Expats are among the most expensive but least tracked part of any organisation. Why do companies often fail to assess Return on Investment (ROI) on international assignments and what can be done about it?

ROI: a moving target?

Even among companies with a sizable expatriate staff, it is not a lack of interest in evaluating what return an overseas employee provided that hinders ROI assessment. It is the range of variables – from specific short-term goals to qualitative long-term career advancement – that can make effectively assessing ROI seem like a moving target.

"These things are not only difficult to measure but operate over different time scales," said Chris Brewster, professor of International Human Resource Management at Henley Management College in England.

ROI typically implies financial issues, said Alan Chesters, a UK-based HR consultant who worked for BP for 20 years. But for international assignments, this is problematic and companies should be looking at setting and measuring objectives.

"A lot of people are moved around either as a way of developing the individual or as a way of developing the organisation," Chesters said. "Measuring that is extraordinarily difficult."

Evaluating ROI

There are several ways to evaluate ROI, said Lisa Johnson, director of consulting services at Cendant Mobility, a provider of global mobility workforce and management development services.

One is to set specific goals, such as setting up a new IT system or opening a new office. However, said Johnson, "a lot of international assignments don't have clear-cut objectives."

In this case, companies should set expectations for several baseline competencies that will be gained from the international experience. These could include creating new networks in Europe, mentoring new hires or developing intercultural skills.

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