Since the outbreak of the economic crisis, there has been increasing pressure on organisations to reduce costs. Global mobility teams have not been immune from this pressure with budgets coming under threat while more is demanded of them. The global mobility dilemma is therefore centred on how to evolve to meet the needs of an ever-changing organisation and international assignee population.
The Global Mobility Dilemma
This global mobility dilemma is accompanied by a change in the profile of the international worker
It is a well-documented fact that expatriates are more than twice as expensive as local employees. While this is true it does not hold companies back from sending employees overseas – be it on a short or long-term assignment. The relentless demand for growth means that organisations must be agile and deploying skilled existing employees is often seen as the most cost and time efficient way. We could call this the Global Mobility Dilemma: there is less money for global mobility but more need for international working.
Change in profile of the international worker
This global mobility dilemma is accompanied by a change in the profile of the international worker. The traditional expatriate is a long-term assignee, going abroad for one to four years on an expat contract. This expat is traditionally male and accompanied by his wife and children. However, in the last decade trends in the profile of the international worker have changed. While still underrepresented, we now see many more female expats than before with or without a (working) partner.
PwC research suggests that the number of females taking on global assignments is going to increase further. It is also much more common to see dual careers (both partners work abroad) or even tandem careers (both partners work abroad for the same company). Young professionals identified as high potentials are more and more often sent abroad to gain international experience. The international workforce is more diverse and complex than ever.
While still underpresented, we now see many more female expats than before
Variety of International Assignments and Localisation of Expat Contracts
The global mobility sector’s response to these changing business needs and changing international workforce is to offer more variety in the type of international assignments. With cost-cutting initiatives prevalent, we might expect the number of international assignments to decrease, but research suggests that the number is on the increase.
The need for a plan B offers great opportunities for HR and global mobility to spend their smaller budget in a more targeted way
Change is visible in the duration of the assignment, though; there are less traditional long-term assignments of more than a year. The report by PwC shows that the average length of a posting has dropped to 18 months and assignments of less than a year are more and more common.
Another trend is the localisation of expat contracts; expats are no longer employed on favourable expat contracts but on local terms with local conditions. Mobile workers such as long distance commuters and business travellers spend a maximum of six weeks abroad for international projects or work on rotation.
Change of Employees’ Needs
Another trend is the localisation of expat contracts
Apart from the change in profile, we also see a change in needs from the employees’ perspective. What does the new generation of international workers want? Remuneration is still a very important aspect, but there is more.
The new international worker highly values professional support and career development opportunities. This can mean getting feedback from an older mentor as well as formalised training development programmes. Happiness and freedom are also very important coupled with flexible working arrangements, a healthy work-life balance and the well-being of the partner and possibly children.
So what can global mobility professionals do? Shortening the length of assignments or hiring on a local contract help to reduce global mobility costs. But research also shows that many expat policies do not address the current changing needs of assignees.
Standard packages should have the flexibility to offer an individual a personalised approach
The need for a plan B offers great opportunities for HR and global mobility to spend their smaller budget in a more targeted way. Expat policies should not be one-size-fits-all but should offer flexibility to spend budgets on benefits the international worker wants such as training or coaching.
HR and global mobility should no longer simply play a supporting role but should partner their businesses and provide strategic vision on remuneration packages including language and intercultural awareness training.
Standard packages should have the flexibility to offer an individual a personalised approach, so that global mobility professionals can build relationships with their international workers, anticipate their changing needs, manage their expectations and create a flexible expat policy to serve the changing format of assignments.
This plan B needs to offer solutions to the global mobility dilemma so that international workers receive the support they need despite budgetary limitations.