2016 Global Mobility Trends Information Technology

2016 Global Mobility Trends for the Information Technology Industry

How global mobility leaders respond to talent mobility challenges in today’s business environment is, in significant part, related to the economic and market realities of their specific industry segment. This article focuses on companies in the information technology industry, and is part of a series highlighting key global mobility trends within certain industry segments.

Information Technology companies represent the third largest percentage of respondents (15%) to BGRS’s 2016 Global Mobility Trends Survey, and they average just under 63,000 employees worldwide.

Companies in the information technology industry find themselves in a sector that continues to expand. The increased uptake in mobile phone usage is driving up demand for product and broadband access, and telecommunications companies are making infrastructure investments to expand internet access. According to a recent study by the Economist Intelligence Unit, all this additional activity is further fueling the rise of big data and cloud computing. At the same time, competition in this industry is intense and profit focus continues to drive concentrated scrutiny of cost management. We expect these market level trends, combined with the challenges inherent in moving employees across borders, will ultimately play into the mobility trends we are seeing in this industry segment.

Specifically for the information technology industry, the survey reveals:

Companies continue to respond to normalizing cost pressures as volumes stabilize or increase

  • 75% state they were required to reduce international assignment costs last year; this is higher than the overall survey participants (69%)
  • Respondents believe that the efforts to reduce mobility program costs have had only a limited effect on the company’s ability to grow talent (28%) and on the ability to retain high potentials (17%)
  • 29% indicate that the number of full-time employees dedicated to managing global mobility has decreased; this is 10 percentage points higher than the overall survey participants (19%)
  • At the same time, 80% expect the number of international assignments to either increase or stay the same next year; this compares to 75% of the overall survey participants

Mixed cost management practices prevail

  • When it comes to providing a balanced cost-benefit analysis in support of an international assignment, more information technology companies (38%) than overall survey respondents (26%) provide one for all assignments
  • All companies prepare some type of comprehensive cost estimate for international assignments; 79% do so for all assignment types, which is significantly higher than that of the overall survey respondents (61%)
  • However, only 46% track actual assignment costs, which is lower than the overall survey respondents (51%)

Assignment adaptability is less of a concern

  • Respondents believe that only 13% of international assignees experience notable difficulty adapting to the local culture; this compares to 18% of overall survey respondents that do
  • Respondents believe that one in five (20%) leaders sent on an international assignment do not possess the skills needed in the host country; this is lower than the percentage for overall respondents (26%)
  • The inability to adapt to the host location is ranked last as a reason for assignment failure
  • Only 17% formally gauge the adaptability of international assignment candidates; this is lower than the overall survey participants (22%)

Room to evolve in aligning the role of Mobility with talent management

  • Nearly the same percentage of information technology companies (58%) as overall survey participants (61%)indicate they’ve communicated to their employees that taking an international assignment is important to optimize their careers
  • Yet, one-third (33%) say that taking an international assignment has no discernable impact on an employee’s career
  • 46% of information technology companies use their mobility policies to recruit external talent which is higher than the 41% of overall survey respondents that do
  • At the same time, only 25% have a process that allows employees to formally indicate an interest in an assignment; this is dramatically lower than the overall survey participants (67%), and the lowest by far of any industry sector
  • And 83% of information technology companies (versus 77% overall) indicate they do not have a formal career management process that incorporates international assignments

Higher international assignment attrition rates and repatriation practices

  • 42% of information technology companies state that the most common way their company identifies new positions for repatriating assignees is the mandatory identification of a job by the home country department; this is significantly higher than the overall survey participants (26%) that do and higher than any other industry segment
  • 25% of information technology companies say that the rate of attrition for international assignees is greater than for all employees; this is higher than the overall survey participants (14%)
  • Half of technology companies (50%) note the most common reason assignees leave after repatriating is that the new role does not meet expectations; this compares to 34% of overall survey participants

Despite widespread cost management efforts in recent years, mobility programs in many information technology companies continue to be subject to cost pressure. Most respondents were required to cut mobility costs last year, and nearly one-third indicate that the resources dedicated to mobility have decreased. At the same time, mobility volumes are expected to either increase or stay the same. The good news is that a significant percentage of respondents are not concerned about the effect of cost cutting on their company’s ability to grow global talent and retain high potentials.

Although containing cost is a primary assignment management challenge, the results are split with regards to having solid cost management practices in place. While a great deal more emphasis is placed on up-front assignment cost planning, well under half of companies track actual assignment costs which will affect a company’s ability to effectively and strategically reduce costs.

Assignment adaptability is less of a concern for this industry segment, which is not surprising given that the nature of assignments is often more short-term, project based. In addition, companies are using mobility to promote career optimization and candidate recruiting. However, there appears to be a gap between promoting and integrating international assignments into the overall career management process and demonstrating a discernable positive career impact.

Finally, international assignment attrition rates appear higher for this industry segment than others; this is at least in part due to the ongoing war for talent. As assignees come back from assignment they are more marketable and thus pose a retention risk. Interestingly, companies in this industry have taken a more aggressive approach to repatriation job identification. While this may allay some unease for returning assignees, companies say the most common reason assignees ultimately leave is unmet expectations in the new role. This indicates there may still be work to do in this arena.

Global mobility leaders in this industry segment will need to continue to support their business partners by meeting their company’s business objectives and managing costs smartly. At the same time, supporting talent management objectives in an industry where finding, developing and keeping high skilled and in-demand talent is critical. Balancing these sometimes competing demands will continue to require a strategic approach to information technology companies’ mobility plans and programs.