<img height="1" width="1" style="display:none;" alt="" src="https://dc.ads.linkedin.com/collect/?pid=26538&amp;fmt=gif">

The True Cost of a Poor Relocation Experience - $8k wasted and 33% Brand Value Lost

In conjunction with the London Business School community, we at Benivo have conducted 30 interviews with IT Engineers who relocated from India to Europe on temporary assignments.

We wanted to find out everything about their relocation experience, from the decision to leave, to the nitty-gritty of errands they faced upon arrival.

One result was striking: Although all of them received what we call selective relocation support (= some extra cash, temporary housing, access to a network of locals), almost all of them were dissatisfied with their moving experience.

This comes down to two factors which, in turn, had significant impact on the employer's bottom line and employer brand. 

 

1. Relocation related errands lead to opportunity cost

The engineers had to spend a considerable amount of time on relocation-related activities. Up to 89 hours, i.e. over two full work weeks, were spent on logistics, mostly for finding long-term accommodation, administrative errands, and family support.

Not only was this effort taxing in itself, but up to 69 of these 89 hours were spent during working hours, thus effectively losing the employer money they could have made. At an average $100 hourly fee that they charge for an IT engineer, this amounted to a total impact of $6.9k.

As the engineers were, theoretically from day 1, assigned to their employer’s client on-site, the large time outlay was a clear case of opportunity cost.

But the employer was not the only damaged party: 60% of the 69 hours were unbilled, 40% billed - the client paid for no services rendered in return.

On top of this comes the impact on colleagues' productivity. When they have no one to turn to, employees ask their colleagues who lose working time. This amounted to up to 10 hours per relocating engineer, adding $1,000 to the opportunity cost bill, leading to a total of $7.9k 

Low quality relocation support leads to opportunity cost of $7.9k.

Providing only basic relocation support (or none at all) is quite literally a lose-lose-lose scenario. 

 

2. Negative employee experience impacts employer brand

Because there was no end-to-end support from their employer, the engineers frequently felt left alone when encountering obstacles during their move - from rental arrangements to school registration conundrums.

In another study we conducted, we found out that the impact on the employer brand was considerable. We asked employees who had received high-quality, comprehensive relocation support the Employer Net Promoter Score (eNPS) question: How likely is it that you would recommend your employer to a friend as a company to work for?

The scores were a staggering 50% better (eNPS 71) than those in a scenario without support (eNPS 14). Viewed negatively, it's a 33% loss of brand value. 

Screenshot_2.png

 

This stark difference is surprising only at first. It becomes more understandable when you consider the momentous impact a relocation across continents has on the individual. It is often the most stressful experience the employee has had until that point in life.

During this time of need, support is immensely appreciated - and lack thereof is resented. It’s like everything you do during this time has an exponentially amplified effect - both on the positive and negative side.

This means that while there is a risk of alienating employees like in the case of the Indian engineers we interviewed, it also represents a magnificent opportunity: When you are there for someone in time of need, you can create extraordinary gratitude and loyalty.

Read our White Paper The True Cost of IT Engineers’ Relocation to get into the details of our research and, more importantly, learn what your business can do to maximise the chance of a positive employee relocation experience, without breaking the bank.

Read The White Paper

 

Image credit: Adobe Stock

Nitzan Yudan

Author

Nitzan Yudan

Created on 12-10-2017