Why does it matter?
Sending the right people, to the right place, for the right cost constitutes more than ever a skillful balancing act and leads companies to use flexible and innovative solutions.
Given the urgent need for a global talent, why do so many global mobility programs fail to achieve both business and assignee objectives? How can companies ensure that their programs are hitting the right notes while remaining cost-effective? How can they support broader HR strategies and maximize global talent? One way is by establishing a good expatriate policy.
Behind every successful global mobility program is a well-thought-out policy that addresses business objectives, assignee expectations and market opportunities. But formalizing a global mobility policy takes time and careful analysis. The best policies read like a roadmap, connecting objectives with actions and actions with outcomes. They integrate best practices into an organization’s overall culture to keep programs competitive and market responsive, linking mobility with talent management and reward strategies.
While many companies have developed global policies, albeit in an ad hoc fashion, they often haven’t road tested them in a while to see whether they are achieving business objectives
Assessing the Need for Change
Companies need to perform a periodic diagnostic health check on their policies to determine whether compensation and benefits are consistently aligned with the company’s business needs, the recruitment and retention strategy, and career development objectives.
Typical issues behind the need for change:
A general perception still exists that expatriates are too costly and that local management face challenges in understanding expatriate salaries. Also, because costs and business objectives aren’t always transparent, companies should think in terms of value received as opposed to focusing solely on cost.
Compensation & Benefits
Some assignees view their packages as not competitive or aligned with market opportunities. Given the growing demand for qualified global workers, it’s a given that expatriates will compare their compensation packages with those of their peers. Gaps in compensation and benefits can be due to an out-of-date policy or assignees’ lack of understanding of their packages’ true value.
Without a cohesive, consistent mobility policy, employees may think they can negotiate whatever terms they want. This perception could reflect unclear policies or a misunderstanding by the potential assignee of the expatriate offer, or it could signal a lack of central control or governance.
Recruitment, Retention & Careers
A prime reason for establishing a global mobility program is to allow companies to access the best talent, so mobility packages must be competitive in order to retain workers for an assignment’s duration. Many companies experience a high turnover among assignees in the long term, making it difficult to find suitable candidates who will remain in a program and achieve business objectives.
Sometimes there is a discrepancy between what assignees perceive the program to be versus the reality. For example, assignees may be reluctant to accept assignments because they think that working abroad may put their careers at risk – when management may in fact perceive foreign assignments as career-building. Or they may perceive that expatriate management is disconnected from talent management and career development.