What’s on the Global Mobility Policy Horizon? Innovative Programs to Meet Business Needs
In most globally successful companies, global mobility is no longer considered a transactional benefit delivery function but, instead, is operating in a more strategic manner and in tandem with the company’s key stakeholders. As companies continue to move employees across borders to enable global growth, talent mobility has become a key contributor to an organization’s overall success.
According to BGRS’s 2016 Global Mobility Trends Survey, the top way in which global mobility leaders can ensure that their team is having an impact on overall company success is by making sure that the mobility policies are aligned and support business needs. In today’s rapidly changing global business environment, mobility is keeping pace by developing and implementing new and innovative benefits and features to their mobility programs. In this article, we examine today’s mobility policy landscape and then turn to the future, taking a closer look at what changes global mobility leaders are making to their mobility policies and programs.
Today’s Mobility Policy Suite Landscape
So what does the current mobility policy landscape look like? According to the survey, 53% of companies indicate that their international mobility policy suite structure contains a set of policies – such as a single long-term assignment policy, short-term assignment policy, permanent transfer policy, etc., – that apply equally to all employees. The policy benefits are largely dictated by the type of move taking place (temporary versus permanent) and any related time frame (over 6 months, 12 months, etc.) versus any other type of criteria. These types of policies are generally global in nature and help reinforce a strong global mobility framework.
Even if over half of the companies have this singular, global approach to their mobility policy suite as the survey respondents do, there are signs of change on the horizon, with some companies taking a more complex and nuanced approach. Specifically, according to the survey, 28% report some sort of segmentation in their global mobility policy suite. This segmentation can be based on business reason, employee level or some other criteria. In addition, another 15% report their global mobility policy suite is best described as core/optional, or having a core set of required provisions that apply to all employees and additional optional provisions that may be offered to some employees based on need and/or approval. Taken together, this means that 43% of companies report they have some type of segmented or core-optional policy suite structure in place. These types of policies offer more flexibility to the hiring manager who is sending employees on assignment but also, in some cases, to the relocating employee and family. These types of policies also balance this additional flexibility against having a set of mandatory provisions, which serve to make sure that the controls are in place to ensure the mobility program remains compliant.
Innovative Programs or Policies
If this is the current landscape of global mobility policies, what does the future hold? In the survey, respondents share a host of new or innovative mobility programs or policies that they had recently implemented or are actively considering implementing in the next 18 months. Although types of policies mentioned by respondents vary widely and reflect the diversity of their companies and themselves as leaders, there are clear links between these new programs or policies and the current business environment. In addition to being aligned to the business environment and company objectives, mobility policies should also ideally be designed to address each company’s unique international assignment management challenges. Here, too, there is a strong connection between the new policies and programs companies are putting in place and what they report as the top international assignment management challenges facing their mobility programs.
According to the survey, respondents indicate the most challenging factor for managing international assignments is compliance and risk management, and it is clear that many of the new policies and programs that global mobility leaders are implementing are designed to shore up mobility compliance in their company. Over the last several years, extended business travel has risen in importance in terms of a potential compliance risk, and companies are actively engaged in finding solutions to address this risk. In many cases, the global mobility function is often seen as a source of expertise, solutions and process controls as a way to ensure compliance for these mobile employees, especially with respect to tax and immigration. As such, when we asked companies to describe new or innovative programs there are examples of companies reassessing extended business travel trip guidelines to cover assignments based on new tax regulations or revising and making their approach to per diem payments consistent in order to shore up centralized control of these critical assignment types.
In addition to business travellers, respondents also mention developing new or innovative programs designed to address commuters, such as instituting a regional European Commuter Policy as well as developing various in-country commuter policies. Having guidelines in place for employees that commute to work across borders on a regular basis ensures the right level of tax and immigration scrutiny is being applied to minimize any unforeseen risk exposure. Other companies mention developing country or region specific policies that have special provisions that may apply in that location only. These policies help make certain that governance and oversight exists not only at a global level but also at the local level as well. Another example mentioned was the engagement of a global employment company, which, among other benefits, can help drive broad reaching consistency and compliance throughout the wider hiring and benefits process for cross border employees.
The Pervasive Cost Challenge
The second most common international assignment management challenge noted by global mobility leaders in the survey is containing the cost of international assignments, so it is not surprising to see many new and innovative programs and policies designed for reducing costs. After years of intense focus on managing mobility costs, cost pressures have not let up. In some industries they have further intensified and for other industries there is a trend toward the normalization of cost pressure, and global mobility leaders are looking to address by making policy and program changes. Companies mention examples such as making program changes intended to realign and reduce per diems and allowances, introducing managed lump sums, getting rid of obsolete and assignee favourable tax policies, phasing out assignee allowances after a shorter period in the host location, and formalizing the practice of offering host based packages for assignees instead of home based packages.
In addition, many respondents mention examples of new and innovative programs they are or will be implementing such as the introduction of new core/optional policies or new policies that are segmented by business reason. These types of policies are typically designed to give more flexibility to the business and offer an avenue for reducing program cost. By allowing hiring managers to choose what specific benefits, or what package, they want to offer potential assignees, the policies provide choice and the ability to better control costs. Segmenting policies by business reason also ensures that the more strategically important assignments are properly supported; at the same time, assignments that benefit the employee as well as the company offer less support in exchange and are, as a result, less costly.
Aligning Mobility with Talent Management
Using global mobility as a strategic tool for talent engagement holds great promise for global mobility leaders and their contribution to meeting their companies’ wider talent and business objectives. Although companies continue to be in a state of evolution in terms of leveraging this critical link, respondents to the survey agree that the management of assignees’ careers is a significant international assignment management challenge. While a majority of companies do not yet have a specific process for incorporating international assignments into the wider career management process, we continue to see companies trying to leverage mobility as a way to develop talent.
As such, many of the new and innovative programs and policies being, or planning to be, implemented are focused on the development of talent. In one example, a company reports launching an exchange program where first time leaders with future senior leadership potential go on a one-for-one developmental assignment. In other examples, companies mention developing rotational programs for top company talent which can be then used as a recruitment tool; rolling out developmental assignment policies designed to address the unique needs of employees using assignments to grow their careers; and enhancing repatriation programs by facilitating close cooperation between repatriating assignees and their mentors in the home country. By cultivating this natural link that exists between international assignments as a career developmental opportunity, companies are looking to implement mobility policies that support this talent objective.
While the current mobility policy landscape still shows a majority of companies having a policy suite comprised of a single policy type for all employees, that may be soon changing. Global mobility leaders are leveraging their mobility policies as a way to support business needs and meet the most critical assignment management challenges today. New and innovative programs and policies that are being implemented or are under development show a focus on policies designed to shore up compliance, to address the demands to continue to manage mobility spend, and to leverage a natural link between mobility and talent management. In moving their mobility programs forward and aligning with and supporting business needs, global mobility leaders are working to ensure the mobility function is contributing at an optimal level to their companies’ overall success.