Elliot H. Clark
Many have prophesied a time when we would collaborate over giant screens with disembodied images, yammering at each other in a kind of Aldous Huxley-esque brave new world nightmare. Pushing back against this threat: Companies have learned that people still work best in teams, especially when individuals are located in proximity to each other. (Even the telecommuting trend that surged in recent years has slowed and many companies have reversed their telecommuting policies.) One of the best benchmarks of relocation as a management tool for deploying or acquiring talent is the trend- lines based on the market performance of relocation providers; we have years of data from the HRO Today Baker’s Dozen Relocation Provider Customer Satisfaction Survey.
In this issue, we release the 2014 list of top providers (see page 20). Congratulations are extended to NEI Global Relocation, Global Mobility Solutions, Mobility Services International (MSI), Graebel Relocation Services Worldwide, Weichert Workforce Mobility, TheMIGroup, SIRVA Worldwide, Xerox Relocation & Assignment Services (formerly ACS Relocation), AIReS, American Relocation Connections (ARC), NuCompass Mobility Services, XONEX Relocation and Plus Relocations Services.
As we evaluate year-over-year data, we see evidence of a mature and improving business. The scope of service numbers, measuring the number of sub services involved in any engagement, moved up dramatically from 2013 to 2014. The index was calculated using the same questions and calculation algorithm in both years so no fluctuation can be attributed to the survey or data analysis structure. We received surveys from 437 participants and used 277 verified surveys in the study. This is a broad expanse of companies that provide this data, which gave us an excellent cross section of the market. The mean of the Breadth of Service index has moved up an impressive 8.5 percent.
This demonstrates that clients are buying more services from each provider. Or another way to see this is that overall the providers are coming up with service bundles that are increasingly appealing to the needs of their clients. The median moved up less than the mean (or the average) by 5.5 percent so this shows that the overall midpoint of service offering moved up as well. The standard deviation, however, moved up 26 percent. That means there was a great variance between the companies offering a broad array of services and those offering a less full featured solution. This segmentation of the market is an important consideration for buyers. Think carefully about what you need and, if it is a broad service versus narrower service envelope, the list of providers you should go to in either case is pretty clear. This should save you time and effort in your RFP process.
The size of deal index remained virtually flat with about a 2 percent decrease. This is a small numerical index and only a few survey question items so this change is not as material as it would be to the other two indices. We measure size of deal not on dollar volume of engagement but number of people moved, so this may suggest that the number of relocations across this group of clients (277) was pretty flat, but the good news for the providers is that the clients outsourced more functions (which they should have not gotten for free), so revenue spent on relocation was probably up modestly over 2013.
Quality of service scores also improved. The average moved up 3.08 or 1.7 percent. This is the largest and most complex number of items so this increase is a positive. The median moved up slightly, but the most impressive change statistically was a decrease in the standard deviation by a whopping 36 percent. This means that the average level of satisfaction with the service provided was up slightly, but the variation between the happy and the unhappy customers dropped by over a third. Everyone was “happier together.”
Relocation services continue to be an important part of the overall new candidate and internal mobility experience. It is gratifying to see that the trends in the industry suggest modest revenue growth in the wake of a period of great economic turbulence and an excellent and improving commitment to service quality.
Elliot H. Clark, CEO
CEO’s Letter: Relo Market Trends Remain Positive