In the corporate sector, recovery from the financial crisis has meant changes for international HR
Moscow, 26 JANUARY 2011: The last two years brought greater challenges for international HR (IHR) with increased cost control, the pressure to localize globally mobile employees and revisit organizational structures. This is one of the main findings of Ernst & Young's third Global Mobility Effectiveness Survey, conducted in 2010.
"Where it was previously common for international corporations to transfer personnel to Russia, today major Russian companies are showing an increasing interest in investing globally, and foreign investments usually involve staff relocation. Russian companies are actively developing this new area and encountering unexpected risks and expenses along the way. The experience of international corporations that have already dealt with such situations and developed optimal solutions can be very useful.
The report on the survey findings summarizes the opinions of a range of participants from 250 international companies based in Europe, North and South America, the Asia-Pacific Region and Africa", said Anton Ionov, Ernst & Young Partner.
The purpose of the survey was to assess the effectiveness of global mobility along with its processes and policies, provide benchmarks of key objectives for international HR management in the current economic climate, and to offer some comparison with our previous surveys from 2008 and 2009.
The key results of this survey include the following:
- 54% of companies report a greater focus on global mobility risk (be it compliance, financial or reputation-related) over the last 12 months.
- In 2009, 81% of companies say that they were planning some cost reduction, but in 2010 only 57% report actually reducing costs.
- Of those that did reduce cost, 74% achieved savings of less than 10%.
- 77% of companies are planning to continue measures to save costs in global mobility over the next 12 months. However, only 9% of companies were able to make an accurate assessment of the assignment costs, and a significant 35% of companies reported that they were not able even to make a rough estimate of their assignment costs.
- 58% of companies report having reviewed their global mobility policy in the last 12 months, and 55% of companies are planning to review/revise their policy within the next 6 months.
- 67% of respondents report that compensation packages were the biggest area where assignee expectations were not met (up from 56% in 2009).
- In 58% of companies, the international HR team is not involved in selection of assignees, while in 28% of companies, IHR is only involved on a case-by-case basis. Just 14% report IHR involvement in the selection of assignees. However, 46% of companies report that they and their upper management believe that IHR should be strategically involved in the selection process, and 64% believe that their involvement would add value in the company.
- 64% of companies have a standardized repatriation process in place, but only 22% rate their repatriation process as good. In fact, 45% of companies report their repatriation process to be unsatisfactory.
Today, cost control remains a major issue, but the challenge is also now moving towards maintaining HR competitiveness, which may be helpful to consider when planning for the future.
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