Ensuring Return on Expat Investment
Posted on June 29, 2009 by Atul
By Jennifer Hamm
International human resource managers have long struggled to articulate the return on investment for expatriate costs.
Smart HR managers will be sure to highlight the findings of a recent
study by Dr. Michael Dickmann in their next presentation on expat ROI.
(Companies spend an average of $311,000 a year on each expatriate.)
An academic authority on expatriate management, Dickmann runs the Centre for Research into the Management of Expatriation (CReME) at the Cranfield School of Business in England.
His study, conducted in conjunction with PricewaterhouseCoopers, found that productivity jumps while the employee is on assignment, stabilizes when he or she returns and then increases again.
But
the key to ensuring ROI during and after assignment, the study finds,
is articulating specific goals and purpose. Though this may seem
obvious, the study – "Measuring the Value of International Assignments"
- found that many fail to do so.
As well, the study notes that evaluating expatriates "tends to be
handled by the host country only, despite suggested best practice and
most organizations' stated goal of involving both the home and host
locations."
Perhaps the study's most compelling result is that 15 percent of
assignees leave their organization within a year of repatriation.
"Companies are at risk of losing their expatriate staff because they
fail to devise a career path for them when they return from overseas,"
said Dickmann in a newsletter published by the school.
When coming off international assignment, new repats can get
lost in the corporate shuffle. Though expats may be well managed while
on assignment, they are likely to experience what the report describes
as "career wobble."
This is due to a couple of factors. The study found a correlation
between losing personnel and failing to articulate career goals. There
is also a tendency for both line and HR managers to think that once the
expat has returned home, they'll be fine. Not so.
"Much more time and effort must be put into preparing for an
employee's return – they need security, a meaningful role on their
return and to see a clear path for their future career development with
the organization," Dickmann says.
Without such a path, an employee may give the return on investment to another organization.
Blog courtesy of My Global Career.
Filed Under: Expatriate
