This podcast is brought to you by the Wharton School at the University of Pennsylvania. More people think about their careers as a global one with more firms keeping operations in different countries. There isn't much wonder why that is the case. But if someone with a global career moves to another country, what is the impact on things like compensation? A new study spoke to over 1300 MBAs to discuss the impact of their careers to being international. Martine Haas, Professor of Management at the Wharton School and also Director of the Lauder Institute, part of that research and she joins us with more.
Martine, pleasure to talk to you again. How have you been? I'm great. Good to talk to you too, Dad. Thank you. And this is obviously a very interesting topic. Let me start with kind of the backstory on what was it that kind of stirred your interest to be a part of this research? Yes. So, you know, this research is about global careers and in some form or another, that's always been an interest of mine. I have a global career myself. But my early dissertation research, I actually did a lot of research at the World Bank and I got really interested there in the difference between what I called locals and cosmopolitan. And so the locals were people who, you know, spent a lot of time in the particular country where the project was being done, really understood it. But then you have the cosmopolitan. So these people who travel all around the world and bring their knowledge with them, you know, and learn more obviously as they go. And so I did this early research on particularly cosmopolitan for locals.
And then, you know, more recently, as you mentioned, I've been, I'm the Director of the Lauder Institute and our students there are doing a master's degree in international studies at the same time as their Wharton MBA. And so they are incredibly international students and have very international careers and stuff. So, you know, there's always, you know, strong interest in how their careers are unfolding. And then this opportunity came along. So my co-authors, Matthew Bidwell and Isabelle Fernandez-Mateo were designing a survey for the alumni of a large European Business School, one of the leading Business School in the world. And, you know, it was a great opportunity for me to contribute some questions that I wanted to know more about to do with global careers. And they became really interested in that too. And we brought on our fourth co-author, Jibana Caponi, to help us analyze the data. And together, we thought we'd be interested in this question because it's really remarkably little research that looks at how global careers unfold over time and how that affects compensation. You know, we know stuff about how it affects people, you know, psychological well-being, that kind of thing. But not how it affects actual career outcomes, particularly with account compensation in this paper.
And so it seems like one of the takeaways here is the fact that a global career, maybe in the first couple of years, has the potential to have a negative impact on compensation, but that over the longer period of time, that that may even out or even, you know, improve it as that person continues, correct?
Yeah, so that's almost correct, but we need to sort of be pretty careful about how we understand it. It's not really about sort of short-term, long-term, it's really about how many global moves, international moves, music of countries you make over the course of your career. So what we were looking at is, you know, how does one international move affect your compensation in the long-term? How does, you know, three, four, five international move affect compensation when we look at it for this, you know, set of alumni, as you mentioned, 1300 or so MBA alumni. And we start counting these moves, by the way, after they've finished their MBA and already kind of started off in one country. So when they move again after that, we count that as one international move. And some ways we're kind of being conservative or, you know, about the number of moves that they're making. And what we find, as you're saying there, is a little bit surprising. We find that people who only move once or twice after their MBA internationally, those one or two moves are associated with kind of long-term pay penalties. So they're paid less both immediately, but also sort of in a longer term that we're looking at some of these folks, you know, up to many years after they've graduated from the MBA program. Whereas people who've moved many times, so that, you know, three, four, five times, are getting positive pay premiums by the time that they've moved that many times internationally. And for the ones who've moved really many, many times, that can be a substantial premium. So it's not anything that you think that impact short or long-term, it's more how many moves have taken on how does that affect you?
So then why is it, do you think that those, that component of multiple moves has the potential to have that benefit? Yeah. So those really sort of two big questions that come out of our findings.
And that's one of them, right? So one is kind of how do they, why is it the one or two moves a negative? And then why is it that multiple moves are positive, right? And so you're asking the second part of that.
So why is it that people who've moved many times really see the premium? And you know, that was something we explored quite a lot. There is quite a bit of literature. There's literature that's saying, there's research that says that, you know, things can be, moves can be difficult for people's careers. And there's also, on the other hand, research that says, you know, moving internationally can help people gain really valuable knowledge and skills and increase their, you know, networks and become more kind of flexible and agile and adaptable when you put them in new context.
And so the positive effects that we're seeing for people who've moved many times really seem to be due to those kinds of reasons. We actually did a bunch of additional interviews with some of the people who've moved many, many times in our study. And we really kind of came to see that what we call these superglobals, right? People who've moved multiple times four or more times, superglobals, were people who really seem to require a really unusual, distinctive set of knowledge and skills, right? They were really people who, who, who, what they gained is the real ability to work internationally. And that was really valuable for certain terms and certain roles in those terms.
And so it was a really, and by the time you get to people who've moved that much, it's a really similar labor market, right? So these people are already rare, which means that they can come on very high premiums. And frankly, by the time you've moved that much, you're not going to want to move again unless you're going to be paid a lot for it, right? So they also kind of had a motivation as well as on the ability to command, you know, very high salaries at that point in their careers. So on the, on the positive side, right, the people who've moved a lot, they were just unique people in the, in the labor market and really valuable against the some firms and for some roles.
So there is a level, a perception, I guess, by firms about that component of international mobility. Yeah, I think that's right. But again, it seems to be, you know, surprisingly, in some sense, depending what you're expecting, surprisingly limited to people who've really moved a lot, right? And on the other end of the spectrum, people who've moved once or twice, and again, this is, you know, very salient for folks who are at early stage of their careers and sort of thinking about, do I want to move at all or do I want to move, you know, a lot if I do move internationally.
For those people, you know, you can't expect that firms are going to value your one or two international moves is what our data seem to reveal in terms of higher compensation. So we didn't find that those people benefited financially from one or two international moves. In fact, we found that there was a, it was negative for them, right? Not just neutral, but negative. So people who had moved once or twice actually received lower compensation at a time than comparable people who haven't moved at all, right?
Right. And remember, we're not talking about moves between firms here, we're talking about moves internationally, some of which are within firms and some of which are between firms, right? And so why is that, you know, I think the reason is partly that firms may not be valuing the knowledge and skills that you gain in one or two other countries that highly, right? There's some value to that, but there's also some deference that, you know, some detriment to that, right? Relative to somebody else who has worked, you know, all that career in, you know, your home country, right? And so you might want to promote that person who really understands who have country more than somebody who's actually spent some time somewhere else. Maybe they have something valuable, maybe they don't, right? So it's not clearly beneficial in that way.
And it's also the case that people remove, you know, just once or twice, they're often doing that for a whole range of reasons that I'm not just about compensation. They're not necessarily trying to maximize their compensation, although, of course, we always, you know, want to do that as well, right? But a lot of those people are going to move because they want the adventure, they want the personal enrichment. They think that over time, there's going to open up new professional opportunities for them, which probably it does, right? But they're not necessarily out there trying to maximize compensation about all else. It's just one of many things.
So again, we have the slightly, I think, surprising finding to people who, you know, it would be, you know, don't assume that if you move internationally, that's going to help your pay over time. It might help your career in also other ways as well as your personal, you know, life. But there can be, you know, negative effects on compensation. If you only move on to trust me. If you keep moving, you're going to see longer-term potential benefits, right?
Let me circle back on something because that component of even within a company moving from one culture to the other. And maybe this occurs more so when that first move or that second move occurs is that the perception at times, and I've heard this referred to, that whether or not that move, that first move or that second move brings different challenges of working in one culture and going to another. And whether or not that has any impact on that mindset of compensation. But then after you've made three, four, five changes in life, you've been a part of so many different cultures that you have that kind of broader experience.
Yeah, I think that's really right. And it kind of gets back to my, you know, starting to talk about at the beginning, these sort of cosmopolitan, right? People who really moved a lot, we're calling them go through on supergloveals in the study, cosmopolitan, there's another way for them. You know, you just acquire a really different kind of set of skills and adaptability and you're not necessarily rooting anywhere, but you're learning to operate really easily and effectively and pretty quickly in a lot of different environments, right?
And it's certainly the case, and there's a lot of research to show this, that, you know, when you first move internationally, it can be really very difficult, right? There's a lot of adaptation that needs to take place. And people often underrate how difficult that's going to be for them. And so there is evidence from prior research that, you know, international moves when people come back, you know, expatriates who come back to their home country, it can actually be associated with, you know, difficulty adjusting, difficulty readjusting, sometimes with, you know, promotions actually being less likely to happen. And sometimes that's because, you know, again, you acquire some valuable knowledge and skills, but you also lose some things, right? You don't develop or maintain your local networks in the same way, right? And so there is definitely a mixed bag and that cultural adaptation piece is part of a learning curve that can be really hard for people in the early days. And again, people do get, I think, more, and I see this again as my MBA students, like more facile and more able to do this the more they do it, right? But it is a skill we can learn really well at this time.
Does potentially this element around compensation, does it differ in terms of certain countries over others? Were you able to determine that or is that just, you know, kind of on the outside edges here?
这个潜在的补偿因素,在某些国家是否与其他国家有所不同?你能确定这一点还是只是在外部边缘上的想法?
Yeah, I mean, we're really interested to look at this because, you know, our data set is unusually large for being able to look at people who are internationally mobile. You know, they're a very unusual population in some ways, right? They are very international people. And so that means that there was actually a lot of variation on what we call heterogeneity, right, in the data set, right? So we have people who have moved within firms and between firms who have moved to many different countries and cities within those countries. You know, we have people who have moved within regions or between geographic regions. So we looked at all of that to try to see whether there were, you know, noticeable patterns. And interestingly enough, in some sense, we didn't see a lot of differences in moves, you know, within firms versus between the returns in terms of how moving internationally within terms of between the effects of compensation.
And we didn't really see, but we weren't really looking for moves to particular countries. We actually controlled that in our analysis. So all our results are looking at kind of nettive, which particular countries you're talking about. But one thing we did see a little bit of evidence for, but it wasn't very strong, was that they did seem to be a bigger premium to move between regions than within regions. And so these sort of longer international moves, which again, has to do probably with these superglobals who are really making, you know, these very global careers moving across regions of the world a lot. There was a bit of a seem to be a little bit advantageous, as opposed to, for example, people who are moving a lot within Europe. Right. But it was not very strong. I mean, it's not a strong payment we can make from the data.
I would assume that in speaking with all of these different MBAs that in terms of putting this research together, it becomes important for those who are considering a career that may have that international component looking forward in terms of having a better understanding of what their expectations should be moving forward, correct?
Yeah, I think that's right. I mean, there's definitely a lot of interest from our students who, again, many of them, you know, not just the law students, but all, you know, MBA students, it's something that many MBA students think about. And many people in their early careers coming out of good universities are thinking about, you know, are they going to try to explore internationally?
And, you know, I think in terms of advice, as you know, just saying, it's kind of recognizing that compensation is only one of many things, right? And you shouldn't assume again that, you know, this is necessarily the path to higher compensation unless it's something moving internationally or something that you're going to want to keep doing throughout your career.
It may be that there's, you know, mixed benefits and costs moving internationally, and you've got to think for yourself, right? You know, how much do I want the experience? Am I going to really enjoy this? Is it going to expose me to things I wouldn't otherwise do? Is it going to be enriching for me? Don't do it just for the pay because it's, you know, it's not necessarily going to benefit you that way.
You know, on the other hand, if you're, if you are only doing it for the pay, then you would only move. If there was higher pay and you can negotiate that as your primary, you know, concern and not do it otherwise, right? So you can, you can make it pay more for you and, or otherwise not do it, right? And they're probably some folks like that in our data sets.
But for more people, what we're seeing is, you know, it's not this compensation returns. I'm not the main reward to this.
然而对于更多的人来说,我们所看到的并非是补偿回报。我并不是这个的主要受益者。
All right. Martine, great to have you with us. Thanks very much for your time today. Thank you so much. I'm good to talk to you. Take care. You too as well. Martine Haas, who is a director of the Lauder Institute here at the Wharton School in the University of Pennsylvania and also who is a professor of management.