DANBURY, Conn., (Jan. 23, 2012) — A new survey on international mobility from Cartus Corporation, the leading provider of global relocation services, revealed that company costs, employees’ changing expectations, and emerging markets represent the three most significant challenges for international corporate relocation managers today (see Table 1 above). The survey, titled “Biggest Relocation Challenges: International Assignments,” includes responses from 116 global corporations.
Cost of international assignments, reported as a concern by more than two-thirds (68%) of respondent companies, is a consistent theme in international relocations. Respondents reported taking a number of actions related to the issue, including that almost one-third (32%) have instituted formal cost estimation and budgeting procedures on transferees, and that 21% of responding corporations have aligned relocation benefits to more closely match employees’ levels within the organization — an approach that creates different policies for different employee levels (also known as “tiering”) and can deliver improvements in the relocation spend.
More surprising than the concern about costs was the issue ranked second: changing employee expectations and attitudes. The high ranking (45%) given by respondents to this issue underscores the difficulties companies are having with identifying capable and willing candidates for assignments.
John Arcario, executive vice president at Cartus, points to the fact that employee expectations and entitlement issues are likely coming to the forefront due to a combination of factors. “Traditional benefit-laden expatriate packages are less common now because the focus on costs is making companies more savvy,” says Arcario. “Many companies are offering global assignees very targeted benefits packages. At the same time, employee demands are increasing, but they appear to vary by generation.”
Arcario points to the emergence of “Generation Y” or ”Millennial” assignees who may not yet have families and households but who have high expectations. They are very comfortable negotiating the benefits that come along with an assignment. On the other hand, Arcario says, companies are also seeing more seasoned employees who may be the best fit for the job, but who are trying to balance an international assignment opportunity with their financial concerns and the needs of their employed spouses and high-school-age children. Says Arcario, “It’s quite apparent that although tiering and new assignment types, such as short-term and commuter assignments, have led to increased flexibility, they have also created more opportunity for negotiation.”
The issue is exacerbated by the challenge ranked third among survey respondents: expansion into new and emerging locations. Based on findings from Cartus’ 2011 Emerging Markets survey, companies entering into these developing locations are faced with many issues, including attracting candidates with the necessary skills required for the international assignment and employees’ ability to adapt to a new area, both professionally and personally.
Respondents’ Future Challenges
Asked about international relocation program challenges in the future, survey respondents again pointed to costs of international assignments as the most important challenge, but their next most highly rated challenges included immigration and expansion into emerging markets, as well as workforce-related issues such as designing equitable policy packages and developing global competencies. All of these factors indicate that employee expectations will likely continue to weigh heavily in international relocation as companies balance talent management against an expanding global footprint. This is again reinforced by the survey’s finding that repatriation and career management are the first aspects of an international program that companies want to improve in the coming years.
“Despite the economic challenges companies have faced over the last few years, it has become clear how important talent management is to an organization’s long-term success,” said Arcario. “It’s imperative for corporations to invest in new initiatives to motivate, engage, and support their workforce, especially as they examine their international growth strategy.”
To download the full Cartus survey, “Biggest Relocation Challenges: International Assignments,” click here.
Cartus provides trusted guidance to organizations of all types and sizes who require global relocation solutions. Serving nearly 60% of the Fortune 100 and providing service to nearly 160 countries, we apply our more than half century of experience to help our clients with their mobility, outsourcing, consulting, and language and intercultural training needs. Cartus is part of Realogy Corporation—a global provider of real estate and relocation services. To find out how our greater experience, reach, and hands-on guidance can help your company, visit www.cartus.com; read our blog at www.cartusblog.com; or click www.realogy.com for more information.