Global companies need to continuously evaluate how they should modify their international assignment programmes, which includes improving the overall treatment of the employees on assignment reports Deloitte.

There once was an era when companies provided very generous packages to compensate their employees sent on assignment - they adapted their policies modelled after what other companies did, or stuck to their existing policies.

Competitive IAS programmes are fair to the employee as well as cost-effective

This was back when assignment policies were not questioned, as the need to find employees to be sent overseas was far greater than review of the policies. The primary objective was to offer enough incentives and premiums to induce an employee to accept an international assignment.

However, when the economic environment changed drastically, multinational companies started paying more attention to the high costs of international assignments. In determining the total costs of assignments, companies realised that the total assignment related costs were much higher than they expected.

The questions generally raised once the actual costs were calculated were: "Can we afford this?" and "How can we accomplish our global business strategy in a manner that is both competitive and cost effective?".

The subsequent challenge was - and still is - to explore ways in which a competitive international assignment programme can be provided that is 'fair' to the assignee and at the same time cost effective to the company.

Therefore, reviewing and improving international assignment programmes became an important part of reducing assignment related costs. Companies began to use other compensation methods and started to look at how to reduce programme administration expenses by utilising technology and systems to administer assignments, or outsourcing.

An outsourcing expert can often manage the function of 'assignee support services' in a more cost and time effective manner than an in-house operation. Few would argue with the basic proposition that companies should concentrate on what they do best.

The more recent trend is that companies tend to increase local hiring as a substitute for sending employees on assignment. They also seek alternatives to long term assignments by varying the type and length of the assignments (for instance short term versus long term assignments, commuting, business trips) to realise significant cost savings.

Now that companies understand that designing a cost effective international assignment programme is critical, and in an effort to reduce international assignment expenses, they accept the assignment costs as a necessary investment and focus more on motivating assignees by integrating the assignment into a longer-term career path.

High potentials expect to travel

More global companies now have the expectation that high potential or mobile employees will seek and expect an international assignment as part of their personal career management. Younger employees, for instance, are increasingly asking for international opportunities as a way of raising their personal worth to the company.

Long-term career planning is critical to the success of a globally oriented programme. The selected candidates must be appropriate not only for a specific assignment at hand, but more importantly and for the company's continued global maturity, for longer-term career growth.

As companies become increasingly global in their thinking and physical presence, the value of internationally experienced employees directly impacts the company's ability to achieve long-term business objectives. 
 
International assignments and the experiences gained in the process play an important role in a company's future plans. Business conditions and the changing nature of world economics, the global market and competition  however  make it virtually impossible to guarantee long-term careers with one company.  
 
To simultaneously serve the company objectives and ensure responsiveness to individual assignment concerns, companies should evaluate, review, revise as necessary and continuously improve the design of their international assignment programmes to ensure that they align with corporate imperatives, address the ever-changing needs of their business environment and keep their international mobile employees motivated and retained.

September 2005

Marina Schrijvers is a senior manager in the IAS  Co-sourcing  department of Deloitte in Brussels, Belgium. She can be reached at +32 (0)2 600 6888 or mschrijvers@deloitte.com.