Alcoa’s worldwide workforce was a patchwork in need of renunification. Mission accomplished.
By Bill Barron
Promising dramatic service upgrades is one thing, but if a relocation service provider can’t implement in a quick and timely manner, then clients have to wait to reap the benefits—and when they’re moving a lot of employees, every day can prove costly. Here’s how Weichert Relocation Resources Inc.’s (WRRI) implementation team exhibited what we like to think was grace under pressure, to the client’s ultimate benefit.
Business Issue
With 47 percent of its revenues generated outside the U.S., Alcoa, one of the world’s largest metals manufacturers, depends on its globally mobile workforce to grow its business. With 63,000 employees in 31 countries, the company relocated employees not only within the U.S.—and to traditional expat destinations such as Russia, Brazil, India, and China—but also to more remote locations within Surinam, U.A.E., Jamaica, Guinea, and Ghana.
As Alcoa’s program and activity evolved, a complex patchwork of vendors, processes, and workarounds led to a lack of spend visibility, inaccurate reporting, excess exchange rate costs, and unnecessary burdens on the payroll and finance departments to manage inter-company accounting. The program needed a reboot, and with global mobility so critical to its success, the company wasn’t content to wait for it.
Action Taken
After a comprehensive RFP process, Alcoa continued to conduct exhaustive due diligence, testing WRRI’s relocation and assignment expertise, tax knowledge, and ability to ensure supply chain solutions in even the most remote locations.
Once final decisions were made, the company wanted to implement quickly with start-up in just 90 days. Working to ensure that we’d be prepared should we be selected, the WRRI implementation team actively evaluated policies, researched locations, and fine-tuned the implementation plan with each new piece of intelligence received. With approvals imminent, WRRI immediately deployed the subject matter experts to make it happen.
The discovery process was extensive and uncovered new information that made it even more challenging to meet the desired implementation date. In addition to 13 kinds of authorization forms, two payroll systems, and countless vendors, Alcoa actually maintained 14 different policies (some grandfathered and soon-to-be retired) that needed to be administered and supported as part of the implementation.
WRRI brought added value to the partnership, providing comprehensive relocation and assignment management solutions as well as expense and tax reporting services, including multi-currency expense management.
The previous provider couldn’t make payments in foreign currencies, so all non-recurring payments had to be made through payroll. This often required non-U.S. employees to open U.S. bank accounts just to get reimbursed, and it incurred unnecessary exchange rate costs for the company because payments had to be made in U.S. funds. Today, WRRI is making payments globally and reporting the payments (as necessary) to payroll through automated feeds that ensure more accurate cost and tax reporting and greater spend visibility.
Conversely, automated HR rosters from the Oracle-based HRIS are fed directly to WRRI’s systems to keep us informed of compensation changes, life events, and other developments that can impact cost and tax tracking, reporting, and payments. To ease inter-company accounting, WRRI created a G/L invoice that facilitates more accurate internal accounting and reporting. In all, no fewer than110 process maps were first reviewed and then simplified in order to create a far more efficient process.
Client Benefits Received
Customized communications were developed to help Alcoa introduce the new programs and processes, and training was offered to ensure program success. The implementation was conducted in two phases: The domestic relocation program went live May 2009, and the reengineered international assignment program was launched in June 2009.
Historically, employees voiced frustration with cumbersome, archaic procedures, delays, and needless expenses. But those same assignees are praising the new process, sending unsolicited e-mails acknowledging noticeable improvements in service. Key to meeting the start-up schedule was not only having a dedicated, proficient implementation team at WRRI, but also having knowledgeable, accessible, responsive decision makers within the client organization.
While substantial hard cost savings are expected to accrue over time, the streamlined procedures, easier inter-company accounting, accurate cost and tax reporting, and access to subject matter experts will pay immediate dividends, including a workforce that is more easily deployed to speed business results. Because when you’re relying on your global workforce to grow your business the way this client does, process improvements can’t wait until tomorrow!
Bill Barron is senior vice president, international assignment management with Weichert Relocation Resources.
