This article is based on the Linkedin Live session from the xpath.global series of live talks on global mobility topics. You can watch the entire series here.
The session “Global mobility – containing costs while adding value” focused on one pervasive and burning question in the global mobility industry. How can corporate mobility professionals deal with the ever-changing and constant cost challenges while 𝐚𝐝𝐝𝐢𝐧𝐠 𝐯𝐚𝐥𝐮𝐞 for the business and keeping the employees happy that will lead to a higher retention rate?
Together with expert HR and global mobility expert guest speakers, we have explored how global mobility professionals could identify cost-effective options with a focus on employee satisfaction. Moreover, how to create efficient global mobility programmes that meet the needs of all stakeholders.
Jill Johnson, Global mobility senior manager, BD
Rohit Sharma, Global HR Delivery Leader, Tata Consultancy Services
Daniela Teodorescu, Customer Success Manager, xpath.global
Liis Tonisson, Head of Global Mobility, Bolt
Jill Johnson. I think we continue to see downward pressure on global mobility programs. I mean we’re headed into a recession, we were just talking earlier about the Wall Street Journal giving the list of companies that are laying off workers, so we are a US-based company and we’re definitely feeling that. But I think that that trend has been happening over many years of trying to find ways to contain costs.
We were talking about the dichotomy between the war on talent and needing to attract and retain the best and the brightest in our companies. At the same time, we’ve got this cost containment pressure. We have moved to the core flex solution and that gives us the ability to ensure that we’re treating associates equitably, in the core, and at the same time, providing flexibility.
I feel like we’re well positioned, but even so, we’re going to continue to see that pressure. We’ve gotten away from long-term international assignments in most cases. We have LTAs exclusively in Switzerland. Everywhere else we’re mostly using commuters, short-term assignments and other types. In the US, which is our largest destination, we’re bringing in primarily one-way moves.
Liis Tonisson. As an overview, I say definitely some things have changed compared to a couple of years back. We have our main hubs and we relocate people there. Given all the recent layoffs, we’re trying to find the people who have already relocated to those countries and we offer them a job.
We’re not only relocating, but doing a lot already in that country. For instance, let’s say some people relocated only three months ago and they were made redundant. It might happen that all their documents are still being processed. They don’t know what exactly will be happening, so if we hire them up from that point, we also offer them a different kind of support.
Rohit Sharma. I would say that by approaching mobility as less a transactional function and more of a dynamic strategy is essential. Thus, leaders can really unlock ways to cultivate the company culture and achieve sustainable business goals. These times are more challenging as we see many layoffs and big companies are announcing them every other day.
I think it’s important that we maintain a level of cost optimization. We need to make sure that you have all the right facts right and we explore the possible compensation approaches, find cost savings in the balance sheet and most importantly put some cap allowances, which are very much needed. Sometimes you don’t realize you end up going ahead of what you had already projected for your expatriates, LTAs, STAs, so it’s important that you balance that cost of living.
I believe it’s also essential that we implement metrics and key performance indicators ahead of time and monitor those KPIs and see how we balance that. There should be something like clawback clauses in the policies related to costs. Sometimes expatriates don’t find the assignment very beneficial, so they go back and end the assignment. But the company has already invested, so there should be some policy amendments in place. We add it to the policy and we explain the policy benefits to employees, we also explain that there’s a cost associated and we expect some level of maturity and sensibility on their part.
Daniela Teodorescu. I do recognize the need for managing costs, but from the expat point of view what I noticed is that most times an expat would appreciate some things that are not related to money. It’s not just about the bigger the benefits package the happier you are.
Sometimes for example you appreciate more the flexibility of support systems that doesn’t really cost you anything. I think it’s really important to not lose sight of that and I truly hope that companies can focus on those elements that are valued by expats that aren’t necessarily generating additional costs.
Daniela Teodorescu. I can speak from my experience and the experience of the friends that have relocated at the same time as me. For me, the biggest one would be transparency. Transparency even when it comes to costs. Companies do projected costs of living to calculate the benefits package and they look at the cost of living in the host country to understand whether a pay supplement is needed or not. However, in my case, I didn’t see the result of that. No one has shared with me any specific information. They did not tell me “hey, look, by the way, these are the expenses that you should expect in your host country”. I think it would have really helped me.
What happens with most expats and what I and most of my friends did was to go around the internet and search, you put up a million spreadsheets, and everyone comes up with their own figures and perceptions on costs.
I’ll be honest with you: I almost turned down a job to relocate to the UAE because of this fuss around not actually knowing what the true costs were. Some people were telling me ‘You’re not going to be able to live with that salary or this benefits package”. It turns out that was not the case. When I went and had my look-see trip and I actually got around to collating the true information, I realized that not only was I able to live off that money but also save some.
If you have that information as a company it’s important to share it. I was so surprised to see that xpath.global actually help you with this through the Expat Resource Management tool on the SasS-enabled marketplace platform. This is exactly what the tool allows you to do: it helps you to see and compare the cost of living, to understand all of these elements. You’ve got that information there, at the touch of a button to just share with your expats. I think that makes a world of difference.
We’re talking about relocating with partners, with families, who in most cases don’t move at the same time as their partner. It can be tough. Showing flexibility and telling your expats up front that you understand their situation is paramount.
In terms of flexibility another cool thing that I realized xpath.global offers and I wish I had it back then is the flexibility in regards to picking how to spend the relocation allowance. It gives expatriates the possibility to choose whatever support services they believe are right for them. Should the companies decide to give employees a budget, a lump sum, etc, expatriates can cherry-pick how they want to spend it. I think this is really valuable.
And then, surely you want an expat to have a great experience, therefore make sure you’ve got competent service providers you’re working with. Communication channels are very important as well – you’re collating a lot of information, sensitive data, documents, critical information for the immigration process, etc. It all needs to be managed in a nice and neat way, otherwise, it can cause confusion, and stress for the people managing it and everyone in the global mobility process.
Jill Johnson. We’ve definitely moved away from that one-size-fits-all in all areas, not only mobility but also the overall Total Rewards benefits approach. We recognize the diverse needs of our associates. Being able to tailor solutions to each individual associate I think is essential.
But flexibility for flexibility’s sake is also not smart. You have to know when to offer flexibility. For example, you’d want to have flexible options in your long-term international assignments or your one-way moves. But if you’re doing something like a project and you’re moving people on short-term assignments or frequent business trips, you really need to have a more prescribed methodology. The need for various policy types is important, but you don’t want to overdo it. It’s like finding the right mix.
We’ve moved to the core flex and our policy is structured on three pillars. You have the core, you have a business choice and you have an associate choice. We have equity in the core – let’s say you’re going on a one-way move from Dubai to the US. We would ensure that everyone has the core, meaning the things that we see as essential, as a duty of care. Things like household goods or house hunting trip – basic services. Then we have some sort of icing on the cake which becomes discretionary to a certain extent. Here we make recommendations to the business based on the facts, patterns, the rationale for the move, the strategy of the move, etc. We make sure that we really understand the entire picture, like 360 degrees. Making good recommendations is essential. I don’t think there are any one-size-fits-all. I think every company is different.
Global Mobility should be regarded as a strategic function. A part of the total rewards strategy to attract and retain talent and build your culture.
We’re aiming to be the destination for top talent in med tech and we’ve consistently been a top employer. Most recently in 2022 we were voted as one of the top employers by Forbes. It’s critical for us to remember that as HRs we’re the torchbearers of the organizational culture. One of our primary roles is to educate businesses. At BD we really pride ourselves on having a culture focused on care. We have a reputation in the marketplace and we have a brand that we’re building.
Liis Tonisson: I would say all these are very important, sure, but there are so many things that are also very relevant and have little or no cost at all. Relocation is a really big part of the pre-boarding, and onboarding processes. Once those two steps are done then we want employees to stay in the company and be happy. We try to be as flexible as possible with the things that don’t always have a cost attached. Things like people feeling they’re part of a community and that they have been heard. If they have pets or kids or a sick partner, they need specific and customise support.
Even if we had never faced these issues before, we’re standing by our employees and try out solutions that really matters to them.
Jill Johnson. I think the move away from traditional long-term international assignments and the use of one-way moves for sort of permanent moves. Generally, I think most companies thought that you can move someone much more economically on an international one-way move as long as you’re taking them off from their home comp & ben and transferring them on to the host country. So if it’s three years or longer we can consider that as a one-way move. Even though we may have an associate that is coming, let’s say, to the U.S for 3 years and we know the intent is to move them again, we would still put them on an international. We always think that we don’t want to disrupt their wealth accumulation, or take them off their home benefits, etc. There are all sorts of challenges with that.
It used to be something like “OK, here’s the policy, you get everything”. You know that those days are gone. Moving away from one-size-fits-all and recognizing more the diversity of our Associates led to a much more agile approach.
We also saw a big increase in personal moves – people for example following their spouses or partners and requesting to work from different countries.
Jill Johnson. In my company generally, people are pretty motivated to relocate, but there’s always key talent that you need to move. And usually, they’re very savvy, they’ve crunched the numbers, they know the policy and they’ve talked to everybody. They will certainly negotiate.
The Dubai – US example is a good one. You have someone coming from a jurisdiction where there’s no income tax and they’re coming to the United States where they’re going to be probably pretty heavily taxed. They’re making a high salary and afterwards, it appears that they have a lower salary or a different salary. So we might get some negotiation and so we would definitely look at doing a full analysis to see what the net take-home pay is vis-a-vis the home location.
Perhaps offer them a two-year step down: it could be a cost of living allowance, an education allowance if they have kids, or a housing allowance. Something they need and provides a soft landing into the new structure.
Liis Tonisson. As we relocate mostly to our HQ in Estonia, for us it has always been a bit difficult to attract people to move to such a small country. Currently, as Europe is fighting a talent war, all the big countries want the same people, so it’s Tallin versus Berlin or Barcelona. I guess it depends on your tastes.
In our case it has helped a lot that we have an in-house team that is really hands-on. People who maybe have gone through the relocation process before in some other company are worried once this is over they will be left alone. But our team plays a very important role right from the beginning, from the recruitment phase. We know that no matter what phase the relocation process is – we are always there to help employees with all the questions they might have. They know that even if they have some questions after 2 years after their arrival, they will always have a person to go to. This is such a big value for them.
I know people that felt a bit lost once the relocation process was over – because not all companies have a dedicated in-house person to support them. We try to be really there for them and let them know that we’re there to help them.
Liis Tonisson. It’s a bit different in our case as we have everything in-house. We have a really big part of the relocations to one single country and it made sense to build an in-house team. Definitely, this is an important cost-saving because we all know how much international relocations cost.
I think it’s really important to find good partners, like travel or accommodation providers. If you’re a good client with many relocations coming up, usually it’s possible to get special prices. I would say usually it’s good if a company has some main locations for the relocated population, because if you’re relocating to all different places then it’s hard to have good deals with partners. But if you just have a few countries and hubs then it’s easier to have partnerships which will help in the long term a lot.
Rohit Sharma. What we have seen in the past year and a half is that in many situations remote work is a viable alternative to physical deployments. Many companies started exploring this option and its long-term potential. Furthermore, I would say that employees’ priorities and expectations have totally shifted during the pandemic. Working remotely has more flexibility and allows for more time at home with family, it’s a very important factor.
But dealing with the costs and the paradoxes of international salary structures, when making comparisons between countries we often talk about low-paying and high-paying countries. In a low-paying market, it can be a useful simplification for the purpose of discussion. But the simplified view doesn’t stand up to the deeper analysis into salary structure. That’s the evolution of the salary curves that has multiple consequences for compensation management. If we talk more practically, I think you can have a more structured way to offer a package in terms of costs, be it a relocation allowance or a hardship allowance, utilities, or housing, as just mentioned. You need to structure it in such a way as to be the right balance for the employee and the employer.
We have to hear the concerns of the employees and see how we can introduce something that can solve their needs and hardships. At the same time, it becomes very difficult for the employer because there is always a defined budget. There is always a defined financial aspect within which the entire framework of the company works from a mobility standpoint. It requires a lot of deep dive analysis, hearing what employees’ requirements and concerns are. We need to regard global mobility as one of the most important retention tools out there.
If you don’t hear the employees you end up losing them. And then you end up reinvesting and hiring a new employee. And this is very expensive, it’s a much bigger cost than retaining employees.
Daniela Teodorescu. I guess one that I wish I had was the transparency of the assignment timeline and that included the partner support. I understand that moving to a different country implied a lot of processes, lots of different actors and many tasks between various people, but that information was not available to me as an expat. So I would always pester HR with emails and questions, which was very time-consuming for me and surely for them as well. You know how we keep saying time is money, well I hated knowing that I was wasting people’s time asking for constant updates. But you want to be in the know when you’re moving abroad.
This is where I resonated with xpath.global because I saw all of this embedded in the platform and I remember asking myself where was this when I needed it a few years ago! For me, it’s all about transparency and partner support as well.
Jill Johnson. I think it does go back to seeing Mobility as a strategic function. As an integral part of your total reward strategy and your duty of care, what is your culture about.
My company it’s very old, it’s over a hundred years old, which is old for the US, maybe not in Europe, but it’s been around for a long time. We have this kind of old-world culture of caring for our Associates. Doing the right thing is really paramount as well as ensuring that everyone feels cared for. We’re striving to create an environment and a culture where you can win and you can grow. Just keeping that in mind and seeing yourself in that light I think really helps.
And then having the right structures in place to support what you’re doing is critical. You need great partners and transparent communication. It’s key to also stay closely aligned to the business, but also to your HR business partners, talent acquisition partners.
One of the things that I did was to create something called the Development Council as I manage all of the development moves. We have about 10 different groups that come or are attracted into the organization, such as engineers, procurement specialists, etc. These are our high-potential talents. So I formed a council with all of the HRBPs and all the Business Leaders and we come together quarterly. We talk about Mobility, we get their feedback, their input. They are an integral part of everything that I do and I let them have their say. Afterwards, I design the programme around that, obviously within the framework of our policies. It has been extremely successful. If you can get that alignment and engagement with the business, you can’t lose.
Liis Tonisson. I would say this role is really important. You don’t even have to like figure it out on your own because surely all companies have some kind of employee survey where they’re collecting the data. You just need to add some relevant questions for the relocated employees and understand what is missing and how satisfied they are. Don’t forget that once the onboarding is over, you need to have a community inside the company as well. You can’t hope that they find a community outside the company. They have expats colleagues right here.
You can have community events, which are really important as they can be informative and educational. The off-boarding is really important too. If they’re choosing a new employer in the same country, then it can be easier. But if they’re leaving the country then there are also some tasks that need to be done. I don’t think that they should be figuring it all out on their own. If we relocated them here, we should also be helping them when they’re leaving.
Rohit Sharma. I’ll put myself in the shoes of an assignee and take my example when I was on a short-term assignment to the United States back in 2017. Everything was very clear and the company I was working for had a very detailed policy. However, I still found that the interpretation of the policy was not there. I think the approach to Mobility allowances needs to align with the Global Talent needs and the objectives of the Mobility Program.
Offering a Mobility allowance can be a very effective way by which the company can attract the best talent. When as an assignee you make that move from your home country to a host country your first expectation is to be given the best of guidance. In terms of where you would be living, what a normal day would look like, how to get a driver’s license and other compliance-related activities. So I had that level of support and assistance.
But, speaking of transparency, when things change from a bigger picture perspective – jurisdiction-wise or governmental – when you land you have no idea how things will be shaped in six months or one year. We may start overthinking and it might affect our mental health. Because we’re already balancing a lot of things at the same time: families in different time zones, job tasks, etc.
I think it’s important that there must be more opportunities, like the one offered by path.global, that give a complete level of transparency on all levels of an assignment. It’s important to have forums that connect employees, they go and talk and get updates from each other. Not just attending the networking sessions about the work going on.
Jill Johnson. I think there’s going to be continued cost pressure on mobility programs and we’ll see an increase in the volume of moves. We’ll be challenged by the business to provide a better experience at lower costs and there are going to be trade-offs.
Top of mind for me would be to remain laser-focused on the overarching goals of the organization and what the business needs, to look at fact patterns and ensure that we’re taking that complete 360 degrees view so that we can best meet the needs of all stakeholders.
Daniela Teodorescu. I believe that with the right support, right partners and the right tools companies will strike a good balance and they’ll find a solution.
Liis Tonisson. I agree. Companies are in different phases and they are experiencing different steps of the process. I believe that what the last few years have taught us is that no matter what happens – if we want to make it work, we’ll make it work. So we continue with the same line of thought.
Rohit Sharma. There are no two relocations ever the same. It’s a fast-changing world and we see it’s more of an employee-centric era. Remote work, work from anywhere and flexibility, in general, are essential. Such arrangements are a win-win: the employer is not having a lot of costs and the employees are happy from an experience standpoint.
Many thanks to all of the speakers who took part in this live event. If you’d like to watch the entire discussion, please do so HERE.