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Meeting Talent Mobility Needs Today and Tomorrow

By Melissa J. Anderson

A new study by Ernst & Young suggests that companies may be approaching talent mobility short-sightedly. According to the research, led by Kevin Cornelius, Human Capital Partner at Ernst & Young Switzerland, only half of the companies surveyed have a global agenda for talent management. At too many companies, mobility is considered an administrative concern, rather than an opportunity for talent development and business strategy.

That means companies are missing out on opportunities, Cornelius says. By aligning business strategy and talent development with mobility, companies can ensure they are sending the right people overseas to meet specific business goals, as well as developing the next generation of senior leadership.

Talent Mobility’s Big Opportunity

The study, now in its fifth year, polled 520 major multinationals on how they approach talent mobility. Ernst & Young found that in many companies, the mobility function is over-looked in strategic importance. That could lead to strategic misalignment, lost opportunities, and wasted money. The report says:

“Global mobility holds a key role in supporting company growth, both in establishing footholds in strategic markets and by giving future leaders vital international exposure. But the function is rarely given the chance: often overlooked by the executive team; excluded from decision-making, including assignee selection, and under-resourced, it lacks the tools or clout to achieve its potential.”

Currently almost half (45 percent) of respondents felt their mobility function was understaffed. On the other hand, the report continues, international assignments are expected to skyrocket over the next few years. This year, the average number of employees on short-term international assignments was estimated at 329. By 2014, respondents estimate the number will be 1,494.

The report suggests that mobility is not receiving the resources it needs to ensure assignments are completed and effective. Part of that reason may be the lack of international experience reported by many in senior leadership. Surprisingly, Cornelius explained, 60 percent of respondents said less than a quarter of senior management at their companies have been on an international assignment. Without the experience or understanding how useful a well-staffed, resourceful, strategic talent mobility function could be, many leaders could be overlooking its value.

As the marketplace grows more global – and emerging markets come to the fore as growth leaders – talent mobility will grow in strategic importance. Companies that realize this sooner or later will gain the competitive edge, Cornelius explained. “We have to start linking talent management to mobility. That’s where companies have to go.”

Repatriation Challenges

The study also identified a challenge around project completion and repatriation. In fact, at 20 percent of companies, six percent or more of international assignments fail (that is, employees leave their assignments before the contract is up).

This may not seem like a lot, Cornelius warns, but in fact, the cost of these projects can be quite high – sometimes three or four times as much as if the employee stayed in their initial job. It can also cause the company to incur extra costs in unfinished work, rushing to find a replacement, and reputational damage. More often than not, the report continues, the reason people leave international posts isn’t related to their work. It’s for personal reasons.

Additionally, companies face a steep attrition risk when it comes to repatriated employees.

“African companies lose 26% of returning assignees within two years of repatriation, compared with Asia Pacific companies, which lose 10%. North American corporations manage 72% of their returning assignees into new positions or assignments but still lose 12% to resignations. European organizations, with 64% and 11%, and South American businesses, at 60% and 10%, are some ways behind.”

Those losses would decrease, Cornelius contends, if mobility could play a broader role in the assignment process – and 84 percent of respondents agreed. “Part of that is around the selection process. At 71% of the companies, the mobility function is not actually involved in the selection of assignments,” Cornelius said. “The mobility profession is really known for helping businesses select the right assignments.”

By working more closely to select appropriate candidates and get them the support they need abroad and when they return, business leaders can better retain and support talented individuals whose expertise could be invaluable as companies expand into emerging markets.

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