International assignments are increasingly popular with talented young professionals. Lynnette Hoffman looks at the finer details of such assignments and explains how HR can get them right
International assignments are increasingly popular with talented young professionals. Lynnette Hoffman looks at the finer details of such assignments and explains how HR can get them right
Company executives often think transferring staff overseas for a year or two is as easy as searching for the best internet deals on airfares, and, abracadabra – it will all magically work out in a moment’s notice.
There’s a tendency to forget about the complex and time consuming regulatory requirements, from deciphering international tax codes to applying for visas in a post-September 11 world.
“It can be quite a tedious process. It’s lengthy and we often have to move start dates – it’s not just a matter of transferring a person and they’ll be there the next week,” says Skye Glashoff, HR coordinator at global business consulting firm Bain & Company’s Sydney office. “It takes six to eight weeks processing time. People expect the turn around to be a lot quicker, but it’s out of our hands.”
Those unrealistic expectations are a common source of frustration for many HR practitioners handling global mobility. And on top of that, many managers are unaware of the difficulties staff being sent on international assignments actually face, so they don’t understand the need for some of the additional support that can drive the costs up.
“They assume because their employees are young, intelligent professionals, they don’t need help finding houses. They don’t always understand how stressful relocating can be, even if some of the individuals have initiated it themselves,” says Catherine Brown, who looked after international mobility internally in the professional services industry for eight years and currently works with corporate firms in her own private practice.
Beyond educating staff about the realities of international assignments, however, challenges abound.
A more consistent approach
Organisations are increasingly developing more centralised policies and standards, reducing the amount of local autonomy in favour of a more consistent standardised approach, according to 2004 research by Cendant Mobility.
Brown is currently working with a professional services firm whose policies are very flexible and ad hoc, and not as specific as they could be. “That’s resulted in a great deal of anomalies and the situation arises where a number of ex-pats are working side by side under different terms and conditions. This always results in unhappy ex-pats and generally higher costs than necessary,” she says.
To combat the problem, Brown is working to create a more centralised global framework that allows for some flexibility for local managers so they still maintain a degree of influence over decision making locally.
For example, currently employees on international assignments are told they can find ‘reasonable’ housing, but are given no guidelines as to what that should cost or the type of housing deemed reasonable. No housing data were used to create the policy.
“By consistently applying housing data from external providers they can contain costs, allow local management some flexibility in terms of a range of accommodation offered and continue to provide adequate support to the ex-pats,” she says.
Ernst & Young created a global policy about 18 months ago, and despite the initial difficulty of getting key people to agree on a policy, the firm’s principal of human capital, Kathy McCombie, says it has been a worthwhile investment.
“The purpose of the global policy was to ensure consistency around the world regardless of which countries they are moving to and from,” she says. It also means assignees know up front where they stand and how they will be treated, and ensures equitable treatment around the globe. “It’s facilitated movement as well. There’s been a dramatic increase in the number of movements in the last couple of years.”
While that may be partly because of an increased demand, the global policy has also made the administrative aspects of moving easier. “Both the assignee and the management are aware of what’s involved and what the costs will be, where as before, those decisions were made on a case by case basis,”McCombie says.
Still, some companies prefer a decentralised system that allows regional and local offices to set their own priorities with little direction from headquarters, research from Cendant has found.
Keeping costs down
Employees are sent abroad for a whole host of reasons, from self-initiated travel for younger employees keen to get out and explore the world a bit, to development positions for more experienced staff, to strategic assignments for senior managers.
They aren’t all looking for the same things and don’t all require the same level of support, yet 2004 research by Cendant Mobility found that 65 per cent of companies offered the same level of support for all employees regardless of the reason for the move, while 35 per cent provided tiered support. Cendant Australia managing director Sue Latina-Cohen says it’s typical of Australian culture to take a more egalitarian approach, but it drives expenses up considerably.
Ernst & Young has minimised costs by providing tiered support, so employees initiating their own travel are given the basics, such as airfares, shipping and temporary accommodation and a small relocation allowance. They’re also paid local salaries rather than ex-pat salaries, further lowering costs. Those going overseas for development purposes are given more incentives, while the most extensive support goes to senior executives on strategic assignments.
McCombie attributes the program’s success to its transparency – young assignees receiving less support than senior executives realise they are at different stages of their careers and tend not to compare themselves in the way they would if the policy were less specific, she says.
Brown agrees: “The people who are going on self-initiated assignments are generally very happy with that because they get to keep their job, and they wanted to go away anyway.”
She says that while those who receive more support adjust faster and are therefore more productive sooner than those receiving less support, she hasn’t seen much difference in the long term results, particularly in the area of retention.
Role of IT
Global access, adaptability of technology products, data privacy, security, and business continuity/disaster recovery were the five biggest issues raised in a 2004 KPMG survey on how technology is expected to impact program operations for international assignments.
More than half of those surveyed said their organisations had invested less than US$50,000 ($66,000) in IHR technology (not including HRIS or payroll systems) in the past five years.
The majority of companies surveyed didn’t have a single common place to store international assignment information and instead housed it in HRIS or payroll and benefits systems that don’t include anything relating to families, immigration, transactions or international policy, making it hard to run assignment-specific reports and track costs.
But when it’s utilised effectively, IT can have a major cost saving role. Some companies have begun replacing face to face cross cultural training with specialised programs such as GlobeSmart, a web-based tool that provides access to extensive information on how to conduct business effectively with people from countries around the world.
Brown says people at the organisations she works with, particularly senior staff, are more keen to use computerised programs on their own time than attend face to face courses and the programs are a much more cost-effective alternative as well.
Easing in back home
Few companies have well-developed repatriation and career-tracking processes in place, and for the most part post-assignment support stops once employees are physically moved back home, according to research from Cendant Mobility.
The biggest factors in ensuring a smooth repatriation process include how much interest the home office takes in the person, and how much ongoing communication there is, rather than what’s spent upfront.
It’s not just about supporting people within the organisation, but externally as well, in terms of how they deal with their family and community, Brown says.
Few companies offer counselling or other formalised support for the psychological issues many people face when they return home to a changed world. Often the people they once worked with have moved on or are working in different positions and they’ve been left out of the loop. And the role itself is likely to have changed.
Someone who has been overseas in a senior leadership position in a small office where work has been quite autonomous might come back to a large office and find it really difficult to ‘get back into the groove’. They might stick it out for a few months and then leave, so the ROI is completely lost, Brown says.
Still, Brown’s experience working for professional service companies was that turnover was only slightly higher among people who had been away on international assignments as compared to those who had stayed home all along – and the ones who remained with the companies tended to be the high performers.
To improve retention further she’s helped implement programs that aim to increase communication and ease the transition back home. For example she has set up contact programs where someone from the individual’s workgroup regularly keeps in touch. The communication can be as simple as office gossip or keeping the person up to date on what’s happening, from team meetings to minor workplace changes.
Bain also has an established mentoring program that stays intact regardless of where in the world a person goes, and is another way to help assignees keep connected, Glashoff says.
Making sure performance reviews are sent back to the home office can also improve repatriation outcomes by keeping the person fresh in the mind of managers here and allowing them to see how the individual is performing and what they’ve been working on, Brown says. “We’ve found it helps a lot in terms of having people slotted into the right place when they get back.”
An assignee’s perspective
Six years after a temporary nine-month stint at the Vancouver office of Via Architecture, office manager Melinda Ifada is on her way back to ice hockey country, this time at the Canadian firm’s considerable expense.
While on a temporary working visa in 1999, Ifada transformed the thenerratic office into a smooth running, well organised operation with up-to-date technology in a matter of months – a feat the company has been trying unsuccessfully to replicate ever since.The company has already begun lodging applications for apartments on Ifada’s behalf, taking into account factors such as the quality of schools and other facilities nearby.
“They’re providing a lot of additional support, helping me find good schools in a nice area of town,” Ifada says. “And they’re offering a great deal of flexibility because I said I only want to work during school hours. So they’re allowing for that and providing a laptop.”
The biggest challenge Ifada anticipates will be finding an adequate support system to settle into – but so far her contacts at Via Architecture are doing everything they can to ease the transition. “They’ve even offered to babysit,” she says.
