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Talent Trends in Mobility for 2019
What’s hot, what’s happening, what’s NOW? Those are the questions everyone asks going into a new year; however, the most important factor for mobility professionals should be, “would this work for MY program?”. As we delve into what Altair Global considers to be the biggest trends and impacts to mobility in the coming year, we’ve included some introspective questions to guide you in examining your program. Altair Global works with clients and programs of all sizes and shapes, so we know first-hand that one size most definitely does not fit all when it comes to developing a talent mobility strategy for what you need today and what will grow with you for tomorrow. Are your programs and policies aligned with your talent management and growth strategy? Are they enabling a productive mobile workforce?
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Core/Flex Programs While the concept of flexible mobility policies isn’t new, the factors motivating companies to strive for flexibility continue to evolve. There are many approaches to flexible mobility policies; however, the term “core/flex” continues to broadly describe the most common approaches. Designing flexibility into your mobility program will likely involve striking a balance between a standard or “core” set of provisions and a range of other services and benefits positioned with some degree of “flex.” This aims to assure employees that basic needs will be met while also empowering them to shape the balance of available assistance in a manner best suited to their individual needs and circumstances. So, when should a core/flex program structure be considered? • When you have diverse employee populations with varying needs. • When your employees continue to “push the envelope” in regard to requests for support of unique personal circumstances and situations. • When your company embodies a culture of adhocracy and flexibility. Are there instances where a core/flex approach may not be the best option for your organization? Absolutely. If your ultimate goal is cost control or cost savings, relying on a core/flex approach is not the best option. While there may be potential cost savings resulting from implementing a core/flex program, cost savings should not be the primary driver behind the consideration of a more flexible mobility policy. If your corporate culture is more hierarchical and patriarchal, a transition to a more flexible program may be met with significant resistance. Airinc’s 2018 Mobility Outlook Survey indicated 31% of companies offering flexible policies still receive pushback on the cost of assignments. In short, “core/flex” is not the answer for everyone. If you’re considering a more flexible approach to your global mobility program, ask yourself the following questions regarding your global mobility policies and programs: • Do they serve the organization’s long- and short-term business goals? • Do they project and deliver talent needs around the world? • What are the factors motivating the development of your mobility programs?
2 Personalizing Global Mobility According to the 2018 Deloitte Global Human Capital Trends Survey, 68% of organizations agree “a mobile workforce is an enabler of business and talent strategies.” However, the same study shows 36% of business and HR leaders see “employee willingness to move” as a barrier to successful mobility. How can we change this? One way is to make global mobility more personal. What does this mean? Putting people at the center of the mobility experience and recognizing mobility is more personal than other aspects of the talent lifecycle. How can a company do this? Altair has embarked on such a journey and is adopting a customer-centric mindset, which entails the following: • • • • •
Collecting experience data about customer needs, expectations, and improvements. Analyzing customer feedback based on experiential measurements vs. statistical measurements. Sharing customer insights with our employees to drive behavior. Changing our technology to offer multi-modal communications and greater personalization. Offering recommendations to our clients to shape mobility program decisions.
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Diversity and Inclusion
More and more companies are increasing focus on diversity and inclusion or what some have started referring to as “inclusion and diversity.” There are companies that have started offering incentives for diverse hiring practices as well as training to target bias against underrepresented groups. The creation of such initiatives shows a shift in the way companies think about the relationship between diversity and business. In September 2016, Thomson Reuters introduced its Diversity and Inclusion (D&I) Index, an examination of the diversity practices of 5,000 companies. This move is one indication of the increasing interest in this issue within the business community. Companies such as Uber and Google have created employee resource groups and encourage training as well as an open discussion of diversity. These efforts integrate equal opportunity discussions into company cultures. It also makes it easier for employees to come forward if they feel they are facing discrimination. The path toward achieving a greater focus on diversity and inclusion has not been without its challenges and missteps. Altair Global noted during our 2018 Mid-year Trends Webinar that leadership positions at a great
number of companies are still largely not diversified. We anticipate 2019 will bring with it an increased awareness of the value of diverse leadership for organizational performance and success. More diverse leadership is also a good indication companies are beginning to understand the value of diversity and inclusion in the workplace. However, we’ve also seen companies experience backlash based on the actions or statements of employees and executives of the company. It’s doubtful these missteps will not continue into 2019, as companies figure out how to build an environment that is inclusive and equitable for both employees and customers. This year, companies should focus on diversity and inclusion training concentrated on behavior changes and unconscious bias. A Pew Research Center survey titled Sexual Harassment at Work in the Era of #MeToo conducted in February and March of 2018 revealed 51% of Americans believe the increased focus on sexual harassment resulting from the #MeToo movement has made it more difficult for men to know how to interact with women at work. 2019 will likely see companies placing more emphasis on training around sexual harassment and prevention in the workplace.
4 U.S. and Global Real Estate Markets Hot U.S. Real Estate Markets Although 2018 wrapped up with a major slowdown in the U.S. housing market, not all metro areas have stalled. Below are the predicted Top 10 Hottest Housing Markets for 2019, as determined by realtor.com.
8 BOISE CITY, ID
GRAND RAPIDS, MI
2
10 BOSTON, MA
6 BRIDGEPORT, CT
7 LAS VEGAS, NV CHATTANOOGA, TN 8 5 PHOENIX, AZ 3 EL PASO, TX LAKELAND, FL 1 9 MIAMI, FL
realtor.com® 2019 Housting Forecast: Existing home prices appreciate 2.2% Existing home sale down 2.0%
Single Family housing starts increase 8%
30-year fixed conforming rate averages 5.3% Homeownership rate increases to 64.6%
4 U.S. and Global Real Estate Markets World’s Biggest Real Estate Bubbles With a decade-long run of stock market growth, Swiss investment banking company UBS notes in their latest Real Estate Bubble Index 6 major cities around the world that are in bubble territory, defined as a persistent rise in prices to the point where properties are well above their fundamental value.
North America
Europe
Asia Pacific
Tokyo
Toronto
Vancouver
Amsterdam
London
San Francisco
Frankfurt
Boston
Hong Kong
Paris
Los Angeles
Zurich
Munich
Geneva Milan
= BUBBLE RISK * UBS information used with permission.
= OVERVALUED
Singapore
= FAIR-VALUED
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Are you preparing your employees for their move with the necessary tools and support?
Momentum Productivity Study Data – U.S. Domestic Lump Sum Altair’s most recent edition of the Momentum Survey Series is our U.S. Domestic Lump Sum report, the results of which provide insights into both the employee profiles most likely to receive a lump sum relocation package as well as the productivity impacts of providing a lump sum only to support an employee relocation. Respondents included 169 employees from 9 companies and all respondents had recently relocated under a lump sum-only relocation package.
Demographics:
30% of respondents noted
42% of respondents noted
70% of respondents indicated 71% indicated their move was the distance of their move was greater than 750 miles.
their first corporate-sponsored relocation.
51% of respondents were
29% moved with only an
71% of respondents were
29% were renters at the start
having lump sum funds left over after covering all of their relocation expenses.
employees who moved alone, without accompanying family.
they had to utilize personal funds to cover additional relocation expenses.
accompanying spouse/partner. homeowners.
of their move.
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Momentum Productivity Study Data – U.S. Domestic Lump Sum Most Highly Impactful Activities on an Employee’s Work Productivity:
54.3%
Finding the appropriate destination residential community
31.2%
Job training/employee orientation/onboarding
Lump Sum Homeowners
lost 22 days
of work productivity. Lump Sum Renters
lost 15 days
of work productivity.
27.5%
Transition of householdrelated services
26.1%
Managing ongoing personal financial concerns
41.3%
Securing a destination location residence
52.9%
Arranging household goods transportation, packing, delivery, unpacking, auto shipment, etc.
When reviewed with our previous surveys for Momentum U.S. Inbound (20 lost days for U.S. homeowners, 15 lost days for U.S. renters) and International employees (24 lost days), the Lump Sum employees have a consistent number of lost productivity days (22 for homeowners and 15 for renters). The data from the Lump Sum survey indicates homeowners receiving a lump sum do lose more days of work productivity; however, renters seem to lose the same amount of work time. Some of the factors behind this, as identified through the Lump Sum survey data and the post-survey telephone interviews, include employee expectations and perceptions. Employees responding to the Lump Sum survey were not necessarily expecting to receive a full menu of relocation benefits and some didn’t perceive themselves as being formally “relocated” by their employers. Look for the full Momentum U.S. Domestic Lump Sum report to be released later this year.
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Technology and Mobility Policy Design We increasingly see companies engaged with how best to make accessible and consumable the critical information mobile employees of today need. HR technology (HRIS, HRMS, HCM) initiatives among our client companies are now regularly influencing the design of mobility policies. HR technology platforms have introduced a user-interface focus into mobility benefits, like other talent management services, and an opportunity to meet the ever-diversifying needs of assignees, transferees, and mobility business stakeholders. If you anticipate an initiative to review and revise your mobility policies in the near term, a good start is to consider how today’s documentoriented policies might be reorganized to anticipate a tech-driven application of benefits. It is also recommended you begin to pay attention to how other HR disciplines within your organization are becoming integrated into these technologies and start to base decisions around your mobility programs in this context. Some useful questions to ask include:
How can today’s document-oriented mobility policies be reorganized or restructured to anticipate a tech-driven application of benefits?
How might technology enable integration of performance management and mobility goals?
How can HR technology be leveraged toward a focus on employee experience as a guiding principle for mobility program design?
Based on responses to a poll from Altair’s mid-year trends webinar in 2018, 38% of respondents indicated HR technology is not yet having a strong impact on their mobility platform. However, 33% of respondents indicated HR technology is leading to greater integration of talent management and mobility.
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Household Goods Move Strategies Keeping Pace? Your global mobility program’s structure, flexibility, and offerings have a significant impact on talent management. Are you ensuring a smooth transition and relocation for your employees? While the hallmark of competitive relocation programs historically focused on generous, full-service move benefits, the key to a truly best-in-class program is acknowledging and addressing not all moves are identical. Flexible programs allowing customers to elect a preferred level of support based on personal situations are the most successful. Easy program adds providing greater flexibility do exist. Although these alternatives will not be the right fit for every move, it does help address the nuances of those who don’t need or want a full-service move. Enhanced Assisted Self-Move Options: With the expansion of support ranging from basic labor assistance with loading and unloading to packing labor and driving assistance, self-move options now provide a level of support necessary to make it an attractive choice for those with smaller shipments. Domestic Containerized Model (DCM): DCM is a truly unique opportunity in domestic moves for shipments up to 5,000 pounds. Goods are wrapped and crated, much like an international shipment, then transported via common carrier. Altair also negotiated for up to 30 days of storage in transit to be included in the shipment cost. In addition to cost savings ranging from $1,100 to $1,400 per move, this model also allows for guaranteed pickup and delivery dates.
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Mobility and Collaboration Tools The 2018 Deloitte Human Capital Trends Survey indicated 71% of respondents believe new communications tools improve their personal productivity. Utilizing real-time feedback to fine-tune the customer’s experience to best meet the customer’s needs is key to transforming and personalizing global mobility. What are some ways a company can solicit more real-time feedback from employees? • Mobile flash surveys – a short 4-6 question assessment delivered to the employee via a mobile device and asking for feedback regarding a recent event or milestone. • Online focus groups or live video chats. • Digital “diaries” to better understand customer pain points.
This can be accomplished through the use of innovative technologies that enhance the “moments that matter” for each customer. Just like with our everyday interactions and needs, mobility is moving toward an omnichannel environment where employees will manage their moves in the way that best suits them: • Don’t want to use a computer? No problem, use an app. • Prefer to text instead of call? Fine, we’ll use SMS to connect. • Don’t want to read a destination guide? Here, interact with the destination virtually instead. The more we can customize the benefit to the need and the delivery of service to the preferred channel of communication as well as right-time the delivery of information to the exact moment it is needed and consumed, the better we become. Pushing for innovation in our approach is key to improving and driving the type of change that matters to the end customer, which of course provides improved acceptance and retention rates across the entire mobility program. – Chad Sterling, Altair Global, CEO Excerpt from Global Mobility Insider
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Compliance, Nationalism, and the Changing Landscape
A global political tendency toward nationalism is proving to be among the strongest near-term trends we’ve seen. The resulting uncertainty is particularly challenging to the drivers of globalism that have served as the foundation for the international movement of talent our industry has relied upon for several decades. Our assumptions about free and open borders and relaxed barriers to trade are on increasingly shaky footing. Our industry will need to confront how best to prioritize movement of talent across borders and into locations that may not be as open as before. In particular, this is leading to the increasing needs of organizations to prepare for the uncertainties surrounding immigration, especially acute in the near term for moves coming into the U.S., and the impacts on talent acquisition, development, and retention. We see companies moving away from primary reliance on traditional expatriate assignments toward shorter-term assignments, including extended international business travel and rotational programs. These developmental opportunities are particularly attractive for employees of the Millennial Generation, who we know to be strongly motivated by opportunities to attain global experience and expertise.
This shift has compounded the complexity of tracking activity and maintaining compliance, which is already challenging given the ever-evolving rules governing movement across international borders. Coordinating and managing the immigration process including working with global service providers and local authorities, procuring passports/ visas, etc., as well as completing all necessary paperwork/documentation was rated as the third highest impact activity in relation to employee on-thejob productivity in the international edition of Altair’s ongoing Momentum Survey Series. This points to an issue with not only setting appropriate expectations with employees moving internationally, but also with the receiving organization and hiring managers specifically. It also suggests that sophisticated contingency planning is needed to mitigate the impacts of a quickly evolving immigration landscape. A prime current example is Brexit and the challenges it presents to companies engaged in talent deployment to and from the UK. Consider, too, the increased uncertainty companies face with trying to recruit candidates into U.S.-based positions while navigating immigration requirements that are quickly evolving and much more unpredictable than before.
Tax Cuts and Job Acts (TCJA): Benchmarking Across Altair’s Clients Taking a look at benchmarking from Altair’s clients in reaction to TCJA:
100%
of clients elected to provide gross-up assistance for relocation expenses previously categorized as deductible
97.5%
of clients maintained a 1-year timeframe as a program guideline
100%
of clients retained the 50-mile distance qualification as a program guideline
Also, while many clients did make overall program changes in 2018, Altair has not seen clients making program cuts in response to the added tax gross up costs.
10 Programs to Support Early Career Employees
We have consistently seen our clients striving to leverage mobility solutions to support their organizations’ efforts to attract and retain critically skilled talent. Recently, with sustained, historically low rates of unemployment and a shortage of skilled candidates becoming acute in many industries, a focus on mobilizing talent at an earlier career stage is becoming clear. As an example, we’ve seen the development of competitive internship policies that support a positive first experience between the company and the prospective future employee. Historically, these policies have provided a fairly limited scope of support and services, but companies are taking a fresh look at these policy types to ensure they stand-up competitively in the market, facilitate relocation to the internship site, maximize productivity of the intern, and engender a positive first impression of the company and its commitment to supporting its future talent. The emergence of mobility policies specifically focused on developmental opportunities for early career professionals is also clearly related to the trend toward integration of talent management and mobility. We increasingly see companies developing policies that apply benefits according to the developmental goals of the transfer or assignment, not just the level of the employee, the skills-transfer related objectives of the company, or the expected duration of assignment. Of course, those criteria are still important to consider but today we see the relationship of benefits to career development goals as a clear overlay to those traditional policy delineations. As this trend continues to mature, we are starting to see more sophisticated approaches emerge including distinct policies targeting high potential employees, policies built exclusively in support of leadership development initiatives, and rotational short-term assignments that expose early career profiles to different parts of the global business. At Altair, of our clients with formal developmental policies in place:
20%
provide support for long-term developmental assignments.
30%
provide support for short-term developmental assignments.
50%
provide support for rotational developmental assignments (a series of back-to-back short-term assignments).
What now? How can you best analyze and assess your program to ensure it remains relevant and competitive? How will your program continue to meet the needs of an ever-changing mobile workforce? 2019 will be about making global mobility more personalized and customer-centric. Additionally, the importance of the customer’s experience and capturing feedback and data around specific moments in the mobility journey will become more institutionalized. Deloitte’s 2018 Human Capital Trends Survey indicated 70% of respondents are in the midst of major projects to analyze and integrate data into decision making. However, in order to meet the needs of future employees, the data being analyzed must be more than just data around the number of moves, costs, employee performance, and employee satisfaction. Likewise, we have to start looking at careers as more than a sequential, stair-step path through individual jobs. Careers are becoming far more about experiences that offer the employee the opportunity to acquire new skills, perspectives, and learning agility. The development of skills will become of optimal importance and learning & development (L&D) departments must be able to keep up with the ever-changing needs of the future workforce. Complex problem-solving, social skills, and cognitive abilities will be to emerge as the most needed capabilities for the success of employees in the future.
W W W. A LTA I R G LO B A L .C O M
I N F O @ A LTA I R G LO B A L .C O M
Š2019 Altair Global. Altair Global (‘Altair’) has provided this information as a service and convenience for your information only. It is not intended to replace your own legal or financial guidance and/or assistance and you are encouraged to seek the advice of your own tax and legal advisor. Further, the information contained herein is to our knowledge accurate to the extent of the data available to Altair as of the date identified. Altair does not assume responsibility for the accuracy of the contents hereof and is under no obligation to update the material contained herein.