Shorter overseas stints for expats as firms try to save money, time: KPMG
[SINGAPORE] Singapore could see more expatriates coming here on shorter stints as international firms begin to frown over lengthy overseas work trips.
Companies today find such overseas postings are becoming more costly and time-consuming, says KPMG executive director Ooi Boon Jin, commenting on the latest results from the 2007 KPMG Global Assignment Policies and Practices Survey.
The survey polled a total of 348 human resource executives worldwide, and found that 49 per cent of them felt that international assignment programmes "take too much time and effort to administer", up slightly from the 48 per cent seen a year earlier.
Forty per cent of the respondents also thought such international programmes are "more generous than they need to be", compared with 38 per cent who felt the same way in 2006.
Mr Ooi suggests that firms with regional or international operations "should look more closely at the commercial needs of an international assignment and the expected returns on investment".
"The benefits of these assignments can then be maximised if proactive planning is done well ahead of the relocation," he said.
Given the respondents' views on overseas stints, it is therefore not surprising that more companies now prefer sending international assignees on short-term work trips, with 80 per cent of those surveyed using this option.
Said Mr Ooi: "The increasing number of short-term assignments requires companies to take a look at their international assignment programmes as traditional long-term expatriate policies often fail to adequately support the needs of the business or assignee."
As these firms try to manage their international assignment costs more effectively, he says, this could result in more assignments into Singapore, "which are short-term in nature, typically less than a year where expatriate families can remain back home".
Based on another KPMG survey released last September, 38 per cent of corporate respondents expect their use of short-term assignments to increase in the next 18 months.
This latest study also found that mid-sized firms now increasingly turn to outsourcing to manage their international assignment programmes.
Among companies with revenues of US$500 million and below, the programme functions that are commonly outsourced include tax compliance (78 per cent), assignment orientation sessions related to tax (72 per cent), and immigration and work permit assistance (67 per cent).
When asked about the top reason for outsourcing, 78 per cent of firms in that revenue range cited the access to a service provider's global resources and expertise as a key factor, while 21 per cent named improved service quality and efficiency as the main reason.
Said Mr Ooi: "For mid-sized companies expanding their global footprint, outsourcing can create operational and cost efficiencies which may not be achieved due to limited expertise or technology tools to support their international assignment programme."