The rise of globalisation has made international hiring a real and important concern for many organisations. But relocation is still a difficult task. HRM looks at how some employers are overcoming the roadblocks
Hiring is now a global task. According to a Globuz HR Solutions whitepaper on hiring challenges, one of the most difficult tasks for HR managers today is finding the right people. This is made even more difficult with increasing globalisation. This is causing companies to sit up and notice talent not just locally, but also internationally.
Technology is also pushing the recruitment boundaries. The advent of the internet and development of high-quality videoconferencing and teleconferencing software, has allowed hiring managers across the world to seriously consider talent from anywhere.
According to Nina Alag Suri, CEO, The Nastrac Group, most international hiring happens in multinational companies and for specialist positions in domains such as information technology, telecommunications and banking. Sectors such as manufacturing, retail and logistics, as well as localised small and medium enterprises also conduct at least some international hiring.
Even the economic downturn isn't holding companies back from looking overseas for talent. Chris Mead, General Manager, Hays Singapore, says, recruitment activity is now beginning to stir again. "Businesses are recommencing - albeit with caution - their hiring plans," he says. "When recruitment activity again reaches former heights, international hiring could again become a solution to a local shortage of skills."
Suri says international hiring has fallen around 20 percentage points during the recession. However, Asia is still extremely open to expatriate hiring from around the region wherever a candidate possesses the right skill set, she adds.
Why hire internationally?
Why seek talent internationally if it's usually the more costly option? Delores McCrorey, "Chief Risk Guru" with Risktaking for Success, a US-based consultancy, says new perspectives and enthusiasm often outweigh the extra costs involved. "These global talents can reinvent themselves in any economy and in any location."
Suri says the diversity that international hiring can bring helps to spur business innovation. She also notes certain countries and cities can have higher domain knowledge in certain fields than others. Hiring from the Indian city of Bangalore ("India's Silicon Valley") can give a company some much-needed technical know-how when it comes to IT, for example.
At the same time, companies often look to the financial hubs of New York and London when they are seeking out the best in banking talent.
International hiring benefits not only businesses but individuals as well. Suri says increasingly mobile executives relish the opportunity to work in new environments and cultures as a form of personal development. That in turn leads workers to develop both quickly and broadly, making them available for higher challenges within their organisations.
Challenges and solutions
With all the perks of international hiring, there are drawbacks as well. Sourcing appropriate skills, interviewing potential candidates, overcoming complicated employment laws, and dealing with the culture shock that comes with international relocations, are amongst a host of challenges that companies need to consider before heading down the international path.
Mead says organisations need to understand the difference between local and international hiring processes. Both require potential candidates to be sourced and interviewed and this will mean either having offices in the locations where the organisation is looking to hire, or engaging a consultancy in order to access appropriate candidates.
Interviewing can also be done through video-conferencing and telecommunications tools. But managers can often be hesitant to sign off on new appointments that they have not met in person. "Unless they have met the person face-to-face, lots of companies are not very satisfied," says Suri. Many companies will therefore arrange to meet in person, regardless of the cost. "One common practice amongst larger corporations is to organise pre-visits for these overseas employees so as to get them acquainted with the local environment."
Relocation assistance
Relocation assistance is another factor to consider whenever employees, even new hires, are asked to move internationally. According to Chris Draeger, Group Vice President of Marketing, Crown Worldwide, homes and schools are usually the most pressing points. "When it comes to home-finding, (expatriates) want to be sure they are working with a reputable real estate company, be sure they are seeing all of the options available and have peace of mind in knowing that they are getting the best information when it comes to neighbourhoods, safety, and security," he advises. New arrivals also appreciate receiving specialist advice when it comes to signing long-term leases, particularly if the document is not in their native language.
Expatriates with school-going children naturally put school-finding as a top priority. Draeger says this can be an educational process in itself. There are both advantages and disadvantages of having children attend a local school (being truly embedded in the local culture) or an international school (ideal for families that move often as the approach to the child's education is consistent). Eugene Tan, Area Director, HR, Shangri-La Hotel, Singapore says this is also a reason why, single people without dependants are generally better able to take on certain foreign assignments.
Besides schools and homes, host organisations need to consider the cultural differences that international hires will experience in their new home. "Depending on the adaptability and personality of the individual, other issues such as language barriers and cultural differences may be daunting, at least at the initial stage," says Tan. Many companies which employ overseas expatriates have a dedicated expatriate welfare management team within their HR departments. Others will have special programmes that cater specifically to this important group of staff.
Bayer Schering Pharma, for example, has put in place several programmes to help key talents assimilate into Singapore's environment and culture. Its mentoring scheme, provides each new expatriate worker with a "buddy" to help him or her ease into the country. "While it is important for an employee to be performing at work, their personal life also needs to be taken care of so they can contribute fully and effectively as an employee," says Jasmine Teo, Regional HR Manager.
All these measures can help to ensure a smooth transition and retention of international talent in any organisation. "This is even more critical especially in today's highly dynamic economy in which the average tenure of an expatriate is closer to three to five years, a long way from the 20 years that expatriates remained with a company in the past," says Mead. So far, it seems like Singapore employers are doing the right thing, looking at statistics from The Nastrac Group which put the failure rate in international hiring at an extremely low 10 per cent of the total international hiring that occurs. This is almost inevitable as a common reason for international talent to leave is due to familial issues, which cannot be controlled or mitigated by any company policy or programme.
Keeping the law onside
Legal considerations should be given a high priority whenever international hiring is taking place. George Cooper, Practice Leader, Freehills Workplace Law and Advisory - Asia, says immigration issues can often make or break an overseas assignment from the employer's perspective. It is important to understand all liabilities in both the home and the assignment location.
Multinationals also need to determine the exact rules of the transfer - is it a clean break, or a time-limited secondment? And importantly, under which jurisdiction should the agreement apply? Cooper says many companies can be caught out, with huge liabilities at risk, if these issues are not dealt with at the very start of an international assignment.
In one of the most significant examples, a well-known multinational was stung for three years of an executive's salary package after an unfair dismissal claim.
"There was confusion about which company represented the employer and apparently a view at the time that as an international employee, the local protections in Malaysia did not apply," Cooper said.
Freehills was not involved in the case.