Four steps to developing structure and strategy around global mobility programs.
By Julia Palmer
As companies focus on driving new market growth, the need for globally mobile talent will continue to increase. According to the new study, Unlocking the Value of Cross-Border Assignments from Harvard Business Review Analytics Services and EY, 63 percent of organizations experienced an increased need for global mobility over the past three years, and 72 percent project an increase over the next two to three years.
Companies with a well-executed mobility strategy will be best placed to meet this growing demand, particularly in a complex global environment. These types of organizations are deemed “strategists” by the survey. Integrating global mobility into the business and talent strategy contributes to a positive impact on financial performance, new business growth, and succession planning.
On the other hand, “reactors” are organizations that are more tactical and ad hoc in their approach to global mobility, and find themselves not achieving these benefits.
Surprisingly, global mobility remains low on the business agenda of many organizations, with almost half of companies saying they don’t have a mobility strategy. So what steps can organizations take to implement a successful global relocation strategy?
1. Engage with C-suite executives. Top performing companies reported a greater level of engagement with the C-suite, with nearly 50 percent of strategists stating they meet with C-suite executives at least quarterly. In contrast, only about 25 percent of reactors are engaged in this level of interaction. When delving deeper into this response, there was also a difference in the types of discussions held during these meetings. Reactors were more likely to be seeking approval for an assignee while strategists were looking to discuss future planning ideas and provide input into talent objectives through mobility initiatives.
The head of international assignments for a building products manufacturer says: “In our company, we have a profound succession planning process, which is discussed regularly among C-level executives. Global mobility falls directly under this. We use a radar to identify talents, with pools on each level: global, zone level, and then local level. To fill the succession pipeline, we use assessment tools throughout the year; it’s a long-term process.”
HR can improve the level of engagement with C-level executives by having a program that runs smoothly at an operational level with little “noise.” This helps shift the focus from the issues and costs often attached to global mobility to the value of successful planning. In order to add depth to the discussions, having good data and metrics to inform strategic planning decisions is imperative.
2. Have good structures and leadership to support mobility’s success. There are many challenges organizations face when trying to implement a global mobility strategy. By far the most common challenge is the tactical ad hoc approach to executing mobility, rather than pro-active planning as part of the business and talent strategy. When business managers don’t understand the benefits of well- planned mobility, they can be focused on quickly getting someone to fill a role at minimal cost. This short-term focus may not result in the best outcome to support longer-term business goals, and therefore the perception of mobility as an enabler to success is tarnished.
All organizations are faced with the high cost of transferring employees and the skills gap left by the person leaving for an assignment. By implementing a pro- active plan, organizations have the opportunity to become better at cost management and skills replacement. HR can help overcome this barrier by implementing good structures to facilitate global mobility policies that meet various business needs including developmental policies, strategic assignment policies, and permanent transfer policies. Nearly all strategists had sufficient global mobility structures in place to facilitate mobility. As with any program, senior level ownership, such as an HR director, is needed to drive change from the top and engage the C-suite at a strategic level. This is clear with 27 percent of reactors citing lack of ownership as a barrier to mobility’s success, compared to only 11 percent of strategists. Without senior ownership, implementing a strategy and embedding it into strategic business planning will be unlikely to occur.
3. Demonstrate the return on investment (ROI) of global mobility. Measuring the ROI of a mobility program has long been a challenge, and the majority of companies continue to have no clear metrics in place to do so. Again, strategists are leading the way in addressing this, with a third of them either measuring ROI now, or planning to do so in the next 12 to 18 months.
Knowing what to measure can be challenging, and may vary between organizations, depending upon the strategic drivers of mobility. In some organizations, simply measuring the successful completion of a project within budget may be a key metric. Strategists are using a combination of business metrics and personal metrics to assess ROI, with the most common business metrics being competency and skills levels, along with employee engagement. With attrition often being considered disproportionately high for globally mobile employees, understanding and improving employee engagement should help in addressing retention of top talent.
The most common individual metric used is the career progression of an employee, measured by 50 percent of strategists. Tied to the business metrics, the skill acquisition of the assignee and their performance ratings are also commonly measured. Strategists are using these metrics to integrate mobility into the organization’s planning by providing business with data on areas including the various skills within the organization, the benefits of sending particular employees on assignment, and what the overall costs might be. This information is used in the areas of growth plans, talent management, career development and succession planning.
As a first step to measuring ROI, HR should be engaging with management to understand what metrics are important and relevant to the organization. HR and global mobility functions have access to a significant amount of data. Knowing how to harness and analyze this data to provide meaningful insights is critical if HR is to be successful in raising mobility up the strategic agenda.
4. Actively promote mobility in career and leadership discussions. Along with capitalizing on new market growth, among the most significant benefits of strategic global mobility are developing local successors, improving diversity, and grooming the C-suite of the future. Achieving these benefits involves including global mobility in regular discussions on talent development and workforce planning for new markets. As one HR director puts it: “Global mobility is part of the talent management organization in our company, and we are constantly looking at ways to align global mobility with talent acquisition, strategic workforce planning, and succession planning.”
By including global mobility in these discussions, HR will be engaged earlier in more pro-active and considered planning and candidate selection. This will improve the level of competency and skills within the organization and increase employee engagement and retention, allowing business to grow. This will lead to more visible ROI and, according to 65 percent of strategists, will have a positive impact on financial performance.
The benefits of an effective global mobility strategy are clear. Organizations that are able to demonstrate the value of global mobility will be better placed to support business in achieving new market growth than those who are busy reacting to business demands and cost pressures. Integrating global mobility as an intrinsic part of an organization’s strategic planning requires strong ownership of the program as well as a well-structured global mobility framework with metrics that are relevant to the organization. This level of ownership and structure will facilitate greater engagement with the C-suite in order for a global mobility strategy to deliver the benefits of a best-in-class mobility program.
Julia Palmer is executive director of Ernst & Young Human Capital.