Remember that childhood friend who left school mid-semester because their parent's job whisked them away to a new country? Or perhaps you've encountered a new coworker who came to work with good knowledge about the company.
Companies offering this kind of opportunity capture the essence of corporate relocation. The strategic practice involved is a well-planned process. It involves the company covering all or most of the relocation expenses. However, this term extends far beyond moving individuals for work.
So, what is corporate relocation?
Here, you'll learn about corporate relocation, including its types and associated challenges.
What is Corporate Relocation?
Corporate relocation is the process of moving employees and their families for work purposes. It often involves moving employees to different countries, states, or cities within the country.
Take it like this: it's a relocation that typically involves some degree of financial assistance. The aim is to ease the transition for both the employee and the business.
Due to the demands of
corporate relocations, businesses engage the services of professionals. By doing so, staff can focus on the business of the day rather than being directly involved in facilitating the relocation.
Types of Corporate Relocation
There are many types of corporate relocation. They can fall into categories based on destination, duration, and business needs involved:
Based on destination
- Domestic relocation involves moving employees within the same country.
- International relocation entails moving employees to a new country. Oftentimes, this includes their families and personal effects.
Based on duration
- Short-term assignments require temporary relocations. They are usually for a specific project or assignment.
- Long-term assignments are often permanent relocations and involve a transfer to a new role or position.
Based on business needs
- Individual employee relocation happens when employed personnel have the expertise needed to fill a role at a new location. This relocation can also be temporary or permanent.
- Group Relocation becomes necessary when a company sees the need for a merger or acquisition. It can also occur as part of a strategic expansion initiative, where entire departments or project teams are relocated.
Reasons Why Companies Offer Relocation Packages
Companies can offer corporate relocation packages for a host of reasons.
These reasons include:
Expansion
Companies are constantly expanding and adapting. They may relocate employees to support business expansion into new markets or regions. It is often a more effective and efficient strategy than hiring new employees in the new location.
Older employees who are relocated already understand the company's goals and objectives. They will also not find it difficult to key into the company work culture in a new place, expediting the expansion and adaptation process.
Talent acquisition
To attract top talent, companies may relocate employees to locations to fill new roles. Relocation benefits also incentivize internal promotions or transfers.
Sometimes, the corporate relocation process is for a new hire. It's initiated for a talented new hire whose skills and inputs will benefit the company.
In most cases involving new hires, corporate relocation is international. It may include reimbursing the cost of visa applications or providing support for the applications.
Mergers and acquisitions
After mergers or acquisitions, companies may consolidate operations. They do this by relocating employees to centralize resources, which in turn, leads to significant savings for the company.
Key Elements of a Corporate Relocation Package
Different companies have their corporate relocation policies. These policies outline the terms and conditions of relocation.
Some of the key elements of this relocation include:
Financial assistance
Companies offer varying degrees of financial assistance to their employees when they relocate. The financial assistance may cover all, most, or some of the expenses incurred during relocation. More often than not, what package an employee receives is dependent on their position in the company.
High-level executives, for instance, often receive a package that covers all relocation costs, from local moving services to shipments of household belongings for international corporate relocations. The exact terms are spelled out in the company's relocation policies.
Home sale or purchase assistance
For international corporate relocations, the homeowner employee will have to sell off their existing home. Companies may offer help with selling the existing home or finding and purchasing a new one in the relocation city.
Visa and immigration support
Some companies offer visa and immigration support for international relocations or new hires. They do this either by providing guidance and assistance with obtaining the necessary visas and work permits.
Cost-of-living adjustments
Companies may offer extra financial support to help the relocating employee and family acclimate to their new location. The extra support may include a monthly stipend for a specified period. If that is the case, it is to buffer the impact of a higher cost of living in the new location.
Even when this is not the case, some companies still offer this benefit. Thus, they remain competitive among other businesses with similar relocation packages. The package could also cover childcare fees and cultural training fees.
Spouse or partner career services
Corporate relocation involving the employee's family leaves the employee's partner unemployed. Some companies assist such a partner in finding new employment opportunities. This is all part of keeping the package competitive.
Benefits of Corporate Relocation for the Employee
Without the benefits, what is corporate relocation? The company alone does not benefit from a corporate relocation as it also holds some advantages for the employees.
Some of the benefits of corporate relocation for the employee are:
- Eases the financial burden of moving
- Makes provisions for the seamless organization of moving logistics
- This leads to career growth and advancement since most corporate relocations are up the career ladder
- Better job security due to the invaluable contribution of the employee to the company
- This leads to an increased job satisfaction
Sorting out the task of moving allows employees to focus on starting their new jobs. Moving, especially to another country, also comes with emotional stress. Eliminating the need to fund and cater to the physical aspects of relocation helps relieve this stress.
Challenges Associated with Corporate Relocation
Although corporate relocation can offer many enticing benefits, it also presents a few challenges.
These challenges include:
- Getting used to a new environment
- Family-related stress due to new enrollments in schools, seeking of new jobs by employee's partner
- Coordinating the physical move and related activities
- Managing the costs associated with relocation if a full-coverage package is not provided
Why Hire Professional Corporate Relocation Services?
Coordinating the logistics of corporate relocation is a complex endeavor. For domestic relocations, a lot of planning goes into packing, transportation, and safe delivery to the destination. The added quagmire of navigating international laws can be daunting for international corporate relocations.
Professional corporate relocation services handle all paperwork and obtain necessary permits without errors, saving time and money. They also serve as guides in the new location, especially abroad, with insights into life there.
Additionally, these services provide a safety net. Professional corporate relocation services often offer full valuation coverage of belongings, so in the event of damage or loss, you will have nothing to worry about.
In the long run, using a professional corporate relocation service:
- Saves time
- Saves money
- Provides expert guidance in unfamiliar territory
- Allows you to focus on your career
Conclusion
Still asking, "What is corporate relocation?"
You can now see that corporate relocation transcends just the moving of an employee for work purposes. It can play into a business strategy to retain or hire new talents and expand the company's brand while providing support in various forms for its employees.
The assistance of professional corporate relocation services even makes the entire process seamless. Thereby saving both time and money for employees and the company.
If you're a company looking to expand or hire new talent from a far away distance, you might want to look closely into corporate relocation.
