International mobility among UK-based business consultancy firms Peter Wood and John Salt

1. International mobility among UK-based business consultancy firms Peter Wood and John Salt University College London p.wood@geog.ucl.ac.uk The research was funded by the Leverhulme Trust. The fieldwork was jointly carried out with Dr. Jane Millar.

2. Seven mobility types identified: • Permanent recruitment through the external labour market (ELM) or the internal labour market (ILM): Rare. • Long-term assignments: 6 months - 5 years • Short-term assignments: 2-12 (- 24) months • Commuterassignments (weekly): months - 2 years • Extended business travel (30 days - 6 months); • Business travel (days - 3 months); • Virtual mobility: substitute for business travel? • Not much evidence of cost-driven substitution between types of exchange, but boundaries not clear-cut.

3. Company A: A major US-based multifunctional management consultancy, employing over 10,000 staff in the UK, engaged in IT and outsourcing, serving UK-based private and public sector agencies, including their international activities. Company B: A ‘top four’ accountancy and financial consultancy serving UK-based multinational clients in many sectors. Core services in audit, tax and corporate finance, transactions and insolvency advice. Company C: A multinational human resource consultancy. It is a wholly owned subsidiary of an international holding company Company D: A smaller international human resource consultancy, with core activities in job evaluation and pay surveys, and strategic work on executive and leadership development, talent management and organisational effectiveness.

4. Dominant management concerns among MNC consultancies: • Corporate arrangements to coordinate national and international obligations. • The need to respond to international activities of clients and markets: Impacts of emerging markets and standardisation. • The assembly and management of effective international project teams. 4) The application of communications technologies to complement personnel mobility.

5. 1) Corporate arrangements to coordinate national and international obligations “We don’t have a global scheduling system for (moving) our people, because at the end of the day we’re not a global organisation…The human resources programmes and policies vary from (corporate subsidiaries in) one country to another… one country may have a bonus scheme, and another country may not. One country may pay upper quartile salaries and another may have positioned itself for paying median salaries, so that is very much a local decision.” [Company B]

6. Corporate arrangements to coordinate national and international obligations (2) ” … When it comes to international assignments, there is a need to have some level of commonality, and therefore we do have common policies….. for example, our (senior staff management system) is the same globally.”[Company B]

7. 2): Market and client characteristics: “The majority of our assignments are for specific clients, for a specific purpose. Whatever grade of person is going, it’s to fill a need for that particular project. We don’t have many assignments that are somebody of a high level going out for broad management responsibilities. It does happen, but those people are more likely to be transferred permanently to that location…. or somebody will be recruited locally.” [Company C]

8. Market and client characteristics (2) “The way that we’re structured, we look at clients at three levels. We have a complex client, which are the large ones basically, and multinational. Corporate clients, which are more your medium sized, between about 1-5,000 and then commercial clients, which are your small ones, and really… on the consulting side, we tend to deal with the complex and corporate level, and the commercial level, we’re looking for package solutions.”[Company B]

9. Market and client characteristics (3) “And we’re also finding that some sectors are quite traditional in their approach. … for example we’ve been working with (a major client) for about three or four years doing some leading edge work on the talent management, and people strategy side.” [Company B]

10. Market and client characteristics (4) “…when it comes to more centralistic projects, touching the executive population, or the (whole) population managed by (the client) globally; or areas that are by definition a global activity ( for example, talent management) … co-ordination is necessary to have a global viewpoint, by the client as well as the consultant.” [Company D]

11. 3) Projects and project management. • [Company A] • Employee-requestedmoves to identified company jobs overseas, for which no financial support is provided. • Filling vacant posts on particular project assignments, usually advertised on the company data base. Successful applicants receive some assistance, including flight, shipping and immigration support. Willingness to undertake such mobility is regarded as integral to a consultancy career. • 3) Recruiting individuals for permanent moves: Particular individuals are approached and offered a support package, including assistance with housing purchase. They are employed on local salaries, with no further assistance once settled. • 4) Occasional recruitment of specific senior executives or experts, offering a generous package to take up a high level role overseas.

12. Projects and project management (2) “Obviously the packages and types of support are really quite different, because of the cost to the business. A company initiated move for a senior individual offers a more significant return, so it will be a more traditional type of package, with things like school fees included and housing. For employee initiated it’s pretty much local terms, plus some kind of removal allowance.”

13. Projects and project management (3) “The traditional assignments tend to split into short term and long term. The short term tends to be up to a year, and long term over a year. … Some will get extended, but not many will be more than three years. The long term ones are fairly static, maybe even be slightly declining. It’s the short term ones that are going up.” [Company B]

14. Projects and project management (4) • “From a people management point of view it gets a bit complicated, because we’re a matrix organisation anyway. So one person often has two bosses, and you then apply a project based organisation across that and you’ve got a number of different individuals working for different project managers.” [Company C]

15. Projects and project management (5) • “We would expect that after, say five years, the percentage of ex-pats to locals will have gone down very considerably…. it becomes effectively a local run thing, … they know the language and the local community - they’ve got the local qualifications…” [Company B].

16. 4) Impacts of communications technologies “The most successful technologies in helping us to do our work? Email is hugely successful. Mobile phones hugely successful. Blackberry - we wouldn’t live without our Blackberrys these days! …The Internet, in particular shared sites with our clients, where we post the work we’re doing; copies of deals; changes of requests, documentation, etc. Those sorts of connectivity websites, are quite good. We use international conference calls all the time.” [Company B]

17. Impacts of communications technologies (2) • “We have a Project Website, which has global access. We have customer databases, which have global access. That means that we can all access the same information, with telephone, video conferencing, that type of thing. … What we do try is to have our client-facing individuals either situated on the client site or in the same country. They’re the ones that need to have real local understanding, but the back end can be done anywhere.” [Company C]

18. Conclusions: • Multinational consultancies: • Must continue to develop and coordinate a wide range of new knowledge and expertise. • Need to integrate this knowledge into the international agendas of their often US-dominated parent companies, in association with international partner subsidiaries. • International knowledge flows being increasingly directed to new markets. • Encouraging localization of staff recruitmentand support for partner subsidiaries in those markets.

19. Growth of lower cost proprietary products and outsourcing modifying role oftraditional face-to-face professional advice. • The functional, linguistic and cultural basis of this • consultancy knowledge are thus changing rapidly. • Consultancies epitomize shifts towards shorter term, but higher quality international staff mobility, a greater reliance on the virtual exchange of expertise and an increasing localization of expert recruitment across global regions.

20. The impact of the recession. • Before the recession, considerable ‘slack’ in the management of mobility, as ‘a cost of doing business’, although already adjusting mobility practices in response to product and market changes. • Recession exposed scope for reducing mobility costs, often for first time in recent commercial and technological conditions, thusaccelerating these trends. • Immediate response to recession was mobility cost savings rather than changing basic networks. Critical attention focused on travel and remunerationcosts andselecting assigneesmore carefully.

21. Consultancies met client resistance to high costs by employing more local staff and virtual communications, and directing senior consultants more in their work • Senior and specialist staff moves less affected than junior staff/career development moves. • Some of these changes are likely to survive the recession: morevirtual exchange, greater staff selectivity,localisation of recruitment and training. • All sectors emphasised need to retain talented staff.