the first place. One reason is that it is more practical or cheaper to send someone from the home country to fill a position than it is to try to hire locally. Another is that the expatriate may be expected to teach skills and knowledge to local colleagues, often with a view to handing them over to those colleagues at the end of the assignment. Those skills and knowledge may be technical, or they may relate to a common corporate culture. Thirdly, a company may wish to improve communication between different parts of its global organization. Next, the headquarters may hope to gain control over a local company, or at the very least, observe what is being done. A fifth reason is to develop talented people from the headquarters by giving them overseas experience.

Clearly, these may all apply at the same time. In other words, your president, division manager, or HR department may decide that it is cheaper or easier to send someone from the headquarters than to hire locally. While the expatriate is there, she can pass on her technical and organizational knowledge, and create a healthy flow of information between the local company and the HQ. She can exercise a degree of control over local management, and she can also learn valuable management skills herself. While her salary and various expatriate allowances mean that she is likely to cost the headquarters a lot of money, the benefits listed here show that it may well make sense to send her.

Now let’s imagine what might happen when that person returns. She has likely developed a personal network with key people overseas. She has learned about how to work outside her home country, and she has acquired new technical skills. All in all, she has valuable knowledge. If her company wants to expand regionally or globally, she has the potential to contribute in a positive way. She can assist colleagues in the headquarters who lack similar experience, she can connect those colleagues with people she knows overseas, she can work to solve problems in communication and management arising from working across cultures, and she can collaborate with other repatriates to establish powerful communities and bodies of practice.

Despite all of this exciting potential, many companies fail to manage repatriates and repatriation in anything even approaching an optimal manner. Most academics and practitioners agree that turnover rates are higher for repatriates than for those who do not go abroad. Even if they do not leave, there is evidence that some become frustrated and disillusioned in their jobs back in their home country, not least because they feel their skills are not being used.

Since our clients at LGS are all at various stages of globalizing, my doctoral work has implications and potential that might be helpful. In particular, I have focused on the impact that repatriates have on their home organizations and vice-versa. This is particularly relevant in the light of ongoing speculation about changes in Japanese human resource management practices. As companies become more global, it is reasonable to expect that they will make adjustments that mean they give up some of their original practices. Is that really the case, however? That is one of the key questions that I will address in this series of articles. I hope that you enjoy what follows from now, and I thank you for taking the time to read this far.

About the author

Gareth Monteath

Gareth Monteath

Gaz has a doctorate from the University of Manchester (2015), an MBA from the University of Cambridge (2003), and a Master’s degree in Chinese Language, Business, and International Relations from the University of Sheffield (2007). He worked in London for Daiwa Europe before moving to Japan in 1991. Gaz spent three years on the JET Programme, and then joined LGS in 1994. In his current role, he oversees the creation and delivery of new programs, and is a member of the management board. He holds level 1 of the JETRO Business Japanese Test (1997) and the Japanese Language Proficiency Test (1994). Gaz is also a published author.