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A defining feature of international business is the necessity for people from diverse cultural backgrounds to interact and collaborate but intercultural interaction is difficult and may give rise to disagreement and conflict. I have been working on the dynamics that promote positive intercultural interaction in the international business context, and two streams of my research, one empirical and the other conceptual, are reviewed here. The first stream is concerned with fairness issues surrounding the pay disparity between locals and expatriates in multinational enterprises operating in China, which has implications for MNC operations in other emerging economies. My research has shown that the pay disparity is associated with negative reactions from local employees but some management practices associated with the relationship between locals and expatriates, attributions made by locals, and salient norms about the pay disparity can buffer such negative reactions. In this research program, the focus is not on the actual interaction between locals and expatriates. To address this gap, a conceptual framework is presented, which provides insight about the factors that contribute to positive interaction between locals and expatriates. This paper ends with implications for future research on intercultural interaction in the MNC context.

This paper develops an integrative framework explaining multinational firms’ managerial staffing decisions in initial foreign-entry situations from resource-based theory, agency theory, and transaction-costs theory, and it offers a set of theoretically grounded, testable propositions concerning these staffing decisions. In particular, we maintain that managerial staffing decisions are influenced by: (1) the value that managerial expatriates and local hires could potentially add to the firm; and (2) the relative contractual risks associated with the use of managerial expatriates and local managers.

This paper indicates that the use of managerial expatriates can improve contractual efficiencies in at least four ways. First, the use of expatriates helps align the economic incentives between the headquarters and the foreign subsidiaries. Second, the headquarters knows better the characteristics of expatriates relative to local hires. The use of expatriates reduces the uncertainty of the headquarters in recruiting managers and mitigates the incomplete contracting problem. Third, expatriates are better equipped with firm-specific capabilities than local hires, reducing contractual (small-numbers) problems. Fourth, expatriates have committed greater sunk cost investments in the multinational firm than local hires. These investments support their cooperative relationships with the firm and mitigate potential bargaining problems in employment contracting. However, although managerial expatriates can potentially improve contractual efficiency and may relieve a firm’s concern over its limited control on managers, expatriates may not have adequate abilities in managing local idiosyncrasy.

This study aims to explore how professional–cultural knowledge is reciprocally shared between experienced expatriates and novice local nurses. To address this, the situated learning in practice lens is combined with social exchange lens.

An interpretive case study methodology enabled an exploratory approach into the knowledge-sharing practices between experienced expatriates and novice local nurses in Saudi Arabia.

Insights gained in the fieldwork suggest that professional–cultural knowledge sharing (KS) often occurred through three primary practices, namely, developing a professional–cultural meaning, forming clinical competency development opportunities and intervening in unfamiliar professional–cultural situations. In addition, two micro-level conditions shaped the reciprocity of professional–cultural KS practices between expatriate and local nurses, which were individual differences and situational conditions.

This study advances and improves the understanding of two intertwined but rarely studied aspects of knowledge-sharing practices. The exploratory lens sought and gained rich insights into the knowledge-sharing practices between experienced and novice individuals and expatriate and local individuals.

The purpose of this paper is to explore the specific difficulties that senior managers face when employing expatriate, Chinese and local‐hired foreign managers in China‐based subsidiaries of Western multinational companies (MNCs). Furthermore, it aims to examine the resultant coping strategies to overcome identified weaknesses.

This research adopts a qualitative approach, using semi‐structured interviews with key‐informants from senior management in 44 Australian and German companies operating in China.

The study identified specific difficulties associated with the employment of expatriate, local Chinese, and local‐hired foreign managers in Australian and German subsidiaries in China. The interviewees indicate a widespread intention to replace expatriate managers with Chinese managers and local‐hired foreign managers. The striving for localization of staffing is more pronounced in German than Australian MNCs. German companies offer more comprehensive development activities for the Chinese talent than Australian companies.

The small number of participants and the restriction to one key informant per company limit the generalizability of the findings. The effects of different staffing options still need to be researched in longitudinal studies and in varied contexts.

Localization of staff suggests the need for specific, culture‐sensitive approaches to personnel development. The findings also suggest that the knowledge transfer between expatriate and local managers deserves more attention. Finally, the return on investment that companies receive from differing staffing options should be assessed using a multidimensional set of success criteria.

This paper has two main contributions to existing research. First, it links academic discussion about the options of international staffing with the experience of practitioners from Western MNCs operating in China. Second, it provides further support for the existence of country‐of‐origin effects in international staffing.

International assignments are becoming more and more typical parts of a managerial career. As an outcome, cross‐cultural leadership competencies are required within international companies. Still, real cross‐cultural leadership interaction between expatriate managers and their local subordinates has not been much studied. In the light of this, the goals of the present study were to analyse whether and how expatriate managers adjust their leadership style due to cross‐cultural differences, and whether and how local subordinates perceive the styles of expatriate managers to differ from the styles of local managers after possible adjustments. The data were collected by interviewing Finnish expatriate managers and their Indonesian subordinates in real cross‐cultural business settings with a bicultural interview team.

The purpose of this paper is to investigate the nature of commitments of local employees to a parent company and a local operation in comparison to the nature of commitment of Western expatriates to the two foci.

Data were collected by questionnaire from 532 local employees and 471 Western expatriates currently working for the subsidiaries of multinational companies (MNCs) in Vietnam. Hypotheses were tested using exploratory factor analyses, confirmatory factor analyses, correlation analyses, t-test, generalized linear models and hierarchical regression.

The results confirmed two distinct commitment foci and revealed that the commitment to the local operation was stronger than the commitment to the parent company for local employees. Remarkably, retention and absenteeism are more driven by local operation commitment than by parent company commitment for the local employees. In contrast, these outcomes are more driven by parent company commitment for the Western expatriates. Working conditions (job autonomy, job variety, transformational leadership and remuneration) positively predicted affective commitment to the local operation for both groups; particularly job variety and leadership were better predictors for local employees than for Western expatriates.

The comparison shows effective and specific ways to sustain and reinforce the commitments of each employee group with regard to two foci. This information may help to reduce the rate of turnover intention and absenteeism in MNCs.

By using a multifaceted approach, this study provided a comparison of dual organizational commitment for different categories of employees working in MNCs. Second, this study shows that the stronger commitment focus has a stronger influence on related outcomes (i.e. retention and absenteeism). If so, MNCs can focus on reinforcing the selected commitment focus in order to reduce the costs of management. Third, the study has initially pointed out that some work factors exert a specific influence on different commitment foci in the two groups. Controlling these work conditions is recommended to sustain and develop commitment levels of the two groups.

In order to identify expatriate roles in a subsidiary it is necessary to go beyond those functions which are subservient to the headquarters. This paper sets out to prescribe a new spectrum of development roles with respect to varying capabilities and development needs of local employees.

The roles of expatriates are analyzed based on seven case studies conducted with top automobile manufacturers in Thailand: Toyota Motor Thailand; Hino Motors (Thailand); Honda Automobile (Thailand); Isuzu Motors (Thailand); BMW (Thailand); DaimlerChrysler (Thailand); and Auto Alliance (Thailand).

Four types of expatriate roles – commander, conductor, coach, and connector – are proposed; the roles correspond to the degree of task readiness and managerial capabilities of local employees.

The paper provides a tool that will help expatriates understand their roles according to the technical skills and managerial capabilities of local employees.

The paper offers practical advice for diagnosing expatriate roles and their training prior to assignment to a subsidiary.

The qualitative study examines the development of purposely created interpersonal relationships in an intercultural context. Contact with a local host is a way of helping expatriates deal with the challenges of an international assignment. Since the quality of contact with the host is pivotal to benefit most from this experience, the purpose of this paper is to examine which factors influence contact quality.

The authors conducted a case study analysis of 33 expatriates and ten accompanying partners who were put in touch with a local host, with whom they undertook a broad range of activities during a period of nine months.

Nine factors influenced the development of the contact (similarities, motivation, benefits, anxiety, expectations, busy schedules, suboptimal timing, communication breakdown, and cultural differences). Key factors were similarities, motivation, and benefits.

While some of the factors (e.g. similarities) are predictable according to the Social Penetration Theory, four factors were uniquely applicable to purposely created relationships such as contact with a local host: motivation, expectations, anxiety, and suboptimal timing.

The study provides suggestions that could stimulate the contact with a local host, making the intervention more valuable for organisations who wish to support their expatriates in this way.

This longitudinal study is one of the first to examine in detail the process of development of purposely created interpersonal relationships in an intercultural context. Furthermore, the study is new because it also examines unsuccessful relationships.

Considers the relationship between the expatriates and locals which affect their working together and therefore the effectiveness of their companies. Suggests that the area of institutional arrangements that sets the pattern of the relationship, the tone of communications and the categorization of co‐workers in conflicting groups is virtually untouched. Attempts to examine the variables that constitute the formation, evolution and impact on corporate effectiveness. Offers solutions such as localization of personnel, equality, integration and sharing of cultures.

The study explores African partners' experiences regarding Chinese expatriates' knowledge control practices in 29 Sino-African joint ventures in 12 countries. It provides insights into power dynamics and knowledge transfer (KT) from African partners' perspective.

The qualitative paper mobilized semi-structured interviews with Africans who worked with Chinese expatriates across Africa. The study focused on understanding the experiences of African partners when collaborating with their Chinese expatriate colleagues on assignments in joint ventures (JVs) in Africa.

Chinese expatriates employed five tactics, as described by African partners, to control knowledge based on power, behaviors and knowledge type. Particularly, through the lens of unofficial power, this study explains knowledge hiding tactics between knowledge-holding Chinese expatriates and host country knowledge-seeking locals. A new dimension of authority-based knowledge hiding is discovered.

The paper brings new insights into the analysis of power (official and unofficial) boundaries regarding knowledge control mechanisms in joint venture collaborations between employees from China and Africa. Unofficial power appeared as a major leverage for expatriates in monopolizing their strategic knowledge. The study recommends mobilizing African diaspora and repatriates from China to improve KT for Africa.