Mobility Services International. Talent Management Strategies to Improve Assignment Effectiveness. Authored by:

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1 Talent Management Strategies to Improve Assignment Effectiveness Authored by: John Brice, Head of Talent Management, MSI

2 Introduction According to widely acknowledged industry standards, between 20 and 45 percent of international assignments fail 1. What this means, generally speaking, is that the organization s objectives were not met by a particular employee on a particular international assignment. In a number of instances, a failed assignment results in the employee leaving the organization altogether. This can become expensive, as sending an employee on assignment typically costs a company two to three times his or her annual salary 2. Organizations assume it makes good business sense, but sometimes it doesn t. They often have a limited view of the assignment process, focusing more on immediate business needs than long-term employee development and strategic organizational objectives such as return on investment. Assignment failure is generally attributed to a variety of standard reasons. These include: Lack of careful planning before the assignment by both the organization and employee (including selection) The employee s lack of relevant skills Inadequate initial and ongoing support to meet the assignment s business objectives Lack of clarity around assignment expectations (including what happens when the assignment is completed). The employee s perception that his or her experience is not valued Degradation of the employee s business and social network To mitigate this and ensure assignment effectiveness, there are a number of steps that can be taken with regard to the organization as a whole and in terms of specific processes. This paper will discuss these steps, which include better integration of talent management functions within the organization and utilization of talent management principles and servic es throughout the assignment lifecycle. 1 Stroh, L., Gregersen, H., Black, J., International Assignments: An Integration of Strategy, Research and Practice. New Jersey: Lawrence Erlbaum Assoc., Inc., Print. 2 A Global Talent Mobility Study: Regional Differences in Policy and Practice, Towers Watson Accessed March 2013 from 1

3 Integration of Talent Management Functions and Principles Although some companies have successfully integrated their HR, mobility, and talent management functions, many have not. In most instances, these functions are currently managed by specialized and often highly siloed groups. Eliminating these silos and integrating functions is therefore an important first step in improving assignment effectiveness, as it results in better employee development strategies, greater efficiencies, and more opportunities for innovation. It can also increase the skills and capabilities of an organization s workforce and create more diversified and global employees and leaders. According to a 2012 study by the Aberdeen group 1, companies are increasingly recognizing this; more than half of the 253 organizations surveyed said their HR teams had become more strategic over the past year. Within these organizations, the HR focus has been steadily shifting from one that is a purely administrative to one that is more closely aligned with the organization s overall business strategy and talent management. As a result, say these organizations, most of their employees (85 percent) are highly engaged. The next step companies can take is to apply coordinated talent management principles and services throughout all stages of the assignment lifecycle (selection, preparation, ongoing support, and re-assimilation). By doing so, they provide employees with a sense of support and improve their experience. And as happy and engaged employees are consistently more productive, the end result is an improved return on investment. 1 Human Capital Management Trends, Aberdeen Group Accessed March 2013 from 2

4 The Selection Process A key component of assignment success is selecting the appropriate candidate, which can be more of a challenge than one might think. Choosing the wrong person, or the right person at the wrong time, is difficult to mitigate once the assignment is underway, even with the best support. All too often, organizations look to known talent to send on assignment, basing selection primarily on the individual s credentials, training, and skills, as well as any previous international experience. It is frequently assumed that the employee s success in previous roles will be duplicated while on the new assignment. However, this is not always the case. Consider, for example, an employee who has married and had children since the previous assignment, and now has concerns that didn t exist before (e.g., schooling for children, quality of housing, medical facilities, the local culture, and the ability of a spouse/partner to work in the host country). According to a 2012 ERC study of 100 companies by Towers Watson, such issues can have a significant impact on assignments; approximately 20 percent of respondents cited family inability to adapt to a host culture as the reason for assignment failure, while 60 percent cited broader personal/family circumstances 1. Other factors that must be considered during the selection process include the individual s flexibility, interpersonal skills, ability to learn, values, and motivation. Does he or she really want to take the assignment or is there a sense of being trapped by the offer? Beyond this, the assignment itself must be carefully considered. Organizations often send employees on stretch assignments to develop them without considering the extent of the challenge this may pose. However, the experience of working in another culture, often with new partners and stakeholders, should always be taken into account. If not, the employee may be stretched too far, which can also lead to assignment failure. To ensure the right fit, best practices for selecting a candidate may include an evaluation of his or her resume in relation to the job description, phone interviews, self-assessment readiness exercises, collection of background information, cognitive and personality testing, and face-to-face interviews. If the employee has a spouse or partner, he or she should also participate. Pre-assignment assessment tools, such as DISC, MBTI, and Hogan, can also be helpful to determine candidate suitability and areas of opportunity. 1 A Global Talent Mobility Study: Regional Differences in Policy and Practice. Ibid. 3

5 Assignment Preparation and On Boarding A lack of clarity around expectations for an assignment, as well as inadequate assignment preparation, can further lead to its failure, particularly when combined with the stress of the transition itself. Therefore, it is essential that both parties (employee and organization) thoroughly understand the assignment s objectives. A best practice is to have a structured communications process is in place that articulates these objectives, along with the specific roles, responsibilities, and level of support to be provided before, during, and after the assignment. The employee must also be thoroughly briefed on the new location and given the appropriate language and cultural assimilation training. The latter, which helps to avert embarrassing or costly business faux pas, typically includes information on cultural beliefs and values, verbal and nonverbal communication styles, business and social protocols, etc. To compliment this, employees can be provided with skill building opportunities designed to help them in areas such as improving management skills, thinking more strategically, leading effectively through change, and developing their teams. In addition to adequate preparation, successful assignments also require individual support during the transition and on-boarding period (the first 90 days). The transition period is often challenging for the employee, as he or she is expected to learn new cultural norms, build new stakeholder relationships, integrate into new teams, and figure out how work is done in the new setting. When these important steps are not supported properly (generally due to insufficient planning around the on-boarding experience), there can be confusion, a lack of productivity, and difficulties assimilating. As might be expected, this can have an immediate adverse effect on employee engagement and the overall assignment. Getting off to a good start is therefore essential, as decisions made during the assignment s onboarding/transition phase can have lasting effects (positive or negative) throughout the assignment s duration. 4

6 Ongoing Support Once the employee is past the transition period, ongoing support is still needed to meet the continuing challenges and uncertainty of living and working in the host country. As Andrew and Martha Miser note in the Routledge Companion for International Business Coaching 1, no matter how much preparation and training expats receive before moving, they will not know what their lives will be like until they re actually in the new location. As such, they need focused and continued support as they acclimate and work in new cultures with new partners, and in new roles that may be more dynamic and challenging then those they ve had in the past. They also need to know where to turn when something is needed. Employees on assignment often feel like they are straddling both the host and home country support systems, not fully tied to either, as they attempt to integrate what they have known into the host country support system. This can lead to a lack of focus and further impact the assignment. This is where assignment-based coaching can prove invaluable, as it offers what many consider a lifeline during a period of much stress and uncertainty. Coaching types vary and can include models that are focused on the employee s specific assignment, cultural assimilation coaching, and/or development and long-term career coaching. There is also peer-based coaching and mentoring provided from support personnel in the home country or by tenured expats. Each method has its value, but all have the ability to significantly improve employee morale and engagement. In each instance, the coach enables the employee to share his or her concerns within a safe and supportive environment. Within a talent management framework, the coach also helps the employee to optimize the assignment from a personal and professional development perspective and recognize areas that need additional focus. Beyond this, he or she serves as both a resource and a point of accountability. 1 Miser, A. and Miser, M., The Routledge Companion to international Business Coaching. London: Routeledge, Taylor and Francis Group, Print. 5

7 Re-Assimilation Planning Another assignment challenge -- perhaps the most costly for organizations -- is the lack of an effective (or any) expatriate management and re-assimilation process, as well as the lack of integration with longer term career development 1. In many instances, employees completing an assignment have no clear understanding of what happens next, although they may believe that working as an expat will ensure career advancement and a bigger paycheck when they return home 2. But this is rarely the case, and the employee may instead return to a role that seems unrelated to the assignment experience. This, perhaps more than other factors, greatly affects employee retention. According to a recent study in the Journal of World Business, 28 percent of repatriates within the 118 companies surveyed quit their jobs within a year of returning from their assignments 3. Among these same companies, the turnover rate for employees who did not go on assignment was only eight percent. If the cost to replace a mid-level employee at an organization is typically two to three times his or her salary, then clearly organizations must find ways to reduce assignee turnover. One of the most effective ways -- in the words of business guru Stephen Covey ( The 7 Habits of Highly Effective People ) -- is to begin with the end in mind. This means that organizations must view the assignment from a holistic perspective and plan for the employee s return early on, before he or she even goes on assignment. The employee should know what is expected of him or her at the assignment s conclusion. Companies must communicate how the assignment will help prepare the employee for his or her next role within the organization or how it will help the employee s overall career trajectory. Beyond this, organizations must also providing re-assimilation counseling to help the employee deal with the logistical pressures of returning home and reverse culture shock. The latter, which affects many returning from long-term assignments, is often more challenging than assimilating to a new culture when the assignment begins. As reverse culture shock can have profound and long-lasting effects, it is a critically important component of re-assimilation counseling. 1 Stahl, G., Cerdin, J. Journal of Management Development, Global careers in French and German Multinational Corporations. January 2004, pp Bolino, M., Journal of International Business Studies, Expatriate Assignments and intra organizational career success: Implications for individuals and organizations. May 2007, pp Ren, H., Bolino, M., Shaffer, M., and Kraimer, M., Journal of World Business, The influence of job demands and resources on repatriate career satisfaction: A relative deprivation perspective. January 2013, pp

8 Conclusion International assignments present unique opportunities for both organizations and employees. When handled correctly, they can yield substantial benefits to both; when handled incorrectly, they can be a considerable waste of resources. In a survey of talent management executives at 37 multinational companies, international assignments were ranked as one of the most effective talent development tools 1. Therefore, maximizing this experience is important not only from a dollars and cents perspective, but also in terms of overall strategy. As a number of recent studies have noted (e.g., PwC s Talent Mobility: 2020 and beyond), the talent shortage is expected to significantly increase over the next several years, further fueling the war for talent in an increasingly competitive marketplace 2. Organizations that develop and utilize a talent management mindset and truly integrate talent management practices into their global mobility programs can be prepared for this and can greatly improve assignment effectiveness. In the end, as we have noted, this ultimately helps companies retain valued employees, increase return on investment, and meet their global business objectives more effectively. 1 Stahl, G., Bjorkman, I., Farndale, E., Morris, S., Stiles, P., Trevor, J., and Wright, P. M. Global Talent Management: How Leading Multinationals Build and Sustain Their Talent Pipeline. INSEAD Faculty & Research Working Paper Talent Mobility: 2020 and beyond Accessed March 2013 from 7

9 About the Author John Brice, is Head of Talent Management at MSI (), where he leads a team of experienced talent management professionals providing consultatative expertise to organizations looking to grow, compete and globalize. He is an active member with World Wide ERC s position around the growing topic of talent mobility, including serving as a speaker and facilitator of the industry GMS-T (Global Mobility Specialist- Talent) designation. John can be reached at john.brice@ msimobility.com. U.S. Headquarters One Liberty Lane East Hampton, NH 03842, USA toll free direct fax info@msimobility.com Western U.S. Operations Center Denver Corporate Center 1 Suite 100, 4700 South Syracuse Street Denver, CO 80237, USA direct fax info@msimobility.com EMEA Headquarters 3rd Floor, New Baltic House 65 Fenchurch Street, EC3M 4BE, UK direct fax emea@msimobility.com Asia Pacific Headquarters Suite 2118, 21/Fl. Shui On Centre 8 Harbour Road, Wanchai, Hong Kong direct fax apac@msimobility.com