With regards to international relocation there are several trends you should be aware of when deciding to expand or relocate globally.
Information has been collected from 123 corporations which employ approximately 6.9 million people. Of those companies, 85% stated that their human resources department in conjunction with a third-party corporate relocation service had facilitated the moves.
Before embarking on a relocation, 51% required that a ROI, return on investment, analysis be conducted. Most found, over the previous year, a 10% increase in costs. Unlike 2012, Russia did not make the list of the most difficult countries to relocate to. However, China, Brazil and India were cited again as challenging places to conduct business.
85% of respondents said that the decision to relocate assignees is made at corporate headquarters, while decisions made regionally and by business divisions were 8% and 7% respectively.
The decision for international relocation seemed to be driven by record high (for the past two years) percentages of corporate money being generated outside of the headquarter country. The respondents averaged 54% of their corporate revenue was generated by international funds. That is nearly a 10% increase over the previous average.
Assignee attrition because of relocation saw little change over last year as 67% of the companies indicated. Although 14% saw an increase and 19% saw a decrease in attrition. However, to quantify this, it must be considered that only 54% of these companies actually relocated assignees to or from the headquarter country. That is a 17 year low.
The top reasons 6% of relocations to fail were attributed to employees leaving for other companies once relocated, spouse/partner dissatisfaction and family concerns or issues. After all, relocating an assignee is costly; some companies have implemented ways to avoid these failures. Cross-cultural training is mandatory in 24% of the companies offering such a program and 85% stated they felt it provided a great value to those moving. Some of these corporations, 10%, provided assistance for moving elderly family members with the assignee and 55% of them offered annual support for trips back to visit family.
According to the World Wide ERC, corporate relocation costs to the individual, on average were $60,000 (US) for a home owning employee and $18,000 (US) for a renter. Mid-level and rank and file employees generally were not assisted by corporate funds for these moves, but upper-level and executive were. The typical compensation package for an expatriate was anywhere between two and three times the base salary of the headquarter country.
In terms of a breakdown of the most costly aspects of a move for the company, those surveyed said, destination services, transportation of household goods, temporary corporate housing, tax services and employee home sale assistance are among the largest costs.
Clearly global reassignments are costly to the company and the assignee, but the ROI can be very lucrative as well. Knowing the pitfalls, being proactive and quick to recover from them is key to having a successful relocation program.
A strategic advisor or relocation service will do the legwork for you and help both the company and the assignee to avoid failure with relocation. Many states in the US have specific agencies to provide such services to you. Having your company presence in their state is as beneficial to them as the success of the move is to you. Idaho is one such state. Idaho makes every effort to insure success when relocating to their state. You can contact us at Relocate to Idaho for corporate relocation services; we will put you in contact with the right people to facilitate a successful move. Reach us by telephone at: 800-621-5600 or by email to [email protected] .