When an international assignment is not completed, necessitating a replacement of the expatriate, the cost of the failure to the organization are both direct and indirect. The direct costs include salary, training costs, travel and relocation expenses. The indirect costs could be loss of market share, poor relationship with the hosts. This is quite costly for an organization and therefore careful selection would be determined by the expatriate success rate in completing their assignments.
Expatriate failure is primarily caused by error in selection. Historically, the selection of expatriates has been based on interpersonal factors of expatriates. For instance, Clarke and Hammer, (1995), found that interpersonal skills assist in the cultural adjustment of the expatriate and his or her family
In the domestic setting the Human Resource department’s involvement with the employee’s family is limited. Most expatriate selection decisions are made informally because expatriate jobs require much more than the right skills. When an organization sends its employees to some other country, it takes over the responsibilities besides the basic functions of human resource management. They do not deal merely with the selection of the best employees for work in foreign countries but also have to be aware of the needs of the family that will accompany the employee to the new cultural environment.
A lot of people taking on international assignments are unsuccessful since their spouses or families cannot adjust to their new surroundings. Hence it is necessary to organize training in the foreign language for the employee and his/her family. Also important is to organize everything necessary for the journey including visas. It is also important to prepare the residence in the new surrounding as well as to assure health services