How to balance the biggest relocation challenges

Given the current economically challenging times, the notion of costs being the number one concern of international assignments is to be expected. However, apart from this finding, the Cartus 2012 Biggest Challenges survey points to a number of other key challenges and suggests that relocation managers are in constant strive for balancing these competing issues.

As already mentioned, looking at the current challenges of international assignments, cost is reported as the major concern (67.8 % of 116 responding companies). Next, employers and relocation managers seem to be concerned with changing employee expectations and attitudes (45.2%). This trend emerges from changes in demographics of assignees and assignment locations, as well as an ingrained sense of entitlement. I suppose that the reported need for change in expectations and attitudes links with the changing face of expatriation. Today, more than ever expatriation is seen as a logical career step, a possibility for personal and professional development, and an integral part of the globalized world, which shifts the perception away from the traditional view of expatriation as an ‘eccentricity’ that is compensated with generous remuneration packages and extra benefits. Likewise, an increase in emerging assignment destinations (usually in developing economies) also contributes to the changes in expatriate conditions. Relatedly, expansion into new and emerging markets was reported by 40% of respondents and accounted for the third-ranked challenge. Naturally, companies entering into these developing locations face many issues, such as attracting suitable candidates and adapting to the new areas.

Interestingly, compared to the cost management topic, which tops also the future challenges list, the talent management topics of employee retention and development are far less important in the list of current challenges. However, in contrast to the current situation, for their future outlook companies ranked such issues as developing global competencies and linking mobility to career development among extremely/very important ones. Moreover, the Cartus report shows that repatriation and career management stands first within the areas that companies want to improve.

These results show some balance between current and future challenges in a sense that the topics being overlooked now become more prioritized in the future.

A similar pattern of changed priorities may be seen when analysing data on the strategic steps that companies already have or consider taking. In line with the cost-control environment the companies have mostly implemented formal cost estimation and budgeting policy changes (31.8%). The second key change reported was tiering (20.9%), which is meant to align benefits more closely to the employee’s level, and thus may also potentially save some benefit associated costs. Echoing the reported current and future challenges, the three lowest-ranking changes in current implementation phase are the three highest among the changes under consideration. More specifically, although not implemented yet, the companies consider making some changes in regards to candidate assessment, repatriation and talent pool development.

These results imply that although today companies are mostly concerned with cost management issues, other international assignment-related challenges, while being in a shadow, still remain on the radar. Naturally, at some point one or another issue will be more prioritized, but focusing only on the current issues may jeopardize the overlooked areas. The Cartus professionals argue that the increased significance of currently overlooked areas in the future prospects reflects companies’ awareness of such risks. In a sense all aspects of international assignments are interrelated. For instance, when cost management is done at the expense of such supporting functions as employee cross-cultural development or adjustment programs it may have a negative impact on the assignment outcomes, which directly relates back to its cost effectiveness. Hence, the Biggest Challenges report suggests that although focusing on different issues at different times, companies strive to develop effective programs that would address the continuous challenge of managing often competing issues of cost, talent and emerging markets.

One thought on “How to balance the biggest relocation challenges

  1. I think the key is managing expectations and ensuring that employees know these reasons why budgets may have dropped or workloads increased. I’m not suggesting you have to be accountable to your employees but a bit of knowledge can be a powerful tool, as it will give your team a clear sense of how the company is going to develop and how they will fit into the future of the company. Uncertainty is extremely detrimental so through a relocation project it is important to talk to your team regularly and help them to understand why priorities have changed.

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