cap relocation program

Should Global Mobility Industry, Companies Use Managed Cap Relocation Program?


Should your organization start implementing a managed cap relocation program, as opposed to the traditional lump-sum program? Ultimately, it really depends on the culture, climate, and objectives of your company as both programs have their own sets of pros and cons.

Sometimes, it may come down to underlining your company’s competitiveness in attracting talent, versus the costs it might have to shell out if it prefers one policy over the other. Then, in a workforce that is fast being dominated by millennials and zentennials, you as the global mobility manager might have to weigh prioritizing the flexibility they prefer, over the control you and your executives want to maintain over your finances.

The lump-sum program, at first glance, seems to be more attractive for the younger talents. It also looks easy, efficient, and less troublesome on paper. Employer and assignee will agree on an amount of monies necessary for the latter’s relocation. The amount will cover accommodations and trucking services, for example.

Millennial talents who want to have a voice in every aspect of their employment would want to make the arrangements themselves. At the same time, the global mobility manager would not be encumbered with making those choices for the assignee. In some cases, they do not even have to track the expenses down (which some accountants may object to, but that is a different story).

On the other hand, managed cap relocation programs do give the global mobility manager more control over the assignee’s transfer, especially finances. Every single cost is accounted for, and the managers involved can make sure that the expenses do not go over budget.

One criticism against the lump-sum program is that, despite the initial agreement on the budget, the assignee can find his costs exceeding it. To the consternation of the financial managers, they might come back, asking for more.

The managed cap relocation program helps avoid pitfalls like this, because it does not take anything for granted. Insurance, rentals, miscellaneous fees for the kids’ education — all are inputted, discussed, and planned for.

Global Mobility Solutions names another intangible yet no less powerful advantage of the managed cap relocation program: it builds a greater bond between the assignee and the organization.

The global mobility manager must approach this program as a partnership which will allow the assignee to give their input.

At the same time, they also function as mentors to make the entire relocation process easier for the assignee.

Guidance and collaboration can make this a win-win solution for both, and create the beginnings of a long-lasting trust between global mobility manager and assignee. The assignee might also appreciate this help, as they are still adjusting to their new work environment.

The global mobility manager can also use the managed cap relocation program to introduce the assignee to their brave new world.

They can partner with institutions and service providers to gradually show the assignee the kinds of homes they can rent, or the neighborhood activities that their family can enjoy. Education providers, business network associations, and corporate housing corporations like California Corporate Housing can get to know the assignee more, and give them solutions customized to their needs.

The lump-sum program might seem to be a more workable, less stressful way to relocate the assignee. The managed cap relocation program, however, might have more sustainable benefits for the long-term.