Bangkok--28 Jan--PwC Thailand
As businesses spend an increasing amount of money sending employees on global assignments, it’s a challenge to measure the return on investment from these trips, says PwC.
PwC’s Moving people with purpose: Modern mobility survey, which polled 193 executives from organisations across the globe, predicted that the number of people undertaking global assignments will increase by 50% by 2020. Nine in ten organisations said that they’re looking to increase the amount of globally mobile people over the next two years.
Despite the expected rise in global assignments, however, only 8% of companies are able to put a cost on their mobility programmes. Just 9% measure their return on investment from mobility.
Wasan Chavalitvorakul, a Partner at PwC Consulting (Thailand), said given today’s economic climate, it’s critical for executives, mobility teams and their Human Resources personnel to work in tandem on how to develop strategy and policies that fit business needs, while keeping both costs and value in check.
“Even though more people are looking for international experience each year, most businesses are finding it hard to measure the cost of their mobility programmes,” Wasan said. “They want to know if it’s actually a worthwhile investment.”
Six in ten organisations believe that their global mobility programmes don’t deliver value for money. A further 30% of companies surveyed aren’t even sure how many of their staff work overseas each year, the report found.
Citing the report, Wasan warned that the HR teams of many companies still operate with mediocre resources. They lack the information, investment and infrastructure needed to meet the evolving business landscape. This includes the know-how to manage the growing number of globally mobile employees.
The battle for talent
Further causes of growth in mobility include predicted changes in the availability and location of global talent, according to the report.
More than 50% of graduates aged 25-34 are likely to be living in emerging markets by 2020 including 29% in China, 12% in India, and 6% in Indonesia, it found.
“With rising urbanisation and older populations leading to talent shortages in some markets, it only makes sense for businesses to start tapping into these talent pools now,” Wasan said.
“They should also seek to create a global employer brand to compete for talent with other local employers.”
Looking at Southeast Asia, Wasan said that the burgeoning region would continue to experience increasing out-bound and in-bound talent mobility over the long term, with continued expansion of multinational corporations and the official launch of the Asean Economic Community at the end of this year adding to growth.
“As with regional peers, talent management will become an extremely important factor for Thai operators as they attract the best people in the current competitive landscape.”
The nature of global assignments is also expected to change, according to the report.
Short-term assignments of up to one year will see the biggest increase in usage (58%) as businesses need to get the right people on the ground quickly to deliver projects.
International business travellers are the second biggest group to grow (57%), the report showed, adding it’s also the most challenging type of mobility to manage. Just 17% of companies said they have robust policies, processes and controls in place to manage the tax, immigration and regulatory compliance for business travellers.
Looking at other key challenges created when businesses expand into unfamiliar and difficult to enter markets, Wasan said that tax and immigration compliance is rated as the main challenges to moving employees, followed by safety and pension benefits.
Africa (23%) is rated as the most challenging region to move people to, followed by the Asia Pacific (21%) and South America (17%).
Talent swaps between two countries are expected to be used increasingly as a new type of mobility among global businesses. According to the report, more than one in five companies plan to introduce talent swaps in the next two years.