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International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
11 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
a. Career implications significant to both expat and spouse
b. Dissatisfied spouse may affect expat performance, marriage, etc.
c. IHRM addressing spousal issues more closely
3. Challenges for Expatriate Children
a. Expatriate children may suffer the most
b. Children have challenges as well as benefits
c. Children sometimes referred to as third-culture kids (TCKs)
d. Preparation for the Transition: Language Training
1. English is lingua franca of the world
2. Goal is to establish goodwill and show interest in host country
3. Fluency not needed, but day-to-day communication helpful
C. Expatriate Services: banking, tax, family-assistance programs
D. Repatriation – The Shock of Returning Home
1. Often re-entry and feeling a part of home office is difficult
2. IHRM needs to offer career counseling and reorientation
LO 14-6
Describe some of the complications of compensation
packages for expatriate executives
• Compensation for international assignments
o salaries
o allowances
o housing allowances
o cost-of-living allowances
o allowances for tax differentials
o education allowances
o moving and orientation allowances
• bonuses
o overseas premiums
o contract termination payments
o home leave
• compensation packages can be complicated
o what percentage of the base salary?
o What exchange rate?
• Compensation of third-country nationals
• International status
• Perks
• What’s important to you?
Key Terms:
• allowances
• bonuses
• compensation
packages
• international
status
Lecture Outline and Notes:
I. Compensation for international assignments
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
12 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
A. Expatriate compensation programs must be managed proactively to keep them fair and
attractive and able to attract the quantity and quality of potential expats needed by the
IC
1. Traditional method for American ICs is balance sheet approach, with base salary
equal to domestic counterpart, supplemented by allowances and bonuses
2. Can be complex and expensive to administer, especial for IC in broad range of
nations and regions (Table 14. 2)
3. Some ICs attempt to localize workforce or phase out expat package over time
4. Some ICs provide a lump-sum approach, with a home-country-based salary plus
addition that can be allocated on individual preference basis
B. B. Salaries
1. usually standard for each level of the management hierarchy throughout the IC.
2. If in a nation with high tax on personal income, common to pay lower salary but
provide expensive perks
C. Allowances
1. payments to compensate expatriates for extra costs of living abroad, such as:
a. Housing Allowances
b. Cost-of-living Allowances (Table 14.3)
c. Allowances for Tax Differentials
d. Education Allowances
e. Moving and Orientation Allowances
D. Bonuses (or premiums)
1. paid in recognition that expatriates and their families undergo hardships and
inconveniences and make sacrifices living abroad. They include:
a. Overseas Premiums (Table 14.4)
b. Contract Termination Payments
c. Home Leave
E. Compensation Packages Can Be Complicated
1. What Percentage of the base salary?
a. What to pay in host country currency?
b. Home country currency?
c. Other country currency?
2. What Exchange Rate?
a. Inflation and exchange rates change
b. Differ from country to country
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
13 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
F. Compensation of Third-Country Nationals
1. Trend is to treat them the same as HCN expats
G. International Status
1. Given to the top people whom the IC wants to retain.
H. Perks
1. Given to a manager with international status
2. much variety on what it may include
I. What’s important to you?
1. Relative priority of different items is influenced by personal and family
considerations
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
14 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
CONNECT TOOLS FOR CLASS PREPARATION
SmartBook
What is SmartBook?
SmartBook is a digital version of your course textbook. It contains the same content within the
textbook, but unlike a typical eBook, SmartBook actively tailors that content to your individual
needs as a student. SmartBook can be accessed online through your laptop, tablet or
smartphone and is also accessible when you’re offline!
How Does SmartBook Help You/Students?
• Assignable – assigning students their reading and studying their textbook content
ensures they are coming to class prepared.
• Proven to help students get a better grade. Studies show SmartBook technology can help
increase grades by a full letter.
• Save time. Study smarter. SmartBook makes sure students focus on the things you don’t
know so they can prioritize your study time wisely.
• No more cramming. SmartBook helps learners retain key concepts so you can learn—not
memorize.
• Accessible on the go. Use SmartBook on your laptop, tablet or smartphone–online or
offline–via your browser or mobile app.
• Results in real time. Track student progress–and prevents them from wait for midterms
or finals. Know how well you understand the material now.
How to assign SmartBook to ensure students come to class prepared?
• On the Connect course homepage click “add assignment” > LearnSmart > Select the
chapter
• Decide what content you’d like your students to study, and how much time you’d like
students to spend on their work. Start by narrowing down the content prior adjusting the
slider bar. – Many instructors find it useful to limit the assignment to a maximum of 45
minutes.
• Assign points to the assignment. Instructors have found that if they give the
LearnSmart/SmartBook assignment a minimum of 10% of the course grade that students
are more likely to complete the assignment.
• The entire LearnSmart/SmartBook module is available to your student at all times,
however, assigning it will prompt students to try it. You are required to select a due date
for this assignment, however, this will not prevent the student from access to the tool; it
is designed to show you that the student has taken the LearnSmart/SmartBook
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
15 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
assignment. LearnSmart/ SmartBook is an adaptive study tool designed for students. It
can also show you where students are struggling to understand specific concepts.
• The student’s LearnSmart/SmartBook score in the Connect reports is based on their
mastery of the material at the time the assignment is due. Mastery is an evaluation of
the number of learning objectives they completed via performance on answering
questions.
• Students may, and are encouraged, to continue to use LearnSmart/SmartBook
throughout the semester. After the assignment due date, they can continue to access
this tool. Continued use of LearnSmart will not affect their LearnSmart/SmartBook
assignment results in the Connect reports, but has shown to improve test scores by as
much as a full letter grade.
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
16 Instructor’s Manual – Module 14 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
ENGAGEMENT & APPLICATION (FACE TO FACE & ONLINE & HYBRID)
BOXED TEXT DISCUSSION QUESTIONS WITH SUGGESTED ANSWERS
IB IN PRACTICE: Executives with a Global Skill Set Are in Big Demand
The focus of this IB in Practice explores “Executives with a Global Skill Set Are in Big Demand.”
The importance of finding executives with a global skill set is particularly critical in developing
economies and examples from Latin America and China are presented. Some of the challenging
differences between a domestic and a foreign, emerging market context are identified. It is
relatively easy to stimulate discussion of this topic in a classroom context, particularly if the
discussion is initiated through probing questions such as those listed in the IB in Practice box.
Online and Hybrid: Assign questions to be prepared in virtual teams and submitted as a
team assignment, or submitted individually and then discussed in a blog or group discussion site.
Face-to-Face: Students develop responses to the questions in class in teams/groups
1. What kinds of skills or experience are needed in order to succeed in a foreign
assignment?
2. How might a company go about assessing whether or not a candidate has the proper
GLOBAL DEBATE: Why Aren’t More Women Selected for International Assignments?
The focus of this Global Debate explores “Why Aren’t More Women Selected for International
Assignments?” The question alone will present controversy in your class, as women will
answer with a resounding and emphatic, “YES!” Once past that, the question serves well as a
starting point for a stimulating class discussion on such topics as:
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
• Is there a glass ceiling for women in IB management?
• What education and training do women need in order to be strong candidates for
global assignments?
• What personal characteristics do women need to be successful in global
assignments?
• Do women on international assignments need different support than men?
• Are women in your class interested in an IB career? Why and/or why not?
Online and Hybrid: A classroom discussion option is to assign individuals, groups, or the
class as a whole to examine the issue of gender in selecting personnel for international
assignments. The students’ findings can provide a strong basis for discussion or debate on these
emerging issues. Virtual teams can be assigned questions and submit their work as a group.
Alternatively, virtual teams can be assigned to take different roles or perspectives to argue for
(or against) and these assignments can be submitted as a group and then opened up to
discussion and debate on an online class discussion site or blog, or presented and debated in a
Face-to-Face setting.
Face-to-Face: Students develop responses to the questions in class in teams/groups, or
else assign perspectives and conduct an in-class debate and discussion.
1. Should ICs select more women for expatriate assignments? Why or why not?
2. Are there circumstances in which you believe female expatriates should be most
strongly considered, or in which they should not be considered at all? Why?
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
3. How can companies help ensure that more high-potential women are encouraged to pursue
international assignments, and that their expat experiences will be supported and leveraged
effectively?
GET THAT JOB! FROM BACKPACK TO BRIEFCASE Laura Gunderson
The focus of this Get that Job! From Backpack to Briefcase box explores Laura Gunderson’s
experiences in preparing for and entering a career in international human resource
management. Her interest in international issues was sparked by her own international
upbringing, which included a broad variety of living and travel experiences. These experiences
clarified the challenges of doing business internationally, and piqued her interest in human
resource management aspects of international business. She discusses her experiences going to
work immediately after graduation in the international human resources group of a Fortune 100
company, providing an insightful overview for students interested in careers in this area. She
provides several salient recommendations for how students might better prepare themselves for
finding and exploiting opportunities in IHRM.
Online and Hybrid: Virtual teams evaluate Gunderson’s advice for their own career
development and their ability to understand the challenges for effective IHRM. Share
conclusions with the class, either online or in a Face-to-Face setting.
Face-to-Face: Students evaluate their own career strategy in light of Gunderson’s advice,
both in terms of careers in IHRM as well as careers where IHRM professionals will have an
important role in the students’ personal and professional performance.
1. How would you evaluate the list of challenges that Gunderson identifies regarding IHRM
support for business success, such as relocation, talent management, recruitment, employee
development, compensation, labor relations, and information systems? Which of these do you
think are most important and why? Which ones might become even more important in coming
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
2. Gunderson emphasizes the importance of being prepared, search widely for positions,
expand one’s network, communicate interest, and volunteer for new challenges. Do you agree
with these recommendations? Why or why not? How can you incorporate them within your
END OF MODULE EXERCISES
CRITICAL THINKING QUESTIONS
1. What are the implications for international companies of trends toward aging
populations in many developed countries and rapid urbanization in many emerging nations?
What changes are ICs likely to make to successfully respond to these trends?
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 14
2. Explain arguments against allowing immigrant labor into nations. Who would benefit
most from limiting the number of immigrants into a country? What are the primary
arguments associated with allowing immigrant labor into a nation?
3. Why might brain drain be beneficial for a country whose skilled people move to other
nations? How might a country maximize the benefits from brain drain, while reducing the
potential damage from this mobility of labor?
