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Running head: XYZ CASE STUDY 1
XYZ Case Study
Johnson & Wales University
Kathryn Faust
November 11, 2020

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XYZ CASE STUDY 2
Why were expatriate managers returning early from their international assignments?
What could Sheila do to remedy this situation?
Although generally sent their expatriate managers on 2-3 year assignments, 20 percent of
them were returning from their assignments early. Upon their early return to the United States, a
majority of the expatriates stated that their reason for the premature return was due the
dissatisfaction of their spouses’ and the inability to adjust to the new culture. Although XYZ
compensated their expatriates using the balance sheet approach, they failed to offer cross-cultural
and language training to the spouses and family members of the expatriates throughout the
duration of the assignment. In order to remedy this situation, Sheila would need to reassess
XYZ’s entire international assignment program, including the way in which the company
compensates the expatriate managers and their families.
XYZ is currently using a balance sheet approach to compensation. Should the company
consider other alternatives, such as localization or cafeteria-style benefits?
Although the balance sheet approach for compensation is considered to be the traditional
and commonly used method for expatriates, it can be the costliest compensation approach for a
company. According to Bernardin & Russell (2013), through this approach, it has been estimated
that the cost of a manager triples once they enter a foreign country. The balance sheet approach
focuses to align expatriate salaries with the salaries of their home country peers, rather than those
of their host country peers (Sims & Schraeder, 2005). The purpose of this method is to protect
expatriates from cost differences between their home and host countries (MSI, n.d.). In addition
to the high costs, XYZ’s use of this method for expatriate compensation has also left the
expatriates and their spouses/families dissatisfied; therefore, it is important for the company to
revise their compensation package or consider alternative methods entirely. It is important for

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Running head: XYZ CASE STUDY 1 XYZ Case Study Johnson & Wales University Kathryn Faust November 11, 2020 XYZ CASE STUDY 2 Why were expatriate managers returning early from their international assignments? What could Sheila do to remedy this situation? Although generally sent their expatriate managers on 2-3 year assignments, 20 percent of them were returning from their assignments early. Upon their early return to the United States, a majority of the expatriates stated that their reason for the premature return was due the dissatisfaction of their spouses’ and the inability to adjust to the new culture. Although XYZ compensated their expatriates using the balance sheet approach, they failed to offer cross-cultural and language training to the spouses and family members of the expatriates throughout the duration of the assignment. In order to remedy this situation, Sheila would need to reassess XYZ’s entire international assignment program, including the way in which the company compensates the expatriate managers and their families. XYZ is currently using a balance sheet approach to compensation. Should the company consider other alternatives, such as localization or cafeteria-style benefits? Although the balance sheet approach for compensation is considered to be the traditional and commonly used method for expatriates, it can be the costliest compensation approach for a company. According to Bernardin & Russell (2013), through this approach, it has been estimated ...
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