Relocation management companies (RMCs) are at the forefront of addressing new challenges and opportunities in talent mobility. Representatives from leading RMCs—Paige Holden, president of XONEX Relocation; John O’Connell, executive vice president of global account management and supply chain at SIRVA; and Mark Woelfel, senior vice president at CapRelo—gathered on 24 October to discuss current trends, share predictions, and discuss the critical role of suppliers in the mobility ecosystem.
Key Trends Reshaping the Relocation Industry
1. Cost Optimization Over Cost Containment
O’Connell emphasized a shift from mere cost containment to cost optimization. Companies are not just looking to cut expenses but to maximize the value of their investments in relocation. “Our corporate clients are stretched in ways they’ve never been stretched before,” he said. With real estate market challenges and talent shortages making it harder to persuade employees to relocate, RMCs must find innovative ways to optimize costs while delivering value.
2. Technology and Data Are Enabling Smarter Decisions
The RMCs are becoming a bigger hub for utilizing and communicating mobility data. O’Connell mentioned the importance of integrating supplier data, RMC data, and client data to create transparent and efficient processes.
3. Speed of Policy Changes
“The speed of change in having to update policies is growing. It’s faster than I’ve ever seen it,” Woelfel said. The National Association of Realtors (NAR) settlement is driving some of these changes, even if most policies don’t seem to be changing much related to real estate yet. With all the policy changes, there’s a greater need for flexibility in programs and policies than ever before.
Considerations in Selecting Suppliers
The panel was asked about considerations in selecting suppliers, and some new trends are occurring.
What is unchanged: Experience and quality of service remain foundational. Suppliers must demonstrate a track record of delivering high-quality services and maintaining reasonable costs.
Providing accurate and timely information is crucial. Suppliers need to feed detailed data into the storytelling that RMCs and their corporate clients rely on for decision-making.
Environmental, social, and governance (ESG) considerations are becoming central in supplier selection. O’Connell noted a significant focus on ESG, driven by client requirements. “Supplier diversity has always been important. The focus on diversity and supplier diversity is absolutely growing,” he said. Companies are also prioritizing environmental sustainability, expecting suppliers to be on a path toward a more sustainable future. Woelfel urged suppliers to invest in carbon accounting. “It’s driving our business,” he stated. With companies needing to report their indirect emissions in their value chain, suppliers must be prepared to provide relevant data.
Holden emphasized the need for trust and transparency between RMCs and suppliers. She sees suppliers as an extension of her own team. “I want to be able to problem-solve together and have open discussions about difficult things,” she said.
The Evolution of Relocation Support
The panelists were asked to share their perspectives on how relocation support might evolve over the next three to five years.
- Stability and growth: Woelfel expressed optimism about a return to stability and growth. “In two to three years, we’re hoping that we’re going to see a renewed demand for growth overall,” he said. This growth will necessitate efficient programs and readiness to meet increased demand.
- Embracing lump-sum programs: While lump-sum programs are sometimes viewed negatively, the panelists acknowledged their continued relevance. Woelfel noted that they run many successful lump-sum programs that meet client needs. The key is to tailor services to this model and find ways to deliver value within its constraints.
- Creative solutions for new programs: RMCs are being asked to apply their expertise in new areas, such as pre-hire services and rotational programs. “In the last few weeks, I’ve had more conversations with clients about the ability to use mobility services in non-traditional programs than I’ve ever had before,” Holden said.
- Core-flex programs: There is an expectation of more core-flex programs that offer a balance between defined benefits and flexibility. These programs allow for customization while maintaining some structure, catering to both company policies and individual employee preferences for flexibility.
Communication Is Key
A significant part of the discussion centered on how RMCs and mobility leaders can help communicate the value of managed mobility over lump-sum programs. The bottom line: We all need to be better storytellers.
Woelfel emphasized the importance of storytelling supported by data. Sharing success stories and demonstrating how issues were proactively managed can illustrate the tangible benefits of managed programs.
O’Connell highlighted the value of connecting clients directly with suppliers. “When clients can sit down with the suppliers, it really supports the overall value chain throughout the mobility experience,” he said. These interactions can deepen understanding and trust, showcasing the collaborative efforts behind successful relocations.
Holden shared that some of the best demonstrations of value come when there’s a problem. When suppliers jump in ahead of an issue, devise a plan, and communicate effectively, it showcases their expertise and commitment. “We always share that message back to the client base,” she said. Providing timely information and guidance positions RMCs as valuable consultants. With regards to the challenges related to the NAR settlement, Holden said, “Clients expect us to be at the leading edge of these things and to bring information and guidance back to them.”
Technology as a Critical Enabler
The last topic discussed was technology, which continues to be a critical enabler in the relocation industry. The key insights:
- Customized employee experiences: With diverse transferee preferences and large differences in policy types, there’s a need for innovative technological solutions. Some employees may prefer digital interactions, while others value traditional support. RMCs must offer a spectrum of options
- Data integration and analytics: Clients require data they trust for reporting and real-time information for improved decisions. Integrating data from suppliers across all the channels of mobility is becoming more important.
- Creative products for lump-sum services: Holden mentioned that they are seeking innovative products that cater to lump-sum recipients. Suppliers offering cost-effective, creative solutions can fill a niche in this market segment.
The insights from Holden, Woelfel, and O’Connell showed a space that is both challenging and full of opportunity. As needs for global talent evolve, mobility is reshaping, and RMCs and their suppliers continue to adapt and evolve to meet these challenges. With a wide range of corporate needs with high levels of variability and more policy changes than ever, we may see greater differentiation unfold among the RMCs and supply chain. It’s going to be an interesting year of adaptation and innovation in our industry.