Foreign Firms Hiring More U.S. Managers

Foreign companies, doing more business in the United States than ever before, have come to the conclusion that no one knows the American market as well as the natives.

Even the Japanese, who prize homogeneity in their corporations, are eagerly seeking U.S. executives, particularly with experience in finance, to work for them in America, said Peter Livingston of Paul R. Ray & Co., the sixth-largest executive placement firm.

“A lot of foreign companies come to us and say, ‘We’ve tried to break into the American market, but the only people who understand American institutions and customers are Americans themselves,’ ” Livingston said.

Those companies most interested in hiring Americans to head their U.S. operations are British, Japanese, West German and to a lesser extent, Swiss and Canadian.

40 or Older

They are looking for Americans in their 40s or older, with plenty of experience and proven accomplishments. Ivy League diplomas mean little to foreign firms, Livingston says. The companies are looking for people who can bring results.

Although Americans have lost what was nearly a national monopoly on marketing skills, they are still more aggressive, said Brooks Chamberlin, a partner in the New York office of Korn Ferry International, the No.1 executive search firm.

“There’s more of an entrepreneurial ethic in the United States. Americans aren’t afraid to pick up the phone and say, ‘May I come in and see you?’ The British and Japanese don’t do it quite as easily,” he said.

With the dollar sliding against other currencies, it is harder for other countries to export goods to the United States, and it makes sense to establish a foothold and do business inside the country.

“The foreign companies’ fat profit margins (from U.S. sales) have eroded,” said Korn Ferry’s Chamberlin. “But rather than raise prices to hold on to market share, they are looking for executives to maximize the profitability of their U.S. operations.”

The demand from overseas clients at Paul R. Ray for Americans with know-how in banking, investment and finance has grown from about 25 in 1985 to more than 60 last year.

Demand in Electronics

Demand for American executives in health care, automobiles and other industries has doubled, and in the case of electronics, it has quintupled.

Overall, Paul R. Ray reports a 60% increase in foreign firms’ demand for Americans.

Livingston said his foreign clients “are primarily looking for people to run their U.S. operation, people with sales and marketing talents.”

In contrast to U.S. clients who seek executives with long-term management potential, “foreign clients are looking for a short-term gain, someone to fire up their business and increase revenues,” he said.

At this stage, women need not apply. Foreign companies apparently hire fewer women for top slots than American companies. Paul R. Ray placed only one American woman with a foreign company last year.

American men, too, have to adjust to an alien corporate environment.

Communication Vital

“In working for a foreign company, you must be more certain that you are communicating, and also that you are understood,” said James Castle, head of the systems and technology unit in New York of the Monte Carlo-based conglomerate TBG Inc.

Chamberlin, who heads Korn Ferry’s financial services department, said the fastest-rising demand for U.S. executives comes from foreign financial concerns.

“With the globalization of financial markets--Big Bang in London and Little Bang in Toronto--foreign companies are building operations here and they are looking for specialists,” he said.

Typically, Chamberlin is asked to find someone with expertise in swaps (sophisticated stock or currency exchanges), private placements, mergers and acquisitions.

“The resources of some of these clients, Japanese and German banks, are staggering. They understand that in order to attract American candidates, they have to pay better than American companies and they are willing to do that,” Livingston said.

Foreign companies are willing to lure American executives with salary increases of up to 25% and perks that are all but unheard of in corporate America: a company car, a paid-for apartment in New York and generous travel benefits.

For many years, foreign companies, particularly Japanese ones, offered their employees more job security than American companies. But that is no longer so, said Livingston.

“When foreign companies come to the United States, they’re just as tough, and tougher than U.S. companies in terms of results. Even in Japanese companies, American employees are not protected,” he said.