Many international assignments today are the product of a global perspective on talent management – far more strategic than the tactical moves of a decade ago. Teresa Russell reports on HR’s role in ensuring the success of short and long-term assignments
Both the war for talent and the resources boom have added fuel to the international assignment fire, as Australian HR professionals seek to fill local roles with overseas talent and develop interesting career paths that will keep high potentials engaged with the business.
Managing inbound expatriates has become an increasingly important part of HR’s role, as international recruitment of both internal and external candidates in the ICT and resources industries becomes the norm. Jennifer Brinsley, mobility manager for Alcatel-Lucent Australasia, says that although her company’s outbound expatriate numbers have remained stable in the last two years, inbound numbers have tripled.
Alcatel-Lucent operates in the voice, data and video communications space, employing 2500 people in Australia and New Zealand. Ingrid Jenkins, VP human resources Australasia, says that headcount has risen 40 per cent in the last 12 to18 months because of some large contract wins in the region, following hard on the heels of a merger in December 2006.
Alcatel-Lucent Australia currently has 45 expatriates on short and long-term assignment overseas, while New Zealand has seven. Australia now has 35 inbound expatriates and New Zealand 20. Asia Pacific and Europe are both the destination and source of inbound and outbound expatriates.
Thiess, the well-known Australian integrated engineering and services provider, delivers projects in the mining, building, civil engineering, process engineering and environmental services industries.
Sandra Bell, Thiess’ corporate manager HR services, says that the combination of the resources boom, organic growth and a tight labour market has affected the number of short and long-term international assignments within the company.
Thiess Indonesia employs about 6000 employees. It has recently won a tender for an open-cut mine in Kolkata (Calcutta) where there are currently 28 employees. Thiess Australia manages 160 outbound expats in Indonesia and India and has a few Indonesians and Indians on occupational traineeships in Australia.
In the last few years, about 12 students from Indian universities have rotated through Thiess Australia, being trained to work on the project the company hoped to win (and recently did) in India.
Justifying international assignments
Jenkins says that Alcatel-Lucent has always taken a strong position promoting global resourcing, but that in the last three years or so a greater emphasis has been placed on cost awareness. “Given that international assignments are usually 2.5 to 3 times the cost of a local hire, business managers need to determine if these costs are sustainable,” she says.
“If the international assignment is a development opportunity for a high-potential employee, a longer-term view of the investment is required than if we just needed to get a particular skill set for a specific project,” says Jenkins. She warns that in the urgency to get resources on board, stringent selection processes still must be applied incorporating cost considerations.
Bell has recently noticed a different attitude in people accepting expatriate assignments to Indonesia. “You have to offer them more than a lot of money and a good contract to work there. People will move to work for good managers and to take advantage of career opportunities,” says Bell. “Having a respected brand behind you with good management teams is very helpful.”
Bell says it is important to make overseas assignments in difficult locations more attractive during the resources boom. “Over the longer term, there needs to be a change of consciousness across the business. Having overseas experience is still not a prerequisite to becoming a senior manager, but it will be in the future,” she says.
Types of contracts
The older fashioned “platinum level” expatriate packages are fast becoming a thing of the past. Brinsley says that Alcatel-Lucent has developed “hybrid contracts” over the last few years to effectively minimise the cost of an assignment to the business.
“An increasing number of people from our overseas locations have joined our operation here as local hires. Australia and New Zealand are attractive locations, so we have been able to entice people here on local contracts,” she says.
Another “work-around” occasionally used at Alcatel-Lucent is to move people on a temporary transfer, so they are paid in-country as a local employee with an agreement that they may repatriate at the end of their time away.
Bell says that Thiess is currently considering keeping people based in Australia, and maintaining an extensive travelling schedule to Indonesia.
“Despite the fact that Thiess Indonesia is registered as a separate company, we’ve found it important for its contracts to look similar to Thiess Australia’s, with terms and conditions written in the same language and with the same visual appearance. They [overseas assignees] don’t balk at signing these contracts,” she says.
Both Thiess and Alcatel-Lucent agree that the most common problem that occurs with overseas assignees happens in the first six months, if the family has not settled well. “Now with dual income families, the tradition of the trailing expat wife is being challenged,”says Jenkins. “The disruption to a spouse’s career is an additional factor to manage.”
Another common issue is the question of what happens at the end of an assignment. “Because of the experience, exposure and new capabilities gained, sometimes it’s difficult to repatriate people back into appropriate roles,” explains Brinsley. “These are the people we risk losing. Some people move on to another international assignment or end up being localised in their host country.
“Typically, if people move for the right reasons –and it’s not just a financial move – they settle well and enjoy the opportunity of living in a different culture,” says Bell. “Reconnaissance in the first six months, conducted by an immigration provider or a line manager, is important,” she adds.
Alcatel-Lucent started outsourcing its visa processing and relocation function a year ago, giving the assignees a single point of contact. “If you have more than ten incoming expatriates, it’s worth outsourcing this function,” says Brinsley.
“Understand what the costs and intent are for every assignment and make an appropriate business decision based on what is driving the assignment,” says Jenkins. “The cost of international mobility is a reality of business today.”
Bell believes it is important to streamline the administration processes to make it as easy as possible for the international assignee. “Set up contracts and remuneration (including long service leave and superannuation) to encourage the movement of people.
“Finally, be able to answer the question, ‘What happens when I come home again?’ and make sure they understand that this assignment will improve their career prospects,” concludes Bell.
A case in point
Tony Spence, marine superintendent with North West Shelf Shipping Service Company (NWSSSC), is an inbound English expatriate based in Perth. On a three-year secondment from BP Shipping UK, he represents the interests of BP, one of six joint venture partners in the North West Shelf project. NWSSSC is responsible for the management of LNG (liquid natural gas) ships owned by the joint venture.
Spence has worked at BP for 24 years, starting as a cadet in its merchant navy. He has been shore-based for ten years. This is his first long-term international assignment.
Professionally, Spence has found the work very rewarding. “I’ve had exposure to other joint venture companies and seen how they do business.
“In the UK, I’ve typically had one defined role, but here I’ve been given the opportunity to be involved in all aspects of the shipping business. It’s been different, new and interesting work,” he says.
Spence believes BP has handled his assignment well. He and his family appreciated a reconnaissance visit and being linked up with a relocation consultant at that time, so that housing and schooling were arranged before arrival.
A third party agent in Canberra processed visas efficiently, while BP’s “furniture relocation, storage and rental allowances have made life a lot easier”.
Spence suggests that one area for improvement would be a single point of contact in HR, rather than different people handling separate aspects of his relocation. “You don’t want to have to deal with lots of people handling your relocation,” he says.
“It also would have been helpful to have been given a pack which included all the allowances I was entitled to, rather than having to find them out via many different sources,” adds Spence.
A year out from the end of his assignment, discussions will start around what sort of training he’ll need for his next role. “I plan to go back into BP Shipping UK, but there are no guarantees,” concludes Spence.