Employee EngagementRelocation

Reigning in Relocation Policies To Maximize Cost Savings

When times are tough, ON Semiconductor turns to an outsourced relocation provider for better results
by Kelly Kayser
Due to the complex nature of relocation and the many moving parts involved, issues can and will come up. The key to a successful supplier relationship is how you approach issue resolution, work as a team to identify defects, and put processes and metrics in place to ensure success in the future.

ON Semiconductor is a preferred supplier of high-performance, energy-efficient silicon solutions to customers in the power supply, automotive, communications, computer, consumer, medical, industrial, mobile phone, and military/aerospace markets. Along with its global corporate headquarters in Phoenix, the company owns and operates several development centers and design and manufacturing facilities in the U.S., Europe, and Asia.

ON Semiconductor operates in the extremely cost-conscious, commodity-driven semiconductor business. Controlling expenses, including costly exceptions, is critical to our bottom line. We pride ourselves not only on keeping costs from rising but also on getting costs down. To that end, effective policy communication is vital. It is imperative that we do a good job of positioning our policy to ensure that our employees or potential employees are perfectly clear on their benefits. As our company has changed, we haven’t always had a consistent discipline in the management of our relocation policy, but during the past few years, we have worked closely with our relocation provider, Cartus, to ensure that we are managing relocation costs effectively.

In our competitive environment, it was also important that we get the best service at the best price. We worked with Cartus to identify opportunities to control costs as well as to resolve issues and improve processes and customer service. Through open conversations and teamwork, we were able to define clear expectations on both sides and identify clear, meaningful metrics to track and report on.

Domestic U.S. Policy. In the U.S., we are always looking for new talent to bring in; therefore, our domestic policy is used heavily. Even in today’s challenging economy and housing environment, we found that it was still possible to achieve cost savings. Eliminating exceptions has been the single most important thing we have done to manage our relocation costs, and to that end, consistency in the application of our policy has been the biggest key. We have worked with Cartus to benchmark our policy against our industry to learn best practices in the area of cost savings, and the findings have been very helpful in ensuring that our policy is in line with our industry.

We have tightened up our domestic policy and figured out which areas were costing us the most. We realized that exceptions were very costly to our program, particularly “extras” that we were moving for employees and reducing temporary living from 90 to 60 days. We now rarely allow exceptions, and when we do, it is truly a collaborative effort. We tied metrics around exceptions and closely monitor the process.

International Policy. In growing numbers, we are also acquiring talent internationally and from region to region. As a result, we continue to work on improving our international policy. We have designed a policy that reflects the current state of our business and, just as with our domestic U.S. policy, we are working to ensure that we are adhering to our processes. As part of that, we’re administering a survey to tap into our expatriates’ view of our program and the benefits associated with it. We hope to use these findings to analyze our policy and see if any changes need to be made. These initiatives have helped HR executives to better manage the relocation program.

“Cartus and ON Semiconductor have worked closely together to develop a partnership that works within ON Semiconductor’s corporate culture and leverages the vast relocation strengths of Cartus,” said Tobin Cookman, the HR director at ON Semiconductor. “Through policy and process improvements, identifying and addressing root cause issues quickly, and putting clear metrics in place, we have dramatically reduced individual employee relocation costs while substantially improving customer service scores.”

The Results
We have collaborated with Cartus to ensure exceptional service, streamline processes, and achieve cost savings. Most importantly, we were able to deliver excellent results against our mutual goals, including reducing overall relocation costs by 11 percent, lowering exceptions by 45 percent, ensuring that our policy aligned with industry relocation standards by completing an international, domestic, and executive policy redesign, eliminating BVO sale fallouts, and improving overall customer service satisfaction to 100 percent.

As we have continued to push for the most competitive relocation model, Cartus through our outsourcing agreement has partnered with us to ensure that our cost objectives will be met and service levels will not be sacrificed. We have achieved improvements in the level of customer service, reduced relocation costs, and put clear metrics in place to continue to track ongoing progress.

Tags: Engaged Workforce, HRO Today Global, Relocation

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