Moving people around either the country or the globe can be highly beneficial for an individual, their family and their employer – providing it’s done correctly. Teresa Russell talks with companies that have developed untraditional but successful relocation schemes as well as employees who have felt the pain of poorly run programs
As business develops a more global focus, the opportunities for employees to work in other countries increases. Many organisations use an international assignment as a way to develop the careers of rising talent, to cross-fertilise the organisation with ideas and to expand business into new markets.
Interstate moves are also common, but the challenges around moving to another country with a completely different culture and language involve much greater complexity.
Moving employees around the globe requires a certain amount of management skill. Some organisations (and famous ones, at that) simply give employees an amount of money to get themselves, their families and their belongings to an international destination and leave all the details up to the individual.
Other companies go to extraordinary lengths to ensure that every last detail of a move is handled well – contracting in an end-to-end relocation provider. These consultants ensure that the person being transferred (and their family) has had familiarisation trips to the location, assistance in buying and selling houses, language and cultural classes, help in finding schools, employment for the spouse and using packers who do everything – right down to making the beds and providing a home-cooked meal on arrival.
Roland Orchard is the corporate HR director for WorleyParsons, a professional engineering services company in the resources sector. He speaks with some authority on the subject of relocation strategy, policies and procedures, having worked for large global organisations as an HR executive and as a past expatriate himself.
WorleyParsons is an Australian listed public company with 23,800 employees working in 30 countries and 90 locations. As only 5,500 people are Australian-based, employees are well-distributed across the world, with 1,800 working on assignment – away from their country of origin. The company has grown its workforce by more than 50 per cent in the last 12 months.
“Because we’ve been a relatively small company that has grown quickly, we have come off a base of minimal global HR systems. We have to make sure we are not too bureaucratic, but responsive to employees and can deliver staff to the projects we have,” says Orchard.
The infrastructure supporting WorleyParsons’global relocated employees numbers just five people – only two of whom are specialist expatriate administrators. One of these specialists is located in Australia because of the complexity of our local laws and visa requirements.
At the other end of the size scale is Diamond Exchange Ltd, an Australian-based, internet diamond retailer that sells diamonds, engagement rings and other diamond jewellery over the internet. The company started six years ago, employs just 30 people and has captured 5 per cent of the whole engagement market in Australia.
It has expanded to having three offices in Australia, four in Canada, one in New York and is about to open its first office in London. Although most of its marketing is done over the internet, 80 per cent of its customers come in to the offices for final selection and payment.
“We would never open a branch without sending one of our own Australian employees, because we have to be able to trust the manager with a couple of million dollars worth of diamonds,” says Johan Barry, international marketing director for Diamond Exchange. These managers run a one-person show for about a year and then hire local staff once they are sure the market will support this infrastructure.
Developing a policy
Orchard says that part of the success of WorleyParsons’ business has been how agile and responsive it is towards its customers. “Our HR policies need to reflect this and be adaptive as well. Our expatriation policies provide guidance and direction that allow local management flexibility,” he says.
WorleyParsons participates in projects in their own name, as a joint venture partner, a junior partner or just by providing a few engineers. They may have to manage their people according to who has the lead in the project. Their policies are not always applicable, as they often have to align employee conditions with others involved in the project.
Orchard says that the policy gives some guiding principles: it must be fair to the employee; there should be an incentive to go overseas, but not a windfall advantage; safety will be maintained; they will get decent living conditions, transportation and security; there will be basic equity in the treatment of all individuals at a particular location; it will be legal; and the terms and conditions of employment must be agreed beforehand.
Orchard has developed standards for an offer which are short, sharp statements that are directional, rather than prescriptive, and used by a local manager in their specific environment. “We’ve tried using other models, but they are a bit too restrictive and don’t adequately reflect how we operate. They type of work our employees are offered is their major motivator. The relocation package is not the only reason they go, but it should not be something that stops them either,” reflects Orchard.
Diamond Exchange manages a varying number on international assignments – some are gemmologists doing a six-month rotation, while others are much more long-term. “We don’t have a written policy. We operate in First World countries, so there is no need for any hardship premiums. However, we use a consultant to determine parity in wages and conditions and then help our people with the costs of searching for accommodation. We leave that side up to them and have had no problems so far,” says Barry.
When things go bad
Not all international assignments end happily – or as planned. Orchard says that occasionally if employees become disgruntled, then inequitable treatment can be a cause. He says that WorleyParsons loses fewer employees than the industry average, so he believes they have the formula pretty right.
“Any inequitable treatment has to be addressed through the local management system. They must look at what others are doing in the area, see what’s available, the level of expectation and the need. We’re not talking about leading a séance to make a decision – our managers are paid to make decisions based on reasonable judgements within our broad guidelines,” he says.
Orchard says there is no formal measurement of the relocation system in his company. “We are interested in our people and how they feel. People talk to us and give us feedback. The best measure is whether we ultimately meet our customers’ needs.”
Barry says that Diamond Exchange hasn’t had any problems with relocated staff because both the people and the destination are carefully selected. “We research the market very thoroughly and choose quite senior people to head up the operation. We’ve found that empty-nesters are more solid and relate well to their new environment. Staff members with children are reluctant to go overseas, as a rule,” he says.
Orchard says it is important to understand the characteristics of your company and to recruit people whose values fit well with the organisation. All policies will follow that and managers must be allowed to manage and do their jobs. “Blind implementation of policy without reflecting people, circumstances, environment and customer focus is not thoughtful management,” concludes Orchard.
A bad moving experience
Tiffany (alias) was promoted within the same strategic business unit of her global healthcare company to a senior role in the USA. Her business unit manager, not HR, negotiated the terms of her relocation and repatriation. No contracts were signed. Tiffany arrived in the US Midwest after organising the moving company herself.
On arrival, nothing was ready for her. Because the company had not organised a social security number for her, she couldn't open a bank account, get a credit card, hook up to cable TV or even rent DVDs from Blockbuster. "It took me six months to get everything organised before I was properly settled in. I couldn't even start a social life because I was so busy getting my house and finances sorted out. It was very unsettling," she recalls.
Tiffany had positive performance reviews, but things turned bad when she took four weeks' home leave. Her manager demanded she return early, because "four weeks was too long". This straw broke the camel's back. On the grounds that her employer reneged on the terms of her employment, Tiffany ended her assignment a year early, returning to her old job in Australia. Her company finally agreed to pay the repatriation costs, but put her on six months' probation.
"Other people in my position were getting their home leave. The inequity bothered me enormously. My loyalty to the company has evaporated. They are going to lose me because of the way I've been treated. HR needs to take control of the human capital in this company to prevent this from happening to others," concludes Tiffany.