Tips for Making an Expatriation Decision

"Congratulations on landing this expat position!" you will hear from your boss and off they'll go and you will be left on your own ruminating over the imminent relocation. You start talking to your colleagues, friends, spend hours on expat forums and make up long lists of criteria based on which you are going to pass your judgment. Luckily, there are lots of resources, starting with general and all-encompassing, such as www.expatforum.com, and ranging to country specific, e.g. www.britishexpats.com, www.singaporeexpats.com, etc. or home country specific, e.g. www.britsabroad.com.

I am by no means an expert: I have only lived in four different countries so far, and there is a separate category of "chronic expats", whose way of life is changing countries every 3-4 years, taking their home, spouses, children and pets wherever they go. Still, I do have an insight into the expat life from both sides of the fence: as an expat myself and as an HR professional handling issues or expatriation, repatriation, painful expatriate separations and blood-sucking dealings with expat transfer desks and relocation agencies.

Here are, in my opinion, the most critical things that you need to keep in mind changing the country you live in:

• Taxes: will you fall into a double taxation situation? Which country is the tax rate higher? Will you company compensate the potential loss in your income caused by higher tax rates? Which country are you a tax resident in? Make sure that you clear out all these questions before you agree to anything in writing.

• Cost of Living: it's a no-brainer that living in Colorado-ville is less expensive that Oslo, Tokio or Moscow. Most companies will add a COLA (cost of living adjustment) payment into your new package, but to confirm for yourself you can use a variety of online resources, including http://www.expatistan.com/cost-of-living. 

• Housing: there are expat ghettoes in practically every country and most often than not your company will take care of your accommodation. However, if you wish to experience the local culture and avoid those protected sterilized look-alike expat residential complexes, you may wish to take the factor of availability of safe decent-quality housing on the local market into account.

• Traffic: read this exciting article about an IBM study on the most horrible traffic in the entire world and rejoice if you do not live in Mexico City, Shenzhen or Beijing: http://gizmodo.com/5838333/the-most-horrific-traffic-in-the-entire-world

• Health: living in areas where it is easier to get malaria, yellow fever or cholera is easier than catching a cold might deter you from moving there. However, there are boosters for virtually everything and if you take precautions you can successfully avoid the majority of dangerous local diseases. What plays a more important role is availability of superb medical facilities, especially if you have a condition or planning to have a baby while being on an international assignment. You can check out with the most renowned medical care providers about the situation with the medical facilities in the countries that you are considering moving to: Bupa and International-SOS.

• Climate: if you have asthma, maybe it's not a good idea where there are many allergens, and if you cannot live in humid climates, probably you should stay away from the Asia-Pacific region. -50° C temperatures in Siberia are not for faint-hearted. High altitudes, extreme heat, long rainy seasons - figure out if you will be comfortable living there.

• Schooling: if you have kids of school age, getting into a school with the native language of instruction for your child becomes a decisive factor. Check out the international schools in the city you are moving to and do spend some time calling the principals and the admission officers there to firm up the requirements and conditions in those academic institutions.

These seven points are by no means exhaustive, but I hope that they will help you make the right decision and avoid culture shock as much as possible.

A Tale of How Spain Was Fighting With Its Own Economic Development

Once upon a time there was a country. It enjoyed many sunny days a year, beautiful beaches and colorful flamenco music, igniting the hearts of many of its inhabitants. Tapas with gazpacho kept them fed and sangria made them happier than, may be, they should be. It would be heaven on earth, had this little Mediterranean country, called España, a better government. The list of social and economic issues impeding its economic growth stretches from Paris to Tegucigalpa and on May 15 many Spanish people had to gather together on the central square of its capital and indignantly protest against the ruling regime.

The people of Spain also bear a part of the blame for the situation that the country has found itself in (see Spanish Youth and Cucumbers). The disillusioned, the revolutionary and the complacent have not done enough to be internationally competitive in the globalized world of today. Many Spaniards will vehemently object to being moved to a different city within the country, leave alone expatriation. With such attitudes it is difficult to imagine how they are going to develop the skills essential to manage business across the national and geographical borders. It always shocked me how the pharmacies work in Spain only from 10 am till 2 pm and then from 5 pm to 8 pm and still make money. A healthy siesta will always take prevalence over customer service; actually, I believe the phrase "customer service" should be eliminated from the Spanish context and substituted by the term "customer experience". If things continue as they are, soon someone will come up with a new business idea of outsourcing dealing with various call centers on behalf of the customer, because getting anything out of them (in case you manage to get through the numerous automatic switchboards and robotic messages) if you do not have the sufficient experience and patience is only comparable by intensity to giving birth, which in some instances yet might turn out to be less painstaking and irksome. 

However, the government can claim the first prize for the inefficiencies and dire faults in the societal tissue. Well, it's true that people have governments that they deserve, but I wish to hope that those who sit in the parliament or serve the administrative branch are part of the intellectual elite of the nation, charged with making things better, not worse. The current so much needed economic reforms are met with violence and rejection, which is an indication that the ruling few have entirely lost touch with their electorate, that they are unable to explain the necessity of severity measures and the previous attempts to handle the affairs were nothing but populist. Gayle Allard of IE Business School argues that the unemployment picture is getting bleaker. Only one look at the graph below would be enough to grasp the idea that not all is well. At soaring heights of 21.2%, the unemployment figures are even worse among those who are less than 25 years old - 46.2%:

Even if you have not attended a business school, you would intuitively agree with Peter Drucker's take on social corporate responsibility: the public sector is there to make money. Forget the rest for a moment. If there are frequent monetary (re-) injections into the economy, it generates a virtuous cycle as money tends to multiply itself. Even if a firm does absolutely nothing else with regards to CSR (corporate social responsibility), let us assume that making profit and complying with the relevant legislation would suffice. Spain seems to know better and is doing its best to keep the businesses from profiting.

What is the greatest asset of any company? It's human capital, right? Innovation and creativity do not come from complacency and spectator attitude. If a company wants to be successful and profitable, it has to get the best people. For centuries the prerogative to select and hire the professionals has been with the business and the government stayed away, since, frankly speaking, the bureaucrats have no idea whatsoever about running a particular business and even less so do they care about it. Therefore, it beats me why the Spanish authorities are trying to dictate the companies whom they should be hiring. You heard me right: whenever a company wants to hire a foreigner, it has to go through the motions of interviewing the "eligible" local candidates and providing the proof that those do not fit the job description. The process may last from 3 to 6 months. There is a special service (INEM) that checks its database for such candidates and does not grant a permission to proceed with the work permit until it is convinced that there is absolutely no one with a Spanish passport who can do the advertised job. Let's pause for a minute here:

• Hiring foreigners is an expensive and generally burdensome practice. Why would a company decide to resort to such measure? Because there is nobody on the local market!
• Always - I repeat - always a company will first scout the market with the help of search agencies and headhunters. Only after that step is done will they look abroad. So if the recruiters have not found anyone locally - there is nobody on the local market!
• What sort of people will INEM offer? (1) Unemployed, (2) same as in the search agencies databases, and (3) rejected everywhere else. How can that candidate fit the job if all the headhunters have confirmed that… there is nobody on the local market!

It is my naïve logic, still I'll venture laying down my thoughts. Companies pay premiums for expatriate staff because they bring skills and knowledge unattainable locally. Being more qualified, these employees produce better results and pass their knowledge onto their local subordinates and colleagues. Better results lead to higher profits. Profit euros get reinvested into the economy creating more workplaces. Knowledge transfer and retention practices ensure upskilling of local staff up to the point that they can replace expatriates, driving fixed costs down and increasing profits, which get reinvested… you get the picture. The government does play its role, but its role should not be meddling, but rather regulating and supporting. All countries mark the playing field and establish the rules but then they give the business to make its own decisions within those regulations. Even the most stringent countries are at least reasonable when it comes to employment regulations, e.g. South Africa (linking labor force profile to state subsidization and governmental contracts eligibility) or Saudi Arabia (limiting expat tenure and demanding skills transfer). Those governments are also concerned with well-being of their citizens but they understand that companies need expatriate workforce for a reason.

Why does the Spanish government want to do it exactly in reverse?

It is undoubtedly honorable to be patriotic. It might also pay off to be nationalistic, particularly if you are a politician. It feels good to guard traditions and preserve the best of the past. But nobody has yet abolished common sense nor has cancelled logic. So being traditional, nationalistic and patriotic against the reason, logic and facts is at least irresponsible. At most - stupid. There is a limit in everything, even human vanity has it. I honestly, frankly and sincerely do not wish that Spain ends up like this unfortunate torero:

The Art of Coming Home

OK, I stole the title of this post from Craig Storti, the author of the book by the same title, which tackles the issues of coming back to places you lived in and loved, after you have been away for some period of time. There are a lot of studies written about how to expatriate people and what to do with them during expatriation, but do we really pay enough attention to those who are being repatriated back to their countries, companies, friends...?

I am writing this being in South Africa on a short exchange between IE and Wits business schools. I lived over two years in South Africa as an expat, so I came to know this country very well: it's traditions, people, food, cultures, and I even dabbled in two out of it 11 official languages (Afrikaans and Zulu). I moved to Madrid after that to do my MBA and now I am back - what a weird feeling! It is a mix of nostalgia with excitement and bewilderment. It feels great to be driving around the familiar routes, listening to my favorite radio stations and DJs, meeting old friends and colleagues, drinking gorgeous South African wine and enjoying the food that makes your mouth water the moment you look at the menu. Yet, it's not the same as I remember it 11 months ago. Same feeling as I had when I returned to Russia after a one-year academic exchange program in the USA (UGRAD 2002-2003): there has been so much change in my life that one year counts for five - but can you really convey this feeling? Massive photo albums and exciting (as you might think) stories do not help... nothing much has been happening here... As they would say in the corporate world, "business as usual".

How do you reintegrate back? Craig Storti suggests that self-awareness is the first step. It is critical to recognize that time, experiences, knowledge, places are perceived differently by different people and being in a foreign country for a long time accelerates the learning process and you might be well ahead of the curve compared to many friends and colleagues who have not had that opportunity. Patience and acceptance of that fact are the next important steps, in my opinion. Thirdly, take this chance to learn about your own culture - many things will not look the same to you after you have been away... and you learn to appreciate it better: we all know that you miss most what you do not have at the moment. Finally, preparation is best weapon: be ready to face the challenges of the inevitable culture shock and remember that it's always a W-curve, so it hits you twice - when you leave your country and when you come back.

I am not aware of any companies that would run reintegration workshops for their internationally mobile employees who return to their home countries after an international assignment, while most of them will have an induction of sorts before s/he leaves. So why are we underplaying the effects that coming back might have on people and their private as well as professional lives?