BenefitsEngaged Workforce

Baker’s Dozen Relocation:The Power Behind Corporate Relocation

Being mindful of the peak moving season and tracking employee feedback will guide you on how to work with relocation service providers to deliver a better experience to employees.

by Michael Drago

Companies with a mobile workforce often invest significant sums of money to relocate their most valuable employees and help them become fully productive in as short a period of time as possible. To assist in this process, many organizations contract corporate relocation companies to coordinate and manage a transferee’s move in hopes that it will minimize the stress on the employee and, in turn, lead to higher productivity.

Despite these well-intended objectives, many companies fall into the trap of treating relocation services as a commodity and rely primarily on costs to drive their partner selection. Such an approach may be poorly conceived if it is acknowledged that:

  • Employees are a company’s most valuable asset, and
  • Moving is one of life’s most stressful events.

It would seem reasonable that overall quality of service would be the most important factor when making such a critical decision. After all, the partner is being selected to guide the company’s prized assets through a situation often filled with potentially high-stake pitfalls. However, before the quality of service can be considered, an understanding of what actually drives transferees’ experiences is necessary.
In 2007, J.D. Power and Associates addressed this issue in its inaugural “Corporate Relocation Transferee Satisfaction Study.” The study was designed to provide comprehensive information to assist relocation companies in their efforts to improve transferee satisfaction and to assist organizations in making informed decisions about selecting a relocation company. The study process was completed through a series of statistical analyses that dissected the transferee experience and assessed the relative importance of a number of factors on their overall satisfaction with the corporate relocation company. The results of these analyses are illustrated in Fig. 1.

Figure 1: Relocation Services Most Often Cited As Having An Impact On Client Satisfaction

The study found that the factor with the highest impact on satisfaction with the corporate relocation company is the performance of its in-house relocation counselor(s)/moving coordinator(s). This dimension of performance correlates very highly with overall satisfaction. In fact, the relocation counselor/moving coordinator drives nearly half (49 percent) of the transferee’s experience with the relocation company. More specifically, issues such as the counselor’s responsiveness and ability to resolve problems in a timely manner rate highest in importance.

Second most important is the nonmoving-related services available through the corporate relocation company. These services are the value-added aspects of the relocation that help to differentiate the transferee’s experience. Some of the services that contribute to this include issues such as financial services, mortgage, insurance, career assistance, and family-related services. On an individual basis, this area represents an opportunity for employers to provide transferees with the comprehensive services they require to navigate the relocation experience efficiently. For relocation companies, this points toward critical opportunities to package easy-to-use services that complement the relocation experience and alleviate pain points for a transferee and, in turn, their employer.

The third most influential aspect of the corporate relocation company’s service relates to its role in accelerating the transferee’s knowledge and overall familiarity with their destination market as they prepare to reestablish themselves. The underlying concept is how successful the corporate relocation company is in assessing and understanding the transferee’s lifestyle needs and whether that knowledge is applied to helping the transferee become established in his destination market.

Based on the statistical analysis of the transferee experience, these three concepts drive nearly 80 percent of satisfaction with the corporate relocation company. While this is a simplified explanation of the model, it should provide the basic direction necessary to better understand the keys to increasing the
likelihood that the transferee experience is a positive one.

When relocations do not run flawlessly, each problem experienced tends to strain the relocation process a little more. This can increase the demand on the corporate relocation company’s flexibility and capacity. It may not matter whether the source of the problem occurs in-house or with one of the contracted service providers. Every problem has the potential to force the corporate relocation company into a problem resolution or service recovery mode.

One of the more commonly occurring events that can generate additional stress for the transferee and, in turn, increase the demands on the corporate relocation company is a problem with moving the transferee’s personal belongings. In the 2007 study, nearly half (46 percent) of transferees reported that their belongings were either damaged or lost while in transit, did not arrive at their destination on the day they were originally promised, or both. When either of these issues surface, transferee satisfaction with the relocation company decreases by slightly more than 10 percent on average. However, if both occur, transferee satisfaction drops by nearly 25 percent.

However, some challenges in completing relocations can be anticipated. The greatest opportunity is in accounting for the seasonality of moving industry demand. Transferees who are able to avoid the peak summer moving season can increase the likelihood that they will have a positive experience. The 2007 study data suggest that the greatest opportunity is to target relocation during the first quarter of the year.

During the peak summer months, the capacity of van lines can become scarce, which creates stress throughout the relocation system. In addition, corporate relocation company counselors are likely to run at or near full capacity. Inevitably, van lines’ capacity limitations and heightened demand for the relocation counselors’ attention and assistance can cause delays in responsiveness and problem resolution for many transferees during the peak season. The impact of this is evident in satisfaction scores compiled in 2007, particularly during July. (Satisfaction scores are based on a 1,000-point scale and reflect the relocations completed during that specific month.)

Figure 2: Average Overall Satisfaction Index Score

Despite the challenges of moving during the peak months, many transferees will need to plan around school schedules, weather conditions, and a long list of other factors that lead them into the relocation system during this period. However, the transferees—and, in turn, their employers—that are able to avoid these peak months may find the process less cumbersome, which will accelerate their assimilation into their new location.
Companies that strategically plan for the transferee experience are more likely to develop and maintain effective relocation programs. This goes beyond just accounting for the impact of timing to also include evaluating the packages of services offered to employees as well as nonmoving-related services, and assessing the ability of a potential relocation partner to deliver on the drivers of transferee satisfaction.

Transfer Feedback

Internal feedback provided by transferees offers employers limited insight into the performance of their corporate relocation company. According to our data, approximately seven of 10 (71 percent) transferees said that they provided their employer with feedback. More often than not, these messages tend to endorse the corporate relocation company, as 58 percent of transferees gave positive feedback whereas only 13 percent offered negative feedback.

Figure 3: Feedback Given to Employer By Overall Satifaction With Corporate Relocation Company

How feedback may impact an employer is better demonstrated through feedback ratios. Specifically, for every transferee who is critical of the corporate relocation company, how many praise it? The 2007 study average is approximately 4.5 positive transferees for every 1 negative transferee. However, the ratios vary among the individual corporate relocation companies, from a high of 10.6 to 1 to a low of 2.6 to 1. The assumption is that the more that a feedback ratio tilts toward the positive, the better a company’s perception is of its corporate relocation partner.
While this assumption may be correct in how organizations interpret the feedback their transferees provide, the conclusions that they draw might not be. The following chart will help to illustrate why this is so. The key observations from the chart are:

  • One-fourth of the transferees who provide their employer with negative feedback about the relocation company actually rate the relocation company to be above average (a score of six or greater on a 10-point scale).
  • Half of the transferees who do not give feedback to employers rate their overall satisfaction as high (eight or greater on a 10-point scale).
  • Nearly three-fourths (73 percent) of the transferees who provide positive feedback rate the corporate relocation company an eight or higher on a 10-point scale—indicating that the relocation experience needs to be more unique to motivate transferees to offer praise than it does to get them to be critical.

The lessons to be learned from this are:

  • It is wise for companies to monitor and track the internal feedback they receive from their transferees.
  • An understanding of where feedback comes from will help in interpreting the message the feedback provides.
  • Transferee feedback may be best used as a supplement to other metrics a company uses to assess their relocation company’s performance.

Michael Drago is senior account manager for the real estate and construction industries practice at J.D. Power and Associates and leads the research operations for the Corporate Relocation Transferee Satisfaction Study.

Tags: Benefits, Engaged Workforce

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