The Effect of Emotional Intelligence on Expatriate Adjustment: An Empirical Study

Abstract

The study examines the role of emotional intelligence (EI) in expatriate adjustment (EA) of expatriates on international assignments and survey collected based on a sample of 170 expatriates who are currently staying in Malaysia. Previous scholar defined EI as the recognise of non-cognitive psychological aspects intervening in human behaviour. Several researchers have identified a significant correlation between the cognitive and emotional components of people’s intelligence, and how its influence effectively on achieving all sorts of goals in any area of human behaviour. Thus, in majority, the successful of companies’ international business activities rely on the level of expatriates’ adjustment to the host country such as in physically and mentally way. Therefore, this study utilised multiple hierarchical regression to analyse the data and thereby to test the effects of EI on expatriate adjustment. The findings reveal that Self-Emotion Appraisal (SEA) of EI has a positive influence on expatriate adjustment. Secondly, ability of Others-Emotions Appraisal (OEA) also found a positive influence on expatriate adjustment. However, there was no positive influence for Use of Emotion (UOE) and Regulation of Emotion (ROE) on expatriate adjustment. Hence, the findings indicate the importance of EI practices as well as practical implication to international firms especially in selection and hiring of international candidates.

Keywords: Emotional intelligenceexpatriatesadjustmentMalaysia

Introduction

As Asian markets continue their remarkable growth, the influence within the global economy is accelerating. Hence, many expatriates get in touch with other cultures because of being travel to foreign locations. In addition, international organisations much initiate expatriation, which sending some individual lives and works in other’s country (Carpenter, Walker, Anderies, & Abel, 2001; Takeuchi, Wang, & Marinova 2005). On the other hand, international assignments are also considered valuable for multiple reasons such as knowledge sharing (Makela, 2007). Thus, global assignments important as not only to evaluate expatriate performance but also related with organisation’s achievement and can create a competitive advantage for a firm (Carpenter et al., 2001). Therefore, it is important to generate a systematic means to measure expatriate performance is important (Caligiuri, 1997). Several previous researches indicate different types of criteria in how to evaluate the successful of expatriate. There are firstly in accomplishment in international assignment, secondly cross culture adjustment and third work performance during international assignment (Caligiuri, 1998, 2000). Furthermore, to gain in global competency, expatriate assignments are become as mechanism for control and coordination between a given foreign subsidiary and the parent organization. To foster the parent corporate culture, MNCs depose domestic employees in key leadership and positions abroad (Kobrin, 1988; Ondrack, 1985). Kobrin Majority the successful of companies’ international business activities today rely on expatriates and expatriates’ successful rely on their adjustment to the host country such as they feel comfortable a new environment and not only in physical but in mental way as well (Koveshnikov, Wechtler, & Dejoux, 2014). Previous research has provided adequate proof implying that expatriate adjustment is a difficult and challenging process (Aycan, 1997; Ciarrochi & Chan, 2000). Moreover, numerous articles have emphasised that expatriate adjustment is a not only challenging but also considered as a hard thing and the complexity of expatriate adjustment such as work, general and interaction (Aycan, 1997; Bhaskar-Shrinivas et al., 2005; Black & Gregersen, 1991; Hechanova et al. 2003). Expatriate adjustment is considered as regular studied in the successful of international. In study of Aycan et al. (2014) dispute that adjustment is an important stator in expatriates’ international assignment. Expatriate adjustment has been defined as the key process of expatriate adjust into the host country and acceptance by the host country as well (Brislin, 1981).

Problem Statement

Period of an expatriate assignment is about three to five years, values appear as correspond to firm structures. Thus, expatriate needs to adapt both processes and structures in the new environment (Haslberger, 2010). Expatriate adjustment occurs as an outcome of communication behaviours (Haslberger et al., 2013). The successful of companies’ international business activities today depends on expatriates. For instance, their success in transferring knowledge to host country subordinates. Whether expatriates can succeed in these tasks depends to a large extent on their adjustment to the host environment or country and psychologically ‘comfort’ in relation to a variety of aspects of their new environment. At the same time, as an expatriate they might involves in numerous role of transitions such as overseas transfers, domestic transfers, promotions, company reorganizations, and inter-company job changes (Black, 1988). According to Black study, role of double entendre and role of discretion were found to influence work adjustment such as knowledge sharing with local’s nationals and family's adjustment were found to correlate with general adjustment of American expatriate managers in Japan (Black, 1988).

During the period of expatriate adjustment, EI played an important role. EI is defined as an array of capabilities, competences, and skills that influence one’s ability to manage with environmental demands (Mayer, DiPaolo, & Salovey, 1990; Schutte, 1998) recognised that the success of the expatriation process rely on choosing a culturally in harmony and emotionally sensitive person who can react apposite to the host environment of another country and different interpersonal work situations (Alon & Higgins, 2005). Existing studies show that adjustment needs short term or long-term process for adjustment it will sometimes cause psychological stress (Aycan, 1997). Several researches also shows that stressful in mental will causing poor adjustment and job dissatisfaction (Cohen, Cimbolic, Armeli, & Hettler 1998). In contrast, expatriates who are well-adjusted can lead to good mental health and life satisfaction with positive relationships with local people, compatibility with jobs, and a positive attitude toward new characteristics of jobs. Therefore, expatriate’s personal factors play important roles to cope with the new environment. For expatriates who are well-adjusted with good EI, they can easily to understand their emotion better and perform better in their overseas adjustment and commitment (Lii & Wong, 2008). Thus, EI has an important impact for expatriates’ adjustment and success (Koveshnikov et al., 2014). Hence, EI needs to be examined more radically not only in the three dimensions of expatriate adjustment (Bhaskar-Shrinivas, Harrison, Shaffer, & Luk, 2005; Black & Gregersen, 1991).

Research Questions

To analyse the influence of EI on expatriate adjustment and the vary between male and female. In

accordance with the purpose of the study and based on the problem statement, the following

questions have been formulated:

  • Does self-emotion appraisal have a positive influence on expatriate adjustment?

  • Does others-emotions Appraisal have a positive influence on expatriate adjustment?

  • Does use of emotion has a positive influence on expatriate adjustment?

  • Does regulation of emotion have a positive influence on expatriate adjustment?

Purpose of the Study

This study examines the impact of EI on expatriate adjustment and to discover whether there is a significant influence and positive relationship between EI and expatriates’ work, general living and interactions adjustment. The study also strives to provide practical implications for organisations concerning the identification and development of successful expatriates.

Research Methods

In short, the respondents were well depicted by the gender. 81 males (47.6 per cent) and 89 females (52.4 per cent) participated in the current research. The age of respondents was divided into five categories. The majority of were aged between 30 and 39 years’ old (32.9 per cent), followed by respondents’ aged between 30 and 39 years’ old (19.4 per cent), respondents aged between 20 to 29 years’ old (17.6 per cent) respondents aged fall between 50 to 59 years’ old (18.8 per cent) and respondents aged fall in the range from 60 years’ old and above (11.2 per cent). The majority of respondents (56.5 per cent) were married; 26.5 per cent were single. In terms of respondent’s education level, the respondents with bachelor’s degree 48.8 per cent followed by postgraduate or higher level with 25.9 per cent. Meanwhile, respondents with college but no degree holder contributed 14.1 per cent. Most respondents (68.8 per cent) were classified as “managerial”. Those in non-managerial position comprised 16.5 per cent; those in “other positions” represented the remaining 14.7 per cent. Many respondents (37.6 per cent) were living in Malaysia for more than four years. 19.4 per cent of respondents were living in Malaysia less than 4 years, followed by respondents (12.4 per cent) were living in Malaysia for 3 years and 12.4 per cent of respondents were living in Malaysia for 2 years. Majority of respondents come from Taiwan with 45.3 per cent, followed by respondents who come from United Kingdom with 7.1 per cent, Germany is 5.9 per cent which is same with China also with 8.3 per cent. Respondents come from Japan is 4.1 per cent which is also same percentage with respondents who come from Korea with 4.1 per cent. There were 2.9 per cent of respondents who come from United States as well, followed by respondents who come from Switzerland which is 1.8 per cent. Majority of respondents’ company’s home country are from Taiwan with 37.6 per cent, followed by respondents work in Malaysia is 19.4 per cent. 10.0 per cent of respondents’ company’s home country from United States, followed by China which is 8.3 per cent. Respondent’s company from Germany and South Korea is 6.5 per cent. Majority of respondents who work in manufacturing sector which contributed 28.2 per cent, followed by respondents work in service sector which contributed 24.7 per cent of this research. Respondents who work in Technology sector contributed to a third highest percentage, which is 24.1 per cent. Respondents from Education sector and others contributed 16.5 per cent and 6.5 per cent respectively in this research.

Reliability Analysis

The reliability analysis was done through Smart Partial Least Square 3.0 software. Table 1 shows the overall analysis of reliability for five variables: Expatriate Adjustment with 11 items, Self-Emotion Appraisal with 4 items, Others-Emotions Appraisal with 4 items, and Use of Emotion with 4 items. In the past, Cronbach’s Alpha (CA) was used to examine the internal consistency and reliability of the measurement model. CA value above 0.7 implies high reliability for the measurement or item (Hair, Sarstedt, Hopkins, & Kuppelwieser, 2014). From Table 1 , the results show that CA ranges from 0.781 to 0.89, which fulfil the minimum acceptable value. However, it is adequate to assess internal consistency using Composite Reliability (CR) instead of CA because CA assumes all items having the equal reliability or loading on the construct which will be inaccurate. It is sensitive to the number of item available in the scale. Such another reliability measurement was introduced by Henseler, Ringle, and Sarstedt (2015) namely rho_A and its consider as the most important and consistent measure of internal consistency reliability in using smart PLS. The reliability rho_A usually lie between Cronbach’s Alpha and Composite Reliability and threshold value is similar with CR, that is should be 0.7 or higher to indicate adequate convergence or internal consistency. Thus, composite reliability is used in this study to measure the reliability and internal consistency of a latent construct. The value of CR should be 0.7 and above to achieve composite reliability for a construct (Hair et al., 2014). From Table 1 , the results show that CR value range from 0.854 to 0.912 which exceeded the recommended value of 0.7. Therefore, all five variables in this research fulfil the minimum requirement of composite reliability.

Table 1 -
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Discriminant Validity – Heterotrait-Monotrait (HTMT) Criterion

Discriminant validity is used to evaluate the correlations between constructs for potential measures. In the year 2015, Henseler proposes that Heterotrait-Monotrait (HTMT) as a new superior criterion (2015) compared to the traditional assessment of Fornell and Larcker (1981). Nevertheless, simulation study has demonstrated that these techniques may not consistently discover absence of discriminant validity especially in regular research conditions. Thus, Heterotrait-Monotrait (HTMT) was proposed to measure discriminant validity in VB-SEM. Previous researches recommended construct thresholds of 0.85 and 0.90 for HTMT to confirm discriminant validity (Henseler et al., 2015). The values are lower than the require threshold value of HTMT0.85 (Kline, 2015) and HTMT0.90 (Gold et al., 2001) indicating that discriminant validity is established for the constructs of this study. Therefore, this research utilizes the HTMT of evaluate discriminant validity. The results show that every value is below 0.85. Nevertheless, the value is seen as valid if its below 0.90 (Henseler et al., 2015) outcomes of the discriminant validity evaluation of the HTMT are displayed in Table 2 . Thus, the HTMT ratio criterion is fulfilled. This current study inferred that discriminant validity is established since all discriminant validity measurement is satisfied.

Table 2 -
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Assessment of Structural Model

According to Hair, Sarstedt, Ringle, & Gudergan , R2 measures and the path coefficients significance level are the key criteria used for the evaluation of structural model due to use in describe the variance of the endogenous variables. Thereby, R2 signifies the expanse of the concerned construct variance which is explained by the model. Besides, in this study bootstrapping analysis was used to evaluate the path coefficients’ significance level and to give robust statistics in SEM. R square measures predictive accuracy of the model that explains the amount of variation in the endogenous variables being explained by all the exogenous variables linked. R square value of EA is 0.277 which is considering weak. It is because according to the research of marketing issues, the rule of thumb for an acceptable R2 is 0.25 for weak, 0.5 for moderate and 0.75 for substantial . The calculated R2 value of expatriate adjustment at 0.28 meaning that although 28% expatriate adjustment still considered acceptable in this study. For instance, R2 values of 0.20 are considered high in other study such as customer behaviour. Besides of R2 value test, Q2 also consider as an important predictive accuracy criterion to show the predictive relevance of the model. Q2 signifies the degree to which the modal with its parameter estimates reconstructs the observed values . If the value of Q2 is greater than zero, which means there is predictive relevance in the exogenous constructs . Besides, an exogenous construct is considered to have large, medium and small predictive relevance when the Q2 values are 0.35, 0.15 and 0.02. Based on the Figure 4.4, the Q2 values of expatriate adjustment is 0.124 which is considered as medium predictive relevance. According to Hair et al. , Q2 value which above zero shows the predictive relevance of exogenous constructs on endogenous constructs. The effect size ( f 2 ) helps to assess if there is any significant effect from the omitted predictor construct on the value of R2 for the endogenous construct. According to Cohen et al. recommendation, guidelines for assessing f 2 values are 0.02, 0.15 and 0.35, represent small, medium and large effect sizes. The results show that the small effect of self-emotion appraisal on expatriate adjustment ( f 2 =0.101) and another small effect of others-emotion appraisal on expatriate adjustment ( f 2 =0.076).

Structural Model Hypotheses Testing

In this research, multiple regression analysis was carried through Smart Partial Least Square 3.2.7 software. Path coefficient (β) and one-tail, p-statistics (p-value) from bootstrapping analysis were used to evaluate the independent variables and dependent variable relationship.

Table 3 -
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Self-Emotion Appraisal (SEA) has a positive influence on expatriate adjustment on Expatriate Adjustment (EA) with β=0.328, P-value=0.001. Besides, Others-Emotions Appraisal has a positive influence on expatriate adjustment (EA) with β=0.275, P-value=0.001. On the other hand, Use of Emotion (UOE) shows there is no positive influence on expatriate adjustment (EA) with β= -0.027, P-value=0.354 and Regulation of Emotion (ROE) also no positive influence on expatriate adjustment on Expatriate Adjustment (EA) with β=0.041, P-value=0.333.

Findings

Statements from each hypothesis will be discussed in this section. Relevant discussion on the significant and insignificant hypothesis will be indicated in detail as well. For hypothesis H1, it was supported as self-emotion appraisal has a positive influence on expatriate adjustment. This finding is in line with the study of Koveshnikov et al. (2014), this ability will help expatriates’ adjustment because this characteristic will have a positive effect on an expatriate’s interpersonal interactions in and outside of work. Hence, this statement is conducted to get more understanding about the EI outcome on expatriate adjustment. Furthermore, having this capacity will make expatriates more assertive, sociable and outgoing with others. They will be more likely to spend time with locals and try to understand their culture and emotions (Black & Mendenhall, 1990). This will enhance their general appreciation and comprehension of their new broader, not just work-related but also environment as well. Moreover, a person especially for expatriate who has high EI should be able to recognise his or her emotions, it is very useful to regulate those emotions, and use them to facilitate in performance. Thus, intrapersonal emotional recognition and management is very important, and this will help to deal with his or her emotions. In addition, a person with high EI would be less affected by his or her self-emotion and be able to manage their own emotions in a positive way and have lower chances of feeling depressed while in host country. Therefore, once the person has an ability to recognize and understand his or her own emotions, it will avoid negative emotions such as anxiety, fear and sadness. Furthermore, recognise own emotional states and discover the reason that affect own thoughts and behaviours, is the key of decision to cultivate self-awareness. For expatriate with high EI they would not afraid of any challenges in host country, conversely, they will get easy to adjust the changes around them and always have a plan to overcome it.

This includes as a dimension understanding others’ emotions. Therefore, expatriate with high EI would also be able to interpret others’ moods correctly and have a higher chance to form a close relationship and getting social support in general especially communicate with local in host country. For instance, they will like to spend more time with locals and try to understand their culture and emotions (Black, 1990). Thereby, this will gain their general appreciation and understanding of new broader, such as work-related and environment. It is important to understand others’ emotions as it is the core factors which can affect intrapersonal well-being and interpersonal relations. Thus, the H2 hypothesis is supported where others-emotions appraisal has positive influence on expatriate adjustment.

Hypothesis H3 was not supported. In other words, the use of emotion does not appear to have a positive influence on expatriate adjustment. A person with high EI would be able to have positive emotions for high performance and eliminate negative emotions away to bring forth constructive performance goals. According to previous study of Mayer et al. (1990) utilise emotions is one of the basis for thinking and thinking with emotions might related to important social competencies and adaptive of behaviour. Hence, in this study use of emotion is assumed as an important factor in expatriate adjustment. This is because it may help expatriate in able to solve problems and facilitate them to prepare for better future opportunities. According to the study of Ibrahim, Jarimal, Nawi, and Megat, (2018), that EI significantly and positively related with creative performance which indicates that a person who can utilise his or her emotion wisely will have conducted creativity in performance. Creative performance is considered one of the important roles of employee. Parke, Seo, and Sherf, (2015) also reveals that individuals’ differences in emotional intelligence will give impact on each stage which ultimately influences creativity.

However, in this study the H3 hypothesis was not supported may related with different reason. In existing study, a high EI person will be able to contribute creative performance, decision-making and problem-solving (Jafri et al., 2016) but in contrast when a person feels stressful tension and anxiety especially for expatriates who are far from hometown might facing tough situations, causing less likely to turn to other, it will become less effective on managing their own mood. Consequently, in this kind of circumstances negative impact of EI on adjustment or no reaction on using emotion could be happened. Therefore, to sum up, the previous studies results cannot be used as the basis for this hypothesis assumption and the H3 hypothesis shows that use of emotion is insignificantly influencing on expatriate adjustment. Hypothesis H4 was not supported the regulation of emotion does not have positive influence on expatriate adjustment. According in previous study of Mayer et al. (1990) advanced that a person who can control own emotion will makes emotion become more stable, and able to enhance own and others’ moods and even can manage emotions very well. Thus, expatriate who can control negative emotion and stress which caused by interactions with locals will strengthen the positive experiences. Therefore, existing research has shown that an expatriate who has the ability to regulate own’s emotions is important because it helps them to in better mood adjustment, self-encouragement and social skills. These all make them become careful in speaking and action and more involved in discover others’ feelings (Lii & Wong, 2008). In addition, previous research of Koveshnikov et al. (2014) also proposed that expatriates who can control their emotions very well would have better communication skills with locals in host country as well as sort out with new rules, regulations and policies of new work environment.

Conclusion

Recently, majority success of the companies relies on expatriates, for instance how well they are able to adapt in new environment to which they are transferred, cooperate and communicate with locals, how fluently they can apply their competences and knowledge. Also, learn new things, and cope with those uncertainty situations. Thus, EI plays an important on expatriate adjustment because their success related with their adjustment in the host country. Previous research shows the critical role of adjustment for successful expatriation and emphasize the complex and different dimensions of the adjustment process such as divide into between work, general and interaction. Therefore, it is important for an expatriate feels comfortable in mentally and physically among variety of aspects in new environment. Several researches also probe into the different factors on adjustment such as firm, organisation and institutional. Furthermore, the impact of big five personality traits also included. The population of this study was focusing on the expatriates and self-initiated expatriates who were currently working and living in Malaysia. The finding of this study suggests that EI has positive influence on expatriate adjustment and this will gain the understanding of different type of adaptive abilities which comprise EI influence on different aspects of expatriates’ adjustment to the host country. However, the finding shows that the expected two variances use of emotion and regulation of emotion were not found in this study. In a nutshell, organization management should utilise EI as a tool of concerning the identification and development of successful expatriates. Moreover, EI practices can also be proceed and promote through company. Human resource management can seek this as a guideline to create better working environment to promote EI among expatriates. For instance, can proposed that human resource managers take EI as consideration of training, hiring and extend office EI activity to improve work performance in workplace as selecting employees with high EI would bring benefit of innovation and creativity for organisations. In addition, organisations could pay greater attention in human interactions, and practice to manage contrast between different emotions and cultures among expatriates.

Acknowledgments

The authors are grateful to the editor and reviewer for their valuable suggestions and comments which enhances the quality of the paper.

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Publisher

Future Academy

First Online

18.12.2019

Doi

10.15405/epsbs.2019.08.66

Online ISSN

2357-1330