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Firms remaining static on mobility monitoring

Published on Friday, 26 Apr 2013
Phil Stanley

Although a lot of companies are still feeling the pinch of economic uncertainty, many continue to invest in international assignments, according to Mercer’s recent Worldwide Survey of International Assignment Policies and Practices report.

The study, which looks at expatriate trends around the globe, found that over the past two years, there has been an increase in the number of international assignments worldwide.

This trend looks set to continue for the next two years, with survey respondents expecting their short-term international assignments to go up 70 per cent, compared with a 55 per cent rise in long-term assignments.

Anne Rossier-Renaud, principal in Mercer’s global mobility business, says that the duration, type and patterns of international assignments are becoming increasingly diverse.

“This is necessary to meet multinationals’ evolving business needs, as well as the aspirations of a global workforce. As a result, mobility and HR directors now face great complexity in the number and type of international assignments that need managing,” she says.

The survey suggests that the root of this complexity lies in the fact that two out of three employers have no specific tools to track and manage assignments and their related costs.

Meanwhile, only 6 per cent of multinationals use metrics to monitor assignments, and only 2 per cent of survey respondents have established how to determine the return on investment for their assignments. This implies that companies are struggling to calculate the value that international assignments bring them and their expatriate employees.

Rossier-Renaud says that without a clear tracking system in place, it will be difficult to both calculate and understand how to maximise the value of the return. “A balance needs to be found between cost, the value of the assignment to the company, and the value of the assignment to the employee,” she says.

Nevertheless, 39 per cent of respondents said that employees with international experience were promoted more quickly.

Offering justification for these fast promotions, Tiffany Wong at Robert Walters Hong Kong says that many expatriate assignees are people who have been identified by management as the next in line for senior positions.

“These are high-potential employees, hence before taking on an international assignment, they will already have had their career path within the organisation company mapped out,” she says. “They are usually promoted on their return to headquarters.”

Phil Stanley, Mercer’s global mobility centre of expertise leader for Asia-Pacific, agrees that posting employees on overseas assignments is a strategic way to encourage talented staff.

“Relatively low pay increases in some regions, and pressure to attract and retain talent, have spurred many firms to embrace a wider range of global mobility strategies to incentivise their high performers,” he says.

Although the pre-assignment competence of these expatriates can be seen as the reason they receive promotions, important skills and experience will certainly be picked up overseas as well, Wong says.

“These employees will gain international exposure and increased recognition from management,” she says. “Assignees will get to know local employees and their culture personally, which will be of great benefit when implementing local company policies or structural changes and will enable them to provide better advice to top management.”

The benefits of expatriate assignments are, of course, reciprocal. According to Mercer, the top five reasons companies implemented international-assignment programmes were to provide specific technical skills not available locally; to support career management and leadership development; to facilitate knowledge transfer; to fulfil specific project needs; and to provide specific managerial skills not available locally.

China ranked third on a list of global mobility hotspots, with 41 per cent of respondents expecting to increase assignees there. Additionally, of the top eight hotspots, five were in developing nations, which indicates that companies are focusing international assignments on fast-growing emerging markets, many of which are in Asia.

Kate Harper, director of banking and financial services at Connected Group, has witnessed the growing interest in Asia firsthand. “As more financial-services businesses commit higher levels of investment into Asia, it is increasingly important for management teams in global hubs to understand the region. I therefore believe that employees with Asia experience will be increasingly sought-after,” she says.

Mark Enticott, managing director of Ambition Hong Kong, says that a company would always rather use the talent they have within the business than look to external hiring.

“Before paying a fee to an external recruitment firm to source talent, companies should look internally to see if they might have the required talent internally,” he says. “In terms of internal mobility, giving people an opportunity to dip into different roles or different countries to cover business needs is the right approach – but companies still need to weigh up whether that person is right for the role or not.” 

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