Talent Management: Selecting and Preparing Leaders for Global Assignments examines how organizations select and prepare global leaders for effective assignments. An effective mobility program allows development of global leaders. The chapter identifies the personal characteristics for an international assignee and conditions necessary for an effective international assignment. Family responsibilities as well as a spouse’s/partner’s career and employment issues continue to be reasons candidates turn down assignments. To increase flexibility, multinationals have increased the use of “flexpatriates” in nonstandard international assignments. Effectiveness is the ability to live and work effectively in the cultural setting of an assignment. Effectiveness is a function of Professional expertise, Adaptation, Intercultural interaction, and Situational readiness and is reflected in a formula: E = f (PAIS). The international assignment of female executives has become an important consideration as more women have graduated from business schools and are in line for senior management and international careers. Training should be a function of the degree of cultural exposure that will be experienced. Culture shock, acculturative stress, can be a reason for failure to adapt to the host country. Duty of Care and an organization’s responsibilities to employees are discussed.

For as long as people have roamed the earth, there has been a fear of strangers. The term xenophobia comes from Ancient Greek and combines xeno (meaning foreign or alien) and phobia (meaning fear). In particular, it is common for natives of a country – whether today or in the distant past – to worry about immigration, especially illegal immigration.

In times of turmoil, one would think that a stable, or relatively stable, exchange rate would be a boon to policymakers, soothing the anxieties of international investors. However, keeping the value of the currency stable against a foreign currency such as the US dollar, when buffeted by shocks, entails sometimes painful tradeoffs.

The exchange rate is the key relative price for an economy open to international trade and finance. The price Americans pay for Japanese automobiles imported into the United States depends on how many dollars it takes to buy 100 yen, i.e., the dollar/yen exchange rate. The stronger the dollar, the more yen it will buy, and therefore the cheaper the imported cars will be. At the same time, a strong dollar makes it harder for US firms to profitably sell heavy earth-moving equipment like bulldozers (say those made by Caterpillar) to the rest of the world. The strength of the dollar against other currencies also affects other sectors, besides trade in manufactured goods. A strong dollar is good for a US tourist visiting Madrid, but places in the United States that cater to foreign tourists, such as Las Vegas, do better business when the dollar is weak. And whether one decides to purchase stocks and bonds denominated in dollars, as opposed to, say, German securities denominated in euros, has a great deal to do with how one expects the dollar to move against the euro over time.

Russia’s invasion of Ukraine in February 2022 sent shock waves though the world’s wheat market. The world price of wheat jumped from about $8 per ton to more than $13 per ton within a few days. The markets feared that wheat supplies from the region – which account for a third of the world’s wheat harvest – would be disrupted.

In 2014, Fabrice Brégier, then chief operating officer of Airbus, called for the European Central Bank to intervene as the strength of the euro was “crazy.” He wanted them to push it down against the dollar by 10% from an “excessive” $1.35 to between $1.20 and $1.25. We learned in Chapter 5 how a strong currency makes it harder for domestic manufacturers to export goods, so we can understand why a European executive trying to sell commercial airplanes might worry that a strong euro was making his job harder. And it is a fact that in 2014, Airbus was registering disappointing sales compared to its rival across the Atlantic, Boeing. But why would it be “crazy” for the euro to be worth $1.35, and yet normal and acceptable for the euro to be worth 10% less than that? And how did Fabrice Brégier expect the European Central Bank to adjust the euro’s value, when the euro is under a floating, rather than a fixed, exchange rate regime?

Americans are big consumers of sugar, eating and drinking some 66 pounds each of it per year, on average. This is not just a dietary issue; it is also a big trade issue. The United States imports sugar from the tropical climes of the Caribbean, which has the natural conditions suited for growing sugar cane. But sugar imports are much less now than they once were – not because Americans have cut back on sugar consumption but because low-cost imports were hurting domestic cane producers in Florida and Louisiana. To help them out, the federal government began restricting imports decades ago. (Just ask any representative or senator from those states whether they believe free trade in sugar would be a good idea.)

In June of 2016, voters in the United Kingdom narrowly approved a referendum on leaving the European Union (EU), a common market wherein labor, capital, and goods and services are free to move between countries without impediment. The vote in favor of Britain’s exit – or “Brexit” – set in motion a process by which the country would leave the EU within two years.

Understanding Culture defines culture and identifies why culture is such an important element of the international management context. International management is about leading people and implementing tasks with people across cultural borders. The starting point for effective international management behavior must be a deep understanding of culture. We set the foundation for culture as one of the important contexts of global management. We define culture, examine its different facets, analyze its impact on people, and explore important questions about the intersection of cultures and individual characteristics. Culture serves two important functions for groups. Culture makes action simple and efficient because it creates context for meaning, and it also provides an important source of social identity for its members.

In late 2017, the US economy was nearing full employment. Unemployment was at a 40-year low of 4.2%, yet President Trump and the Republican-controlled Congress embarked upon a policy of tax cuts. The Federal Reserve, seeking to avoid overheating the economy, tightened monetary policy, raising interest rates. In other words, the two policies were working in opposite directions. The dollar rose in value, making US exports more expensive to foreigners, making imports cheaper to Americans, and thus worsening the trade deficit. How and why these events played out motivates the development of the model in this chapter.

Mapping Cultural Dimensions for Effective Interaction positions personal interaction at the center of global management. It focuses on high-quality person-to-person interactions across cultural boundaries in everyday situations and in teams. The Map-Bridge-Integrate (MBI) framework, a tool for engaging in effective cross-cultural interaction, is presented and explained. The chapter identifies the role of cultural mapping tools and recognizes strengths and weaknesses in different tools. It summarizes the multiple social maps that have dominated international management research and practice over the years, such as Hall, Hofstede, and Globe. The Aperian GlobeSmart tool provides an excellent combination of validity and practical application for mapping cultural work-style interactions. GlobeSmart maps five dimensions: Task vs. Relationship, Independent vs. Interdependent, Egalitarian vs. Status, Direct vs. Indirect, and Risk vs. Certainty. Each dimension is validated with survey data from people in that country, updated on a regular basis. The five dimensions help compare cultures, and the survey gives individuals an easy way to compare themselves with each other and with different cultural profiles. Maps of 22 cultures are presented.