Performance issues faced by Expatriates of Sony Corporation

Table of Contents

Executive summary

The report is going to talk about a global challenge related to International HRM that is faced by Multinational Corporations. The company selected for this purpose is the Sony Corporation. The report will provide a detailed overview of the organization along with its size, location, and subsidiaries. The aims and objectives of the investigation will also be summarised in this section. The next section will critically evaluate the issues through theoretical frameworks and models and evidence from the chosen organization. The last few sections will present recommendations for minimizing the issue and also highlight the risks and contingencies of the issue. The report will end with a summary of the key points.

Introduction

Overview of the organization

Sony Corporation is a Japanese multinational firm, which is based in Konan, Minato, Tokyo. The company is a leading manufacturer of electronic products, which are primarily sold in commercial markets. The company has a wide range of subsidiaries located in different regions all over the globe. The important subsidiaries located in Japan are Sony Electronics Corporation, Sony Music Entertainment, Sony Energy Devices Corporation, and Sony Financial Holdings Inc. The company currently has a revenue of ¥8.259 trillion and the number of employees has already crossed 1 lakh as reported in 2019 (Dimitrova et al. 2020). The company serves a range of products and services to the customers ranging from consumer electronics, telecommunications to financial and insurance services. According to the Fortune Global 500 list, the company ranks 97^th as in 2018. The company also owns the largest music entertainment business on the global platform.

Overview of the issue

The broad issue to be talked about in this report will be the challenges faced by expatriates while working with the global assignments. Expatriates are referred to as the employees who are sent to work on international assignments in the foreign subsidiaries of the organization. By working in a foreign location these expatriates help in establishing the prominence of the company in these markets and carry out the exchange of knowledge and information between the partners of the company (Lauring and Selmer, 2018). These expatriates face a lot of challenges while working on these global assignments at foreign locations. These issues can occur due to the lack of motivational and appraisal techniques provided to these expatriates. Lack of recognition and empowerment can degrade the performance of these expatriates in foreign locations, which might prove detrimental for the future success of the companies. All these issues will be taken into consideration in the next few sections.

Aims and objectives

The report aims to focus on a specific issue related to international human resource management. In this context, the report will sum up the performance issues faced by expatriates while working with international assignments at foreign locations. A special emphasis would be given on the appraisal issues faced by these employees in multinational organizations. Evidence would be drawn from Sony Corporation.

The specific objectives of the report are as follows.

To identify the performance issues of expatriates belonging to Sony Corporation
To find out motivational and appraisal issues that hamper the performance of the employees.
To provide suitable recommendations to the narrated issues
To point out the risks and contingencies related to the particular issue

Analysis

Expatriates play an important role in multinational organizations as they level up these organizations in terms of growth and profitability in the global environment. All the organizations which plan to expand beyond national boundaries and set a global footprint require expatriates for working in their subsidiaries (Guttormsen et al. 2018). These employees take up bigger responsibilities and job roles and experience career development. However, these opportunities come in their hands with a lot of unknown challenges and risks.

Flexibility – This is a common challenge faced by expatriates while working on global assignments. This factor is coupled up with cultural empathy and the ability to adjust with the partner. Many expatriates fail to handle uncertainty due to which they fail to perform well in their global assignments. Sometimes, the personal problems of expatriates may hamper the quality of their work. According to Chen and Shaffer, (2017), cultural awareness is a very important element that comes into play in this context. The expatriates find it difficult to follow the corporate culture prevalent in the foreign location.

According to surveys conducted in Sony Corporation, one of the employees has revealed that the two most challenging things being an expatriate can be a new cultural environment and interaction with co-workers. Difficulties in the interaction with co-workers might occur due to a gap in the training procedures (Sekiguchi et al. 2016). The training process could not match up with the needs of the employees. One of the female respondents deliberately stated that no training had been provided to elevate her interaction skills (Kwon et al. 2019). Two male respondents talked about seminars held in the company but showed a lack of skills in communication and cultural awareness. It can be observed that there had been a gap between the expectations of both parties, which occurred due to communication problems.

Selection of expatriates – Another underlying reason behind the underperformance of the expatriates in global assignments can be the incorrect selection of employees as expatriates by the management (Park et al. 2020). Many times incapable employees are selected as expatriates and they perform below expectations in the global assignments. The HR manager of a company is directly responsible for selecting expatriates among the employees. In this situation, two important skills should be considered, that is, the social skills and technical skills of the person. Social skills should be present at the highest degree, which might not be prioritized well by the HR manager of the organizations.

From the responses provided by the employees of Sony Corporation, it had been examined that the company does not give a high degree of importance to social skills due to which many employees fail to understand the behaviors of their colleagues. Even the technical skills are judged following the records of the employees, which might not be accurate (Mills, 2017). Instead, it focussed on the adjustment skills of the employees, which should not be the sole criteria for selecting an expatriate for international assignments. The company did not culturally train its employees so that they can develop technical skills.

Moving away from personal circles – This is a common issue that is faced by all expatriates irrespective of an organization. Being part of foreign locations, the expatriates have to stay away from their family members. At depressing and harsh times, a lack of personal support makes a person weak and vulnerable. The expatriates face the challenge of handling any problem alone without the mental support from the family members (Nunes et al. 2017). It takes time for an expatriate to adapt to a foreign location and make new friends. Until then, he might face performance issues while working on global assignments.

In multinational corporations like Sony, this problem is persistent among the expatriates. According to opinions put forwarded by expatriates of Sony Corporation, it has been realized that many of them have faced the challenge of dealing with loneliness in foreign locations (Oki, 2018). Many of them have become mentally broken due to the absence of their near and dear ones. Though the company provides an opportunity for visiting the home country very frequently in between work, still it has been very difficult for the expatriates to live without their family members in a completely unknown location (Koskela, 2016). This situation has directly affected their performances negatively.

Language barriers – This is a major hindrance in the process of undertaking global assignments as languages vary from one place to another. English has been considered as the universal language acceptable in all countries. However, many employees are comfortable speaking in their local languages and this affects their productivity while working in foreign locations (Dickmann et al. 2018). The issues faced by these expatriates are left unaddressed most of the time as they could not communicate properly with their concerned authorities due to language issues. This not only affects the tasks of the employees working in foreign locations but also pulls down the growth and development of the organizations.

Sony being a Japanese company, has issues related to language and communication. Lack of rigorous training of the expatriates is observed in Japanese companies like Sony due to which employees face issues while communicating with foreign people and take a longer time to show progress in their works (Davis et al. 2019). Through responses provided by the Japanese employees, it had been noticed that language problem persists in the organization and the language training provided by the company has many loopholes. Most of the employees are not fluent and well-versed in English and lacks capabilities in learning new phrases and expressions.

Appraisal management – The issue of appraisal management occurs when employees are not appraised and motivated properly, which directly degrades their performances. Most of the companies tend to believe that the expatriates are already well-trained in their respective fields and fail to recognize that they lack different levels of knowledge and motivation required for the success of the business (McKeown et al. 2016). Along with this, the expatriates are not evaluated properly based on their performances and the performance measures are not applied properly to them. This acts as a demotivating factor for the expatriates and downfalls their performances.

In Sony Corporation, five differences have been found out among the expatriate groups of the organization. The first issue relates to the conduction of the evaluation of the expatriates (Pachana et al. 2016). A structured administration in terms of expatriate evaluation is not present within the organization due to which the evaluation techniques are not carried out properly. The communication gap and non-transparency in the communication channel created a difference between the senior authorities and the expatriates (Mavor et al. 2017). The actual talents of the organization do not get proper appraisal and recognition for their jobs. On the other hand, many incompetent employees tend to acquire high positions in the hierarchy and get selected as high performers or expatriates.

Motivation is an important technique which affects the performance of the expatriates in global assignments. Through motivational techniques, the performance can be elevated to a certain degree as observed through many studies. However, many organizations face this issue as they do not sufficiently motivate their employees for adapting into the foreign environment (Bader et al. 2019). The employees have a lack of confidence and do not consider themselves as important parts of the organizations. This hampers their psychological well-being and becomes a barrier to their performances. The three derivates of motivation applicable for expatriates are autonomy, competence and relatedness.

Sony employees face problems with these three elements of motivation, that is, autonomy, competence and relatedness. Autonomy talks about freedom of choice through high diversity and flexibility. The employees are not provided with all these choices (Faeth and Kittler, 2020). The relocation professionals do not pay attention to matching the skills and potentials of the assignee with that of the needs and goals of the global assignments. This crates a gap in the performance of the employees while working in foreign locations. Lack of relatedness is also observed between these employees as their need to feel connected to other is restricted to a certain extent.

Supporting theories and models

Many psychological theories and models could be relevant in understanding the behavioural and performance issues of the expatriates. One such theory could be social identity theory. According to this theory, a person’s social identity is driven his social groups, such as family, friends, peers and colleagues (Tahir and Ertek, 2018). The social group of a person is an importance source of pride and self-esteem. These groups create a sense of belonging into the minds of a person about the social world. Being detached from social group, a person might feel lack of confidence in performing his task effectively.

Another important theory which is relevant for the expatriates is the ethnic identity confirmation theory, which is a sub-part of the self-verification theory. This theory introduces a level of agreement between two parties. Broadly, the theory states the extent of acceptance of one’s ethnic identity by another through a set of variables. This theory is applicable for expatriates as there is a mutual acceptance of the culture and ethnicity between the foreign country officials and the expatriates. This is very important for the growth and development of the expatriate in his job.

Recommendations

Suitable recommendations could be provided by addressing the above stated issues.

The new generations of assignees selected as expatriates have the expectation that companies will provide them suitable trainings for being flexible in the foreign environment. The companies like Sony Corporation should devise flexible approaches for handling the expatriates of international assignments. Segmented policies having distinctive terms and conditions should be prepared for the expatriates along with greater choices and mobility benefits. On-job training methods should be implemented that would include both theoretical and practical sessions about the foreign environment where the expatriates would work. This will impart knowledge and insights to the expatriates and they would display greater flexibility while working in foreign locations.
Sony corporation can follow technique consisting of sequential steps for selecting expatriates for international assignments. The first step is to set up a selection panel, which would have manager and HR staff from both home and foreign locations such that they can easily judge a potential candidate (Greppin et al. 2017). It is always better to choose candidates who already have experiences in international assignments. Otherwise, candidates should be prioritised through their language fluency and intercultural adaptability. Both these factors should be taken into account before finalising a candidate as expatriate.
Many steps could be taken by the company to create a personal space of the employees in the foreign location. To boost up the morale of the employees, the companies can send one of their family members in the foreign location free of cost such that the expatriates can enjoy a homely atmosphere in the foreign place. The company can also arrange holiday trips for the expatriates such that they can travel in-between works and feel refreshed while starting off with their tasks after the short break. Video conferencing can be another useful way of having a personal conversation with the family members.
The most important way to deal with language barrier is to learn the local language. Sony Corporation should take the initiative in providing vocal training to the employees for the purpose of developing linguistic abilities. Learning and speaking a foreign language would also give additional benefits to the employees. It would develop a sense of empowerment and personal accomplishment in the minds of the expatriates and the person would be one step ahead from other employees. The person would also easily form a social group in the foreign country and have a chance to meet new local people.
Sony Corporation can adopt many strategies for appraising expatriates. The first analytical attempt of appraisal can be setting up of performance criteria of the employees. The quantifiable aspects of employee performance should be measures and evaluated (Przytuła et al. 2018). Use of more than one criterion helps in carrying out a balanced and less biased appraisal technique of the expatriates. Another important criterion in this context can be contextual criterion, which deals with the situational aspect of the employees. Along with this, the hard-working, loyal employees should be awarded at regular intervals. A highly appraised employee would automatically perform well in international assignments.
Two kinds of motivation are common among expatriates, that is, intrinsic and extrinsic motivation. Intrinsic motivation generates when the expatriates derive satisfaction from their assigned activities. Extrinsic motivation occurs through tangible, verbal rewards provided to the employees. Sony Corporation should devise methods that would provide autonomy to the staff for putting his or her own ideas into the system. The maximum motivational levels among expatriates can be achieved if they are participants in the decision-making process. The management should support equity, achievement and camaraderie in organisations for levelling up the job satisfaction of the employees.

Risks and contingencies

Risks can occur if an international relocation of an expatriate fails massively due to the above stated challenges and issues. This failure can have a devastating impact on the individual sent abroad for international assignments. It might affect the reputation of the individual not only in the home location but also in the respective foreign location, which might prove detrimental for the progress of his career. According to Govender (2018), the failure also affects the brand name of the company in the foreign market creating a hindrance in its growth and development. The companies have to bear financial and non-financial costs for enduring such a loss.

In the financial aspect, the costs include transportation costs, international flights, short-term or long-term accommodation costs, household goods shipments, and miscellaneous ancillary charges. If the international assignment fails at an advanced stage, the cumulative costs would add up in the subsequent years. This would create a massive financial loss for the company. In the non-financial aspect, a failed international assignment might impact the mental well-being of the employee. Such incidents can lower the self-esteem of the employees along with lowering down of the motivational levels and lead to depression in the minds of the employees. All these factors would affect the productivity of the expatriates.

A contingency plan should be set up by Sony Corporation for minimising the risks of failed international assignments. The first step of this plan could be proper screening of the candidate who would be assigned to the international assignment (Zhou, 2020). The suitability of the candidate and his family to the foreign location should be evaluated before selecting him as the expatriate. Another important way is to provide appropriate support services for relocating the personal needs of the candidate and his family. Sony Corporation should assess the overall return from the global investment beforehand such that failure would not affect it in a greater way.

The company should prepare a financial plan summarising the costs, returns and viability of the foreign investment. The cash flow for the next few years should be calculated and higher returns should be ensured taking into account the costs of failure. The company should not only think about the employee but also about his family background, his marital status and children before taking a final decision (Pinnington et al. 2018). This is because, an employee might be pressurised to leave the assignment by his family members. Other factors should be kept in mind in this context such as customs, culture, food and etiquette of the new country.

Conclusions

From the above report, it can be concluded that performance issues of expatriates are a major concern for companies who wish to expand their operations across the national boundaries. Many performance issues have been detected in multinational corporations like Sony. These issues are cultural shock, adjustment in foreign locations, language barriers and other similar issues. All these issues can lead to the failure of an international project and create a risky position for the company in the global market. Therefore, recommended solutions should be implemented for minimising these risks and issues concerning the performance of expatriates in international assignments.

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