C ompanies often take a “living in the moment” approach to running global mobility programs. At many organizations, decisions about global mobility policies and processes are based largely on whatever state the world economy is in at that time. When a sunny economy prevails and a struggle for talent ensues, the emphasis is on recruitment and retention. As economic storm clouds roll in, cost management takes center stage, and organizations can find themselves dismantling, often haphazardly, the global mobility programs they worked so hard to build in better days.
While living in the moment might seem like a correct response to economic realities, your organization can take a better approach. Rather than merely enabling your global mobility program to react to changes in atmospheric conditions, you can design the program to anticipate any such economic shift before it occurs.
The problem with the prevailing way of doing things
Global mobility programs can be considered analogous to a business’ supply chain. During the recent recession, many manufacturers experienced both a cancellation in existing orders and a substantial drop in the volume of new orders. As a result, some companies temporarily shut down their manufacturing capacity and permanently closed some of their factories. In the short term, such moves may appear to be good business practice. But what will happen when the economy makes a solid comeback and customers start placing orders again? The lead times for producing goods can be substantial. How quickly will companies that shut down factories be able to bring sufficient manufacturing capacity back on line? How will such companies respond to customers’ demands—and how will they compete?
An organization’s global mobility program is a key part of the supply chain for talent management. Unfortunately, many organizations are reacting to the economic crisis by temporarily shutting down some parts of their global mobility programs and permanently closing other parts. By casting aside key components of such a program and the policies, processes and human and technological infrastructure behind the program, an organization hinders its ability to aggressively pursue global talent management objectives when the economy decisively rebounds. Simply put, when global talent management objectives are not met, the broader strategic objectives they support become more difficult to execute.
In good times, organizations in sectors where the fight for talent is particularly intense tend to create fairly robust (read “expensive”) global mobility policies and processes. This may be necessary in corporate cultures in which throwing money at international assignees is expected and allows organizations to be competitive in recruiting and retention. (And by throwing money at assignees, we are not just talking about cash incentives; but also referring to “softer” benefits, like pet shipping, top-of-the-line housing, covering expenses for both exploratory and house-hunting trips and extensive language and cultural training programs.) However, in good times, many organizations often fail to plan for the inevitable fact that the economy will ultimately turn down again. And when the downturn does come, a global mobility program that is burdened with expensive cash payout obligations and HR staff may become unaffordable.
Characteristics of a global mobility program built for all economic cycles
To be successful, a global mobility program must be aligned with and support the organization’s overall philosophy, culture and strategic objectives. The program’s provisions must make sense for assignees, taking into consideration their demographics and values. And the organization must clearly communicate the program so that it makes sense to assignees and all other stakeholders.
Too many organizations fail to recognize that there is another imperative for a global mobility program: To achieve lasting success, the program must be able to quickly shift gears when an economic change—upswing or downturn—is on the horizon. It can’t make those changes after the slide or climb is already under way. To get to this desired state of readiness and resilience, a global mobility program must have the following characteristics:
Alignment with the organization’s talent management philosophy: The organization should clearly define its talent management philosophy and ensure that its global mobility policies and processes are aligned with that overarching philosophy in good times and bad.
Multiple global mobility policies: Any organization with an assignee population should have at least four separate global mobility policies and corresponding sets of processes: a long-term international assignment policy, a short-term international assignment policy, a localization policy and a tax policy. Basic guidelines should be sufficient for most of these policies, especially for small programs. But a tax policy should always spell out exactly what will happen to the assignee from a tax perspective. Having appropriate multiple policies in place will set expectations for the organization and assignees.
A clear and consistent process for approving assignments: At least one person at an appropriate level of leadership should have authority to sign off on assignments. The approval process should always include the preparation of an assignment cost estimate, including home- and host-country tax costs. Few things are more important—in good or bad times—than understanding and anticipating the cost of an assignment. In good times, the organization can better understand the full amount of its investment in the employee and evaluate whether it is deploying the right person from a financial standpoint. In down times, the organization can budget for the cost of the assignment or determine whether the assignment is truly necessary.
A clear and consistent process for approving exceptions: The decision-making process for granting or denying an exception should consist, at the very least, of addressing the following questions:
• What is the exception?
• Who is requesting it?
• Why is it being requested?
• What is the dollar value of the exception?
• Has such an exception has been granted before?
• What will the precedent considerations be if the exception is granted?
As with the assignment approval process, at least one person at an appropriate level of leadership should have authority to sign off on exceptions.
Clear objectives and ongoing monitoring of whether objectives are being met: Before an assignment letter is drafted, the organization and assignee should agree on, and commit to, the assignment’s objectives. (And any organization that hasn’t followed this practice in the past should start now by examining current assignments to determine whether objectives have been defined.) Once objectives have been set, progress toward them should be monitored.
A framework for determining who should be deployed on assignments: The organization should address such questions as these:
• Given the demands of the assignment, what level of employee should be deployed?
• As a way of creating a great opportunity for development, is there someone at a lower level who could do the job as effectively?
• How efficiently will the chosen assignee be able to do the job?
• Will the job get done more quickly if we send someone else instead—perhaps even a local person?
An open line of communication with leadership: At all times, the team responsible for the global mobility program should be in contact with the organization’s leadership. This will allow the team to have a clear understanding of the organization’s strategic, global objectives. At the same time, the team will be better able to secure leadership’s support for the program.
Ongoing communication with assignees: Both the organization and the assignee invest heavily in an international assignment. The organization invests time and money, and the assignee invests the personal sacrifices involved in relocating to a foreign country. Ongoing communication between the organization and the assignee improves the likelihood that both parties will realize a significant return on their investment.
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