Too many HR professionals find themselves wondering why employee relocation fails. The reality is that employee relocation is a high-stakes process that can result in either a smooth and productive transition or a costly failure. When an organization invests in relocating talent, the expectation is that the employee will hit the ground running. They will contribute to the company’s success, and settle comfortably in their new environment. However, too many relocations fall short of these expectations, leading to failed assignments, employee attrition, and increased costs.
For HR professionals, understanding why relocations fail is crucial to improving success rates. At TRC Global Mobility, our employee-owners are deeply invested in ensuring transferees have the best possible experience. We make it our mission to help our clients avoid these common relocation pitfalls. In this blog post, we will explore some common reasons why employee relocations fail and provide actionable strategies to avoid these issues. This ensures a smoother process for both companies and transferees.
#1 Inadequate Pre-Decision Planning
Why it Fails: One of the most common reasons why employee relocation fails is poor planning. Pre-decision planning is an almost universal part of the international relocation process, but it is just as important for domestic moves. If an employee is offered a relocation based purely on immediate business needs, with no further consideration of the company’s expectations or the employee’s personal situation and requirements, that relocation runs a needlessly high risk of failure.
How to Avoid It: Successful relocations start with robust pre-decision planning. Typically, this includes in-depth needs counseling, BMAs (Broker Market Analyses) to establish the value of the departure home, mortgage pre-approval, and a pre-decision trip. Properly managed, it allows the employer and employee alike to estimate the costs and other impacts of the move and for each side to decide if it makes good business sense.
TRC Global Mobility can help you to develop a well-structured pre-decision program. In addition to reducing the risk of failed relocations, this will allow you to manage talent more effectively, identify candidates who are unwilling or financially unable to move, increase employee acceptance rates, assess the financial impact of the relocation and budget, reduce the number of policy exceptions, and speed cycle times due to more realistic departure home pricing. Read the TRC Global Mobility e-book, Pre-Decision Planning: Domestic Relocation.
2. Communication Breakdown
Why it Fails: Poor communication among HR, the relocation management company (RMC), and the transferee is another reason why employee relocation fails. Employees may not fully understand what support they are entitled–or not entitled – to. HR might not be aware of the employee’s personal circumstances. Or the RMC might not have all the information it needs to administer the client’s policy accurately. When key details are inadequately shared or overlooked altogether, employees and families often experience unnecessary stress. Without clear communication, the relocation process can go off the rails quickly, leaving employees unprepared and frustrated.
How to Avoid It: Clear, consistent, and transparent communication is key to a successful relocation. HR and the RMC partner should ensure that transferees are kept informed at every stage of the process, with regular check-ins to address concerns or changes. Using electronic relocation management systems and apps, HR professionals, employees, and RMCs can streamline interactions among all stakeholders.
TRC’s flat, employee-owned organization facilitates transparent, open communication, and this extends to our clients and their relocating employees. As employee owners, we have a personal stake in ensuring transferees receive the information and support they need at every step of the process. We know that a well-informed employee is more likely to feel supported and satisfied, and more likely to relocate successfully.
3. Insufficient Relocation Assistance
Why it Fails: Moving to a new city or country is often stressful, and employees who feel unsupported may struggle to adjust. When an employee is overwhelmed by logistics, such as finding a home or adjusting to a new culture, their performance at work can suffer. Employees with families may experience even greater pressure as they manage schooling, healthcare, and spouse/partner career concerns.
Providing appropriate relocation packages will greatly reduce the risk of relocation failures. What is adequate will vary depending on the employee and family needs, the complexity of the move, and more. A simple lump sum policy might suffice for a recent college graduate making a domestic move with few possessions and limited expectations. A family moving abroad will require comprehensive support. HR professionals should consider the entire family’s experience, not just the employee’s, as family dissatisfaction can bring an assignment to an end quickly. In fact, according to IMPACT Group, 70 percent of failed relocations are due to the family not settling in and adapting.
TRC offers comprehensive domestic and relocation services. We can work with you to develop policies that support your employees and your business needs. Our employee-owners understand the importance of providing tailored assistance to meet the unique needs of each family. This personal investment leads to a smoother transition and higher satisfaction rates among transferees. Read the TRC Global Mobility e-books, 2024 U.S. Domestic Relocation Policy Best Practices and International Mobility Policy Trends, Design and Best Practices
4. Out of Control Costs
Why it Fails: Budget overruns represent another reason why employee relocation fails, though from the employer’s perspective, not the employee’s. Without proper oversight, relocation costs can spiral out of control. Unchecked policy exceptions such as temporary housing extensions or unforeseen tax liabilities, can create financial strain and sour the relocation experience. Sometimes excessive costs are the unfortunate consequence of poor pre-decision planning.
How to Avoid It: Transparent and thorough cost management is key to avoiding unpleasant surprises. HR teams should work with their RMC to establish a clear budget that accounts for all potential expenses, including housing, travel, moving services, and taxes. Ongoing monitoring and reporting ensure that costs remain under control and within budget.
TRC is a reliable steward of clients’ relocation programs and budgets. Our employee-owners are committed to providing clear, upfront cost estimates and tracking expenses to avoid overspending. This approach ensures budget compliance and creates a positive experience for the company and employee. Read the TRC Global Mobility e-book, 16 Ways to Reduce Your Mobility Program Costs.
5. Failing to Address Cultural Differences
Why it Fails: Relocating to a new country often involves more than just a change in scenery—it can require adapting to a new culture, language, and way of life. Employees often underestimate the effects of culture shock. Those who are not adequately prepared for these changes may experience culture shock, leading to poor job performance and, in some cases, early repatriation.
How to Avoid It: Pre-decision planning is essential for international moves. An employee might be the perfect technical fit for an international assignment but a poor fit for expatriate life. Or the family might be unwilling to make the significant sacrifices that an international assignment entails. Cultural training and support are critical to helping employees adapt to their new environment. Language support and local orientation services can also help ease the transition.
TRC Global Mobility understands that successful relocations go beyond the logistics of moving. We can coordinate cultural training and other support services that help employees feel confident and prepared to thrive in their new surroundings. This commitment to holistic support can make the difference between a successful and a failed relocation.
6. Unrealistic Job Expectations
Why it Fails: Relocating employees often face different work environments and job expectations in their new location. When there is a disconnect between what an employee expects from the new role and reality, job dissatisfaction can quickly set in. This misalignment can lead to disengagement, reduced productivity, and a failed assignment.
How to Avoid It: HR professionals should ensure that job expectations are clearly communicated before the move. This includes discussing any potential differences in management style, work hours, and local business culture. Managing these expectations upfront reduces the likelihood of job dissatisfaction and improves the employee’s transition into the new role.
TRC employee-owners work to make the move less stressful, removing distractions and helping the employee to focus on the new assignment. Our personal stake in the success of every move means that we take the time to understand both the employee’s and the company’s needs.
7. Real Estate Woes
Why it Fails: Real estate concerns, both at the departure and destination ends, are a common reason why employee relocation fails. Selling the current home promptly, for a fair price, and finding a new home that meets the employee’s needs and budget, is an undeniably stressful process. Today, many employees are reluctant to give up an existing, ultra-low mortgage rate, and even if they are, they will find a limited supply of homes and high prices in many locations.
How to Avoid It: Employees might be able to sell their home relatively easily in today’s market, but professional home-finding assistance is essential for a successful relocation. Destination agents can help employees find a neighborhood and home that meets their needs and navigate what can be a complex and competitive buying process.
TRC’s network of professional relocation-oriented agents understand the pressures of relocation and can make the homefinding process more efficient and less stressful. They work closely with the employee and TRC Relocation Counselor to deliver an outstanding customer experience.
Avoiding Relocation Failures with the Right Partner
Employee relocation is a complex process with many moving parts, but with the right planning, support, and partners, companies can avoid the common mistakes that lead to failed assignments. At TRC Global Mobility, our employee-owners have a personal stake in ensuring that transferees receive the highest level of support and service. We take pride in offering comprehensive relocation management services that help HR professionals avoid the pitfalls of relocation, leading to a more successful, cost-effective, and satisfying experience for everyone involved.
Read the TRC Global Mobility e-book, Selecting a Relocation Management Company.
