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Relocation is Not a Widget

Relocation is Not a WidgetLately I’ve noticed that procurement representatives and relocation companies are having a hard time appreciating each other – or at least getting on the same page when it comes to moving transferees. This is an issue when it comes to implementing strategic HR practices that will benefit transferees and the company as a whole. We all need to work together to build the best relocation team and subsequent program.

I can understand some of the angst. Historically, the human resources department managed relocation from start to finish. Now, cost-cutting measures have caused more companies to charge procurement with sourcing the relocation vendor, which has changed the nature of the RFP process (and subsequent relationship) to focus solely on price, instead of a combination of quantitative and qualitative attributes.

This is not to say that involvement by procurement is bad, but I do wish procurement better understood relocation and the impact that it can have on talent retention and recruitment.  It has been my experience that most procurement professionals are rarely interested in what individual providers do and how they do it. Differentiating factors such as menu of services, delivery, technology, quality records and culture mean little as long as the most obvious cost savings components are there. The problem here is not necessarily the focus on cost-cutting. The problem is the lack of consideration for other must-haves that will impact the HR department and transferees down the road.

Ultimately, the reality of relocation is that the decision about which provider to work with should largely be based on three things: the financial goals of the company, the overall business objectives of the company, and a strong cultural fit. Swinging the pendulum one way over the other is not harmonious or strategic.

For this reason, I think it’s critical for HR managers to insert themselves in the relocation sourcing process. Even HR folks who are not responsible for the decision can educate their colleagues on the big picture. Here are some of the most important points to remember:

– Relocation should always be viewed a value-added benefit for its transferring employee population

– Relocation programs work better when the relocation company is a true partner – an extension of the company’s HR department

– Relocation companies may seem very similar but each boasts unique attributes and offers its own host of features and benefits to both the client and transferee

– Poor quality, a cultural mis-match and sub-par technology can make or break a relocation program

– Relocation costs can sometimes be cut in the least obvious of places

– Talent management is critical and benefits should reflect this

– Competitive policies aid in recruitment and retention, which can save money in the long term

And, the most important point:

When it comes to relocation, nothing is more expensive than a failed program

Is procurement involved in sourcing your relocation partner? What are some of the benefits and challenges that you have noticed? How do you educate your company about relocation?


VP, Client Services

VP of Business Development Northeast Region


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