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How are organisations responding to the increasing demands of global mobility?

The global mobility landscape is changing. To support a growing number of international assignees and assignment types, operating in an increasing number of locations, organisations are having to adapt. ECA’s Global Mobility Organisation (GMO) Survey 2017 identified how over 220 companies, of various sizes and industries, structured the administration of their global mobility (GM) programmes. It revealed several interesting developments, indicating how GM teams intend to change in the future.

In the article, ‘The decline of the traditional expat?’, we found that sending employees to work overseas was more popular than ever before, but that there had also been some significant changes to the demographics of the typical assignee profile. Given this changing landscape within international mobility, and the need for companies to accommodate different types of assignments, how will organisations structure their GM functions in future?

Structure, responsibility and specialisation

Our GMO Survey results highlight a clear link between the number of assignees a company has and the way GM departments are organised. Due to the specialised nature of the work involved within global mobility, only organisations with very few international assignees (nearly half of those surveyed with 1-5 assignees) do not have a separate GM department. As well as the number of assignees, a greater variety of assignment home and host country combinations can increase the need for a dedicated GM department. Specialised teams can provide the knowledge required to successfully plan, implement and manage a complex range of international assignments.

We have observed a substantial increase in the number of short-term and other alternative assignment types. As the chart below shows, GM departments are often responsible for a range of employees and not just long- and short-term assignees. Over 50% of companies stated that their GM departments are usually or always responsible for permanent transfers. Even though commuters and business travellers tend to fall outside of the remit of GM departments, it is essential that companies have a clear policy in place to ensure that someone takes responsibility for these assignment types, given the considerable compliance issues involved.

Global mobility responsibility for assignment types

The previous survey that ECA ran on this subject, the International HR Organisation Survey 2011, revealed a strong trend towards the ‘centralisation’ of the GM function. Our GMO Survey revealed that 77% of surveyed companies have a centralised system in their current structure. 47% of companies stated that they have increased centralisation over the last three years. The main driver behind centralising appears to be a desire for greater control and oversight. Two major areas of concern among GM departments could be influencing this outcome. Firstly, the cost pressures that companies are under, and have been for some time, and secondly, the increasing focus on compliance as governments pay closer attention to tax and legal issues.

Global mobility teams are becoming more strategic

Over 88% of surveyed GM staff believe their future lies in being more strategic, as opposed to transactional - or at the very least achieving an equal balance between the two. So, it is worth reviewing how the function has recently changed in this direction and what barriers might stand in the way of future progress.

The good news is that the balance has shifted since five years ago, when 67% of respondents saw their operations as mostly transactional, compared to just 45% now. However, this figure is expected to fall further as nearly 50% of companies expect the function to be more or entirely strategic in the future and only a very small percentage (13%) believe they are achieving this level of strategic input today.

Evidently, the role of the GM department is steadily transitioning from transactional to strategic work. To achieve further progress, organisations may need to review areas of their GM programmes to ensure that time and resources are allocated in the most efficient way. We identified some key areas where developments could be made:

GM staff to assignee ratios

There has been very little change in efficiency over the five years since our previous survey. In 2011, the ratio of support staff to assignees was 1:36. This year’s survey has the figure at 1:33 on average. The ratio does vary with assignee population size as scale efficiencies are possible with larger numbers of assignees. If organisations are to improve the efficiency of their GM teams, they will need to invest in tools and infrastructure that will enable their staff to support assignments that are growing in complexity and frequency.

Assignment data analytics

As previously mentioned, cost control continues to be a major concern of companies. We have seen centralisation being used as one way to ensure costs involved in global mobility are closely monitored, but without analysing post-assignment data, potential areas of cost containment are likely to be overlooked.

As the table below shows, data collection and analytics are still under-used. For example, we have found that measuring ‘return on investment’ (ROI) is the greatest overall challenge facing GM departments. However, only 45% of surveyed companies stated that they measure ROI, reflecting a big gap in the desired outcome and the reality of the steps being taken to achieve it. Measuring ROI is crucial if companies want to ensure they are getting the most out of assignments, which after all are costly undertakings. Measuring assignee welfare, satisfaction and retention rates are powerful tools for determining where improvements can be made and play a crucial role in talent management. Surprisingly, over one third of surveyed organisations do not use such analysis that could help them to make the most out of their employees.

Percentage of companies using monitoring and analytics
Measuring retention rates 60%
Measuring assignment success 61%
Tracking assignees     92%
Measuring 'return on Investment' 43%
Measuring assignee satisfaction 65%
Measuring assignee welfare 63%

Lack of investment in IT

There is evidence in our survey findings of a lack of investment in infrastructure. A staggering 63% of companies reported either no recent change in investment or reduced investment in IT solutions over the last few years. Digging into the detail shows a range of activities that many companies don’t use software for, from management reporting to cost estimates. GM teams may be trapped in an administrative slog when time is taken up collating these types of activities by hand or from poorly connected systems.

The case for improving IT investment for the GM function is strong. Nearly 80% of companies believe international assignments are critical to company growth, seeing them as key contributors to developing senior managers (73%) and essential for skills transfers (83%). Over half of respondents also consider assignments as an unavoidable business expense, so reducing the cost of administering these business-critical resources by introducing IT solutions would make sense.

We have seen an increase in companies using IT solutions to deliver information directly to their assignees, something we expect to see continuing. The use of IT solutions provides companies with three main advantages; time and resource-saving on repetitive reproducible tasks such as calculations; fewer errors on those same calculations; and much improved oversight and data on processes, costs and compliance. Companies clearly recognise these advantages as 68% expect to increase their investment in IT at the next review.

ECA’s Global Mobility Organisation Survey 2017 report now available!
The Global Mobility Organisation Survey report is available to buy on demand. Find out how other companies and organisations manage the administration of their Global Mobility function for long- and short-term international assignments.
 

Summary

Global mobility has growing demands and requirements and, as the number of assignments increases, companies respond by introducing specialist GM teams. However, organisations will need to invest more in their GM departments to ensure staff are equipped to manage assignments that are growing in complexity and frequency.

Centralisation of the GM function is a method organisations have used to focus their resources and become more efficient, enabling them to transition GM departments from purely transactional to more strategic work. Further investment, especially in IT solutions, may also help to facilitate these goals by reducing the amount of time taken on transactional tasks, freeing up resources for more strategic operations. Additionally, it would help companies meet compliance requirements, enabling tracking of employees in real-time as well as for reporting purposes.

It is clearly up to the GM function to raise its profile within the organisation, obtain more investment and improve its productivity. This will help to ensure that the organisation’s future expectations are realistic and obtainable, by aligning resources with the growing demands of global mobility.

If you need help reviewing key areas of your GM programme or would like to know more about software that can assist with everyday costings and calculations – saving time and resources for more strategic operations, then please get in touch!

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