ORC Sightlines

December 2009

In this issue:

In addition to maintaining our proprietary survey products such as SIRS® and our international cost-of-living indexes, every year ORC conducts literally hundreds of pieces of research for the benefit of consulting clients, Network members, and data subscribers. In this year-end issue of Sightlines, we have compiled some of the information we have learned through these studies.

IRC Releases New Talent Management Study

Industrial Relations Counselors, Inc. (IRC), a not-for-profit research and educational organization specializing in human relations in management, released in December the results of its 2009 study, Talent Management Processes for a Diverse Leadership Team. Conducted by consultants in ORC’s human capital management and global diversity and inclusion practice areas, the study explored how leading multinational organizations identify, develop, and ensure advancement of talented women, racial/ethnic minorities, and non-HQ nationals into high-level executive positions.

Women

The barriers most frequently blamed for the inability of women to break into senior positions are:

  1. Exclusion from informal networks
  2. Having a different leadership style from that of current leaders
  3. Lack of visibility to senior leaders

Some of the strategies that the most successful companies use to overcome these barriers include:

Racial/ethnic Minorities

Like women, racial/ethnic minorities often suffer from difficulty being noticed by senior leaders and lack of access to informal networks. However, minorities are also frequently the victims of an unwillingness among managers to “take a chance” on nontraditional candidates. Companies with superior records on advancing minorities are likely to use strategies such as:

Non-HQ Nationals

Employees outside the headquarters country share the issues of not being visible to senior leadership, being excluded from informal networks, and sometimes using leadership styles unfamiliar to current senior executives. The most important things employers can do to ensure that non-HQ nationals have a fair shot at top jobs are to get them international experiences early in their career, and to find ways to bring them together from around the world to build their networks.

The study also addressed selection of high potentials, the role of organizational culture, accountability for diversity in talent management processes, and international assignment practices. The executive summary and the full report are available to the public free of charge at www.ircounselors.org. For more information, contact ORC consultants Michal Fineman or Mary Martinéz.

New Graduate Compensation

Our investigation into pay practices for new graduates in the U.S. was conducted primarily among companies in the life sciences, high technology, financial services, and consumer products industries. Findings included that:

Short-term Expatriate Assignments on the Increase

The use of short-term expatriate assignments is increasing among nearly half (46.8%) of the multinational participants in ORC Worldwide’s 2009 Survey of Short-term International Assignment Policies. Interestingly, cost reduction—even in the current economic climate—is not cited as the primary driving force in implementing shorter assignments instead of more traditional postings that last a few years. Multinationals generally link the need for shorter assignments to objectives such as:

As more employees go on these shorter assignments, managing them often becomes a significant challenge, not only for HR but also for business unit managers. The key difficulty reported is controlling assignment length. Once the assignment stretches beyond the duration originally contemplated, all sorts of complications can ensue regarding tax compliance, immigration status, home leaves and family visits, housing, and so forth. HR may have to address requests for exceptions to policy by assignees looking for special treatment. In those cases, it is also important to try to minimize potential adverse impact on the morale of other expatriates who have not been granted policy exceptions (and who may not have requested any) and to keep an eye on any increase in expenses.

Expatriate Spouses and Partners’ Employment, Work Permits, and International Mobility

This survey, sponsored by IRC and conducted by ORC for the Permits Foundation, examined the views of 3,300 expatriate spouses and partners of 122 nationalities, currently accompanying international employees working in 117 host countries for more than 200 employers in both the private and public sectors. It provides evidence that a lack of spouse or partner employment opportunities adversely affects global mobility of highly skilled international employees. A few focused and simple improvements on the part of employers and governments can make a triple win for families, employers, and the countries in which they work.

Best Practices in Global Diversity

ORC’s Global Equality, Diversity and Inclusion (EDI) area has been doing research all year on behalf of the members of its six networks as well as individual consulting clients. Here are a few of our findings for topics such as global diversity metrics, making the global business case, identification of employees’ sexual orientation, and roles and responsibilities of diversity champions:

Global Diversity Metrics

The two greatest challenges to global measurement of diversity representation among surveyed members were the lack of knowledge of local diversity issues (i.e., the “differences that make a difference” in the particular country) and the lack of local demographic data for benchmarking appropriate representation targets. (In response, ORC compiled Global Dimensions of Diversity: Differences That Make a Difference in 19 Emerging Market Countries for members of the Global Diversity Forum.) ORC’s year-long research into the broader subject of best diversity and inclusion measurement practices led to publication of For Good Measure: Diversity and Inclusion Metrics.

Making the Global Business Case for Diversity

Many organizations whose senior leaders clearly understand and support diversity in the headquarters country still struggle to communicate the business case in a compelling way to managers and employees in other countries. ORC’s benchmarking found several practices that have helped successful global organizations do so:

Self-Identification of Sexual Orientation

Most U.S. companies still do not ask employees to identify their sexual orientation. However, more are beginning to consider doing so, especially since in many cases, LGBT employees and advocacy groups are requesting it.

Roles and Responsibilities of Diversity Champions

The role of diversity champion is most often filled by senior business executives, either at the corporate or business unit level. Middle managers and individual contributors are called to fill this function in fewer than half the responding companies.

Most commonly, diversity champions play both a symbolic and an active strategic role. Their symbolic function is to demonstrate leadership support for diversity by attending diversity events and delivering diversity messages to stakeholder groups within the company and externally. They contribute to diversity strategy development and implementation by serving on diversity councils, campaigning for support from their fellow executives, and consulting with diversity leaders.

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