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Strategy, Power and Negotiation: Social Control and Expatriate Managers in a German Multinational Corporation

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The International Journal of Human Resource Management
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This paper contributes to the ongoing debates on HRM in head office/subsidiary relationships and the uses of expatriates in corporate strategy, focusing specifically on the literature that argues that expatriates are used by the head offices of multinational corporations primarily for social control. Taking Erving Goffman's theories of strategic self-presentation, I suggest instead, on the basis of a detailed ethnographic study of the expatriate staff of the London office of a German multinational bank, that, in fact, not only do the local managers use the presence of the expatriates to resist head office's practices, but that the expatriates themselves employ their position strategically, to negotiate between both parties according to their own interests. This creates a situation characterized less by domination and resistance than by dynamic negotiation between different groups with different strategies engaging in particular forms of self-presentation, in which no group ultimately prevails. I conclude by arguing for the development of a new way of considering international management in theory and practice, taking into account the influences on the managers and their organization, and the strategies of individuals and groups within the MNC.
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Strategy, power and negotiation:
social control and expatriate managers
in a German multinational corporation
Fiona Moore
Abstract This paper contributes to the ongoing debates on HRM in head
office/subsidiary relationships and the uses of expatriates in corporate strategy, focusing
specifically on the literature that argues that expatriates are used by the head offices of
multinational corporations primarily for social control. Taking Erving Goffman’s theories
of strategic self-presentation, I suggest instead, on the basis of a detailed ethnographic
study of the expatriate staff of the London office of a German multinational bank, that, in
fact, not only do the local managers use the presence of the expatriates to resist head
office’s practices, but that the expatriates themselves employ their position strategically, to
negotiate between both parties according to their own interests. This creates a situation
characterized less by domination and resistance than by dynamic negotiation between
different groups with different strategies engaging in particular forms of self-presentation,
in which no group ultimately prevails. I conclude by arguing for the development of a new
way of considering international management in theory and practice, taking into account
the influences on the managers and their organization, and the strategies of individuals and
groups within the MNC.
Keywords Expatriates; ethnography; social control; strategy; HRM.
Introduction
While recent studies of branch/head office relations in MNCs have explored the role of
expatriates as a means by which head offices maintain control over their branches, the
situation as experienced by employees appears to be too complex to be fully explored
using quantitative research techniques. An ethnographic analysis of the London branch
and Frankfurt head office of a German financial MNC, informed by Goffman’s theory of
strategic self-presentation, suggests that expatriates instead act as agents of negotiation
between the different parts of multinational organizations.
Theoretical background
In this section, I will briefly explore the background to the study. In particular, I will
consider the literature on branch/head office relations and the uses of expatriation as a
means of knowledge transfer and/or social control. I will then examine how the work of
Goffman on strategic self-presentation could affect the way in which we view the roles
that expatriates play within organizations.
The International Journal of Human Resource Management
ISSN 0958-5192 print/ISSN 1466-4399 online q2006 Taylor & Francis
http://www.tandf.co.uk/journals
DOI: 10.1080/09585190500521359
Fiona Moore, Kingston University Business School, Kingston Hill, Kingston-upon-Thames, Surrey
KT2 7LB, UK (tel: þ44 (0)208 547 2000 ext. 65631; fax: þ44 (0)208 547 7026; e-mail:
f.moore@kingston.ac.uk).
Int. J. of Human Resource Management 17:3 March 2006 399 413
Of recent years, many researchers in the area of branch/subsidiary and head office
relationships have been arguing for more and more complex ways of considering this
subject. Birkinshaw and Hood (1998: 789), for instance, envision the relationship
between head office and branch as taking different forms and having different dynamics
depending on the situation. Ferner et al. (2004: 363), similarly, focus on ‘the balance
between centralised policy-making and subsidiary autonomy’. The problem, as Ferner
et al. (2004: 3669) note, is in how to document accurately this process; they argue
persuasively that earlier, more linear and functionalist views of the organization stem
from writers taking a more quantitative perspective, and ignoring the external
environment and the personal strategies of the managers. An example of this can be seen
in, for instance, Ghoshal and Nohria (1989), in which, while the authors’ proposed model
does bring more complexity to the organization, it still fails to take into account all the
possible influences on the form that branch/head office relationships take. Similarly, Doz
et al’s (2001) concept of the ‘metanational’ organization considers the organization as an
entity in and of itself, rather than one formed of a variety of different perspectives. Ferner
et al. (2004: 3678) argue that to provide a more organic and dynamic view of the
organization, researchers must resort to more qualitative methods, as, for instance, with
Kristensen and Zeitlin’s (2004) study of branch/head office relations in dairy-product
multinationals in their historical and national contexts or Jaw and Liu’s (2004)
examination of firms not through a single theoretical lens, but integrating a number of
different perspectives. Many researchers, therefore, believe that an ethnographic, organic
perspective on the organization is the best way to explore the relationship between head
offices and subsidiaries.
The need for a more complex perspective can be seen in the case of studies of the
use of international managers as a means by which head offices can retain a degree of
informal social control over the branches. This idea was first explored by Edstro
¨m and
Galbraith (1977: 248), who proposed that expatriates are used for three reasons:
knowledge transfer, individual development, and, finally, as a means of coordination
and control within the corporation, through the development of an information
network linking the subsidiaries and the headquarters and by transmitting the values of
head office to the subsidiaries. Much of the subsequent literature on the subject has
focused on knowledge transfer (e.g. Bonache and Brewster, 2001; Doz et al., 2001;
Torbio
¨rn, 1994). More recently, however, there has been a growing literature on the
use of expatriation as a form of control (e.g. Al-Husan and James, 2003; Selmer,
1998), responding to the fact that much of the knowledge-transfer literature with the
partial exception of Torbio
¨rn (1994) largely ignores the power-relations issues of
expatriation. In particular, Anne-Wil Harzing’s well-known papers (2001a, 2001b)
focus on bringing a degree of complexity and strategic focus to this area of research,
with the second paper in particular describing three different strategies, the ‘bear’
(formal direct control), the ‘bumblebee’ (control through socialization) and the
‘spider’ (control through informal communication), which are used to different
degrees in different circumstances. Harzing’s work is thus particularly valuable, not
only in that it adds to the literature exploring the power-relations dimensions of
expatriation, but in that it highlights the complex strategies that expatriates use in
performing a social-control function.
While these studies are significant and well-developed, there are a few areas that could
be explored even further. Many, for instance, lack the complexity that is currently being
called for in studies of head office/branch relations; although Harzing (2001b) notes that
different expatriates play different roles in the organization, the arguments of Birkinshaw
and Hood (1998), Ferner et al. (2004) and others suggest that simply classifying them as
400 The International Journal of Human Resource Management
‘bears, bumble-bees and spiders’ is only to expose the tip of the proverbial iceberg.
Forster’s (2000) critique of studies of international management argues that to treat
international managers as a more or less homogenous group ignores the significant
differences regarding length of assignment, type of assignment and personal
circumstances of the manager. Furthermore, none of these studies directly considers
how the personal strategies of managers influence the controlling function of the
expatriate; while Selmer (1998) does explore the conflict between personal and corporate
strategy, he does so on a purely theoretical level. Finally, one might ask whether the
quantitative approach taken by the above-named writers provides an accurate portrayal
of branch/head office relationships: the implication is that branches are passive
recipients of the control of head office, rather than actively practising strategies of
resistance or subversion. As noted before, there is also the question of how much one can
divide knowledge transfer and social control as part of organizational strategy; the
knowledge-transfer functions cited by Bonache and Brewster (2001: 156) could equally
be deemed social-control functions. Finally, there is the issue of change over time; the
literature on knowledge transfer suggests that expatriates are bound up in dynamic
systems, changing in response to inside and outside pressures, and should be considered
as such rather than in isolation from other influences (see Delios and Bjo
¨rkman, 2000:
290). To consider the role of expatriates within MNCs, then, theories must be developed
that take into account the complexity of the different motivations, actions and practices
by all parties involved.
It may be that a more complex picture can be developed through reference to the work
of Erving Goffman on strategic self-presentation. Many of Goffman’s works focus on
exploring the ways in which strategic competition between actors (individual and/or
group) takes place on the micropolitical level, most famously in The Presentation of Self
in Everyday Life (1956). Actors, Goffman says, may define themselves predominantly
according to a connection with one group, but within that there is a constant interplay of
allegiances to many groups and institutions, with different ones prioritized in different
situations according to which the actor feels best suits their aims, which have an impact
on the relationships and social dynamics in which the actor is involved (1961: 143). Self-
presentation, therefore, can be a key part of the strategies of social actors in their
interactions with one another, and is an often-overlooked influence on group strategy and
action (Burns, 1992: 232).
Although his work largely predates the study of transnational business (apart, perhaps,
from his study of marketing as self-presentation, Gender Advertisements (1979)), an
examination of the knowledge-transfer literature suggests that Goffman’s work has
relevance to the question of the role of expatriates in corporate strategies of control.
Delios and Bjo
¨rkman (2000) note that the use of expatriates for knowledge transfer, and
the selection of expatriates, is, on an unspoken level, guided by company strategy.
Minbaeva and Michailova (2004: 667) observe that the dissemination of knowledge
depends on the ability and, significantly, willingness of the expatriates to do the
dissemination. Torbio
¨rn (1994), although he does not follow this up, questions how much
personal factors, as opposed to quantitative calculations, are involved in expatriate
recruitment. It would thus seem that aspects of personal strategy, such as self-
presentation, may indeed be relevant to the way the expatriates fit in with the strategy of
the organization as a whole.
It is, therefore, likely that considering the use of expatriates for social control through
the lens of Goffman’s theory of strategic self-presentation may prove helpful in
understanding the role of expatriates in multinational corporations. By focusing on the
strategies of individuals and groups, we can examine how the different strategies and
Moore: Social control and expatriate managers 401
circumstances of the actors involved affect each other, take into account the differences
between assignments, and formulate expatriates and branch offices not as passive
recipients of head office policy, but as active agents in their own right. Adding Goffman’s
theory to Harzing’s work on expatriates thus might add greater degrees of complexity to
the extant model of expatriates as controllers.
Methodological and situational background
Before examining the lived experience of expatriates in a particular transnational
organization in more specific detail, we must first consider the setting of the project and
the social structures of the London branch and German head office of the MNC under
consideration, with a view to establishing the context in which the study took place and
the relationships between the different parts of the organization.
Methodology
This paper is based on ethnographic research that was carried out at a German
multinational bank, here called ‘ZwoBank’, between January 2000 and January 2001
(for confidentiality reasons, all names and some details of the bank and its staff members
have been changed), following suggestions by Bonache and Brewster (2001: 146) and
Ferner et al. (2004) that qualitative studies may be the best way to understand the
motivations behind the actions of individuals. During this time, I conducted participant
observation for six months, which involved coming in to the bank every working day and
having access to a desk in a shared office and other basic staff resources. I also made
three trips of ten days each to Frankfurt to visit ZwoBank’s head office, in April,
September and October of 2000. Follow-up visits were conducted to London Branch in
the autumn of 2003.
Formal interviews were conducted over the course of the participant-observation
period and the six months following it with 16 individuals at the London branch. Of
these, six were expatriate Germans, five were Germans living permanently in the UK,
two were English who had lived in Germany, and three were English with no German
connections outside the bank. In addition, formal interviews were conducted at
ZwoBank’s head office with six managers in the HR department and one in a Front Office
division, with follow-up work via telephone and e-mail. One of these was part of the
division directly responsible for expatriation. Each participant was interviewed between
one and four times, with interviews lasting approximately an hour each. Bilingual
interviewees were given the option of being interviewed in English or German; although
most at the London branch chose English, and most at the head office chose German, no
interview was conducted exclusively in a single language. During the 2003 follow-up
visits, four employees were re-interviewed. The interviews were also complemented by
informal interviews with these and about 20 other members of the London office’s staff,
usually conducted over lunch or after work; the people who received informal, but not
formal, interviews included five Germans living permanently in the UK, six non-
Germans who had lived in Germany, and nine non-German employees with no
connection to Germany.
My position with regard to the bank was as an outside consultant to the London
branch, brought in to advise on the impact of a matrix integration programme on Anglo-
German relations in the branch. I was expected to submit a report detailing the issues in
this area which had arisen from the matrix integration. Interviewees were thus aware that
the results of their interviews might find their way – albeit anonymously – into the final
report. However, perhaps because of the tense situation between the London branch
402 The International Journal of Human Resource Management
and the head office, people seemed more interested in discussing the question of
relations between local and expatriate staff with me than they might have with an
‘insider’ to the bank.
This project was, therefore, conducted using qualitative research methodologies while
the researcher acted as a consultant on Anglo-German cultural issues to the bank in
question. As such, it should yield insights into the lived experience of strategy and power
relations within the organization, and the ways in which different groups negotiated with,
or sought to establish dominance over, each other through self-presentation during
expatriate assignments.
ZwoBank: an introduction
ZwoBank AG is a Frankfurt-based universal bank which, while it is one of the largest
banks in Germany and maintains an above-average number of foreign branches, is still
limited in its international operations, a typical state of affairs in German finance
(see Ebster-Grosz and Pugh, 1996). It has maintained a presence in London since the
1970s, with a full branch being opened in the early 1980s. The branch had about 160
employees at the time of the study, including trainee, temporary and service employees.
Of these, about 30 per cent were German, 10 per cent were non-German foreign
employees and the rest were British. ZwoBank London is thus more or less typical of the
London branches of German banks.
The head office, by contrast, is a massive organization housed in a complex of several
modern buildings close to the centre of Frankfurt. It employs approximately 2,000 staff,
with all staff members pertaining to particular departments being housed in the same area
of the complex, but in separate, enclosed offices containing two or three people rather
than the big open-plan offices of the London branch. There were fewer non-German staff
members in the head office than there were non-English staff members in London;
however, more people in the head office were fluent in at least one foreign language
(usually English) than in the London branch. While I could not obtain educational
statistics on head-office staff, I spoke with a number of people there who held
postgraduate degrees, including doctorates, which was almost unheard-of in London. The
head office thus is much larger, less diverse and more focused on formal qualifications
than is the London branch; its employees are, therefore, starting from a very different
position to their London counterparts with regard to the ways in which they view the
organization and the expatriates’ role.
From its establishment until July 1999, the London branch had operated more or less
autonomously from the rest of the bank. It retained a traditional ‘pyramid structure’, in
which the heads of individual departments reported to the General Manager, who was the
only staff member in regular contact with superiors in Frankfurt. Under the matrix
integration system, however, individual department heads were required to report
directly to individual department heads in Frankfurt, making the bank’s structure less a
matter of individual national branches reporting to a German centre, than of globe-
spanning departments radiating out from Frankfurt, in a shift from a multinational to a
more transnational business strategy (see Bartlett and Ghoshal, 1992: 15 20).
Consequently, many London branch staff members who had previously had little to do
with the Frankfurt office now found themselves reporting to a German ‘global head’,
and/or having to learn business practices that were common at head office, but less so in
London. Unsurprisingly, a number of issues arose from the integration in the London
branch, mostly relating to employees having difficulty learning the new business
practices, or to the failure of many employees to use the new reporting system, either
Moore: Social control and expatriate managers 403
through ignorance or in protest against its perceived lack of efficiency. The situation at
the time of the study was thus one in which the head office was adjusting its overall
strategy and structure, which involved the exertion of more direct control over its London
branch.
The expatriate managers
As part of its strategy to orient its London branch more towards Frankfurt, the head office
sent a total of five long-term expatriates, and an unknown number of temporary visitors,
to the organization during the period in which this study took place. The long-term
expatriates were primarily specialists who, like those described by Harzing (2001a, b)
and Beaverstock (1991, 1996), had been brought over from head office to fill a new post
or ease a department through a transition period, usually for between one and three years.
All had at least a vocational college education; all but one were in their thirties, all but
one had spent seven to nine years at head office, and all but two had prior experience of
living in London. All but one were male, and all were Caucasian. All had volunteered for
the job. All but one had worked for ZwoBank for most if not all of their careers; the sole
exception, Jens, had worked for another company for much the same amount of time that
the others in his age cohort had spent at ZwoBank. Two had a spouse and one had
children; one had a fiance
´e and two were single. This fits with the profiles of expatriates
given in Beaverstock (2002: 529); although Adler and Izraeli (1994) note that an
increasing number of companies are encouraging women to take international positions,
Linehan and Walsh’s more recent study (1999) indicates that this is still relatively rare,
and so it is safe to say that the ZwoBank sample can be regarded as reasonably
representative of expatriates in European and American MNCs. A detailed breakdown of
the circumstances of ZwoBank’s expatriates can be found in Table 1.
The reasons why each had been sent to the London branch incorporated elements of
both control and knowledge transfer. Three (Suzanne, Michael and Jens) had been sent to
take over or assist with the running of departments seen as crucial to the functioning of,
or which were strongly affected by, the integration. One (Florian) had been sent to assist
Jens. One (Werner) was a specialist, brought in to teach a new IT process. Table 1 also
includes a temporary expatriate, Johann, who was a visitor sent over for a fortnight to
learn about a process carried out at the London branch that affected his department in
Frankfurt. He has been included in this study since, although temporary visitors did not
spend as much time in London as long-term expatriates, they played a similar role in
terms of knowledge transfer and of promoting the strategy and structure of head office
in the branches.
As noted above, however, the expatriates were not the only Germans at the bank. Due
to ZwoBank’s need for German-speaking employees to carry out certain of its day-to-day
functions, there was also a large number of German staff who had been hired locally.
In addition, there were about 5 to 10 German trainees, working at the branch for between
three and eighteen months, and a noticeable minority (approx. 25 per cent of total staff
numbers) of British employees who were ‘ethnic Germans’ (i.e., of recent German
descent). These individuals will not be extensively discussed in the study; however, it is
important to note that there was no sharp national division between the expatriates and
the local staff at London Branch.
ZwoBank London thus had among its staff five permanent expatriates (as well as a
continuously changing number of temporary visitors), all of whom were established in
areas over which the head office wished to maintain a degree of control. We shall now
404 The International Journal of Human Resource Management
consider how ZwoBank’s head office and London branch engaged in strategic activities
to maintain or achieve their desired positions in the matrix integration structure.
Head office, London branch, strategy and expatriates
As the matrix integration progressed, not only did the head office develop strategies to
maintain control over the organization, but the London branch countered with strategies
for retaining at least a symbolic degree of autonomy. As such, the picture that emerged
was less one of head office attempting to impose control over its branches through the
expatriates, and more a struggle for control over a particular area of the organization.
ZwoBank head office, as noted above, is focused on the German market. Its
employees describe the bank as ‘German’, portraying the branches as channels by which
the benefits of overseas markets are brought to German clients, or as outposts to serve
their clients overseas. They describe the branches as intransigent and focused on
obtaining local prestige at the expense of participating in the group, and as such needing
to be brought into line with the strategy of the head office. Head office’s aim is thus to
develop a structure in which the branches act as its overseas arms, in keeping with
Bartlett and Ghoshal’s (1992) ‘global’ model of MNC organization.
Head office’s strategy to keep control over the branches was largely focused on
maintaining continuous contact between their representatives and the staff of the
branches (compare Ghoshal and Nohria, 1989: 326). Methods used included enforcing
the new reporting procedures, as well as the use of networked IT systems and periodic
interbranch meetings. On a more informal level, the fact that much of the key business
done in the group is carried out in German meant that official documents were primarily
written in German, putting non-German-speakers in the London branch at a
disadvantage. Head office thus had a number of official and unofficial strategies for
reinforcing its control over the branches.
The expatriates were regarded by the head office as another resource by which to
maintain control over the organization, in terms of informally disseminating its culture
within the branches (see Bonache and Brewster, 2001). On the official level, they were
said to be in their particular positions as they were ‘familiar’ with head office procedures,
and would thus have less difficulty adjusting to the new system. Although it was never
officially mentioned, it was implied that the local staff might not only have problems
adjusting, but might fail to follow the new procedures. On a less technical level, the
managers in Frankfurt also openly expected that, since the expatriates had recently come
Table 1 Expatriates interviewed at ZwoBank London
Name Department Marital
status
Age Education Years
at
head
office
Years
at
London
branch
Prior
experience
abroad
Suzanne Human
resources
Single 31 BA 10 2 No
Werner Information
technology
Married; 2
children
55 BA, professional
qualification
83No
Jens Audit Engaged; no
children
28 BA, MA 1 .3 Yes
Florian Audit Married; no
children
32 2 professional
qualifications
7 2 Yes
Michael Accounting Single 30 BA 8 2 Yes
Johann Operations Unknown 40 BA Unknown 14 days No
Moore: Social control and expatriate managers 405
from head office (and, in most cases, planned to return) they would be more sympathetic
to head office’s point of view. It is significant, given head office’s self-presentation as
‘German’, that, for the most part, head office sent expatriates out rather than receiving
expatriates in from other branches, or cultivating an interbranch network of skilled
transnational employees. It also did not, as some companies do, encourage interbranch
expatriation, in which managers from one branch are sent to another. Furthermore, HR
managers at head office noted that, although one of the ostensible benefits of expatriation
is to develop the ‘international experience’ of managers, in most cases they simply
returned to their old posts on returning to Frankfurt. There was also a strong element of
strategic self-presentation in the use of expatriates: by maintaining a number of German
people with a head office connection in visible positions within the branch, the message
was emphasized that, even overseas, head office was participating in the company’s
operations. Had there not been the side benefit of physically reinforcing the presence of
head office, for instance, Johann could have learned about the relevant process without
leaving Frankfurt. The general philosophy regarding expatriation at ZwoBank is,
therefore, that expatriates inculcate head office practice and philosophy in the branches,
as opposed to regarding the exercise as the construction of a global network of
expatriates from all offices, or a form of mutual development between head office and
branches.
The London branch, on the other hand, had historically attempted to maintain a hands-
off relationship with head office (cf., Ghoshal and Nohria, 1989: 326, 328). Past General
Managers who had favoured head office were spoken of in less positive terms to those
who had encouraged independence on the part of the London branch. The London branch
interviewees presented their company as ‘Anglo-German’, emphasizing, through
strategic self-presentation, that non-Germans have a role in the company. The General
Manager of the time (who was German) had also tried to promote a strong culture for the
London branch within the group: as well as campaigning to ensure that the branch had a
large minority of English people among its general managers, he also encouraged staff
exchanges with head office with a view to boosting the branch’s visibility within the
organization (in a strategy similar to that used by head office vis-a
`-vis the expatriates).
London also reinforced its distinctive identity through maintaining a high-context,
informal corporate culture (see Hall, 1976), having an active roster of social events: aside
from monthly organized excursions and ongoing sports activities, one could usually find
many of the staff at the local pub on Friday evenings. Expatriates remarked on London’s
‘strong community feeling’ and on the fact that this closeness was seen as threatened by
the matrix integration: Jens described the feelings of the staff in his division by saying
‘they used to be a unit over here and now they are all cut to pieces.’ Despite this,
however, the former ‘unit’ was maintained through social networking within the office or
at the abovementioned events: the London branch’s relatively small size meant that it
was easy to maintain a degree of informal social control, and that micropolitical activity,
such as self-presentation, took on a great degree of significance. In general, then, the
London branch had a strategy of guarding a distinctive place within the organization,
which placed it unofficially in conflict with the strategies of head office.
Although people in the London branch were not unfriendly to the expatriates, they
were aware that part of their function was to act as agents of control for head office.
Consequently, they made attempts to turn the presence of the expatriates to their
collective advantage through strategic use of their own, and the branch’s, self-
presentation. A common tactic was to encourage the expatriates to integrate by
describing the bank with the ‘Anglo-German’ symbolism mentioned above; the presence
of locally hired Germans was presented as a way in which one could become sympathetic
406 The International Journal of Human Resource Management
to London without losing one’s essential ‘Germanness’. Subversion through self-
presentation was another common practice. Many London staff, for instance, would
‘unofficially’ ignore imported head office practices, arguing that these would be too
difficult to carry out in the UK environment. The importance of the new managers
was attacked through humour: Florian, for instance, almost immediately acquired the
nickname ‘Flo’ (in England, a common abbreviation for ‘Florence,’ a woman’s name).
It should be emphasized that this was in no way cruel, but such humour, redefining the
self-presentation of important individuals to undercut their perceived dignity, is not
unknown in situations in which a group feels itself to be under threat (Goffman, 1961:
1224). The London branch thus made use of the expatriates in strategies for control
through self-presentation as much as did head office, but in a manner aimed at reinforcing
their independence and multicultural self-image rather than as a means of enforcing
particular practices.
The ultimate result, however, was that both institutions negotiated some form
of compromise between their interests. The London branch’s self-presentation as
‘Anglo-German’, rather than simply ‘multicultural’, is an acknowledgement that head
office plays a role in the organization’s culture. The head office, similarly, has had to
make concessions to local conditions in the UK market: employees at head office did
admit that they felt head office could learn from the branches as well as vice versa.
Contrary to what was often said at the London branch, local branches were actually
allowed much leeway to organize themselves according to the local conditions: I never
actually heard any complaints at head office about London’s relatively informal
way of doing business. Rather than simply following the official line of maintaining
a centralized control system, in fact, head office uses the mechanisms ostensibly
in place for maintaining control to engage in a more open form of negotiation with
the branches.
In addition, this negotiation also took place through the strategic self-presentation of
individuals and groups. Expatriates aside, different people in the branch expressed quite
different orientations towards, and attitudes to, head office in their self-presentation:
while British employees tended to be fairly detached from it, German-speaking
Anglophones were more sympathetic, and locally hired Germans exhibited a range
of attitudes. Rather than one organization dominating and the other resisting, then, the
London branch and head office had systems of compromise that varied from situation
to situation, which also involved the use of individuals’ and groups’ strategic self-
presentation as channels for negotiation.
In sum, then, head office and the London branch both practiced a variety of
strategies aimed at structuring the organization in a manner that fits with their
particular strategies. These strategies did not simply define a position of dominance
and suppression through self-presentation, however, so much as they did a complex
pattern of negotiation involving activities of dominance, resistance and mutual
compromise. We shall now consider how the expatriates themselves negotiated
between their loyalties to both the head office and the branch in which they found
themselves through strategic self-presentation, and what role they played within this
negotiating process.
The expatriate managers and personal strategy
Throughout the implementation of the matrix integration, expatriate managers found
themselves in the sometimes-awkward position of having to maintain a balance between
their interests at head office and at the London branch, both in daily practice and in their
Moore: Social control and expatriate managers 407
self-presentation. For the most part, they tended to vary between expressions of support
for each of the two groups in turn, depending on the circumstances, in such a way
as to benefit their own particular strategies for success in the organization. As such,
their activities advanced the wider processes of negotiation taking place within
the MNC.
Early in their term of expatriation, expatriates tended to present themselves as in
sympathy with head office’s position. Many, in their initial interviews, described the
matrix integration in terms of the formerly independent London branch needing to
be brought into line with Frankfurt, even though the process could equally have been
described in terms of London being brought closer to the New York or Singapore
offices. While some later questioned the applicability of head office’s structure to the
much smaller branch, none suggested that the integration programme should
therefore be modified or abandoned, instead concentrating on ways of making the
two structures compatible. The expatriates thus, at least at first, supported head
office’s position in their self-presentation in interviews and informal conversations.
The expatriates’ self-presentation within the London branch also reinforced head
office’s position. Many of them were in positions of greater authority than they had
held at head office, meaning that they were often seen as taking the head office line.
Some expatriates brought over former colleagues from head office to fill particular
posts, reinforcing their presence as a distinct and dominant group in ZwoBank
London. The fact that the temporary expatriates (who have little opportunity to
adjust to the London branch’s culture) tended to arrive at random times could also
be seen as a way of keeping Londoners to the prescribed routines, as they did not
know when an observer from head office might come. Even informal self-
presentation could be seen as reinforcing this: at an interbranch meeting of HR
managers, Suzanne spent the breaks catching up with ex-colleagues, which, although
innocent on her part, might have suggested to her London co-workers that she felt
more sympathetic to her former colleagues than her current ones. The self-
presentation of the expatriates thus reinforced the position of head office within the
organization.
The expatriates’ strategies for action were, however, not totally in line with the
interests of head office. One Human Resources manager in Frankfurt remarked that
expatriates take international assignments with a view to improving their career
prospects, not to support head office (see Selmer, 1998: 997 8). When asked why
they had applied for the job, most expatriates cited personal reasons above all else: a
desire to visit or to return to the UK, for instance, or an interest in making
international contacts with the hope of pursuing a more global career later on, or
simply wishing to make a higher salary. The expatriates thus are not simply acting to
carry out the strategies of head office, but are acting according to their personal
strategies for success.
Through their self-presentation, the expatriates were also engaged in supporting the
London branch against head office as much as the other way around. They were aware of
their value as sources of information about the ‘real’ (as opposed to the official) state
of affairs at head office for Londoners, and also that they could provide useful contacts at
head office. They, however, also benefit through maintaining social connections with a
city which is much more strongly engaged with global finance than Frankfurt
(Beaverstock et al., 2001). One of the expatriates later chose to do an MBA while in
London, taking advantage of the fact that degrees from British universities are considered
more prestigious in the business world than those from German universities. Although
the expatriates spoke German among themselves, they were forced to speak English
408 The International Journal of Human Resource Management
in their dealings with colleagues, and studies of the use of language in mixed-linguistic
business groups have found that non-native speakers of a language tend to take
a subordinate position vis-a
`-vis the native speakers (see Geluykens, 1989; Moore, 2005:
chapter 6). The fact that the expatriates were acting to further their personal strategies of
self-presentation through emphasizing their cosmopolitanism and London connections
meant that their actions supported London as often as they did head office, depending on
the needs of the individual expatriate.
It also has to be said, however, that there were also pressures encouraging
the expatriates not to present themselves as supporting the London branch. They were the
subject of conflict and tension as much as they were of sympathy and fraternization: there
was at least one situation in which an expatriate was assigned to a post which in the
normal course of events would have gone to a local manager, which caused resentment
on the part of the manager and difficulties for the expatriate in working with him. There
were other tensions caused through the expatriates’ lack of familiarity with the local
situation. The expatriates thus did not totally support and/or act for the London branch
against the head office, nor were their actions vis-a
`-vis each party totally deliberate and
conscious.
The key point to consider with regard to how the expatriates deal with both the
London branch and head office is that they are neither unthinking instruments of policy,
nor of subversion, but individuals, with their own strategies. Although head office may
send expatriates to the branches for reasons of control, the stated strategies of the
expatriates themselves were more varied, and did not necessarily involve company
loyalty. Consequently, the expatriates tended to present themselves in ways that allow for
strategic negotiation between the two organizations. All of the expatriates described
themselves at one point or another as ‘mediators’ between the branch and headquarters.
They also tended to be publicly even-handed in their criticism of both groups: Michael,
as well as acknowledging that the London branch were ignorant of head office
procedures, said in an interview that ‘I know what’s going on, but you get people there
[in head office] who’ve never been outside Germany... and they have problems
understanding why certain things are going on over here.’ They would adapt London’s
multiculturalist line in such a way as to include head office: Michael, in his second
interview, said ‘London is more multicultural than Frankfurt, but I think Frankfurt is
going that way.’ The expatriates thus tended to present themselves as occupying an
intermediate position between head office and the London branch, allowing them to
negotiate between the two.
In sum, then, the expatriates tended to incline neither to the head office, nor to the
London branch, but to act according to their personal strategies for success, negotiating a
position that allows them to move between presenting themselves as representing the
interests of either group, depending on which suits them best under the circumstances,
and which, directly or indirectly, furthers negotiation between branches and the head
office. We shall now consider why this is the case, and what the implications of this study
are, both for the ways in which organizations treat their international staff and for future
studies of expatriates.
Analysis and conclusions
The application of Goffman’s theory of strategic self-presentation to debates on
international management, then, not only develops earlier research on the use of
expatriates as a means of social control and/or knowledge transfer, but also illustrates the
degree to which the strategies of groups and individuals within an MNC affect
Moore: Social control and expatriate managers 409
branch/head office relations and the company as a whole. More than this, however, this
case suggests that we can develop a more complex model for looking at strategy,
motivation and success in international assignments.
The ZwoBank case first of all illustrates that, following Goffman, the strategic
self-presentation of individuals plays a significant role in branch/head office
relationships. Both head office and the London branch have formal and informal
strategies that are sometimes in conflict, and sometimes in agreement, with each
other (cf., Ghoshal and Nohria, 1989; Jaw and Liu, 2004; Selmer, 1998), which are
played out through their presentation of themselves as groups as well as through the
self-presentation of individuals within the organizations. The position of the bank as
a whole is thus not the product of head office imposing its will on the branches,
but of groups within the organization continuously negotiating in order to obtain
what they see as the best position possible, through the way in which they
present themselves and their groups. In this case, the strategies of the London
branch and head office are both mediated through the self-presentation of the
expatriates, and, consequently, are shaped by the expatriates’ agendas and strategies.
The self-presentation of individuals and groups is thus a significant, if tacit, force in
branch/head office relations.
In the ZwoBank case, also, the expatriates have to tread a path between
presenting themselves as representing the interests of the head office (or else they
damage their future careers) and those of the London branch (as otherwise they are
ostracized by their immediate colleagues), and their own strategies for career
advancement. In doing so, however, the expatriates act as mediators between branch
and head office, and as such influence the structure of the organization as a whole.
At the time at which I left the organization, an unofficial structure combining aspects
of both the ‘pyramid’ and the ‘matrix’ was developing, with official channels going
to Frankfurt, and an unofficial second set of channels running between parallel
institutions in the London branch; the follow-up work done in 2003 suggested that
this unofficial networked structure was now solidly in place. The self-presentation
strategies of individuals, as well as their unspoken strategies for personal success, are
thus crucial to negotiating compromises between branches and head offices of
MNCs, and also to developing the networks that form the basis of transnational
operations.
Furthermore, the ZwoBank case also sheds new light on earlier research done on
the roles of expatriates for knowledge transfer versus social control, by making
explicit the role of self-presentation in overall corporate strategy. Bonache and
Brewster (2001: 1456) believe that we cannot look at expatriation solely as a form
of social control, arguing, among other things, that only by viewing it as a form of
knowledge transfer can we understand why, for instance, expatriate assignments have
different impacts upon individual careers, and why expatriates are still used when
more reliable forms of control are available. The ZwoBank study would suggest,
however, that these are understandable in light of the impact of the personal strategies
of expatriates on the company’s overall strategy for control, and stem from the conflict
between the interests of the actors involved. Furthermore, the ZwoBank findings
support Minbaeva and Michailova’s (2004: 664) argument that knowledge transfer and
social control are complementary, rather than mutually exclusive, functions.
The ZwoBank study also suggests that the practices and strategies of firms are
predicated less on rationalaction strategies for achieving competitive advantage (see
Minbaeva and Michailova, 2004: 666) and more on organic, not necessarily rational,
negotiation between the different parts of the group. The ZwoBank case thus adds
410 The International Journal of Human Resource Management
a degree of complexity and qualitative reasoning to earlier studies of expatriates and
the functions of expatriation.
The ZwoBank study also suggests that Human Resources practice could benefit
from a more integrated approach, which takes the complexity of actors’ motivations
for action into account. While the most obvious conclusion is to encourage head
offices to ensure that they choose expatriates whose personal strategies have a close
fit with their own, this might jeopardize the assignment, as the ZwoBank managers
were regarded with suspicion principally because of their head office orientation.
Also, the ZwoBank research reinforces the idea that strategies are dynamic, and the
expatriate’s personal strategy might become less aligned with head office’s over time
(cf. Torbio
¨rn, 1994: 14). Rather than simply assuming expatriates to be ‘for’ or
‘against’ head office, or considering branches as passive recipients of control from
head office, we can thus postulate that researchers and managers should consider each
individual assignment in terms of the parties involved, their formal and informal
strategies and self-presentation, and their possible motivations. The possibility of
compromise and negotiation must also be accepted, not as a negative outcome, but
as the most realistic scenario for the situation. HR professionals considering an
expatriate assignment, and researchers considering expatriate practices, should thus
aim for a dynamic view of the organization that accepts the reality of change
and compromise.
When preparing for an expatriate assignment, or analysing an extant one, it thus might
be worth asking the following questions, to determine how the strategic self-presentation
of the parties involved might impact on the situation at hand:
.Who are the different players in the assignment?
.What are the aims and objectives (stated and unstated) of each?
.Where are the common points and the differences between them?
.What strategies are each likely to pursue within the assignment?
.How might these aims and strategies change over time?
It might, in some cases, be useful to diagram the motivations, strategies and other
influences on the situation, as seen in Figure 1. From considering the individual
circumstances of the case at hand and the potential impact of different strategies of self-
presentation, it may be possible to identify potential trouble spots, and areas in which the
micropolitics of the organization can be used to particular advantage. It is thus possible to
apply Goffman’s theory to individual expatriate assignments.
The case of ZwoBank thus has implications for future research. It might, for instance,
be worth doing more ethnographic studies of multinational corporations, in different
sectors and national settings, for the purposes of comparison and in order to overcome the
limitations of the case-study approach. One might also develop a comparison of
ZwoBank with other companies in a similar situation. A key limitation of the research
was that, due to the nature of the population sample, I was unable to acquire significant
data on other forms of expatriation to the traditional ‘home country to host country’ type,
such as third-country nationals or ‘inpatriates,’ both of which deserve exploration from a
strategic point of view. Finally, it might be worth considering the role of self-presentation
in other areas of business than expatriation, for instance regarding the strategies of local
managers or contract staff.
In conclusion, then, it seems that expatriates do play a strategic role in the running of
multinational corporations, but not necessarily as instruments of control from head
office, nor as agents of resistance for the branches. In fact, their personal strategies, and
Moore: Social control and expatriate managers 411
the ways in which they present themselves, form a means by which compromises are
negotiated between groups, assisting in developing flexible company-wide social and
business networks.
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Impression management is a powerful psychological phenomenon with much unexplored potential in corporate settings. Employees or corporations can deploy impression management strategies in order to manipulate others’ perceptions of them. Cultural knowledge is powerful capital in impression management, yet this has not been sufficiently explored in previous literature. This chapter argues that impression-motivated employees or corporations need to perform a three-step knowledge audit: (i) knowing what their impression deficits are; (ii) knowing what impression management strategy is needed to address that deficit, based on the taxonomy of impression management strategies tabulated here; (iii) knowing what societal (e.g. collectivist culture or individualist culture) or organization-specific cultural adjustments are needed. A cultural knowledge base can thus be created through cross-cultural training of and knowledge transfer by expatriates. Multinational corporations can also benefit from utilising the knowledge presented in this chapter in their international public relations efforts.
Chapter
Impression management is a powerful psychological phenomenon with much unexplored potential in corporate settings. Employees or corporations can deploy impression management strategies in order to manipulate others’ perceptions of them. Cultural knowledge is powerful capital in impression management, yet this has not been sufficiently explored in previous literature. This chapter argues that impression-motivated employees or corporations need to perform a three-step knowledge audit: (i) knowing what their impression deficits are; (ii) knowing what impression management strategy is needed to address that deficit, based on the taxonomy of impression management strategies tabulated here; (iii) knowing what societal (e.g. collectivist culture or individualist culture) or organization-specific cultural adjustments are needed. A cultural knowledge base can thus be created through cross-cultural training of and knowledge transfer by expatriates. Multinational corporations can also benefit from utilising the knowledge presented in this chapter in their international public relations efforts.
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