IPD guide urges employers to adopt strategic approach to rewarding international workers


IPD guide urges employers to adopt strategic approach to rewarding international workers

Businesses hoping to attract, keep and motivate the new breed of international workers need to embrace a far broader agenda than just pay packets, warns a new report by the Institute of Personnel and Development.

The days of the traditional expat career are now long gone, according to the authors of the IPD research, Stephen J Perkins, director of the Strategic Remuneration Research Centre and Chris Hendry, professor of organisational behaviour at City University Business School. The expat career has gradually died off to be replaced with employees who want more flexibility and variety in their careers and this has had an impact on how they want to be rewarded.

There has been a shift to shorter assignments, reflecting not just the different — often cheaper — ways of organising and managing international operations, but also individuals' reluctance to undertake longer-term assignments.

The new breed of international worker is looking for an increasingly varied reward package — one replete with corporate share options, recognition programmes and policies designed to achieve a better work-life balance .

Yet much of international reward management and the literature in the area is still preoccupied simply with managing the terms and conditions of expatriate pay, and juggling with the intricate details of hardship allowances, cost-of-living indices, exchange rates and taxation regimes. As Perkins and Hendry point out, this is an outdated concern.

There has been a shift in practice away from a simple model of expatriate careers and its attendant rewards to more flexible and varied patterns. This is tending to a more 'holistic' approach, in which reward management is intimately linked with career management and recruitment, and its position at the interface of business strategy and HRM through performance management is more fully appreciated.

For today's organisation, the harsh reality is that the managing the performance of international workers takes more than just money.

Say Perkins and Hendry: Financial packages are obviously still a factor, but increasingly companies need to link reward to how people perform in line with overall strategy. They should also offer alternative ways of motivating people through, for example, offering career management advice as an integral part of the finishing the projects.

So, international reward management has to be concerned with the why as much as with the what or how . But the authors of the research discovered that all too many businesses fail to link the reward of international workers to performance across the company, do not set performance goals for individual employees and only fitfully communicate with them, both during and after their projects.

The new international workers may be mobile but are increasingly looking to still feel part of the parent company. The reward package for these people needs to make them valued and included, say Perkins and Hendry.

The authors conclude by urging employers to adopt a more strategic approach to rewarding their international workers. This holistic approach to managing international reward and recognition is particularly important as multinationals are increasingly relying on their top international managers to bring together all aspects of the business and its people for sustainable success in fiercely competitive international markets.

The 66-page report draws on 10 case studies of reward practice in major international companies, as well as a review of the literature and interviews with renowned experts in the field.

Want to know more?

Title: The IPD guide on international reward and recognition, by Stephen J Perkins and Chris Hendry.

Availability: the report may be purchased from Plymbridge Distributors, tel: 01752 202301, or through the IPD's online bookshop at www.ipd.co.uk

Price: £ 5.50