Here are a few things to remember when instituting a cross-cultural awareness program into your corporate relocation program. For a full account of information regarding this service visit our resource library.

Don't forget the family
Just as spouses should be involved in the assignment selection process, they should be involved in training for global assignments. Some experts estimate that nearly 80 percent of all failed global (international) assignments can be linked to the spouse's inability to adjust to the new environment. Each member of the family faces special issues in the expatriate environment that should be addressed.

Other cultural resources
Organizations should consider utilizing their returning expatriates for help with cultural awareness initiatives. Employees who have already completed similar assignments can act as subject matter experts (SMEs) to help new expatriates learn business customs and how to navigate foreign business circles. SMEs can also prove invaluable in helping new expatriates learn the hierarchy in companies with which they will be dealing. It's important to note, however, that companies should not rely solely on employees to provide guidance to new expatriates. Relying exclusively on veteran expatriates can be problematic if the guidance reinforces cultural stereotypes or results in the new expatriate adopting the predecessor's bad habits. While other international assignees have a role to play in helping newcomers adjust, they should not replace professional consultants/trainers.

Alternative views
Although cross-cultural awareness is important, some might argue that its importance is just a hyped up myth. In actuality, on average only 30 percent of American managers sent on international assignment lasting from one to five years receive any cross-cultural training. It can be argued that managing is simply "managing," so where it is done is irrelevant. Another point of view is that any type of short-term cultural training would be ineffective because people can't learn to work and live in a foreign culture after only a few days (or even a few weeks) of training. Others argue that an understanding of a country's culture is something people assimilate over many years based on personal experiences in that specific culture. Others will say that corporate culture takes precedence over country culture. For example, a local employee working for a "bullish" American firm in Thailand might show traits of aggressiveness and conflict, which are not traits normally associated with the Thai culture. These traits, however, may be common in the corporate company culture of the employee's organization, causing the Thai employee to act outside his or her normal cultural dimensions.

Nevertheless, in order to be successful, an expatriate must be comfortable with his or her staff, colleagues, clients and business atmosphere--regardless of location. Cultural specialists also agree that to be successful in dealing with people from other cultures, expatriates need knowledge about the cultural differences (and the similarities) among work locations. The global employee of today's business world can only benefit from gaining cultural awareness, either through direct training or personal experience, which would lead to greater professional effectiveness and company performance. Read more

If you would like more information about cross-cultural education and how it can be added to your international relocation package/program, please contact our corporate relocation consulting team.

What is a group move?
The definition of a group move is when 10 or more employees are being transferred from the same area and to the same area, at the same time, for the same business reason. Group moves are critical to the performance of the company and are of high strategic value in meeting the objectives of the business plan. If the group move is being driven by either a merger or an acquisition, the pressures only become greater as the already charged environment that a group move can create is compounded with the added factors of merging two different cultures. This reality, combined with the inherent risks that a merger or acquisition almost always adds, results in higher stakes and more pressure on corporate relocation program managers to make sure that the right group move process be in place.

Why do group moves fail?
In a series of internal reviews with subject matter experts who have had extensive experience in assisting our clients in planning and managing a wide range of corporate group moves, a number of reasons repeatedly rose to the top as to why a group move may fail:

• Announcing the move without adequate preparation or involvement
• Not having clearly defined objectives
• Lack of time and/or poor planning
• Losing control of the relocating transferees
• Not understanding the unique needs and dynamics of the group
• Not bringing outside resources in early enough
• Political pressure to use non-qualified suppliers
• Lack of senior management endorsement and involvement

How do you avoid the pitfalls? This topic will be covered in our next post. For more information about this subject or to view the complete white paper, visit our resource library.

Imagine that you are just leaving a meeting where you were told that your employer has decided to relocate a group of people from one location to another. The CEO told you that you are expected to manage the move. He/she stresses to you that the success of this group move is critical to the future of the company and everyone is counting on you to, "make it happen." Any number of business scenarios could lead to this decision.

Even though this may be your first experience in managing a group move, you may have heard stories about the stress group moves can bring to an organization and the people who are working on the relocation. You may recall hearing how a group move does not always turn out as planned, and that a lot can change between the time the plan is initiated and the last employee is in place at the new location.

Whatever you do, you need to be prepared for the responsibility of:

• Business disruption
• Talent loss
• Low employee morale
• Cost overruns
• Having your plan for the move challenged by others

You may not be able to eliminate all of the issues, but if you can bring an effective plan to the project and assemble the right team to execute the plan, the odds that the move will be a success and that you will survive the group move will be greatly  improved. The intent of our "How to Effectively Plan for a Group Move" white paper is to provide you with a proven approach to effective group move management.

 View white paper

If you would like more information about corporate relocation services including group move management consulting, contact us.

• Host country information. Basic information about the assignee's host country, including its history, common religions, political structure and recent events, so employees can understand citizens' values and beliefs.
• Behavior adaptation. Although people have a hard time challenging their cultural understanding, they can learn to alter their behavior to adapt to a new culture. In this phase of cross-cultural training, expatriates examine the way that they currently handle a situation and what is required in the new culture.
• Local business etiquette. Even the most veteran and prolific employee can have difficulty without an understanding of business etiquette in other cultures. For example, the U.S. tendency to "get down to business" is regarded as rude in Japan, where business transactions often have a greater personal relationship component. An employee who appears impatient with Japanese traditions designed to establish friendship and trust will have little success in business negotiations.
• Communication techniques. A manager going to live in a foreign country for the first time might not realize how communication styles differ around the world. For example, U.S. employees tend to use "low context" communication, which is direct and task-oriented. Many other cultures have "high context" communication, in which messages are more indirect, like in the Middle East.

For more information about components that make cross-cultural programs successful, view our white paper, "Importance of Cross-Cultural Awareness."

Accurate and timely accounting of relocation expenses has a far-reaching impact on the overall performance and success of a corporate relocation program, to both the company and the individual transferee. With relocation costs per employee homeowner topping $70,000 in recent years (according to averages reported by Worldwide ERC), effective management of expenses can easily exceed several million dollars annually for a company. Because all relocation services funnel through the expense management function, to be appropriately recorded and paid, this function is a significant responsibility for those managing the relocation program. As a result, corporate relocation managers and/or payroll managers should consider several key issues when evaluating the effectiveness of the expense management process in their companies...read more.

The decision to relocate sets in motion a number of key events. One event that can quickly raise the level of stress in a transferee's life is trying to physically and mentally plan and adapt to working in a new location. While there is the expected stress of a new job and a location, there is also the stress of being separated from family and/or friends, as well as the reality of being moved from familiar surroundings for a certain length of time, if temporary housing is needed.

There are a number of factors to consider when building a U.S. domestic temporary housing component into a relocation policy. A properly constructed benefit reflects a prudent use of corporate funds, and is flexible and easy to administer, takes into consideration possible impacts on lifestyle, and is in balance with other components of a relocation policy. 

To view key points to consider when creating a temporary housing relocation policy, visit our resource library.

Over the past few years, a trend has developed with regards to the localization of expatriates. An increasing number of organizations are either adding localization as a new element to their global mobility program or expanding on existing policy and practices—the main driver of this trend is cost containment.

As a refresher—localization is the process when an employee is moved off of the expatriate package and integrated into the host country on local terms of employment.

What Triggers Localization
Localization is usually triggered by a pre-defined limit to assignment length, most commonly three to five years. It is best to proactively address this threshold either in a global assignment policy and/or in the expatriate’s letter of assignment. By communicating a location policy early on in the assignment process, an organization can reduce unplanned or ad-hoc localizations, reduce expatriate demands and negotiations, and reduce the overall “shock” factor to employees.

What Approach to Take
There are a few different approaches to recognize when managing localizations. The first and most common approach is a straight localization, which entails immediately eliminating all expatriate benefits, e.g. housing, COLA, home leave, etc., on the effective date of localization. To execute a straight localization, it is important that the organization has a clearly defined localization process, and re-communicates the process and policy to the expatriate as early as possible. Not surprisingly, moving from a full benefit package to no additional assistance can cause great strain on the employee, especially if they have family accompanying them on the assignment.

The second approach is to phase out the expatriate package over a pre-determined length of time. The transition over to a “local” package can take anywhere from six months to two years. For example, many companies continue to pay a reduced housing allowance for six to twelve months after the effective date of localization. Other provisions that tend to be phased out in exceptional cases include education assistance and home leave.

Another approach is the lump sum approach. This involves the expatriate immediately transferring to local employment. A lump sum payment, however, is offered to the employee to alleviate some of the financial strain of localization. The lump sum can be used to cover education costs of children, assist with home finding and purchase, or to ship household goods from the home country. A lump sum approach is ideal for organizations that like to remain flexible and give their employees the freedom to decide how they want to utilize the localization assistance.

SIRVA recently released a whitepaper dedicated to outlining our fixed-fee home sale program and how it can improve predictability and reduce real estate risk in a slow housing market. Below is an excerpt from this whitepaper, along with a link to the complete document.

The U.S. housing market is continuing to slow, and most economists and housing professionals predict the housing slump will linger longer than previous forecast. Total home sale costs become less predictable in sluggish real estate markets, and unpredictable home sale costs translate into unpredictable total relocation costs.

Relocation service companies offer several home sale programs, each with varying levels of risk, to help employers relocate transferees. Employers should consider the advantages of each program to determine the level of risk involved, and those employers who want a predictable and low-risk home sale program should consider a fixed-fee program.

For more information about our SIRVA’s fixed-fee program, view the complete whitepaper or contact us.

Relocating is often a stressful and confusing event in anyone’s life and career, especially if the transferee is going through his/her first relocation. Lack of role clarity (who does what) and inadequate information throughout the process will not only amplify a transferee’s stress, but will also directly impact the outcome of the corporate relocation. There are a number of measures that can be taken to make the relocation process easier. One key action is to include a section in the relocation policy that defines specific roles and responsibilities of all transferee resources.

When defining roles and responsibilities during the relocation process, there are a number of key points to remember. We are going to outline a few of them here, but encourage you to view the complete article in our Resource Library.

Internal and external resources
Include internal and external resources when defining roles. In many cases, the transferee is starting a new position with the organization and may not immediately understand where to go for support. Identifying internal resources early in the relocation process will enable the transferee to assimilate into the new organization quicker, he/she will feel more comfortable, and will also feel more in control of the relocation.

Setting transferee expectations
Clearly lay out the company’s expectations for the transferee during the relocation. This will help prevent the employee from straying outside the policy and limit the need for exceptions. Decreasing exceptions goes a long way toward alleviating the dissatisfaction that can result if a transferee finds out they were treated differently than others at their same salary or grade level. More and more companies have placed wording in their policies that clearly outlines that exceptions are not expected, and if requested, will be escalated to a senior-level executive for approval. It should be noted in policy that the transferee is a visible representation of your company and needs to act and behave in accordance with your company’s code of conduct.

View more points to keep in mind when defining roles and responsibilities for corporate relocations.

When localizing an expatriate, there are several compensation items that need to be considered. Here is a checklist to use a guideline:

1. Base salary. Should the employee be "re-priced" to the local market pay structure? Should a premium be offered for international experience? Many organizations move the employee to local salary levels. If there is an extreme difference in salary levels (either lower or higher), however, a phased-in approach is often carried out. On the other hand, oftentimes organizations justify paying an expatriate on a higher pay structure because of his/her international experience and business relationships with the home office.

2. Retirement benefits. Because retirement plans, social security and pensions do not cross national boundaries, this is often the most difficult item to transition. Often employees have expectations to remain on their home country retirement program, but unfortunately there is no typical solution to bridge the gap between country plans. Some basic alternatives include retaining the employee in a tax-qualified home country plan, simply transferring to the local plan or using an umbrella-funded plan.

3. Income taxes. Normally, the expatriate will simply transfer to the local tax system. This is not a problem for most of the world. American workers, however, are put in a difficult situation because they are taxed on a worldwide basis. Many organizations will continue the "tax equalization" process on an as-needed basis to prevent double taxation on American expatriates. Employees of other nationalities do not require such assistance.

4. Housing. It is recommended that organizations remain flexible regarding host country housing because many factors come into play when deciding how to handle housing for the expatriate. In many locations throughout the world, expatriate housing is vastly different than local standards and expectations. In some cases, it may be unreasonable to expect an expatriate to move into a local neighborhood or local style housing, e.g. Mumbai, Beijing, Jakarta, etc. Therefore, if the expatriate is moved to the local salary structure, a housing allowance may be needed to subsidize continued living in expatriate style housing. Other issues that arise with housing tax issues, family matters, property ownership laws, home search assistance and moving costs.

5. G&S differential/assignment incentives. In locations where assignees receive a G&S differential, the common practice is to immediately stop the allowance. Other options include a phase-out or lump-sum buyout, although it is rare for companies to continue to pay a G&S allowance beyond the effective localization date. Other assignment incentives such as mobility premiums, hardship allowances, etc. are also normally stopped upon conversion to local status.

6. Education for dependent children. After housing, this item is the most commonly subsidized cost after an expatriate is localized, especially if the local schools are inadequate based on international standards or if the host country language is an issue. To alleviate the problem, organizations should consider continuing education coverage, or pay a percentage of the education costs for one to two years.

7. Health care. Health care standards and costs vary greatly in different parts of the world and is a priority issue for most employees and their families. Normally, localizing employees will simply transfer into the local health care system, but concerns will arise if the health coverage in the new location is of a lower standard than in the home location. This will be a costly change for an employee coming into the United States, where typically the health care is more expensive. Because of their time spent in the host country, a localized employee will most likely be aware of the issues, and therefore be in a position to make appropriate decisions.

Finally, localization may subject the employee and the company to various employment laws and regulations that apply to employees hired by local companies. It is important to speak with a local employment counsel to understand the legal effects and ramifications of localization, including subjecting the company to stringent employment laws in some European countries.
Localizing expatriates can be a complicated process and is not as simple as transferring expatriates to a local compensation package. By having a strategic plan in place, companies can anticipate potential localization issues and make the process as efficient as possible.

The decision to relocate an employee or new hire is the result of a great deal of effort and evaluation by a company and then by the prospective transferee. Agreeing to relocate at the request of an organization is not always an easy decision for an individual and his/her family to make. When describing your company’s corporate relocation policy it is important to remember that no matter what the circumstances are, agreeing to relocate will begin a stressful and sometimes life-changing process for most transferees. When crafting the relocation policy it is advisable to look beyond just describing the level of benefits that will be provided. You should also consider if the policy will assist and support the transferee when it is examined at the start of the relocation.

When writing a relocation policy there is a checklist of things to keep in mind when setting the right tone:

Optimistic Empathy
Start your company’s relocation policy with a supportive and positive welcome or introduction. Recognize what your company is asking transferees to do and acknowledge what they may face during the relocation process. Let the transferee know that your company understands the experiences of other transferees that have preceded them. Point out that understanding and following the relocation policy will minimize the disruption to the lives of the employee and their families. Close the introduction with words of appreciation and thanks for accepting the relocation.

Rational Processes and Requirements
When describing a process or requirement in your company’s policy, include the reasons behind the wording. Letting the transferee know the “why” can often increase voluntary policy compliance and reduce the level of enforcement needed. While relocation is a complex process and there are a number of hard rules that need to be followed, the tone of the policy as being one of mutual benefit is critical. The key is to avoid setting a negative and controlling tone that may offend the reader and create a pessimistic view of the relocation process and even perhaps of your organization.

Clarity and Firmness
A policy needs to be both clear in what it says and firm in how it says it. A policy should not give the impression that the components are subject to personal interpretation and/or can be negotiated. Some policies even state up front that the company is ”…please to provided you with a quality relocation program and exceptions are not anticipated.” While the tone needs to be supportive, the policy must still clearly state what benefits will or will not be provided. If the company style/format guidelines permit, write the corporate relocation policy in the second person voice. Using the pronouns “you” and “your” adds a personal tone to the policy. It also assists the employee in understanding what processes and procedures he or she must follow.

There is no such thing as a small relocation, but some companies don't require the large-scale support needed by those relocating hundreds or even thousands of employees annually. For these companies, SIRVA Advantage might be the answer. SIRVA Advantage is a program developed specifically for companies that relocate fewer than 30 employees per year. Currently, 120 companies participate in the program.

Through the program, companies have access to a dedicated service delivery team with specialized experience in small-volume relocations. Users don't have to be experts in relocation because all the details are handled for them. SIRVA can get a relocation program up and running quickly, and because they manage every aspect of the program, companies don't have to worry about the details. Transferees receive the full benefits of having a corporate relocation provider manage their transfer without the large corporate relocation budget.

"Companies that relocate a small number of employees have different needs than those of their large-volume counterparts," said Tim Callahan, senior vice president of sales and marketing SIRVA, Inc. "These companies may not be as familiar with the process or the complexities involved in different domestic or international relocation scenarios because they simply don't relocate employees as often."

Using SIRVA Advantage, companies can choose their services á la carte, which offers them the flexibility to develop a cost-effective custom program to fit their needs. SIRVA Advantage provides companies with guidance and assistance on a range of relocation issues, including:

• Domestic and international support
• Fixed-fee or traditional home sale programs
• Home marketing services
• Home finding and new home purchase services
• Home rental and temporary housing services
• Mortgage services
• Move management
• Tax and legal services
• Vendor contracts
• Online relocation tracking and reporting

One-on-one attention and interactive tools
The Advantage process starts with a consultation between our client and SIRVA Advantage's Business Development Manager, Jane Yanosko, to coordinate services tailored for each transferee - with this program a corporate relocation policy is not needed, SIRVA's abbreviated contract serves as the purchase order for all services authorized by the client. Once services are determined and the transfer process is initiated, the client and the transferee receive dedicated support from relocation counselors and associates focused on serving clients with fewer than 30 relocations annually.

In addition, transferees have access to MoveOurHome.com, a Web portal designed to help them take an active part in their move. MoveOurHome.com has up-to-the-minute relocation information configured on a per-client basis. On the site, transferees can view company-specific policy information and transferee-specific relocation program information.

"Transferees can submit, view and check the status of expense reports, communicate with their relocation counselor, and specify home and area preferences," continues Callahan. "They also have access to an online move organizer and essential destination information such as weather, crime statistics, school reports, population figures and other community information."* SIRVA Advantage was developed based on input from current customers and internal service teams, and is designed to provide a company will a small or no relocation program a high level of service on a more flexible, on-demand basis.

To learn more about SIRVA Advantage, contact Jane Yanosko, SIRVA Advantage business development manager, at 800.531.3840 or jane.yanosko@sirva.com.