PwC Sweden · PwC Sweden Mobility Survey 3 In 2009 PwC in Sweden launched its first survey on...

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Measuring the trends within global mobility.

Mobility Survey 2013PwC Sweden

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PwC Sweden Mobility Survey 3

In 2009 PwC in Sweden launched its first survey on long-term international assignments. We are now launching our second survey on the subject. The findings give us an understanding of current trends and how companies are addressing the challenges of mobility in a changing world.

Over the next decade the global competi-tive landscape will change dramatically. We are living in a world that is changing at “warp speed”. For example, the third biggest country by population is today Facebook (if Facebook were a country). The new landscape affects how compa-nies do business and how they compete in this new environment. There are new markets to enter, new demands for new products and new opportunities. Business is driven by companies and the people who work in them. PwC’s global research shows that 94 percent of new graduates expect to work across more geographic borders than their parents, reinforcing the trend that international assignments will continue to be a signifi-cant but necessary cost to organizations. At first glance there is no mismatch bet-ween the new global workplace and the willingness of new generations to work abroad, yet we know that the typical cost for an assignee is four to seven times that of hiring a local professional. There are some questions that we need to ask ourselves: Is the investment needed for every assignee, and is it justified? Does the company always get a good return on its investment?

Historically, we have designed and implemented international assignment strategies and policies that align our bu-siness objectives to the overall business strategy. We have typically formulated long-term and short-term policies. Our survey shows clearly that in order to justify the cost and get a return on their investment, companies need to get better at integrating talent management in the assignee lifecycle and step up their efforts on repatriation. In addition, we may now have reached the point where it is appropriate to devise a policy framework giving the company flexibi-lity within certain agreed parameters as part of a move towards differentiating the assignment package, career deal and global mobility services offered to the assignees based on the planned value of the assignment.

Foreword

Anders Assarson Partner, PwC, Human Resource Services



BackgroundDuring November and December 2012 PwC in Sweden conducted a compre-hensive survey on how companies in the Swedish market manage employ-ees on international assignments. The survey’s primary focus was on long-term international assignments (assignments exceeding one year) but it also addressed mobility questions in general. A total of 57 companies parti-cipated in the survey and a majority of the largest Swedish companies are re-presented. The survey, which consisted of 85 questions, was conducted using a web-based tool and through personal interviews.

0 3 6 9 12 15

How many Long-Term expatriates does your company (i.e. group of companies) have during the calendar year 2012?

SINGLE

1–10 12

7

5

14

11

8

11–20

21–50

101–300

301–

51–100

Number of participants

How many Long-Term expatriates does your company (i.e.group of companies)have during the calender year 2012?

(Single choice)

International assignment – trends Mobility Survey 2013


0 10 20 30 40 50

Please mark your most important regions for Long-Term expatriates (in- and outbounds)

MULTI

Western Europe 38

10

21

10

7

41

Central/Eastern Europe

North America

Africa/Middle East

Other

Asia


Please mark your most important regions for Long-Term expatriates (in- and outbounds).

(Multi choice)


Summary

The results from the survey show that the importance of working abroad has increased since a similar survey was conducted in 2009, and the participating companies anticipate a continued in-crease in the coming years. At a majority of the companies international assign-ments are today a priority or even a cru-cial issue and international assignments are by most of the participants viewed as important for the employee’s career and the development of the company’s talent.

The survey also shows that the trend in mobility is for traditional long-term assignments to be gradually replaced or complemented with other types of inter-national assignments (e.g. local employ-ment, “local plus” solutions, short-term or commuting assignments). Further-more, the survey shows that companies are increasingly introducing policies and guidelines to regulate these new forms of assignments. The increased use of other types of international assignments is justified by cost considerations or a desire for increased flexibility.

0 10 20 30 40 50

In addition to your "standard" Long-Term international assignment policy, does your company also have written separate policies/guidelines which cover any of the following types of international moves or categories?

MULTI

Short-Term assignments 45

28

19

14

7

11

Business trips

Commuter assignments

Other

Trainees/ Develop-mental assignments

Top Management/ Executives assignments


In addition to your ”standard” Long-Term international assignment policy, does your company also have written separate policies/guidlines which cover any of the following types of international moves or categories?

(Multi choice)


An awareness of and focus on costs is still important for the mobility of em-ployees. Cost estimates for international assignments are often produced but ra-rely followed up by the companies upon completion of the assignment. Issues concerning family and ac-companying family members remain important. The survey shows that individual circumstances, such as family situation, are relatively often a problem when recruiting a suitable candidate for an international assignment.

The survey also shows that only a few companies follow up international as-signments over a longer period than one year after the employee’s return.A majority of the participating compa-nies believe it is important to have a better link between mobility and talent management. However, the survey shows that there is often a lack of gene-ral processes to ensure this link.

Estimation of costs for an international assignment is often performed but rarely followed up by the companies when an assignment is completed.


Mobility – development

In recent years global mobility has increased significantly and a continued increase is predicted.

70 percent of the participating compa-nies consider mobility to be a priority or crucial issue for the company’s conti-nued development 90 percent believe that having been on an international assignment is good for an individual’s career development.

70 percent say that the importance of mobility at the company has increased over the past three years.

70%state that mobility is a prioritized or a vital question for the development of the company

70%state that the importance of mobility has increased slightly or a lot during the last three years

40%state that it is not difficult to find candidates for long term assignments

Policy benchmark

75 percent of the participating compa-nies have a global policy for handling ex-patriates on long-term assignments and about 50 percent updated their policies in 2011 or 2012.

At approximately two out of three companies is employment in the home country a principal rule and among a similar share the principal rule is to remain in the home country’s social security system. About 90 percent of the participating companies have a home country pension plan.


0 5 10 15 20 25 30 35

Please describe the employment conditions for an expatriate on a Long-Term assignment (please choose all that apply).

MULTI

Seconded (i.e. employed by Home Company) 32

21

18

29

1

Local contract (i.e. employed by Host Company)

Dual contracts (i.e. employed by both Home and Host Company)

Other

Re-entry guarantee Home Company


Please describe the employment conditions for an expatriate on a Long-Term assignment.

(Multi choice)

0 5 10 15 20 25 30 35

Which of the following approaches most often describes your international remuneration policy?

SINGLE

Headquarter based system

9

32

5

2

4

5

Home country based system

Better of home or host

Local market rate

Other

Expatriate local market rate


Which of the following approaches most often describes your international remuneration policy?

(Single choice)

0 10 20 30 40 50 60

Which of the following are included in your company's compensation package for Long-Term expatriates?

MULTI

Salary 57

42

25

38

49

51

Bonus

Incentive premium for accepting the assignment

Hard ship allowance/ adjustment, if any

Relocation/ repatriation allowance

Cost of living allowance/ adjustment, if any


Which of the following are included in your company’s compensation package for Long-Term expatriates?

(Multi choice)


Costs

80 percent of the participating compa-nies say that cost is an essential factor determining whether the assignment will go ahead or not. 40 percent answer that cost reduction is important.

Three out of four participating compa-nies produce a cost estimate before an international assignment, and of these 30 percent follow up the estimate.

The survey shows that long-term assignments where a spouse or other family members remain in the home country have not increased over the past three years. Among the reasons stated is a reluctance to split up the family. Other forms of international assignment are therefore chosen, such as short term- or commuting assign-ments.

None of the participating companies provide specific benefits to a spouse or other family members remaining in the home country.

The survey points to a wide range of different benefits provided for accompanying family members. The most common is to offer support on obtaining a work permit (more than 40 percent) and providing a “spouse allowance” (30 percent).

Family/Accompanying family

75%

make an estimate of costs of the international assignment

of them who make an estimate of costs do not follow it up

70%

0 5 10 15 20 25

Does your company provide the following for Long-Term expatriates accompanying spouses?

MULTI

Spouse allowance 17

11

22

11

14

5

Spouse pension

Work permit assistance

Job search assistance

Other

Education


Does your company provide the following for Long-Term expatriates accompanying spouses?

(Multi choice)


Approximately half of the participating companies begin the process of repa-triation six months or more prior to the scheduled end of the assignment. 10 percent have a process of repatriation lasting longer than three months after completion of the assignment. 15 per-cent follow up returning expatriates for more than one year after their return.

Almost all participating companies indi-cate that international assignments are important for the development of the company’s talent.

Half of the participating companies say that talent management is part of the selection process prior to an internatio-nal assignment.

Repatriation/Talent Management

50 percent perform an analysis of perfor-mance ratings prior to, during and after the international assignment while 30 percent perform no analysis at all.

50 percent of the responding companies say there is no contact between talent management and the expatriate during the assignment and another 20 percent do not know if any contact takes place.

65 percent find it important to establish a clearer link between mobility and talent management.



90% More than 90% say that having been on an international as-signment is good for the career

50% start the repatriation pro-cess six months or more before the end of the international assignment

10% have a repatriation pro-cess that continues for more than three months after the return home


95% state that mobility is important for the development of the com-pany’s talents, of which 40% think that it is very important

90% state that regular perfor-mance management process is applicable during an interna-tional assignment

50% state that Talent Mana-gement is involved in the selec-tion process in connection with international assignments

50% analyze performance ratings before, during and after the international assignment

30% make no analysis at all


15% follow up the expatriates more than one year after the return home, e.g. if they leave the company

60% state that it depends on the individual circumstances

20% state that it is generally difficult

20% state that it is not difficult to find suitable positions for employees returning from international assignments


65% think that it is important to have a better connection between mobility and talent management within the company for future mobility

30% have contact between the expatriate and talent manage-ment during the international assignment

50% no such contact

20% of the companies do not know


Future issues

Two out of three participating compa-nies believe that mobility in general will increase at the company over the next few years.

The region where international assign-ments are expected to increase the most is Asia.

In response to the question what the big-gest challenge regarding future mobility is, several companies pointed to legal obstacles and complex regulations on tax, migration, pensions and social se-curity. Other companies said the biggest challenges regarding future mobility are to adapt to and meet existing and future expectations, get more women to go on international assignments and meet additional and more complex business needs. Several companies replied that

one major challenge is to find the appro-priate talent for the assignment and an appropriate position for the employee when he or she returns to the home country. A few companies mentioned that financial uncertainty affected the number of expatriates while some emp-hasized that the primary focus was not cost reduction but cost awareness.

The survey results also show that the key to success regarding mobility in the future lies in solutions that are more flexible, as regards the form of assignme-nts as well as compensation models and in terms of obtaining the best possible return on an international assignment – return on investment.


0 5 10 15 20

In which regions, if any, do you anticipate an increase in your Long-Term expatriate population?

MULTI

Western Europe 18

5

10

3

3

4


North America

Africa/Middle East

Other

Asia


In which regions, if any, do you anticipate a decrease in your Long-Term expatriate population?

(Multi choice)

0 5 10 15 20 25 30 35


MULTI

Western Europe 13

6

9

13

4

32


North America

Africa/Middle East

Other

Asia



(Multi choice)


”To satisfy more and more complex needs of the business”

”What are the biggest challenges with the future mobility of individuals in your company?” Some of the answers in the survey

"Pension issues – especially for expatriates staying in several different locations during their career"

”To make it cost efficient and at the same time attractive for the expat”

”Finding the right talent, meeting expectations both during and after the work abroad”

”To meet legal requirements, e.g. in BRIC-countries”

”Getting Talent Management involved”

Our thanks We would like to thank all of the companies that participated in our Mobility Survey 2013 and welcome you to attend our upcoming surveys.

Catarina Böö[email protected] 14 20

Anders Assarson [email protected] 14 23

Henrik Lundh Risinggård [email protected] 33 68

PwC Sweden is the market leader within audit-ing, accounting, tax and advisory services, with 3,800 staff members and 130 offices spread across the country. Using our experience and unique business knowledge, we enhance value for our 66,000 clients, who are comprised of global companies, major Swedish companies and organizations, smaller and medium-sized com-panies, primarily local, and the public sector. PwC Sweden is a separate and independent legal entity. We are the Swedish member firm of the PwC global network. Close to 180,000 people in 158 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

If you have any questions regarding this survey or if you want to discuss the matter further with our experts, please contact:

We regularly conduct surveys on mobility in Sweden and internationally in order to measure development and analyze trends.

“What do other companies do?” is one of the most common questions we get, and our surveys enable us to provide answers to what is market and industry practice.

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