International Human Capital as a Source of Competitive Advantage for Organizations: International Human Resource Management

International Human Capital as a Source of Competitive Advantage for Organizations: International Human Resource Management

María Bastida Domínguez (University of Santiago de Compostela, Spain)
Copyright: © 2016 |Pages: 21
DOI: 10.4018/978-1-5225-0356-9.ch001
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Abstract

The aim of this chapter is to highlight the properties presented by the international human capital that allows us to conceptualize it as a strategic resource of organizations, and therefore, a potential source of sustainable competitive advantage. We highlight the role of international assignments as a preferred way for companies to contribute to developing global skills in leadership. Finally, under the consideration of the difficulties that can raise these assignments, both in terms of cost and effectiveness, we review some other alternative ways of development that companies are currently hiring: short-term expatriates, virtual, self-initiated and inpatriation.
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Introduction

One of the salient features of the current economy, that will mark the present century, is the internationalization of Economy. In this context, companies are forced to compete in markets without borders to remain competitive. Internationalization has grown from a traditional way of expansion and growth for companies to a strategy for sustainability and survival.

The factors that promote or enhance the international expansion are multiple and varied, but several studies have highlighted the importance of the adhesion of a global culture among these variables. According to the upper echelons theory (Hambrick & Mason, 1984), the international experience of top managers in multinational companies should be considered as a driver of internationalization (Carpenter & Fredrickson, 2001; Reuber & Fischer, 1997; Sambharya, 1996) playing a key role in the effective accomplishment of the global strategy and in the achievement of better results (Hutzschenreuter & Horstkotte, 2013). For companies competing in a world without borders, it is essential to have leaders with global talent, capabilities and effective intercultural skills (Baartlett & Ghoshal, 1990; Harvey & Moeller, 2009). There is a greater consensus about the importance of international staff for globally competent organizations (Harvey, Novicevic, Speier, 2000). Consequently, international mobility is a competitive differentiator for the success of organizations in a global context (Altman & Shortland, 2008).

It has also been suggested that one of the ways to get those global capabilities (if not the only, at least the faster) is the successive occupation of international assignments (Black & Gregersen, 1999; Boyacigiller, 2000; Caligiuri & Tarique 2009; Insch, McIntyre & Napier, 2008). Moreover, since the concept of “bondaryless career” appears (Arthur & Rousseau, 1996), it has been widely recognized that international career has positive outcomes for the career of managers, to the point that one of the most frequent reasons for a manager running for a international position is his or her desire to move to the top of organizations (Tharenou, 2010; Banai & Harry, 2004).

In the context of organizations operating globally, International Assignments have increased their presence and importance in recent decades. Nowadays, they are recognized as the main way in which organizations could improve their international management pool, both for its direct (relative to the competition in the international market) and indirect benefits (career development managers, highly skilled human capital). The expatriate managers acquire a set of skills (knowledge, perspectives, professional relationships...) that reverse in positive performance of the multinational Companies. Also possessing international experience is rare, so these managers become a valuable, limited, and inimitable resource for their organizations. To take advantage of this resource as a competitive one, the organization must necessarily identify, evaluate, and acquire the knowledge they possess, helping to disseminate the same, which necessarily involves the right repatriation of expatriates.

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