Michael Kannisto has his house in order when it comes to expats.
As director of talent management and talent acquisition at manufacturer JLG Industries Inc., he has created a practice for expatriate assignments that maximizes the potential of its global workforce. His secret? Integrating talent acquisition, development and global mobility.
“We’re creating the expectation that this is a global company with a global workforce, doing global work,” Kannisto said. To that end, JLG, a 5,000-person company that makes aerial work platforms and other lift equipment, is taking a strategic, thoughtful approach to its international assignments.
Expatriate assignments are expensive. The cost of a traditional assignment — three to five years in length — exceeds three times an expat’s annual salary costs, due to income tax costs, assignment location housing, cost-of-living allowances, dependent education support and relocation expenses, according to Mercer Mobility Services, which conducts an annual international assignment cost survey.
Even though expat assignments are expensive, many companies lack an effective process for optimizing their benefits. Part of the reason is that HR professionals often do not participate in assessing and selecting who is going on an international assignment, nor do they have the opportunity to prepare and coach soon-to-be expats through the process so they have a significant chance for success.
Far from integrating a development plan that incorporates business needs with identifying eager, qualified candidates to create a pool of globally ready talent for those business needs, many companies don’t even take advantage of the assessments and tools that are available to support their expats so they can realize their potential. Instead, organizations often are reactive. They try to find someone to fill an immediate skills gap or suddenly realize that an individual needs an immediate developmental overseas experience. This is changing, though, as more senior leaders understand that global experience is crucial for their organization.
Integrate Talent and Global Mobility
JLG, headquartered in Hagerstown, Md., has operations on six continents. Its employees enter their interest in an international assignment in the company’s human resources information system, including details such as the languages they speak, whether they’re open to relocation, what countries they prefer and any special skills they may have. Managers can look at the data, including a performance history, and determine who would be best for certain jobs in certain locations.
As part of the HR talent strategy, there is a thoughtful approach to giving top talent the opportunity for global assignments to help build their careers. Kannisto’s vision is “predictive analytics.”
“Instead of saying, ‘Let’s try all these things and see who is successful,’ I think the more enlightened approach is to first identify the people who possess the traits that are most successful,” Kannisto said. “There’s tons of performance data so we can use that and make a predictive model and determine at what point it makes sense to send someone on an international assignment.” It is this type of fact-based approach that sets JLG apart.
Kannisto and his team then look at people’s attributes and at what point in their careers an expat assignment makes the most sense for employees and the company. When it’s determined that someone will go on an assignment, JLG provides cultural training. Everyone involved with the assignee helps to get the person ready.
In addition to the data collection, the overall talent review process is open and collaborative. Kannisto said the discussion could include the person’s manager, the functional lead, Kannisto himself, the head of HR and even the company president. Compared to how JLG used to conduct an employee’s talent assessments, there are more people involved,” Kannisto said, “which we think will increase the likelihood of his success.”
Another way JLG realizes the potential of its expats is through what Kannisto calls working one’s way up a pyramid of leadership. That is a representation of what specific learning activities employees will encounter at JLG as they move from individual contributor to enterprise leader.
Two features of the pyramid important in the context of expat assignments are that learners are encouraged to expand their cross-cultural agility throughout their careers and to learn about their own strengths. This is particularly true for those going on international assignments.
“We give them access to a bunch of tools that give them the ability to reflect on themselves, their strengths and weaknesses,” Kannisto said. “We’re identifying people who have that awareness and giving them information about themselves, which is one variable they can control.”
To further enhance the chance of success — and value for JLG after the assignee is on location — Kannisto makes occasional visits to ensure that any difficulties are caught early and that the family is adjusting to the cross-cultural experience as well.
Equally important is shared expectations of the expat’s role and goals. “Every single person at the sending country, at the receiving country — everyone has to understand why the expat is going on the assignment; what they’re going to do on the assignment; what they’re going to leave behind; what they’re going to get in return, and what’s going to happen when they come back,” Kannisto said.
Creating an Integrated System Isn’t Simple
This may sound simple in theory, but it is complicated in practice. “You need to have a very deep understanding of the work people do and the demands of the organization,” said Jodi Starkman, an independent consultant who has worked at Mercer, IBM and PricewaterhouseCoopers. “You need to have a model, a taxonomy of the skills that are needed to meet the business goals and come up with various kinds of vehicles to help people meet the skills they need to be successful. It’s really about understanding how the assignment is going to contribute to that individual’s development along a series of dimensions that are important to the company,” she said. “Probably the strongest link is to be able to understand what people need to have to help prepare them for future roles in the organization, and then it’s leveraging what they learn when they come back in a future role so that succession planning, leadership planning are linked closely.”
Realizing the potential of talent, particularly expats, has been a focus of Milton Ives for years. “Companies need to be better about integrating talent and mobility,” said Ives, formerly the global mobility director at food company Mars Inc. and previously with global bank HSBC Holdings. The global mobility role, he said, “should be moving from managing mobility as primarily compensation and deployment to a more strategic one of talent development, which includes the organization’s talent succession structure.” This means focusing on the people instead of reacting to a vacancy. “At the end of the day, the primary role is to develop talent for the business,” he said, adding that talent development and the mobility function “should be functioning together.”
Ives suggested looking at how strong the talent pipeline is for the organization’s business needs and developing that bench strength as you think about the international assignment. For example, when Mars set up businesses in Russia, the locally recruited talent needed to be supplemented with experienced expats who brought the knowledge and skills of setting up and running operations in more mature markets, such as in Western Europe and North America. The local talent wasn’t available yet, so in the early growth stages of the Russian business, expats were the most effective way to accomplish the goals. But when subsequent groups of expats went to Russia, they could focus more on developing the local talent to run the business. Thus, expats helped to establish the business and continued to give value by developing the local workforce.
Another major challenge organizations face is finding ways to effectively capitalize on the people who have returned from assignments. Regardless of the reason they went or how successful they were, the company’s core talent management process often loses track of people during assignments and fails them upon repatriation. Said Ives, “Often, while there was a clear purpose for sending someone on an assignment, there is not a clear track for bringing them back and building on their skills.”
These valuable corporate assets may leave a company upon their return because they feel unappreciated or because they had a very large role during their assignment and now have a smaller role.
Ives said metrics can show how an organization is doing with repatriation goals and expat program goals overall. Companies can put metrics into place, he said, “to see if you’re delivering what the business needs. If it is to build bench strength, see if that’s happening. Is the talent pipeline getting filled? Are you improving? Is the program delivering its objectives?” Among the questions to ask is how are you using the repatriated employees’ new skills and capabilities after they return? Focus should be on smoothing the reintegration of expats back into the organization, assessing and valuing their success and finding ways to integrate their new skills in the organization’s talent pool. Such steps will help an organization maximize the investment made in that expatriate upon return.
Of course, the upfront piece needs to be done correctly as well. Selection, preparation and cultural training must be done right. Those are the first steps. Paying attention to support throughout the assignment and strategically positioning the expat’s new capabilities upon return complete the picture. In this way, every organization can get its house in order with respect to expats.
Charlene Solomon is president of RW3 CultureWizard, which provides online and instructor-led cross-cultural training and global business skill development. She also is co-author of “Managing Across Cultures.” She can be reached at firstname.lastname@example.org.