Mobility plays a crucial role—when used as a global business strategy, rather than simply filling international positions.
By Jonathan Pearce
Companies need to be both strategic and nimble in order to survive and prosper in an increasingly competitive “New World,” buffeted by fluctuating fortunes in mature markets, and rapid but inconsistent growth in developing markets. For many organizations, the future hinges on penetrating those markets unlocked by globalization. That’s a tough challenge, especially when the critical opportunities and critical talent are often not in the same country.
Mobility can play a crucial role when used as a business strategy rather than simply just filling international positions. Companies are starting to view mobility programs as a way to pursue specific talent development goals. For example, organizations are sending promising leadership candidates abroad so they can develop the global experience and perspective necessary to lead in a global economy.
In Deloitte’s annual survey researching the strategic orientation of mobility programs Strategic Moves, a key outcome was that companies that adopt a strategic approach to mobility are more likely to take advantage of the opportunities for growth because their specialization and leadership is focused in the right geographies, products, and sectors.
More than 140 organizations participated in this global survey with an aggregate mobile workforce of more than 30,000.
Three specific themes emerged from the research:
1. The importance of a global mobility strategy. Global mobility is an increasingly important strategic enabler that should align to core business objectives. The overwhelming majority of survey respondents (88 percent) feel it is important or critically important to align their organization’s global mobility strategy with their business strategy, with nearly half of all organizations surveyed agreeing that their top strategic business issue is emerging geographical markets. In reality, however, there is a significant disconnect with only 2 percent of participants believing that mobility is an activity currently being set-up to meet these objectives. The increased importance of formal global mobility programs emphasizes the need to establish a formal global mobility strategy.
2. The need to integrate mobility and talent management. As companies continue to face ongoing challenges in the wake of global economic turmoil, reducing costs as well as retaining and developing talent globally is high on the corporate agenda. Mobility can be an enabler for retaining key talent, especially younger talent and talent from certain developing markets. But investing in deployment to retain and develop talent can be prohibitively expensive and leading organizations are finding ways to co-invest with their high-potential employees in these desirable moves. The first step is to link mobility and the company’s talent management processes to determine improved succession planning and career development for assigness.
Developing new leaders and providing them with experience to grow new markets is crucial, however, the current lack of integration with talent programs and strategies means that many organizations will not be able to fill their talent pipelines with the global leaders required for future growth. Sixty percent of survey respondents feel that global mobility is important or critically important to meeting their talent agenda. Global leadership and pipeline was selected by a third of respondents as the global mobility issue most critical to their organizations’ success, however, only 11 percent feel this issue is fully supported by their current mobility program.
3. Enhancing the value of global mobility. The survey findings reflect the challenges facing chief executives and HR leaders. Global mobility functions have grown reactively, with responsibilities often split across talent, reward, HR shared service centers, and disparate pockets of mobility specialization with no overall strategic direction. Approximately 40 percent of survey participants believe their global mobility program needs significant or radical improvement. Thirty-six percent feel that their program is adequate, with room for improvement. In total therefore, three quarters of organizations rated their mobility function as no better than adequate.
Most departments managing global mobility measure their success in terms of how well they manage internal administrative and operational costs and external vendor contracts; however, these components typically comprise only 3 to 5 percent of a company’s total mobility investment. This narrow perspective has led many mobility functions to focus too much attention on the tactical aspects of mobility—such as offering only rigidly defined packages of services that in the end may not meet the needs of the assignees and business units—and place too much emphasis on operational efficiency.
We believe that companies can improve the return on their global mobility investment by refocusing their global mobility functions on more strategic issues, such as determining the right number of globally mobile employees to support the business, the right level of investment in global talent deployments, and new approaches to solve business problems that make a real impact on the bottom line.
Organizations need to approach global mobility based on specific business and workforce strategies, the size and complexity of the global mobility program, the sophistication of the overall HR infrastructure, and the existing level of integration between HR and the global mobility function. The following three-step process provides a general framework for developing global mobility capabilities that are more valuable, efficient, and strategic.
Step 1: Refocus. The first step is to create a new vision for global mobility that treats global mobility as an integral component of an organization’s overall talent management program—both from a strategic and operational perspective.
Step 2: Transform. Transforming global mobility into a strategic asset often requires establishing new global mobility capabilities to support the vision. These
new capabilities may require different skills for the mobility team, different approaches to technology and innovative approaches to designing reward strategies for mobile employees.
Step 3: Rebrand. One of the biggest barriers to improvement is to change how people think about global mobility and to demonstrate its increased importance and value for assignees and the business. The organization must understand that global mobility is now a core business activity, not just a niche program for administering a handful of special assignments.
Now is the time for companies to bring their global mobility capabilities into line with the demands of their businesses and the global environment. Strategic execution of a well-articulated global mobility and workforce strategy can help a company achieve its growth objectives by bringing the right resources to the right opportunities at the right cost—quickly and efficiently. It can also help develop a new generation of leaders and technical specialists with the global skills and experience to lead the company into the future.
Given the central role of global growth across all aspects of business in the coming decade, executing and integrating global mobility and talent programs are leading priorities.
Jonathan Pearce is a principal and leads Deloitte Tax LLP’s global mobility transformation practice.