Multinationals not effectively deploying their mobility programs in line with their wider business agendas to drive competitive edge
New York, 29 October 2013
More than half (56%) of mobility executives working in multinational companies today reveal that their mobility teams are involved only in deploying services, playing no role in talent management and wider business objectives, according to a new survey by EY. This is despite an overwhelming majority (83%) stating that mobility has a positive impact on career progression, helping to create future leaders and drive competitive advantage for their organizations. Nearly half (42%) of the respondents say they do not even have a global talent management agenda.
The majority of mobility professionals are either on the outside, struggling to understand their future role, or are too busy with operational day-to-day tasks to elevate their role. Half of the respondents say their mobility team is understaffed. This operational burden is illustrated by the fact that seven in 10 (68%) are preparing internal paperwork and sign-offs, while 69% say they are not involved in the assignee selection process.
Seventy-eight per cent of the 264 senior mobility executives interviewed for Your Talent in Motion: Global Mobility Effectiveness Survey 2013 reported that their mobility function did not measure return on investment (ROI). Most organizations also come up short in tracking what happens after an assignment ends – such as employee retention, performance rating and career progression – with 16% of assignees leaving the company within the first two years after repatriation. A further 41% simply are returning to their pre-assignment position.
Dina Pyron, EY Global Director, Human Capital, says: “With the globalization of markets comes the need to have talent that understands, relates to and can compete in these diverse markets. Mobility professionals must play a more effective role in strategic business planning, rather than focusing on immediate needs, to drive competitive advantage for their organizations.”
“Mobility teams offer valuable insight on travel issues, compliance and cultural differences that other business units often overlook. Yet, many companies are still hesitating to link the talent management team with the mobility function,” says Leslie Fiorentino, EY Americas Mobility Services Leader. “An integrated team can find ways to improve retention and advance careers, while finding ways to create a more diverse pool of business travellers.”
Organizations do not have adequate tax, payroll and immigration procedures in place, despite emerging market growth
The survey also reveals that many organizations do not have the adequate procedures in place to track tax, payroll and immigration issues for those on formal or informal assignment. This is despite almost half (49%) reporting deploying more employees into high-growth emerging markets, where laws are constantly in flux:
- 40% report that they do not have a formal risk control framework to monitor payroll tax and social security compliance
- 31% report that they have had to engage outside consultants or firms to address violations
- Few mobility teams monitor ‘business travellers,’ or those not on formal assignment, with 73% saying that they are not part of the global mobility team’s responsibility
- 73% are not using technology to track their people’s activity
- Only 30% have a system in place for tracking ‘business travellers’
Jane Malecki, EY Americas Global Mobility Policy Advisory Leader for the Americas says: “Companies expanding into growth markets will struggle to run an effective mobility program if they continue to grow with underdeveloped mobility policies and neglect to create a formal risk control framework for travellers. Companies could increase the ROI on their mobility programs if they establish an effective way to track business travellers. For instance, 64% of companies have incurred avoidable penalties for non-compliance. These fees affect the bottom line and will only grow more complicated as new markets bring unfamiliar laws and practices as well as cultural and linguistic differences that can create unforeseen exposures to risk.”
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This news release has been issued by Ernst & Young LLP, a member firm of EY serving clients in the US.