For Returning Overseas Execs, It’s ‘Welcome Back! Now Get Lost’

Despite the popular emphasis on “globalization” as the key to corporate growth, many companies tend to squander the expertise of managers who return to headquarters after working overseas.

So concludes a recent study by the Conference Board, a business research organization in New York. The report indicates that U.S. companies in particular talk a better game than they play when it comes to competing globally.

While many multinationals these days all but require international experience of those being groomed as future chief executives, the story is far different for returning middle-tier managers.

Increasingly, American managers don’t even have a job to come back to, Paris-based researcher Stephen Gates found. Only 38% of U.S. companies surveyed offer expatriates a written guarantee of a position when they return; by contrast, 74% of continental European companies lure expatriates back with the promise of a headquarters job.

American managers “are coming back into restructuring, downsizing environments where whole departments are being wiped out,” said Gates, who surveyed 152 human resource managers in the United States and Europe at companies with 1994 sales of $3 million to $75 billion.

About 80% of repatriate executives say their international experience was not valued; in fact, they said being overseas exposed them to an “out of sight, out of mind” mentality at the home office. Most said they were not promoted upon their return.

The result? At U.S. firms, expatriate managers leave their companies at twice the rate of domestic managers.

“I don’t think we’ve figured it out at all,” said Jackson N. Huddleston Jr., a Seattle-based consultant who advises companies on operating overseas.

Huddleston said the future commitment of these returning expatriates to their companies can be further undermined by the ongoing turmoil in corporate America. U.S. companies have relied on massive layoffs to hold costs down, and individuals have responded by focusing on their own careers rather than on helping to build institutions.

Managers working overseas generally feel a great sense of responsibility and accomplishment for building a business, Huddleston said.

“Then you come back and, unless you’ve got a mentor who’s looking out for you, you get slaughtered,” he said. “You don’t have your tentacles out in the organization, and they don’t appreciate what you’ve done.”

He cited the example of a telecommunications company manager with extensive experience in Korea and Thailand. Since his return to U.S. headquarters, Huddleston said, “the company has not in any systematic way tried to take advantage of his knowledge.”

Throwing away such talent carries a horrendous cost, and not only in lost knowledge and experience. The cost of overseas postings equals at least twice, and as much as five times, an expatriate’s salary. And most of the companies surveyed said they expect to increase the number of people they send to other nations.

Richard L. Drobnick, director of USC’s Center for International Business, traces part of the problem to companies’ failure to do adequate homework when selecting candidates for overseas posts.

“American firms do not do a serious job of selecting their people,” Drobnick said. Companies tend to be lax in evaluating the employees’ personalities and the ability of the managers’ families to stand up to the rigors of overseas life. The result is that many expatriate managers struggle with challenging foreign assignments and perform poorly, dooming their careers back home.

The report looks at what some forward-thinking companies are doing to help. Motorola, for example, assists spouses of expatriate managers with funds to help maintain or improve career skills. At Royal Dutch Shell, consultants advise spouses who want to work or pursue an education. The company also maintains a global database of spouses who have worked overseas and who are willing to share their experiences with others.

Minnesota’s 3M salvages expatriate managers by attaching them to a mentor in senior management. The mentor maintains regular contact during the employee’s overseas stint, keeping the manager abreast of key developments, and helps ease the way into a new position back home.

To avoid keeping the returning manager in limbo, companies wanting to make the best of the situation should begin plotting the employee’s next role months in advance. The overseas assignment should be viewed as one element of a long-term career plan.

Consider the path of Jann Westfall, who joined Levi Strauss & Co. in 1972 as a summer intern. From 1990 to 1995, she ran the company’s manufacturing operations in New Zealand and then Britain. Upon her return to San Francisco headquarters in March 1995, she became president of the jeans company’s new Slates division, its first new brand in 10 years.

“We strongly encourage individuals to take assignments in other parts of the world,” said Vada Manager, a Levi spokesman. “We think it contributes to a greater diversity of decision making.”