Altair Global Momentum Survey Series International Employees Report

Your business doesn’t advance during downtime.

Neither do your international employees.

International Employees Report September 2017

Forward

A few years ago, I envisioned a detailed study into the hidden cost of relocation on employee productivity in the workplace. I wanted to know specifically how this would affect the total Return On Investment (ROI) for corporate relocation programs. What came next was the development of the Momentum Survey Series. Starting first with the U.S. Domestic edition and now the International edition, Altair Global worked with numerous clients and their employees across the globe to gather feedback, tabulate results, and interpret the findings to compile these reports. We wanted to illustrate to our clients and the industry alike, how productivity loss from a relocation or an assignment can financially impact a company.

From the beginning, I knew this research was important and also innovative in our industry. I have been continually amazed at the receptiveness of our customers to participate in the surveys and learn where breakdowns are occurring. We want to guide these companies to better structure their policies and programs for maximum support of their mobile talent.

Ultimately, the goal is still to identify where employees lose the most time across the duration of their move while finding specific solutions based on a company’s current processes. We hope to extend the Momentum Survey Series even further to other specific employee populations in order to paint a picture across an entire mobility program. While each client’s program is unique, the one challenge we all face is the ever-changing landscape of global business and technology, where relocation can sometimes be an after-thought. Armed with this research, we hope to push the conversations further up the proverbial food-chain and increase the top-down view of how integral global mobility can be to a company’s overall talent management goals and results.

As with the inaugural edition of the Momentum Survey, I would once again like to thank the companies who allowed us to survey their relocating employees. With participants from more than 50 countries, we were able to provide a truly global perspective, and without their time and involvement, this report could not have been written.

Chad Sterling | Chief Executive Officer, Altair Global

Table of Contents 1 - Objectives 2 - Methodology 3 - Demographics 6 - Survey Analysis 15 - High Impact Factors 24 - The Voice of the Employee 27 - Conclusion and Recommendations

Š 2017 Altair Global Services, LLC. All Rights Reserved. Copying of any portions of this document is prohibited without the express prior written permission of Altair Global Services, LLC.

Objectives The international edition of the Momentum Survey Series was developed based on the previous U.S. domestic edition and customized with the intent to study productivity impacts on employees who relocate internationally.

The goals of the Momentum Survey Series have not deviated from the original purpose to: • Identify the “pain points” that have the highest impact on transferee productivity.

• Measure their effect on workplace productivity and ROI. • Translate the findings into action items that employers can use to positively impact productivity.

However, for the international edition, our focus and analysis shifts from looking at the base issue of employees having to spend time away from their core job to a more in-depth look at how the usage and provision of certain benefits for both the assignee and family impact productivity. For global programs, issues such as immigration, compensation and tax, and destination services have a much larger influence on the time spent away from the job.

1

Methodology As with the first report in the series, this survey was designed by Altair Global. It was conducted in late 2016 through early 2017, using commercial survey software.

Altair Global solicited support from 12 corporate participants, from which over 600 employees were identified and invited to respond to the survey. Of those invited, 149 responded to the survey and their answers were utilized to compile this report. A response rate of 24% provides a high degree of confidence in the findings, as the average response rate for external email surveys ranges from 10% to 20%.

Participant criteria included: • Current employee or new hire.

• Completed an international relocation within the previous six-to-twelve month period.

• Was relocated/transferred under a formal Long-Term International Assignment Policy or a formal International Permanent/One-way Transfer Policy.

Respondents were asked to rate the separate components of their assignment in terms of distraction level and time taken away from job focus: • High-Impact Item: Caused three or more days (combined) of lost productivity.

• Low-Impact Item: Caused fewer than three days (combined) of lost productivity.

• Not Applicable. Did not apply to the assignee or did not impact productivity.

2

Demographics Location

149 participants in the survey represented 52 different departure locations and 30 different destination locations.

Departure Locations Hong Kong India Ireland Israel Italy Japan Kazakhstan Malaysia Mexico Netherlands New Zealand Norway Peru Portugal

Australia Austria Belgium Brazil Canada Chile China Columbia Costa Rica Cyprus Denmark Finland France Germany

Number of moves (per country)

3

Puerto Rico Romania Russia Saudi Arabia Singapore South Korea Spain Switzerland Thailand Turkey United Kingdom Ukraine United States Venezuela

Demographics Location

149 participants in the survey represented 52 different departure locations and 30 different destination locations.

Destination Locations Australia Austria Belgium Canada Chile China Colombia Czech Republic Denmark Ecuador

Poland Russia Singapore Spain Switzerland Taiwan United Arab Emirates United Kingdom United States Vietnam

Egypt France Germany Hong Kong India Ireland Japan Mexico Netherlands Peru

4

Demographics Employee & Assignment Type The respondents were equally split between two assignment types with 49% of respondents moving on a permanent/one-way international transfer and 51% moving in conjunction with a long-term international assignment. However, when looking at the employee type, 90% of respondents were existing employees and only 10% new hires.

New Hire 10%

Permanent/ Long-term One-way Assignment 49% 51%

Existing Employee 90%

Employee Age From baby boomers and GenXers to millennials, all major generational groups were represented in the demographics of respondents with ages 35-44 representing the largest population at 40%.

1%

18-24

30% 25-34

40% 35-44

5

24% 45-54

5% 55-64

Survey Analysis The Not So Hidden Cost of International Moves A realistic expectation of relocating an employee internationally are periods of time when the employee will be primarily focused on the tasks and activities associated with the move such as filling out paperwork for immigration or household goods purposes, touring prospective communities in the new location, settling into the destination area, and simply managing the business of life – especially if the employee is relocating with family. However, while employee downtime is expected to some degree, when that same decrease in productivity is multiplied across an entire population of international employees, corporations risk losing significant focus on core functions, which ultimately impacts profitability. Based on our research, a corporation’s investment in global talent could be in jeopardy to the tune of $4 million across the company’s global mobility program.

While a minimum of three business days of accumulated time spent on international relocation, transition, and assimilation activities would be expected, unavoidable, and probably acceptable to most employers, the effects of multiple “core, high-impact” activities result in a significant drain on employee productivity.

Each high-impact event causes three or more days of lost productivity, with an average of 6.5 high-impact events per respondent. Applied to a program of 100 employees moving internationally, the projected loss is startling:

24.4 days

39.21 days

$4M

Based on high-impact activities only (those causing the employee to lose a minimum of three days’ focus on the job), the average employee moving internationally loses a minimum of 24.4 days of work productivity.

When those activities identified as low-impact (those causing the employee to lose less than three days’ focus on the job) are added to the high impact responses, the average employee moving internationally loses a minimum of 39.21 days of work productivity.

The financial impact of lost productivity in terms of salary, benefits, and expected return on investment, in addition to lost revenue, could total more than US $4 million per year for the entire program.

Finding Solutions Through our proprietary productivity estimator tool, we can equip you with a customized cost analysis and recommendations for program enhancements to address and possibly curb the significant losses experienced across an entire population of assignees. Our estimator tool takes into account each company’s experiential data to profile a particular mobile population – including compensation, overhead, and profit contributions to estimate the annual cost of productivity losses. Our team can work directly with your company to target potential services that will provide tangible value for your program and your transferees.

6

Survey Analysis Highest Impact Events Overall, respondents reported an average of six and a half highimpact events that affected their ability to focus on the job. (The average number of high-impact activities noted by respondents in the Destination U.S. study was six.)

Below are the top 10 high-impact activities based on all 149 responses:

66% 61% 57% 48% 45%

Finding and selecting the appropriate residence/home in the new location including touring prospective communities and setting up the new residence.

Establishing a residence in the new location including obtaining a driver’s license/permit, setting up local bank accounts, arranging utilities, obtaining local registrations, etc.

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.

Learning, researching, and understanding the compensationrelated specifics of the assignment/move including tax ramifications, compensation structure and delivery, employee/family benefits, and pension/retirement implications arising from the move.

Arranging and overseeing household goods transportation including packing, delivery, unpacking, customs clearance, etc.

Companies should not ‘penny pinch’ the program or go cheap - spending a little bit more goes a long way to making assignments successful.

Activity overload around a move leads to confusion, missing the significance of some information provided. Need more breathing space while moving.

7

Survey Analysis Highest Impact Events

The decision-making process related to accepting or declining the assignment/ transfer with regard to financial situation, including overall financial impact, potential tax implications, cost of living differences, relocation expenses, etc.

34%

Researching, identifying, and managing schooling/educational requirements for accompanying family members in the new location.

Settling into and assimilating to the new community including identifying local amenities such as recreation, shopping, etc., making friends, establishing a local network.

The decision-making process related to accepting or declining the assignment/transfer with regard to personal situation, including family/spouse, new location lifestyle, etc.

Preparing, marketing, selling, and closing process of home country residence (home disposition or lease termination process).

34%

32% 32%

32%

Compensation issues are often very complex, additional third-party advice would really help.

Assignees should get “new hire� treatment, rather than being handled like [an] existing employee. Need that support to get set up in new location for internal processes, equipment etc.

10 8

Survey Analysis First Time International Movers versus Experienced Movers For Altair’s Destination U.S. study, we looked at the productivity impacts that affect homeowners versus renters. There were surprising insights in that homeowners seemed to be more impacted by logistical issues while renters were more impacted by socioenvironmental issues.

For the International study, we explored the productivity challenges faced by employees moving internationally for the first time (51% of respondents) versus employees who had prior experience with an international move (49% of respondents).

First Prior International International Move Moves 51% 49%

First time international move respondents lost an average of 25.6 days (high impact responses).

and managing the immigration process including working with global service providers and local authorities, procuring passports/visas, etc., 64% Coordinating as well as completing all necessary paperwork/documentation. and selecting the appropriate residence/home in the new 63% Finding location including touring prospective communities and setting up the new residence.

a residence in the new location 62% Establishing including obtaining a driver’s license/permit, setting up local bank accounts, arranging utilities, obtaining local registrations, etc. researching, and 54% Learning, understanding the compensationrelated specifics of the assignment/ move including tax ramifications, compensation structure and delivery, employee/family benefits, and pension/retirement implications arising from the move.

43% 9 11

Arranging and overseeing household goods transportation including packing, delivery, unpacking, customs clearance, etc.

Survey Analysis Interestingly, among first-time international move respondents, the immigration process and the time spent learning about, researching, and understanding the compensation-related specifics around the international move/assignment were ranked as higher productivity impacts than in comparison to those employees who had experienced multiple international moves.

Respondents with multiple moves lost an average of 23 days as compared to the overall average of 24.4 days for high impact responses.

66%

Finding and selecting the appropriate residence/home in the new location including touring prospective communities and setting up the new residence.

59%

Establishing a residence in the new location including obtaining a driver’s license/permit, setting up local bank accounts, arranging utilities, obtaining local registrations, etc.

48%

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.

48%

Arranging and overseeing household goods transportation including packing, delivery, unpacking, customs clearance, etc.

42%

Learning, researching, and understanding the compensationrelated specifics of the assignment/move including tax ramifications, compensation structure and delivery, employee/ family benefits, and pension/retirement implications arising from the move.

10 12

Top Four High Impact Activities (Ranked in Order of Impact Rating) Employees with 1-2

Employees with 3-5

Employees with 6-9

Employees with 10+

1

Establishing/ setting up the destination residence

Finding/selecting the destination residence

Finding/selecting the destination residence

Arranging and overseeing the Household Goods move

2

Finding/ selecting the destination residence

Establishing/setting up the destination residence

Coordinating and managing the immigration process

Managing ongoing personal financial concerns

3

Coordinating and managing the immigration process

Arranging and overseeing the Household Goods move

Arranging and overseeing the Household Goods move

delivery)

4

Settling into the new community

Preparing, marketing, and selling the departure residence

Establishing/setting up the destination residence

Finding/selecting the destination residence

prior international moves

prior international moves

11

prior international moves

prior international moves

Learning and understanding compensation specifics (tax, pay

Survey Analysis When comparing factors impacting employee productivity with the number of prior moves, we find that as the individual becomes a more experienced mover these factors change the degree of impact on work productivity: • Negotiating compensation, benefits, and relocation; learning and understanding compensation specifics (tax, pay delivery, etc.); and managing personal financial concerns become more impactful to the employee’s productivity. Logically, this makes sense. An employee with prior international move experience is likely in a more established and/or senior level role. It is likely employees fitting this profile are earning greater base, as well as incentive compensation. He/she may have more investments and in some cases, these employees may have trailing tax liabilities from prior international moves or assignments in multiple global locations. From an age and family perspective, this individual is likely older and may have accompanying family members. This results in particular components of overall compensation such as housing support, cost of living allowance, and dependent education becoming critical negotiating points, where they may not be for someone who is moving for the first time, i.e., someone earlier on in their career and possibly moving alone.

• Arranging and overseeing household goods shipment becomes more impactful. As noted above, employees fitting the profile of an “experienced” international mover are likely further along in their careers and are more likely to be older and have accompanying family. It’s more likely that the employee (and family) has accumulated more personal possessions over the span of many years and to add to this, these personal possessions may now carry more sentimental value and emotional attachment. Rather than being responsible for just moving themselves, these employees are tasked with managing the physical relocation of the family’s possessions.

• Home finding, destination assimilation, and settling into the new location remain as significantly impacting employee productivity. This is consistent with the results from the Destination U.S. Momentum study and is supported by the anecdotal data and comments from the telephone interviews conducted with survey respondents. The process of settling not just the employee, but the family will continue to be one of the most impactful and critical components of an international move.

14 12

Survey Analysis Moving Alone versus Moving with Family Another important data point relates to employees moving alone versus employees moving with accompanying family.

Respondents Moving with Children Across our survey population, 24% of respondents moved alone, while 76% moved with a spouse/partner and/or accompanying children. Additionally, 49% of respondents moved with one or more children, with a more detailed breakdown highlighted below:

39%

42%

16%

3%

Respondents Moving Alone Below is a closer look at the different productivity impacts experienced by employees moving alone versus employees moving with family.

54%

, Establishing a residence in the new location (driver s license, utilities, etc.)

49%

Coordinating and managing the immigration process.

43%

Finding and selecting the appropriate residence in the destination.

43%

Learning and understanding compensation specifics (tax, compensation delivery, etc.)

40%

13 15

The decision-making process with regard to financial situation.

Survey Analysis Respondents Moving with Family

72%

Finding and selecting the appropriate residence in the destination.

59%

Coordinating and managing the immigration process.

50%

Learning and understanding compensation specifics (tax, compensation delivery, etc.)

63%

Establishing a residence in the new , location (driver s license, utilities, etc.)

53%

Arranging and overseeing household goods move.

In looking at the productivity impacts that shift the greatest when moving with family versus moving alone, we find the following:

33%

Researching, identifying, and managing schooling/ education requirements in the new location.

30%

Arranging and overseeing household goods move.

32%

Handling of spouse/ partner/family transition challenges.

29%

Finding and selecting the appropriate residence in the destination.

These four relocation activities and components were rated as having a high impact on work productivity by approximately 30% more respondents moving with accompanying family compared to respondents moving alone.

16 14

High Impact Factors Destination Assimilation and Settling-in The two highest productivity impacts identified by survey respondents centered around the issues of: 1) Finding and selecting the appropriate residence in the new location (66%) 2) Establishing the residence in the new location, including such tasks as arranging utilities, obtaining license/permit(s), setting up local accounts, and attending to other local registration requirements (61%).

Similar to the Destination U.S. study, these responses shed light on the importance of and need for comprehensive destination support and assistance for employees moving internationally.

Destination Services/Settling-in Assistance (Employee and Family) 3% 8% 89% Participated

Did Not Participate

Was not offered/provided

Specific to Destination Services/Settling-in Assistance, respondents were asked to rate the overall impact of these services with regard to the employee’s work productivity.

Destination Services/Settling-in Assistance Impact on Employee Work Productivity

36% Highly Improved 26% Moderately 18% Somewhat

15

12% N/A

9%

Not at all

High Impact Factors Respondents were also asked to indicate if they participated in and/or took advantage of various service offerings including cultural training and language training.

Language Training for Employee 27% 30% 43%

Language Training for Accompanying Family 22% 25% 53%

Cultural Training for Employee 31% 34% 35%

Cultural Training for Accompanying Family 29% 36% 46%

Participated

Did Not Participate

Was not offered/provided

16

High Impact Factors It is surprising to see the vast differences between the percentage of respondents that took advantage of destination services and settlingin assistance provided versus those that took advantage of cultural and/ or language training. Even more surprising is the large percentage of respondents who indicated cultural training and/or language training was not offered or provided as part of the international move.

Further, while the large majority of respondents participated in and took advantage of the destination services and settling-in assistance provided, a mere 36% indicated these services significantly improved their work productivity.

Insights from the live telephone interviews provide some useful and enlightening anecdotal information in this area. The destination assimilation and settling-in process was identified as a high productivity impact by the majority of individuals participating in the telephone interviews. When participants in the telephone interviews were asked “What could have improved your experience?� a significant number responded with the need for more support from a destination services perspective.

Better briefing of destination challenges in advance.

More destination services information.

Better destination services support.

Longer lead in time; better Destination Services support.

More in-depth Destination Services.

Provide a pre-assignment trip.

Destination Services provide school info, more help with housing.

More time to assess new location, either longer pre-assignment visit or initial business trip.

Better, tailored guidelines on housing and schools.

Insightful information in advance of move, then able to arrive more prepared.

New location information provided before move.

17

High Impact Factors Further, those that were offered/provided and took advantage of the destination services/settling-in assistance, as well as the cultural and language training services, expressed a greater level of satisfaction and a higher level of work productivity as a result. These employees indicated that often times, the cultural trainer and/or the language trainer was able to identify and recognize a need the employee and/or family was experiencing that the Destination Services Provider (DSP) may not have uncovered and in most cases, the cultural trainer or language trainer was able to provide support and assistance to the employee in meeting that need.

We as an industry have discussed the importance of cultural and language training for decades. There is a general agreement among industry experts alike that these services contribute to the overall success of an international assignment or transfer. Through the anecdotal data captured in the telephone interviews with survey respondents, it is also clear that when these services are offered in conjunction with destination services and settling-in support, the overall assimilation experience is enhanced and the opportunities for success even greater.

Immigration Coordinating and managing the immigration process was rated as the third highest impact activity in relation to employee on-the-job productivity.

64%

Respondents who were moving internationally for the first time.

57%

All respondents.

48%

Respondents who had prior international move experience.

18

High Impact Factors The following highlights the destination countries rated highest with regard to the impact of immigration on an employee’s work productivity (based on destination countries with 4 or more respondents):

Immigration Rated High Impact By Destination Location USA

Ireland

76%

66%

China

63%

60%

Netherlands

Switzerland United Kingdom

40%

33% Germany

33% 23% Singapore

19

High Impact Factors The immigration process was identified as the highest productivity impact by almost one-third of the 35 survey respondents that participated in live telephone interviews.

The majority of respondents expressed a sense of resignation with the immigration process. There was a definitive recognition that the immigration process “is what it is” and ultimately, no one person can change the process or system.

What was noted was a level of pressure received from the receiving location and/or hiring manager to “speed up” the move process or an unrealistic expectation on behalf of the hiring manager that the employee would be able to move immediately or at the very least, quickly. Other telephone interview participants noted that the immigration process “lacked direction.” Finally, interview participants noted the immigration process being slow and out of an employee’s control can create anxiety that the move itself ultimately may not happen if immigration issues arise.

These comments and feedback point to an issue with not only setting appropriate expectations with employees moving internationally, but also with the receiving organization and hiring managers specifically. Are there ways that expectations can be set more appropriately with the transferring employee? Are there tools that can be utilized to “train” the hiring manager and provide more realistic insight into the process the transferring employee is experiencing?

Best practices to setting realistic immigration expectations include the following:

1

Establish realistic timelines up front – with the employee, the receiving business unit, and the hiring manager. The most critical part of this stage in the process is to ensure that “artificial” or unrealistic timelines are debunked and avoided.

2

Explain the immigration process – again, this explanation should include the immigration partner/provider, the employee, the receiving business unit, and the hiring manager to ensure that all parties involved in the process, either directly or indirectly, are on the same page.

3

Clearly define roles and responsibilities – this doesn’t just apply to the roles and responsibilities of the parties directly involved in the process, i.e., the employee and the immigration provider, but also to the hiring manager. Further, one of the most crucial components of this part of the immigration process is ensuring that the employee has clear direction on who to contact with questions or issues throughout the process.

16 20

High Impact Factors Understanding Compensation and Tax Companies face significant challenges when it comes to communicating compensation effectively to employees moving internationally. However, the effective communication of employee compensation and rewards plays a significant role in overall employee retention and satisfaction. For employees moving and working internationally, perception is reality and the perception of fairness, equity, and transparency is critical. Fairness and equity, by nature, are subjective and culture-laden concepts.

Hay Group’s Most Admired Companies studies show that companies find tremendous value in providing employees with total reward statements. Total reward statements show the total value of base pay, incentives, and benefit packages so employees can see the value they receive in the total compensation package.

Another “best practice” employed by some multi-national corporations involves a consultation with the employee to review a “pre-transfer” or “pre-assignment” pay statement against a “post-transfer” or “on-assignment” pay statement. This provides the employee with a proactive view of how their pay will change as a result of the international move and where the employee will most likely see these changes.

Effective communication requires attention to a variety of factors. There should be an overarching strategy and standard implementation guidelines; however, they should always be adaptable to local conditions and norms. It’s quite possible that a global organization will need to utilize a variety of approaches to ensure understanding across cultures. Employees should understand how pay is determined, including any relevant allowances or incentives.

Equally important is that employees understand the total value of the compensation and benefits package. Written communication should clearly identify who should be contacted if additional explanation or assistance is needed.

21

High Impact Factors The United States as a Destination We already noted that 76% of respondents who undertook an inbound U.S. move identified the immigration process as being particularly challenging. How did the activities rated highest impact by respondents moving into the U.S. compare against the highest rated activities overall?

Highest Impact Activities for U.S. Inbound Moves:

76%

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.

46%

Establishing a residence in the new location including obtaining a driver’s license/permit, setting up local bank accounts, arranging utilities, obtaining local registrations, etc.

43%

Learning, researching, and understanding the compensation-related specifics of the assignment/move including tax ramifications, compensation structure and delivery, employee/family benefits, and pension/retirement implications arising from the move.

38%

Finding and selecting the appropriate residence/home in the new location including touring prospective communities and setting up the new residence.

32%

Arranging and overseeing household goods transportation including packing, delivery, unpacking, customs clearance, etc.

29%

The decision-making process related to accepting or declining the assignment/ transfer with regard to financial situation, including overall financial impact, potential tax implications, cost of living differences, relocation expenses, etc.

25%

The decision-making process related to accepting or declining the assignment/transfer with regard to personal situation, including family/ spouse, new location lifestyle, etc.

24%

Managing ongoing personal financial concerns, issues, and decisions resulting from the move.

22%

Researching, identifying, and managing schooling/educational requirements for accompanying family members in the new location.

22%

Disconnecting from social and support network (extended family and friends.)

22

High Impact Factors Managing Personal Finances Some unique responses from employees moving into the U.S. include challenges with managing on-going personal financial concerns and disconnecting from social and support networks, neither of which fell into the top 10 high impact activities among all respondents.

It is a known issue that individuals moving into the U.S. face significant challenges in establishing credit. Due to the barriers of sharing personal financial information internationally, most foreign nationals arriving in the U.S. have no credit history, even if they have well above average income and well-established credit profiles in their home countries. Unfortunately, an individual’s credit does not travel with them. Building credit “from scratch” takes time and can cost thousands of dollars.

Almost every facet of everyday life in the U.S. can be affected by an individual’s credit score. To help ease the burden for employees moving into the U.S., organizations would be wise to consider not only pre-assignment and pre-transfer tax briefings, but also pre-assignment and pre-transfer financial counseling. Further, it is imperative that organizations understand the services that exist to assist foreign nationals coming into the U.S. with credit migration and obtaining car loans, home loans, credit cards, etc.

Social and Support Networks The six dimensions of national culture, based on extensive research done by Professor Geert Hofstede, help explain why employees moving into the U.S. may face challenges disconnecting from social and support networks in the home country. The cultural dimension most applicable to this impact is Collectivism versus Individualism. Since the U.S. is one of the most Individualistic countries in the world, employees moving into the U.S. from highly Collectivist countries will likely encounter these distinct cultural differences. This is an example of where cultural training can greatly reduce the level of culture shock an employee might face.

“

The fundamental issue addressed by this dimension is the degree of interdependence a society maintains among its members. It has to do with whether people´s self-image is defined in terms of “I” or “We.” In Individualist societies, people are only supposed to look after themselves and their direct family. In Collectivist societies, people belong to “in groups” that take care of them in exchange for unquestioning loyalty.

— Professor Geert Hofstede

23

The Voice of the Employee Survey respondents were asked to opt in to a telephone interview for further discussion on specific topics, and 58% of those surveyed agreed to participate in the interview portion of the survey. Altair conducted 35 interviews over five weeks with participants across 18 countries for more personal and in-depth discussions regarding the challenges that decrease work focus during an international move.

The anecdotal data captured through the telephone interviews not only supports the hard data obtained via the survey, but it also highlights other impactful challenges and issues that employees moving internationally face.

Cultural Integration While the results of the survey did not point to any significant impact on employee productivity as a result of cultural integration or assimilation to the new country, feedback from the telephone interviews showed employees did indeed have challenges with cultural integration. The difference was that the cultural integration challenges were more related to the employee’s organization and host/receiving office and not the new country. Additionally, employees moving into the U.S. seemed to have the hardest time adapting.

This could very easily be tied to the number of participating companies that are headquartered in the U.S. The general feeling was related to a perception that moving into an organization’s head office would be an easier transition for an employee than moving into a nonheadquarters location, or a location outside of the headquarters country. A comment from one interview participant noted that the employee wished he had been treated as a new hire rather than an internal transfer. This employee felt as though there was an assumption that he would know what he was doing and would just easily “fit-in” and find his own way around.

Other interview participants expressed that moving into the U.S. versus moving to locations outside of the U.S. resulted in employers having very different perceptions.

The perception was that an employee moving to someplace outside of the U.S. would need more assistance whereas an employee moving into the U.S. would not need as much support and assistance. There was also often an assumption that employees moving into the U.S. automatically would have access to more formal systems and structured services.

Finally, employees moving into the U.S. more often felt they were assigned to a Destination Services Provider that had no experience living or traveling abroad and therefore could not relate to what the employee was experiencing.

24

The Voice of the Employee Technology vs. Personal Touch Another interesting insight from the respondent interviews was the issue of the use of technology in the global mobility process. There is a common belief that technology is the great differentiator between service providers and that younger generations are looking for more self-service and technology-driven solutions. However, the interview comments paint a different picture. Respondents overwhelmingly felt that while technology is great and definitely helps make the transition process more streamlined, there is no substitute or replacement for personal support and the human element.

A recent article by TechCrunch, an AOL subsidiary, confirmed this notion. A report on the possible economic impact of artificial intelligence (AI) and automation released in January 2017, by the Obama administration looked at the issue at least partly through a policy prism. “Whether AI leads to unemployment and increases in inequality over the long run depends not only on the technology itself but also on the institutions and policies that are in place,” the report stated. It went on to peg the percentage of jobs affected by automation over the next 10-20 years somewhere between nine and 47 percent, a broad range that suggests the true impact won’t be known for some time. In early January 2017, The New York Times reported on a McKinsey study that found while automation is growing, it may not be at the pace we have been led to believe. “How automation affects employment will not be decided simply by what is technically feasible, which is what technologists tend to focus on,” McKinsey’s James Manyika told The Times.

Technology marches relentlessly forward, and it would be foolish to argue otherwise; however, based on the feedback of Momentum respondents, some things remain fundamental, and people-to-people communication will continue to be one of them. Just because the tech is available, doesn’t mean it’s always going to be the best option in every situation.

25

The Voice of the Employee Post Relocation Support from Peers A large number of telephone interview participants noted that post-relocation support is critical and the majority of these employees indicated that support provided by individuals with prior international move experience is essential. Some interview participants even alluded to feeling abandoned upon arrival in the new location, unsure of where to seek out support and assistance.

One interview participant suggested that companies organize forums for the sharing of information and support for their international employee populations. This could be accomplished through round tables or brown-bag lunches at work and could include an external partner as a facilitator.

Another interview participant remarked that advice from current and former expatriates is valuable as these individuals are able to share how they faced and addressed similar challenges. Facilitating access to support networks would go a long way toward helping ensure a smoother assimilation to the new location.

When asked to share what would have helped improve post-move productivity and provide recommendations/suggestions for future international moves, comments included the following:

“ “

Program or onsite forum for expats to share knowledge with upcoming, new expats.

” ”

Culture and settling-in support from someone who had been through the experience.

Follow-up support and roundtables.

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Conclusion and Recommendations Our industry has seen years of discussion and debate around assessing and measuring the success of international assignments. At the same time, there exist multiple studies around how companies are working to control international assignment and relocation costs more effectively.

Neither of these discussions can or should take place without including the subject of employee productivity. As this, our second iteration in the Momentum Survey Series shows, employee productivity loss is not just a concept or theory.

It is a real and legitimate concern as well as a significant expense for companies moving employees around the globe.

For the vast majority of employees, the decision to accept an international assignment or transfer involves a complex set of financial, personal, and emotional variables that are as different as the individuals themselves. Maximizing the productivity of each of these employees may seem an unreachable goal or at best, a daunting task. The personal and emotional factors affecting international relocations and assignments are far more difficult to factor in than the hard costs of travel, housing, compensation, or the transportation of household goods. However, through Altair’s innovative, industry-leading research, companies are now able to pinpoint areas of productivity loss and identify program-specific solutions to help minimize the productivity loss both during and after an international relocation.

• Ensure that the provision of destination services and settling-in assistance is sufficient for meeting an international employee’s needs. Employees moving with accompanying spouse/ partner and/or family will likely need in excess of three to five days of support and assistance.

Be open to exception requests for additional days’ support.

• Encourage participation in cultural and language training in addition to destination services.

Consider mandating cultural training for the employee and accompanying family. If cultural training and language training are not core components of the current international program, consider adding these benefits as core program offerings for all employees moving internationally.

• Set appropriate expectations with all relevant and applicable parties related to the immigration process. Establish formal communication channels for internal sharing of information and education around the immigration process. Clearly identify roles and responsibilities in relation to oversight and issue resolution for the immigration process.

• Provide international employees with a total rewards statement to illustrate the total value of base pay, incentives, and benefit packages so employees can see the value they receive in the total compensation package. Further, provide the employee with a review of a “pre-transfer” or “pre-assignment” pay statement against a “post-transfer” or “on-assignment” pay statement. This provides the employee with a proactive view of how their pay will change as a result of the international move and where the employee will most likely see these changes.

• Afford international employees formal opportunities to network with current and former expatriates and other employees with prior international move experience.

• Treat all employees moving internationally as if they were “new” employees. Do not assume that a current, tenured employee will be able to navigate the new location on their own.

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The goal of the Momentum Survey Series has always been to illuminate the distinct challenges that employees face as they navigate through the relocation/assignment process and to clearly illustrate how much companies stand to lose if employees are not properly supported throughout the mobility continuum. For more information on our research or an in-depth discussion regarding your program specifics and how employee productivity loss may be affecting your bottom line, please contact us at www.altairglobal.com.

To learn more about Momentum and our Productivity Calculator, visit us at altairglobal.com/momentum.

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