The favored spots for international assignments—and why.
By Debbie Bolla
As the world becomes more and more flat, global organizations are tackling growth initiatives and filling key skills gaps through international relocation. In fact, according to Brookfield Global Relocation Services’s 2013 Global Relocation Trends report, this year 54 percent of executives indicated their international assignee population increased. With more than half of respondents reporting an upswing, the industry is seeing a significant pace above the historical average of 47 percent. So where are companies transferring their talent?
Recent research from relocation provider Cartus shows the top destinations include:
1. United States
2. United Kingdom
10. Hong Kong
12. United Arab Emirates
Brookfield’s survey findings concur with the U.S. holding the number one spot with 22 percent of respondents listing it as a principal destination. It also recognizes the United Kingdom as the second most common destination (12 percent) and China as third (4 percent). All three destinations offer cities in which global organizations can house headquarters or have a satellite office where international business can be conducted.
Relocation providers report that popular relocation destinations are determined by the business needs of clients, including potential areas for growth and expansion to gain speed against competitors. Affordability of cost of living, tax structure, and immigration requirements are also factors.
Amy Glynn, mobility manager for Xerox, notes that the U.K. and U.S. are the most popular spots with 75 long- term assignments and business travelers in each locale. “These locations are important business centers and offer employees a chance to live in a different country and culture, but [allow them to] be able to find what they need and connect with not just individuals who may be from their home country or others who are globally savvy,” she reports. Cost also plays a role. “In our business services groups, some countries are popular due to the changing business model to less costly countries, such as India.”
Industry needs also drive relocation country preference. “We find that top locations are determined by internal and external factors in the industry,” says Deborah Graham, vice president of global relocation service for Paragon Relocation, who also reports the U.S., U.K., China, and Singapore as top spots. “Factors include the global economy and new consumers, location of corporate headquarters, location of labor/manufacturing, and of course, the industry involved. Each of the top locations have different benefits to offer, ranging from experience for management at corporate headquarters to availability of consumers to availability of labor/materials for manufacturing.”
Cara Skourtis, vice president of knowledge and experience for NuCompass Mobility Services Inc., breaks down the advantages by region. “Each location offers different benefits and risks,” she explains. “For example, Singapore is generally viewed as a desirable gateway to APAC, where it is easy to establish business, it’s generally accepted as a strategic location, and the country is welcoming to foreign business. Germany and Switzerland offer central locations for EMEA business needs. The U.K. offers U.S. employers the ability to be in proximity to Europe without the added complexity of a language difference.”
In addition to business needs, international locations need to be attractive to employees. International assignments are often viewed as a benefit to high-performing employees, seeing them as an opportunity to build a sought-after skill and gain experience not obtainable in their current role. In fact, they can actually be leveraged to retain top talent— that is, if done properly.
“Companies have been successful keeping their expats after an assignment and the secret is out. What is the secret? Companies who embrace global mobility [and] integrate talent management into HR are successful in keeping their most valued human capital working for them and not a competitor,” says Graham. “It is simple. Employees who go on an assignment are no different from any other employee. They want to be recognized for their achievements and rewarded for their contributions to the organization. If they come home and there is no parade or place to showcase their new skills, they will become disillusioned, feel unappreciated and look for greener grass. Unfortunately, they will turn to your competitor. It’s human nature.”
So what are some best practices to executing international relocations?
Implement a candidate assessment process. While an employee may be a top performer in their current position, be sure to fully assess their ability to transition and adapt to living and working offsite. They may or may not fair so well elsewhere. Twenty-eight percent of respondents of Brookfield’s 2013 Global Relocation Trends survey indicated they use candidate assessment tools when determining if employees are suitable to take on international assignments, and another 35 percent of companies are considering adopting the use of candidate assessment tools. Skourtis says that the candidate assessment process often increases awareness around the cultural differences that will be experienced, and any potential issues.
Ensure open, honest communication in selection process. Glynn says that it is crucial for the employee—and their family—to be 100 percent invested in the assignment. Time and money will be saved if everyone is on the same page about the benefits—and any challenges—that come along with the relocation.
Provide cross-cultural training prior to departure. This will aid the employee in understanding what it will be like to work and live in the new location. Graham says, “Cross-cultural training is one of those things that everyone thinks they don’t need, until they need it. Companies who spend millions to move an employee half way across the world cannot afford to have the employee lose valuable time in the workplace because they are not culturally prepared, especially if the employee will be managing people.”
Respondents from the Brookfield’s 2013 Global Relocation Trends report agree. Eight-five percent of respondents indicated that they considered cross-cultural training as
a good or great value. Glynn adds that training helps the employee and their family understand nuances of the host country, especially when there is a language difference.
Offer destination services. Skourtis explains that organizations should deliver assistance in home search, area orientation, and settling-in services. She advises that employees also assess their comfort level with the new location six months in and address any situations they or their family may have encountered.
Assist in relocation. Glynn says employees will be able to focus on their jobs better if they receive assistance with the move and home finding. Companies are often at an advantage if they have a dedicated assignment manager to coordinate every aspect of the move.
Assure the employee has personal and professional support. Organizations should provide support, such as phone and Internet capabilities, for the assignee to be able to communicate to extended family and work associates, Skourtis advises.
Follow up and track assignment progress. Make no assumptions—have trackable goals to ensure the relocation is worthwhile for both the employee and company, says Glynn. Skourtis also recommends that organizations have a job lined up at the end of the employee’s assignment at the departure location to encourage retention.
Source: 2013 Global Relocation Trends report
Brookfield Global Relocation Services
As previous years, China, Brazil, and India capped the list of countries with the most challenges for international assignees, reported by 16 percent, 12 percent, and 11 percent of respondents respectively. For Brazil, executives overwhelmingly noted immigration complexities and timing as posing challenges, whereas for China and India cultural and family adaptation, and quality of life issues were more predominant. The United States was fourth in the list of countries most commonly presenting challenges for international assignees. In the verbatim comments, respondents cited immigration regulations, taxation, and difficulty obtaining transportatioon without a credit record as common issues. Russia rounded out the top five locations, with immigration and cultural adaptation flagged as key challenges.
As companies push into a more diverse set of destinations and thereby support international assignments to a growing number of emerging markets, the number of countries being noted as challenging locations for assignments is also expanding. For example, Qatar, Romania, and the Philippines were countries that did not appear on previous years’ reports but were reported by respondents as locations posing challenges to assignees. Immigration, security, qualityof life, and housing are all areas that can pose considerable difficulties for international assignees. These difficulties can be exarcerbated when program managers face parallel challenges in those countries, such as curreny restrictions, changing regulations, and complex tax and legal issues. As the landscape of internaitonal assignments conintues to grow in complexity companies will mostly take steps to better understand and prepare themselves and their candidates for what lies ahead.