A relocation should be planned like a military operation, and one element of your strategy is deciding whether to organise the process in-house or call in outside consultants there are pros and cons to both approaches. Diana Clement looks at what’s involved and who’s available to help if you do decide to call for back-up
To be successful, an international relocation requires military precision and disciplined management. Planning for the move can take up to two years, as it involves many key phases strategy, location analysis, risk assessment, budgeting and implementation. Luckily, there are many sources of help available for each of these phases.
Communication links, suitability of available premises, the cost and education of a local labour force, proximity to competition, availability of inward investment grants, the cost and quality of living, cost of relocating employees and local amenities will all play a part in your relocation. But much of your plan will be shaped by human resources (HR) questions. Indeed, these may play a greater role than property, communications, or labour market issues in locating your new operation.
Advice for companies moving to the UK is available from several sources central and local government agencies, and commercial relocation consultancies.
The central government agency Invest.UK can assist in region selection and give advice about availability of labour, tax, and employee costs and skills. It will then usually pass the contact on to one of 12 regional development agencies for localised assistance. Invest.UK can be contacted via British embassies, consulates or high commissions.
Bedding in
The regional development agencies, such as Advantage West Midlands, can help in a specific site search, provide grants, facilitate planning permission, deal with local authorities, and provide aftercare to ensure the new business “beds in”. In addition, there are several smaller inward investment agencies such as Locate in Birmingham and Locate in Kent that promote their respective areas.
Other non-commercial sources of advice include local authorities and the CBI. Dover council, for example, provides free grant assistance to companies moving to the area while the CBI works in the field of employee mobility.
R&D grants
A variety of financial incentives is also open to companies relocating to the UK. These include regional selective assistance grants (see Inward investment assistance, p9), which are offered to companies creating jobs in the UK’s assisted areas. Research and development grants are available through several government and European Union projects.
Few firms can gather all the necessary skills in-house to keep relocation on track. Small details left out of your plan or budget can mean the difference between success and failure. That is why many companies employ relocation consultants or project managers to smooth the process.
Some relocation consultants provide just commercial property, HR, education, or grant consultancy. Others can project-manage the entire move with a team of specialists skilled in budgeting, HR, commercial property and facilities management.
If you have in-house skills, you may prefer to limit assistance to destination services such as commercial property searches, home searches, orientation tours, school searches and information packs for your staff.
Several of the services offered by relocation agents can be obtained free from government sources. However, regional and local development agencies sometimes introduce companies to relocation agents for specialist assistance.
Larger companies often employ relocation consultants or management consultancies such as PricewaterhouseCoopers to validate their strategic decision. The larger the move, the more likely firms are to use experienced full-service relocation agents, says relocation consultant Richard Pugh of Location Strategy Management.
Relocation consultancies can be found by contacting Trade Partners UK, a government organisation at www.tradepartners.gov.uk ; the Association of Relocation Agents at www.relocationagents.com , or the British Service Providers Association at www.bspa.co.uk.
When it comes to managing the move, you need to work back from the date when you must be up and running. Pugh says some clients are unrealistic about the timescale of their move.
Two-thirds of firms that relocate experience delays in the process, according to CBI research. The biggest problems came from building contractors running late, the housing market inhibiting staff relocation, and obtaining local authority planning consent.
Fragmentation risk
The research found that sharing tasks out eased the burden. But this risked fragmentation unless the lines of communication were clearly defined.
Usually, companies undergoing a relocation appoint an internal project manager or project team to liaise with relocation consultants or development agencies. For this team to succeed, it is vital to involve human resources managers, according to Pugh. If you employ consultancies, they will usually form part of a move management team along with heads of departments from your firm.
One approach to HR is to allocate different “labels” to all of your staff. You should categorise them as “critical”, “essential” or “desired”, says Pugh.
Many a relocation has failed because the staff would not move. Those with school-age children or working partners will be the most difficult to relocate. More than 70% of relocation “refuseniks” make their decision because they do not want to disrupt their children’s education, says Stuart Mitchell, senior partner at the Business Moves Advisory Centre.
School continuity
If your “critical” staff want continuity of education for their children, you might have to locate new premises near American, or European schools.
Bronwyn Thorburn, education consultant at Sterling Relocation, cites a family whose child is at GCSE or A-level stage. If the family arrived part way through a school year, the child might be forced to repeat a year. Another option would be for the child to attend an international school. In an extreme situation he or she could be left behind at boarding school.
Other sweeteners for potential refuseniks, suggests Mitchell, are providing “look-see” visits with the employee’s family; cross-cultural training; advice on where, and where not, to live; a location-specific cost-of-living allowance; local help for the family following the move to help them settle; and repatriation assistance when the assignment is completed, or in the event of an early return if everything goes wrong.
But get the education equation wrong and your move will be put in jeopardy.
The second largest group of staff likely to refuse a move are those in dual-income families. For these families the second income is essential, and in many cases the career of the “trailing partner” can be severely affected by such a move.
The problems can be overcome with help such as providing a desk and chair for the partner and introducing them to the local job market. First you need to find out what the partner’s employment needs will be. You should also meet them to ensure they feel included.
Assistance with obtaining work permits will be essential. In addition, you could provide them with an information pack about the local job market. The trailing partner should also be introduced to local business groups and associations that could help them network their way into employment.
A series of useful move management tip sheets is available from Easy Office Relocation at: http://www. easyofficerelocation.com/tipsonmoving.html
Copper tube manufacturer Mueller Europe used an in-house team to project-manage its £25m inward investment in 1999. The project, in Bilston, West Midlands, was completed ahead of deadline and under budget.
Manufacturing director Brian Parsons headed the team and members of staff were given specialist areas to manage reporting back at weekly meetings. One team member had previous experience within Mueller’s US operation, but the rest learnt as they went along. Parsons decided not to use a external consultancy. Instead he deployed staff members to learn about certain functions such as grant applications. “Someone with a modicum of intelligence could get us just as much money as a grant consultant, and you then have a member of staff who understands the process,” he says.
He advises companies to concentrate on the ability to produce a consistent return on the initial capital investment. “It can be easy to lose sight of this when confronted by the myriad assistance packages that are offered,” he says.
German auto-components maker DAU Draexlmaier Automotive UK, opened its 53,820 sq ft (5,000m2) plant in Rubery near Longbridge, Birmingham in 2000.
The company was required to build a UK operation as part of its contract to supply parts for the Mini car, which is manufactured in Oxford.
Director Herbert Kohl and his team chose Birmingham after an exhaustive nationwide search for a suitable location.
“Birmingham was certainly not the cheapest, but it was the most cost-effective location,” Kohl says. “The criticality of our products mean we must have a very reliable supply system.”
Draexlmaier used the services of the local development agency, Locate in Birmingham, throughout the entire planning process, and Kohl believes the relocation would have been difficult without the agency’s help. Project-management consultancy Fuller Peiser was employed for the building phase of the plant.
Kohl says the most difficult stage of the project was employing a suitable local workforce. BMW, which owns Mini, expected a German style of production. Yet Draexlmaier had to learn to manage a 90-strong English workforce that had a very different culture. “Our staff have to be reliable and motivated, and it was difficult to find the right people,” he adds.
He advises other firms planning an international relocation to take two or three years to learn about the conditions in the UK before setting up. “It would be really hard if you came here without any local knowledge and relied upon advice that might not be appropriate for your business,” he says.
