Designing cost-effective and employee-friendly mobility solutions

In this episode, Cartus' Andy Conduit-Turner, Director, Sustainable Growth Enablement, and special Cartus guests, Terri Bonfiglio, Director, Global Mobility & Consulting Solutions, and Michele Brescia, Director, Strategic Business Development, discuss how to balance mobility costs with employee experience.

Our guests:

Michele Brescia

Michele has dedicated an impressive 24 years of her career to Cartus. During this time, she achieved remarkable success and growth (leading to nine promotions), ultimately attaining the position of Vice President, Global Talent Mobility. Michele officially re-joined the Cartus team in 2023 and brings with her vast industry knowledge and exceptional leadership qualities.

Terri Bonfiglio

With more than 35 years' experience in the mobility industry, Terri joined Cartus in 2005 and supports Global Talent Mobility teams and our global Consulting Solutions group, the latter of which is responsible for developing and overseeing global client initiatives in the areas of HR and talent technology solutions, program benchmarking, policy design and writing, and group moves. 

Our host:

Andy Conduit-Turner

Andy has performed a number of roles throughout his global mobility career with Cartus, which followed his own time living and working internationally. After building his skills in both account management and transformation projects, when asked to describe his role today as Director, Sustainable Growth Enablement, Andy’s one word response is, “Questions.” Specifically answering the questions that our partners and the broader mobility community have for us, and asking our own in order to move our innovations in the direction that best serves our clients, as well helping to support the long-term, sustainable growth of our solutions. 

Executive production: Louise Koncowski 

Transcript

Andy Hello, and welcome to today's episode of Mobility Matters your official podcast from Cartus. I am Andy Conduit-Turner, Director of Sustainable Growth Enablement and I am delighted today to be joined by two of Cartus’ very own… first, Terri Bonfiglio, Director of Global Mobility & Consulting Solutions. Hello, Terri!

Terri: Hi, Andy. Great, thanks. Nice to be here. 

Andy: And then, of course, I have along with us as well, Michele Brasher, one of our Directors of Strategic Business Development here at Cartus. Hello, Michele! 

Michele: Hi, Andy. 

Andy: Welcome to you both. In today's episode, we're going to be exploring how to balance mobility costs with the need to deliver a positive experience for relocating families. And at a time of heightened fiscal scrutiny and ever-evolving macroeconomic dynamics. Try saying that three times fast. Demonstrating cost effectiveness is not just about saving dollars, but it's about maximizing the value and impact of the ability spend that you have. So, let's begin by turning to you, Terri, our recent Global Talent Mobility Survey found that rising mobility costs is currently one of the number one challenges for HR and mobility professionals. But can you tell me anyone who doesn't care about the current economic situation? Is that even possible?

Terri: Really good point, Andy. Yeah, I agree, cost is always going to be a critical component of decision making. That said, when we talk to clients today, I feel like what I'm seeing emerge is a conversation about experience, flexibility, and making sure that they're really driving a return on the assets that they're investing in their mobile talent. In essence, clients are looking for solutions that are not just taking costs away, but also asking how do I retain or create more value in the actual relocation or assignment experience for my employees? 

Andy: Thanks so much, Terri. And Michele, turning to you then. So, in the circles you travel, and you spend a lot of time out in the mobility community or a lot of industry events, what are you hearing out there?

Michele: Yeah, I would say, you know, in participating in some of the trade events or the regional conferences, cost is certainly king. Cost continues to be king. And a lot of the clients are receiving pressure to do more with less, I recently had an opportunity to bid on a prospective client. And one of their KPIs or SLA requirements was for the partner that they choose to find a 5% cost savings annually for them, as part of their contract requirements. So, definitely remains a key focus, and a pressure that the global mobility teams are receiving. 

Andy: So, particularly interesting, I look at it as actually being factored in as a KPI for an ongoing relationship as well, a really interesting angle when the stakes are really high to make sure we're delivering on those priorities. So, Terri, you must do this all the time putting yourself in the shoes of someone who is just beginning their cost savings exercise. Where would you suggest people start? Where do they begin?

Terri: That's a great question. Andy, I know initial conversations may start with how do we find cost savings? Do I remove benefits? Do I cap offerings? What do I take away? And I always say the most important first step is actually just taking a step back. Consider not just where you're spending your money, but why you're spending your money. So, making sure you have the right information about the people who are moving, what your reasons are for moving those people, understanding what's important for your organization. What are the objectives of a relocation or an assignment, and then taking it forward to understand what's really necessary. 

We talk about flexibility being an area that you see a new trend around. So, looking at what's core, what's important to your employees, what's important for you to do. You have to get somebody there, you need to bring their goods somewhere, you need to get them back. You need to support certain areas of the relocation itself. We all know that. There might be other things that are important to one family, but not as important to another or might be needed for someone who's living alone, but not needed for someone who's moving [as] a family. So, really understanding the split, the segregation of your population and what you're trying to get out of that population by moving them, and if you're ultimately bringing them back… what you need to be doing while they're there, and what you need to be spending money on in the end. 

Andy: Brilliant. Anything you'd add to that, Michele?

Michele: Yeah, I would think you know, after you've built the framework that Terri's outlined, kind of the “why” and the “what” behind it, and developing your policy and program around that, once you've got that up and implemented, one of the key things that I see as it relates to cost savings is really pre-planning. The pre-planning is so critical. You know, when you've got someone going on an international assignment, you've got that timeframe of immigration, where it allows you a little bit more time to plan that assignment. But when you've got someone perhaps moving into a country that doesn't have that stipulation of immigration, they can move much more quickly. And if you're not doing proper planning, it could result in the employee needing a lot of exceptions, because there wasn't that time allowed for that employee or family to kind of think through the things that they need. 

So, definitely, I think in one of our earlier discussions, Andy said, “time is a commodity, to reduce exceptions.” And I just love that thought behind it. And really, you know, when you've got the time available, and we know sometimes there isn't always that time. But when you've got that time available, really that thoughtful, pre-planning to Terri's point, about what is important for this particular person or family that's moving, will certainly help to reduce some of those exceptions and costs.

Andy: Brilliant. So, let's take a step forward in the cost savings journey here. Once you've made those initial steps and trying to ascertain what cost measures to implement in your relocation program, some people might argue that the more challenging next step is to make sure that they don't impact negatively, the employee experience. Michele, I'll start with you this time. How are people balancing that focus on cost against other priorities, especially with a light towards things like sustainability, DEI [diversity, equity, and inclusion], flexibility, all these things that impact the employee experience and business goals? How are we balancing them against the ongoing focus on cost.

Michele: Very carefully! I think certainly in the companies that I'm speaking with, there are many that are starting this development of their comprehensive programs and aligning their organizational objectives, optimizing supplier partnerships, right? In the RFP phase in particular, in the role that I'm in and then starting to leverage operational efficiencies and technology to build those efficiencies for their programs. You know, when we look at things like integrating sustainability into a mobility program, some of that could lead to a cost savings in itself, you know, increasing employee satisfaction, and in turn boosting some of that morale and productivity and an example there would be, you know, if you're cutting down the size of your household goods shipments, Terri mentioned, the “Discard and Donate” program. If there's a reduction in packing materials to support sustainable initiatives, some of that comes also with cost savings, right. So, it may balance itself out is I think [what] I'm trying to say, across the cost savings initiative. And adding a sustainable initiative as well. 

I would also say that, you know, as companies start to look at these aspects and create a work environment that sort of supports their financial goals, they're also starting to foster more of a culture and values that focus on employees’ wellbeing and social responsibility, and really finding that balance that I highlighted and taking that organizational ambition to implement these new programs, marry it to the feasibility of actually doing that. And then, you know, focusing on ways that you can do that without compromising cost. Really kind of achieves the goal in the end, and perhaps also does implement some cost savings.

Andy: Weighing up those responsibilities and looking for things that are mutually beneficial. So, thank you for those ones. 

Michele: Agreed.

Andy: So, Terri, turning to you to expand on that point. Obviously, in a Consulting Solutions role as in yours. I'm guessing finding the balance between cost and experience is something people ask you and your team to solve every day. Right? So, what do you advise them?

Terri: So, I think that's it's definitely a question that we get asked every single day. And I think that one of the areas that we focus a lot of time on with clients is understanding what other organizations are doing. So, we do a lot of benchmarking. I would say, over the past year, rolling 12, we probably have done seven benchmarking campaigns with clients looking at various topics… Whether it's truly understanding what's going on with a certain population. It might be interns or it might be expatriates, etc. but understanding what their competitors are doing but not only from a competitive edge, but to really ensure that the right emphasis is being placed on things that we haven't thought about. In the past, which are more tied to, you know, diversity, equity inclusion, and making sure that their lens on how they're developing their programs and their policies is delivering to the talent they have today. 

So, that's something that I see a lot of attention around. I loved the concept of understanding how we touch the environment and making sure that we're more aware in the decisions that are being made, I think we talked about “Discard and Donate” but I think also making sure that we're holistic, that we understand that every decision we make, is going to be touching not just the family or the employee, but your local community or, you know, the environments as you move from one place to another. 

So, I'm really excited to see that clients are having these conversations, and they're thinking more broadly. And it even gets into wellness and family care and connecting employees with expat communities while they're on assignment, so they can be more successful. So, a lot of exciting conversations. 

Andy: Thanks, Terri. And one of the things that I really love that your team touch on is when you look at the benchmarking part of things, the way you've expanded to not only looking at the peer organizations in terms of being in the same industry, but leveraging data to look at the markets they're moving into, the type of relocations that they're authorizing. The fact is that, of course, competition and peer ship is not always determined by the products you're selling, or the services that you're selling but also the scope of the employees, the demographics that you're trying to attract to work in your organization as well.

So, I've seen your team do some wonderful things with the data surrounding a wide variety of companies and trying to find out contexts to really find out what's meaningful in their particular markets and moving into.

So, obviously lots more we can talk about on that one but for now, we're gonna flip from that practical question to Michele, I'm gonna get to some philosophy with you here. And can you talk to me about how we might differentiate between cost and value? What sort of differences do you see when you're comparing these two related but quite different aspects?

Michele: Yeah, certainly I can. I can tell you in my current role and also in in the years that I spent in account management, there's always been that assessment of cost versus value, right? If we're going to offer this service, what's that cost and what's the employee benefit as a result. So, you know, when looking at the difference or the value that relocation services bring, there certainly is a need to have an eye to that quantifiable cost and what all the financial expenses are related to that move: the packing, the transporting the home, home search, and such. Whereas when we're looking at the value on the other hand, of course, that's certainly much more subjective. It relates to kind of the perception of those benefits that are offered, and the overall experience for the employee. 

So, a couple of examples that I thought of, you're looking at, in the US home sale market, a buyer value option program, as an example. And certainly, a relocation service that can offer a tax advantage to the company that's doing the relocation of the employee, but also reducing that financial burden on the employee, which adds value beyond just that actual cost of the service. 

And then similarly, on an international assignment, when we look at something like a cross-cultural service, providing that employee and their family with the skill sets that they're going to need to acclimate culturally to the new location, will offer significant value to that employee and their family, but also helps from a cost perspective at potentially reducing assignment failures and those things that could have significant cost. And certainly, you know, the cost component is concrete and something that's not going to go away throughout the move, but really adds that value and in building those effective and efficient, and comprehensive employee services.

Andy: Thanks, Michele, you pulled out some great examples there. And the same ones that I'm seeing as well back in my days in account management as well. Obviously, when you look at the essential spend required to get someone to a country and the services provided once they're already there. That real big difference between what's perceived as a cost and value for example, making sure that dependent children that are accompanying a family are able to get into a an appropriate education facility, particularly for people going on expat assignment, one that won't disrupt the long term education of those children when they eventually turn home is a great example of I see where the value perceived and enjoyed by those employees is a huge factor for them. 

Terri, anything you'd add to one of these examples, cost versus value discussion?

Terri: Yeah, I think when you were talking about education, it was making me think about an actual example where we had a client that was highly focused on the high cost of tuition. So, they didn't want to impact the value of the experience for their employees. And I also think that by taking a step back and looking at where their employees were utilizing their tuition, what schools they were going to, what the median value of those costs and fees were, they were able to come up with a balanced solution, where they went with a median/maximum contribution. And the added value is that it took away some of the cost, but it also removed the judgment from the employer’s hands regarding the type of educational experience the family wanted to pursue. It wasn't telling them where they could go, where they couldn't go, it was telling them that we're going to make a contribution, and you make the best decision for your family. 

So, there are ways of putting a lens on it that's a little bit different. That feels like it's more inclusive of the employees’ choice. So, I thought that was an interesting cost savings for that particular client, with a witty way of going about it. I think the other area that I focus on is really making sure that you're, again, listening to your employees, because where you think you may need to spend money, you may not. And you may find that looking at a core/flex solution gives the same type of a cost value combination for your population, where you're doing things that you know, need to be done, but you let your employees decide on how to spend the funds that are being put in place for their relocation or their assignment to help them in the way that best suits their needs at that time as a family or an individual.

Andy: kind of giving employees that shared stake in deciding for themselves where they place the value in the services they receive. Right?

Terri: Yeah, absolutely. We get really good feedback on that as well. It's been highly successful. 

Andy: Yeah, certainly reflecting on what the previous years have been like in mobility, you can certainly see an overall change in the focus there. Whereas once upon a time, there might have been such a focus on the being a parity of experience… People having the same experience and the same services offered to them time and time again. So, if you were talking to someone around the watercooler in your new office to relocate your employees, you would understand that the experience you had was exactly the same. But now as technology has enabled a flexible program, really giving each employee that equity of choice, their experience does not have to be the same but they had an equal opportunity to choose what was important to them. I think we're seeing it make a lot of waves across our client base and across our industry as a whole. Right?

Terri: Yeah, absolutely. Absolutely. 

Andy: Wonderful. Well, thank you very much, both. I'm going to finish with a final question. A quick look at some different pricing models. Terri, when you're looking at cost containment, what pricing models are you seeing perform the best?

Terri: Yeah, so I think that's a loaded question. Actually. Pricing is really one of the most daunting areas. I think that our prospects and our clients look at when they're going through an RFP, I think that trying to understand, you know how to put together those packages and what to ask for. And then how to compare providers against one another is just very convoluted. Sometimes, there's two schools of thought. So, one is really looking at a value procurement type of the strategy. You're using technology, again, to drive cost value and service delivery, balancing the three. 

Another and tied to that is really within a contract structure. Bundled pricing, right? Making sure that you're getting the biggest bang for your buck, if you will, but you have to understand what it is you're going to need to use to create the right bundles. So, you can put a bunch of bundles on a contract but if you're not using two of the five things that are in that bundle, are you really being efficient with your spend? So, making sure that again, you really assess your program, your needs, and how you're going to use the programs, and then create bundles that really fit your organization. 

The other model that I've seen and it's really something that has gone away for a period, but there are some organizations still using it. It's called a fixed fee strategy and that's really more around a home sale structure. So, we talked about domestic and international and on the US domestic side, if you're working through a at home sale, whether it's a buyer value option [BVO], or a home sale buyout program, clients would say, “I want to have a fixed fee.” Government clients would quite frequently would use that. But what they maybe didn't think about is when you have the fluctuation in market, and we've had very, very strong selling markets over the past several years, I think our average directs on a home sale program right now are under 16%. A BVO is usually between 7.5% and 8%. But if you're pricing that out, and you're doing fixed fee, I've seen those fix fees in the 20% to 23% to 24% range. And so, you could be spending a lot more with a fixed fee solution. 

So, I think the bundles are probably the best way to go. And I think making sure that you're using some sort of a supplier comparative, like a procurement process with your provider is always a solution that really makes sure that you're achieving the goals in a sustainable way, using that word “sustainable” in a different way, but in a way that shows consistency that you can then report against.

Andy: Brilliant. Thank you, Terri, and thank you for taking a bold statement on the response as well. Like, Michele, if I look at maybe, come down the rabbit hole with me, and look at when we're looking at those supplier fees. How is the procurement model really helping people to get the best out of every single move they make? 

Michele: Yeah, I would say… I have three thoughts now, Andy. The first is I completely agree with Terri on the bundle component I was going to use that answer as well. So, certainly I've seen prospective clients benefit from moving away from an a la carte type pricing to a bundle. 

The second thing that I've seen specific to the supplier component is companies that are choosing to work with Cartus are, especially the ones that are coming from much smaller organizations or competitive organizations, are instantly realizing the savings of the sheer volume that we have with our suppliers, which allows us to negotiate better rates with those that are more of a fixed rate type program. 

And then certainly the third, my third point that eProcurement model, you know the ability to put in whatever household goods lane for example, or temporary housing needs, and then have those suppliers come back and bid against each other, certainly drives down cost but also the way that our proprietary software works that allows us to insert certain criteria. 

So, if the client wants a particular service level, for example, or a particular supplier tenure, those sorts of things that we can build into that model to allow them to not only get the best cost, but also get the best overall service satisfaction certainly has been a winning factor for us with clients who are looking at saving money. But back to your earlier question also not compromising value.

Andy: Brilliant. Thank you very much, Michele. Well, when it comes to looking at people's bottom lines, looking at how we contain costs, we could continue for a while but let's also be containing people's cost and how much time they're spending with us for today. So, we will draw a line under there. If there are more questions around cost containment that people send in, perhaps we'll pick this up again another time. But for now, thank you very much to both of our speakers today. So, thank you to you, Michele, thank you to you as well, Terri. Thanks to everyone who is listening along with us today. 

For more on this topic, you can read our two-part white paper series, “Achieving cost savings through policy design.” You can find both on cartus.com on the Insights page. Be sure also to subscribe to Mobility Matters on your favorite podcast platform where you can hear us again on previous and future topics, covering all the things that are keeping you up in the mobility space, week after week. My name is Andy Conduit-Turner and I will see you all next time.

Visit cartus.com/podcast for more episodes of Mobility Matters.