Decoding the Mystery : Relocation Best Practices in New Territories

Presenter: Esther KiddleDirector Client Services Cartus EMEA Friday 4 November 2011

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Agenda

• Emerging Markets: A Relocation P tiPerspective

• Expanding Destinations• The Challenge Continuum: Case Studies• Key Relocation ConsiderationsKey Relocation Considerations• Best Practice Recommendations• Q&A• Q&A

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Emerging Markets: A Relocation Perspective

Cartus Definition of Emerging Markets

Locations with infrastructure, talent or administrative difficulties that require targeted strategies to meet needs such as recruiting housing education recruiting, housing, education, transportation, culture, language, security, and governmental challenges.and governmental challenges.

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Expanding Destinations: Top 25 Locations – Next Two Yearsp

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Source: Cartus 2011 Mobility Challenges In Emerging Markets Survey

Expanding Destinations: Regional Trends

Reflects countries named by respondents as among their ‘Top 3’ emerging market destinations – next two years

2011 Mobility Challenges in E i M k D i i 57%

Europe 20%

Emerging Markets, Destination Volume Predictions

20% 23%

Europe – 20%Middle East – 14%

Africa – 23%

20%

Source: Cartus 2011

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Americas Asia Pacific EMEA Mobility Challenges In Emerging Markets Survey

The Challenge Continuum: Establishing or Expanding Operations in Emerging Marketsp g p g g

Top ConsiderationsInfrastructure Culture People

Best Practice RecommendationsDue Diligence Blueprint Execution

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Key Relocation Considerations: Infrastructure

• Housing• Schooling• Security

• Current situation• Impact of infrastructure

Case Study: Angola

• Impact of infrastructure• Competitive market strategies

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Case Study Highlights: Angola

• Housing– Very high cost and quality not to expat standardsVery high cost and quality not to expat standards– Re-circulate good properties and ensure they are checked by

corporate or external security prior to lease signing• Schoolingg

– Shortage of places at international schools– Very high fees – certificates have cost USD100,000!

Investigate requirements and parameters; establish – Investigate requirements and parameters; establish relationship with company who has certificates

• SecurityViolent crime is commonplace reality – be vigilant– Violent crime is commonplace reality be vigilant

– Include security and cultural briefings in your mobility policies; ensure crisis management process is clearly outlined

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Key Relocation Considerations: Culture

• Immigration process• Rental properties• Business meetings

• Current situation• Impact of cultural nuances

Case Study: Brazil

• Impact of cultural nuances• Competitive market strategies

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Case Study Highlights: Brazil

• Encountered a variety of challenges with first several assignees moving to Sao Pauloassignees moving to Sao Paulo

• Immigration – timeline too long, required documents change, process does not flow smoothly

• Rental properties shortage of rentals landlords will not do • Rental properties – shortage of rentals, landlords will not do repairs, first cash offer usually gets the property

• Business meetings – cancelled web meetings, meetings take too much time meetings begin later than scheduledtake too much time, meetings begin later than scheduled

• Cultural nuance – recognise the importance of relationships• Relax, ask questions, be pleasant, do not rush • Lean on knowledgeable destination services provider who

knows local landlords• Face-to-face meetings, confirm in writing, be flexible; do

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g , g, ;not criticise in meeting

Key Relocation Considerations: People

• Shortage of skilled local staff• Attracting and retaining key foreign talent• High levels of assignment failure• Gaps in succession planning

Case Study: China

• Current situationCurrent situation• Impact of talent management• Competitive market strategies

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Case Study Highlights: China

• Existing foreign talent not incentivised to focus on succession planningon succession planning

• Perception of ‘glass ceiling’ by local staff• Adaptation challenges increased dramatically in

2 d d 3 d i i i2nd and 3rd tier cities• No long term strategic traction due to lack of

China tenure• Local talent development delivered through

‘seasoned retired staff’• These ‘coaches’ were in addition to regular • These coaches were in addition to regular

expats• Positive response from locals

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Local Considerations

• Challenges of poor infrastructure and t t h d itoverstretched capacity

• Fragmented supplier bases• Lack of traditional relocation vendor

support I ff ti f i f ti • Ineffective use of information technology/communications

• C l t / t t• Complex tax/government systems

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Best Practice Recommendations

• Confirm company objective for market entry

T l t t d– Talent management needs

• Investigate key challenges

Market conditions– Market conditions

– Cultural profile and nuances

Top Considerations Best Practice RecommendationsInfrastructure + Culture + People Due Diligence → Blueprint → Execution

– Regulatory, tax, infrastructure

• Identify areas requiring additional support or specific expertise

– Policy adaptations

– In-house or external partners required

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• Educate key stakeholders

Questions & Answers

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