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Key findingsEXPATRIATE SOURCES AND DESTINATIONSThe current report reflects a continuation of the globalization trend. For example, only 56% of assignmentsinvolved relocation to or from a headquarters country. This was the lowest percentage in the history of thereport and it compares to a historical average of 62%. It also signals an increase in reliance upon thirdcountry nationals for assignments (transferees between locations that do not include the headquarters).Furthermore, there has been an increase in the percentage of intra-regional transfers – from 22% in the2009 report to 27% in this report. Among companies that rely on intra-regional transfers, 49% tookplace within Europe, the Middle East, and Africa; 26% within the Americas; and 25% within theAsia-Pacific region.The United States and China were the top expatriate destinations – reversing the order of the 2009 report.The United Kingdom remained in third position. The results for emerging assignment locations, however,were surprising. While China remained in the top position, Singapore moved from fourth to second place.While India fell from second to fourth place, the United States rose to third place – climbing from itsnineteenth position in the 2009 report. Another unexpected change was Russia; it fell from third positionin the previous report to twenty-first position. We believe that this is possibly a reflection of the continuingstrains in the Russian economy.China, India, and Russia led the list of countries that were most challenging for expatriates – making thisthe fourth consecutive report without a change in the ranking. This year, India took the top position as themost challenging destination for program managers – replacing China, which had held the top positionsince the 2003/4 report. Russia remained in third position, which it has held since the 2006 report.To obtain more specific information about key areas of concern, for the first time we asked which countrieswere most challenging for housing, temporary accommodation, and immigration. For both housing andtemporary accommodation, China and India were the most challenging. For immigration, Russia, theUnited Kingdom, India, and the United States were the most challenging. The United Kingdom, ranking inparticular, is a reflection of changes to immigration law and the United States continues to mirror ongoingsecurity concerns. As in the 2009 report, China and India topped the list of locations with the highest ratesof assignment failure, and the United States was in third position (replacing the United Kingdom).ASSIGNMENT TYPES AND BENEFITSThere was a slight increase in the percentage of long-term assignments, from 61% in the 2009 reportto 64% in the current report. The percentage for short-term remained unchanged and for one-wayassignments it actually decreased 1% from 12% to 11%. With regard to expectations about assignmentlength, respondents presented a more complex picture: On one hand, they expected more assignments of six months to one year – 15% in the current reportcompared to 11% in the previous report. On the other hand, for assignments of one to three years in length, there was a decrease inexpectations – from 55% to 47% in the current report. At the same time, there was an increase in the number of expected three-to-four-year assignments– from 13% to 18%.The shorter assignments may be less costly and less disruptive, and are sometimes easier to approvethan longer assignments. However, in spite of this, it is only the expectation of an increase in short termassignments that we see so far and it remains to be seen if this translates into an actual increase.With regard to the expected increase in three-to-four-year assignments, we believe that companiesare hoping to keep expatriates on existing assignments for an extra year rather than to replace themwith another expatriate, which is very costly, or possibly if there are no open positions available for theexpatriate upon their return.We also noted a shift in the percentage of assignments that were completed on schedule. Compared to the2009 report, there was a 3% decrease in assignments completed on schedule – from 62% to 59%. The

Key findingstop responses to the question ‘why some assignments required additional time to complete’ were a changein business needs, expansion in the project scope, and because there was no successor ready to replacethe expatriate. All of these reasons speak again to the less predictable economic times that companies arefacing. It is possible that assignment duration is positioned optimistically as part of the approval processbut that reality intervenes later and assignments are then extended when necessary. While assignmentextensions are unavoidable at times, we urge mobility managers to avoid the practice of transformingshort-term assignments into long-term assignments because of the corresponding tax implications andadditional expenses.Regarding policies that are currently in place, we noted increasing use of policies for localization (from52% to 58%). We believe that this reflects the fact that localization was once only a “practice” and arecent increase in use of this practice has prompted companies to develop corresponding “policy”. Theincrease in local-hire policies from 37% to 38% and the increase in commuter policies from 29% to 35%,however, are certainly in line with trends we have seen developing over recent years. On the other hand,the percentage of extended business travel policies has fallen from 47% to 44%. This may signal anothershift. Extended business travel was once viewed as a cheap alternative to an assignment, but it is difficultto administer in terms of taxes and immigration and carries a great deal of compliance risk if not done well.Furthermore, when we asked which policies are being considered for the future, commuter assignmentpolicies increased from 30% in the 2009 report to 36% currently. This again is consistent with thesignificant increase within the industry in this type of assignment. We also noted that the practice oflocalizing expatriates after five or more years was at an all time high: 44%. We believe that this is aresult of companies experiencing increased pressure to reduce costs and the administrative burdenof assignments by shifting long-term expatriates to local status. Furthermore, we noted the followingdevelopments regarding the benefit-transition schedule: There was a reduction in the percentage of respondents that transitioned expatriates immediately tothe local benefits structure – from 43% in the 2009 report to 37% in the current report. At the same time, there was an increase from 7% to 11% in respondents who transitioned expatriatesduring a one-year period.These results can be explained by acknowledging that localization has become a more common practicein the current economic climate. However, in many cases, the lack of a transition period seriously inhibitsthe ability or willingness of expatriates to accept a localization. In response to expatriates’ reluctance tolocalize, companies may be providing an incentive to make the transition to local benefits by offering astructured transition to local benefits over the period of one year.GLOBAL BUSINESS STRATEGYThis report documented a record high percentage (58%) of revenue generated outside of the headquarterscountry; the historical average was 44%. It is therefore not surprising that only 56% of expatriateassignments involved relocation to or from a headquarters country.For the first time, we asked respondents to identify where the mobility function reports within the corporatestructure. There has been some excitement about closer collaboration between international mobilityand talent management functions, but when we tabulated the results, only 4% indicated a reporting lineto talent management. In fact, 56% of respondents reported to corporate human resources, and 31%reported to the compensation and benefits function. The lack of innovation in the traditional pattern ofreporting relationships perhaps speaks to the difficulty of making the significant organizational changesthat would be required in order for mobility to report to talent management.The centralization of the decision-making process has reached the highest level in the history of this report:96% of respondents reported that relocation decisions were made globally at company headquarters. Atthe same time, regional decision-making fell from 7% in the 2009 report to 2% currently. This reinforcesour perception that companies are exercising more top-down governance. Driven by the need to managecosts more closely in a weak economy, central human resource departments are issuing guidelines forpolicies and processes, and they are keeping tighter control of the relocation process than ever before.10

Key findingsTo prepare for global expansion, companies continue to pursue centrally directed strategic practices. Forexample, the choice to “evaluate programs to ensure that needs are met” remained in the top positionat 80%. It shared that spot with “align global business objectives and needs,” which historically held thefirst position most often. In both cases, companies are exercising a greater degree of governance as theyevaluate and adapt policies and processes to respond to current conditions. In addition, the choice to“identify a pool of potential candidates” was less of a concern. It slipped from 64% in the 2008 report to49% in the 2009 report and 45% in this report. This trend is an understandable consequence of reducedbusiness activity and the decreasing need to have a pipeline of available candidates.When asked about their method of policy standardization, global policy standardization rose to a historicalaverage of 69% while regional standardization fell to a historical average of 20%. Divisional standardizationremained at 4%. Verbatim comments indicated that the core-flex methodology has gained in popularity.Moreover, we do not believe that regional policies have been as effective as hoped. We believe that thereason for this is related to the fact that companies often find that there is no real justification for offering adifferent package for intra-regional assignments to that offered for inter-regional assignments.Seventy-two percent (72%) of respondents indicated that companies were reducing expenses (versus ahistorical average of 63%.) Furthermore, 84% of respondents reported an increase in pressure to reducecosts compared to a year ago. Companies are finding that there are a number of ways in which to attainthese reductions. So while they continue to reduce or modify policy options as their primary method, theyalso are scrutinizing policy exceptions more carefully and they are increasing their reliance on local hiring.Attempts to reduce vendor fees, however, have been nearly abandoned as a method of cost reduction (itfell to 2% of respondents). Respondents realize that continuous reductions in this area can jeopardize thequality of service. Instead, they are adopting a pro-active stance and are structuring their policy optionsand benefit packages accordingly – placing heavier reliance on short-term assignments and localization.Not surprisingly, the stated objectives for embarking on an assignment have changed to reflect the newculture of cost-consciousness. While “filling a skills gap” and “building management expertise” continue tobe cited as top reasons, “launching new endeavors” has fallen in rank for the third straight year – decliningto fifth place in the current report and losing its former position to “technology transfer.” In responseto significant relocation challenges, participants once again displayed concern about costs, but appeardetermined to make strategic decisions that help them to manage costs, not simply reduce them acrossthe board. For example, the leading challenge remains “cost of the assignment,” but it was followed by“controlling policy exceptions,” which had moved up to fifth position in the 2008 report and to third positionin the 2009 report. We believe respondents are attempting to obtain greater value by managing both policydesign and the way exceptions are managed. Furthermore, the decline in employment opportunities wasreflected in the decline of “finding suitable candidates” to third place.CULTURAL AND FAMILY ISSUESWhile 80% of responding companies provided formal cross-cultural preparation, the percentage thatprovided it on all assignments dropped by 8% (from 35% in the 2009 report to the current 27%). Morecompanies provided it only for some assignments (an increase from 46% in the previous report to 53%currently). Usually the decision to offer it was based on the destination country (57% of respondents).At the same time, fewer companies mandated cultural preparation – only 17% in this report comparedto 22% in the 2009 report and 25% on average. Since cross-cultural preparation is widely accepted toimprove expatriate performance and 83% respondents believe it has good or great value, the lack of apractice that makes the benefit mandatory is disappointing. We assume that the difficulty of quantifyingthe benefits to be derived from this type of training continues to inhibit the way it is offered.As alternatives to face-to-face cross-cultural training, 35% of respondents provided media-based orweb-based cross-cultural training – an all-time high. More companies (25%) use it to supplement formaltraining, and its portability is cited as a chief reason (20%) along with cost (20%). Only 5% of companiesprovided it as the only type of training offered (a decrease from 19% in the 2006 report).When asked which family challenges were critical to companies, respondents once again cited family11

Key findingsadjustment, children’s education, and partner resistance as the top three reasons. Similarly, when askedto rank the most commonly cited reasons for candidates turning down assignments, respondents onceagain cited family concerns, partner’s career, and employee career aspirations as the top choices. Familyconcerns also topped the list of reasons for early return from an assignment (although 7% was not ahigh percentage). With such widespread agreement about the nature of these challenges over such along period of time, the lack of apparent success in addressing them is puzzling and they continue toappear year after year. On one hand, it is possible that companies have not adequately addressed thecareer aspirations of partners, concerns about children’s education, the career aspirations of employees,or concerns about family adjustment during an assignment. On the other hand, it is possible that theseconcerns are unavoidable in any transfer involving a two-career family with children enrolled in school.Again, the difficulty in providing a quantifiable cost benefit analysis means that justifying the cost ofadditional support is problematic and so is rarely pursued.If we take a closer look at how companies assist spouses or partners, once again, the top three choiceswere language training, educational assistance, and company-sponsored work permits. Furthermore thisyear, “assistance with career planning” moved up from sixth to fourth position. Spouses and partners feelstrongly that their professional lives are valid concerns – both during and after international assignments.After all, 50% of spouses were employed before such assignments. Consequently, they are demandingthat companies assist them in maintaining their careers – especially when economic conditions makethis difficult.ASSIGNMENT EVALUATION AND COMPLETIONThe ranking of the top three performance review methods was nearly the same as it has been for the pastfour reports: performance review in the host country, performance review in the host and home locations,and performance review in the home country. In the current report, however, 18% of respondents repliedthat they did not know how expatriate performance was measured – an increase from 6% in the 2009report. It is possible that mobility departments realize that they are separated from the talent managementprocess. Nonetheless, by noting this shortcoming, they at least indicate an awareness of the importanceof knowing how expatriates are evaluated. It remains to be seen if this surprising lack of information will beremedied in the future.When asked about the career impact of international assignments, respondents reported that expatriatesreceived promotions more quickly (33%), which has been the first choice historically. In equal percentages(28%), respondents indicated that expatriates more easily obtained positions in the company and changedemployers more often. We wonder if these responses were based on documented records or if theyrepresented only an impression that mobility professionals have of the career impact of assignments.The responses regarding promotion and obtaining a new position, appear to contradict the conclusionsthat might be inferred from the data on post assignment attrition, i.e. that 38% of expatriates leave theircompany within a year of repatriating and 23% leave between one and two years of repatriating. Howwould expatriates themselves answer this question? We believe that there may in fact be a significantdifference between how mobility professionals and expatriates themselves perceive the career impact ofassignments and that more integrated processes between the mobility and talent management functionsmight be used to gain more information in this regard.There appears to be increasing agreement that successful repatriation is an integral part of theinternational assignment cycle. For example, 74% of respondents now have written repatriation policiescompared to 70% in the 2009 report. In addition, 92% of respondents held repatriation discussionswith expatriates – compared to 91% in the 2009 report and a historical average of 73%. Unfortunately,most of these discussions (38%) take place less than six months before assignment completion, andonly 25% take place before departure. Moreover, only 12% of companies require a clear statementabout post-assignment expatriate duties. In an uncertain economy, it may be difficult to make extendedpost-assignment commitments, but these discussions should be had at least for the expatriates thatcompanies wish to retain. This is another area where a closer collaboration between the mobility andtalent management functions is likely to be beneficial. At a minimum, companies should attempt to holdrepatriation discussion 12 months before the end of an assignment, and they should develop the processes12

Key findingsand milestones, during an assignment, for opening and progressi

The 2010 Global Relocation Trends Survey Report is the 15th annual report issued by Brookfield Global Relocation Services (Brookfield GRS). These reports constitute one of the industry's most reliable sources of global relocation data and trends. The longevity of this report enables us to compare each year's results with