Vital statistics: 44% increase in international assignments by multinational companies

Tuesday, June 20, 2006

Vital statistics: 44% increase in international assignments by multinational companies

According to a new survey by Mercer Human Resource Consulting, a global HR and financial advisor, 44% of 200 multinational firms questioned report an increase in the number of international assignments to and from locations other than the headquarters over the past two years. Much of the increase in the number of international assignments is due to the widespread use of short-term placements which have become more prevalent over the past few years. According to survey findings, while the vast majority of multinational companies (84%) place employees on short-term assignments, only about half (56%) have a formal policy for this type of assignment.

"Short-term assignments are generally more cost-effective than long-term assignments and they allow companies to transfer skill sets quickly and easily. However, for short-term assignments to be successful, companies need to develop well-defined policies to manage costs and limit risks," said Yvonne Sonsino, a principal with Mercer in London. Incentives and cultural support Only 22% of companies say they do not provide mobility premiums as an incentive for international assignments.

However, far more companies provide these premiums systematically for long-term assignments (73%) than for short-term assignments (31%). Gareth Williams, a worldwide partner in Mercer’s Chicago office, said: "One of the main reasons that assignments fail is because expatriates and their families cannot successfully adjust to their new environment. Companies are recognizing the importance of providing support in advance of employee moves. Investment in language and cultural training, for example, can dramatically improve the chance that the international assignment will be successful."Other Mercer survey findings related to trends in international assignment programs include:

· The proportion of female expatriates has increased significantly, from 8% five years ago to 13%. North America and Asia/Pacific lead this trend. Females now account for 14% of the expatriate assignments of companies based in Asia/Pacific, compared with 9% five years ago.
· 72% of the survey participants provide language tuition and 60% of companies provide cross-cultural training, but the critical process of integration once in the host country is typically left to employees.
· Globally, 42% of companies provide expatriates with free housing, but for North American companies, the figure is just 22%.
· Some 50% of companies include spouse support in their international assignments policy; 11% do not have a policy but are developing one, and 12% handle spouse issues on a case-by-case basis.
· While the majority of companies surveyed believe they have a general understanding of the cost of their international assignments, only a few are in a position to measure the specific expense, resulting value, and, ultimately, return on investment from such postings.


More information about Mercer’s 2005/2006 International Assignments Survey can be found here.

source: the source Melcrum

Blogged on 11:15 AM by Upay

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