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Cost a factor, but not everything

By: Staff Journalist, Singapore
Published: Apr 01, 2009

More HR practitioners are exploring alternative international assignment types to keep costs down and to ease the work involved in administering long-term expat assignments.

Global – Even with the recession, 83% of 430 HR practitioners surveyed say they expect the number of international assignees from organisations to remain the same or even increase.

In a new KPMG’s 2008 Global Assignment Policies and Practices survey, it found that companies are now utilising a broader range of assignment types. For instance, 81% of those surveyed say they now use short-term assignments (STAs), which last less than 12 months. Commuter assignments where employees work in a different country to where they live in are also becoming increasingly popular in European-headquartered companies, which bank on improved mobility within the European Union.

However, the survey found Asia-Pacific headquartered companies tend to prefer development or training assignments (36%), to develop employees and enable them to gain valuable experiences.

The report also found that balancing costs and easing the administration process of international assignment programmes remain a concern for HR practitioners, with 49% of respondents saying international assignments require too much time and effort to administer, while 38% believe that assignees are overcompensated.

To manage expatriation costs, 31% of companies say they use an “efficient purchaser index” to measure the ratio of the cost-of-living between the home and host locations.

But costs are not a concern for some companies (13%), as they say the primary goal of their international assignment program is to achieve an appropriate recovery of their costs. An additional 27% of companies either do not estimate costs related to international assignments or only prepare cost estimates when requested.

According to Ooi Boon Jin, head of the IES Practice at KPMG in Singapore, while companies are concerned about cost reductions, companies are still investing assignments due to business or developmental needs. “When competing in global markets, global experience continues to be critical to the success of the organisation,” Ooi adds.

But when it comes to repatriation, only a mere 4% of companies say they handle the repatriation process well, with 12% offering a formal mentoring or career coaching plan for their assignees. One-quarter of companies also do not know if their assignees have left the company within 12 months of returning from their assignment.

While assignees who quit the organisation after returning often cite the a lack of an appropriate job after repatriation as a reason for their departure, 30% of organisations do not know why their assignees leave the organisation after returning.

In order to retain assignees, Ooi says companies must focus on repatriation process and taking adequate measures to reduce the risk of isolating a returning employee. “For example, utilising a formal mentoring plan to resolve this disconnect cam assist in the overall career succession and an organisation’s talent management.”

Companies featured:

  • KPMG

Saturday, 11 February 2012, 02:21 PM


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