The benefits of being understood: The role of ethnic identity confirmation in knowledge acquisition by expatriates

• Author: Anne‐Wil Harzing,Christina Cregan,Tine Köhler,Shea X. Fan
• Date: 01 January 2018
• DOI: http://doi.org/10.1002/hrm.21839
• Published date: 01 January 2018

ORIGINAL ARTICLE

The benefits of being understood: The role of ethnic identity

confirmation in knowledge acquisition by expatriates

Shea X. Fan

1,2

| Christina Cregan

3

| Anne-Wil Harzing

4

| Tine Köhler

3

1

School of Management, RMIT University,

Melbourne, Australia

2

Nottingham University Business School

China, Ningbo, China

3

Department of Management and Marketing,

The University of Melbourne, Parkville, VIC,

Australia

4

Middlesex University, Business School,

London, the UK

Correspondence

Shea X. Fan, School of Management, RMIT

University, Building 80, 445 Swanston Street,

Melbourne, Australia, 3000.

Email: shea.fan@rmit.edu.au.

In this article, we propose that the concept of ethnic identity confirmation (EIC), the level of

agreement between how expatriates view the importance of their own ethnic identity and how

local employees view the importance of expatriates' ethnic identity, can explain why expatri-

ates who are ethnically similar to host-country employees are sometimes less effective than

expected when working overseas. Multinationals often choose ethnically similar expatriates for

international assignments, assuming these expatriates can more effectively acquire knowledge

from local employees. Thus, understanding the specific challenges that endanger the realization

of this potential is crucial.

Our survey, administered to a sample of 128 expatriate–local employee dyads working in

China, reveals that both ethnically similar and ethnically different expatriates acquire more local

knowledge when EIC is high. However, the association between ethnic (dis)similarity and

knowledge acquisition is direct for ethnically different expatriates, whereas for ethnically similar

expatriates it is indirect via their perception of local employees' trustworthiness. We discuss

this study's important implications and provide recommendations for multinationals on how to

provide tailored support to expatriates who face different identity challenges.

KEYWORDS

diversity, international HRM, knowledge management, social identity theory, trust

1|INTRODUCTION

Given the potential organizational and personal costs associated with

unsuccessful expatriate assignments, including, but not limited to,

poor performance (Dowling, Festing, & Engle, 2008), low job satisfac-

tion (Reiche, 2007), premature return (Harzing, 1995), or leaving the

organization (Shaffer & Harrison, 1998), researchers have focused on

identifying factors that might increase the likelihood of success for

expatriates on international assignments. The role of local employees,

in particular, has gained increasing attention (Mahajan & Toh, 2014;

Toh & DeNisi, 2005; Vance, Vaiman, & Andersen, 2009). Local

employees who interact with expatriates on a daily basis can help

them achieve business goals and can provide work and non-work-

related information and support (Shen & Kram, 2011; Toh & DeNisi,

2007). However, they may also negatively influence expatriates' per-

formance if they are unwilling to cooperate with expatriates (Toh &

DeNisi, 2005).

One stream of research tries to explain why local employees

might not support expatriates from the angle of ethnic (dis)similarity

in expatriate-local employee interactions. Researchers have found

that ethnic dissimilarity can trigger out-group categorization, which

could damage trust and inhibit interpersonal support, information

sharing, and cooperative behaviors (Mäkelä, 2007; Toh & DeNisi,

2007; Varma, Pichler, & Budhwar, 2011a). These findings align with

self-categorization theory, suggesting in-group categorization facili-

tates interpersonal interactions (Brewer & Pierce, 2005). In fact, many

multinational corporations (MNCs) assign expatriates who share the

same ethnicity as the local employees (called ethnically similar

expatriates in this article) to local subsidiaries, believing these expatri-

ates will be more effective than ethnically different expatriates.

Although we are not aware of any official statistics on this, research-

ers have identified that this is a prevalent practice, especially in sub-

sidiaries located in emerging economies such as India and China

(Björkman & Schapp, 1994; Goodall & Warner, 1998; Thite,

DOI: 10.1002/hrm.21839

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