Challenges in Cost Management and Compliance for Global Mobility

By Dennis Clemente

How much did companies spend for their global relocation programs in 2014? For Worldwide ERC member corporations, it was a staggering $12.8 billion.

Beyond the total figure, did that amount factor in the exponential risks of immigration, tax, legal and regulatory missteps that can happen to any company, experienced or not?

We’re not privy to that information, but the same data also said that each company transfer cost $19M each. Now that is even more staggering. Would you say each international assignee is worth that much or did we just miscalculate that number from ERC?

Cost management and compliance in relocations are handled by global mobility specialists who face many challenges, especially many of those who are just making the switch from plain recruiting and human resources.

Multinationals may have a centralized global mobility process and better internal communication that can help address cost management but complying with compliance is constant, subject to change, difficult to track, and administratively confusing in an increasingly complex hiring world..

What many specialists lament is immigration matters, only because it’s a government prerogative and they can’t do anything about. Its politicization doesn’t help their cause. Pwc, a multinational professional network, has argued that countries that allow the free movement of labor, are more likely to become the most economically competitive. Some countries have taken steps toward minimizing immigration restrictions because of their aging workforce.

Newcomers also need to address the need for a cohesive global compensation accumulation, benefit-in-kind reporting, travel approvals and tracking extended business travelers. Leveraging technology can also help improve compliance, monitor travel patterns and exposures, and incorporate tracking time and business expenses.

What kind of pressure can global mobility specialists expect in this industry? Managing compliance and risk is up there, first in the row of  a long list that should somehow be alleviated in the near future by better analytics–to better understand its costs.