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How HR professionals can attract and retain top talent when a company relocates.
Moving your home or office—whether down the street or across the country—can be stressful. For companies moving their entire headquarters, multiply that stress by the number of employees, and you’ll understand why HR should play a central role in planning, personal counseling and talent management during the transition.
"The responsibility of the HR department is to make sure that all employees can make an informed decision about whether or not to move," says Marge Fisher, a Riverside, Conn.-based management consultant who specializes in relocation project management. "Crucial to that is ensuring that they are making a decision about the new location based on reality and not perceptions."
Polycom’s vice president of talent management, Daniel Sonsino, describes HR’s role in relocating a headquarters—and the key to success—in straightforward terms. "We have to tell the relocation story to our employees in a clear and transparent manner," says Sonsino, who helped lead the global voice and video collaboration company’s move from Pleasanton, Calif., to San Jose in May 2012.
"HR professionals should insert themselves into the process as early as possible," he says, adding that a headquarters move is just as much of an HR matter as it is a real estate issue.
An Unrehearsed Change
Naturally, one of employers’ biggest priorities for a relocation is to ensure that their best employees make the move. HR’s responsibilities also include hiring in the new location and managing the integration of new hires and relocated employees while minimizing productivity declines after the move is announced and completed.
Fulfilling these responsibilities hinges less on the distance of the move and more on the way the move is planned and communicated. "Distance does not minimize impact," says Fisher, who notes that one of the most difficult headquarters relocations she ever supported was just 17 miles away.
Polycom’s move covered fewer than 40 miles, but it added at least three hours to many employees’ commutes because of the terrible traffic between San Francisco and Silicon Valley.
"Moving from Raleigh to Chicago is a tough but clear-cut decision," Sonsino says. "Either you pick up and move or you look for another job. Our move proved challenging because there was so much gray area." He recognized that Polycom needed to address the possibility that employees who agreed to stay might change their mind a few weeks into their new commute.
Longer moves pose other challenges. Drew Morton, chief human resources officer of Hanger Inc., a provider of orthotic and prosthetic patient care and services, says there were significant cultural transitions to manage in the company’s 2010 move from Bethesda, Md., to Austin, Texas. Only 50 of roughly 150 employees (among a total U.S. workforce of 4,000 at the time) made the move.
Just one of the four HR executives reporting to Morton stayed with the company. "The biggest challenge was not finding qualified people; it was finding qualified people who could fit into a culture in the process of integrating legacy people and new people," he says.
This helps explain why Fisher describes headquarters relocations as "unrehearsed major life changes."
What’s genuinely good for a company may be distressing for an employee with a working spouse, a child in school or a parent in elder care. Unlike other forms of relocation, such as expatriate assignments or promotions to new positions in other cities, headquarters relocations affect the entire employee base. Here’s a four-step plan for making a smooth transition.
Step 1: Planning
Planningrepresents the first and most important step, preceding any announcement of a move to the workforce. Planning typically includes identifying why the company is moving, when it will move, what the budget will be (including relocation benefits), and how news about the move will be shared with the workforce, the media, the current and future communities, and other stakeholders.
You also need to address the important and delicate question of whether everybody will be invited to move.If a manufacturing company is moving to a location where the cost of labor is much lower, for example, its leaders may decide not to relocate all employees or to dissuade them by offering a less generous relocation policy.
Jennifer Connell, director of consulting services at Weichert Workforce Mobility in Norwell, Mass., says HR professionals should identify the critical skills the company needs and then create a related plan for hiring new talent to fill any gaps created by employees who do not move.
Sonsino and his team conducted this sort of workforce analysis, running scenario plans to identify what talent challenges would arise—and how such issues could be resolved—if fewer or more employees relocated than expected.
As a result of the planning process, HR professionals should produce a policy document that identifies any benefits employees will receive to remain with the company until the move takes place or to stay on for a specific amount of time after the move.
According to Douglas Weed, vice president of global services and supplier solutions at Cornerstone Relocation Group in Basking Ridge, N.J., this policy should take the following into consideration: the cost-of-living difference between locations, amenities available or lacking in the new location, moving costs, and family issues and related factors.
Through the planning process, HR and other leaders also should identify communication and retention activities.
A group-move policy addresses employee stress by laying out exactly what benefits relocating employees will receive.
A group-move program, on the other hand, includes the policy and all other components of the effort, such as evaluating who is likely to move, what positions will need to be filled after the move and what ongoing communications activities will be necessary, according to Marge Fisher, a Riverside, Conn.-based management consultant who specializes in relocation project management.
“A great deal of planning and strategizing is necessary to ensure a successful move,” notes Cindy Madden, director of global consulting services for relocation company Cartus in Danbury, Conn. “The earlier HR can be brought in, the more likely the success of the move.”
Step 2: Communication
The success of the communication effort hinges on its clarity, consistency, two-way nature and responsiveness.
"A lot of companies never clarify or articulate the reason for the move in a way that can be understood or appreciated by the employees affected," Fisher says.
Polycom’s move was consistently portrayed to employees, the press and other stakeholders as part of a rebranding effort designed to let the world know that the company’s videoconferencing and software offerings are on par with the innovative products and services that other Silicon Valley companies provide.
Sonsino and his senior colleagues listened and responded to employees’ concerns. They asked relocating employees to identify the features they wanted to see in the new headquarters building. Including many of those design elements—such as a state-of-the-art gym and innovative collaborative spaces, known as huddle rooms—helped strengthen retention and morale after the move.
The timing of the announcement is also important. Fisher suggests that companies not go public—even if rumors about a possible move are swirling—until they have completed their planning and have answers to questions that will arise. She notes that, even though keeping a relocation secret is all but impossible, "announcing the move before you have an understanding of your program doesn’t solve anything and only makes it worse."
The initial communication is just the beginning. If possible, Connell recommends appointing a dedicated HR manager to act as a relocation point person who is available to answer questions about benefits and other facets of the move. Connell also suggests setting up a full-time relocation information desk or booth.
Step 3: Retention
Once Polycom’s relocation planning was finalized, Sonsino began holding one-on-one conversations with critical talent to share the news, find out their concerns and figure out ways to address those concerns. "Some said, ‘Yes, this is a concern,’ but they eventually came around," he explains. "Others we recognized we were going to lose. … We planned far enough in advance so that we started recruiting for the roles of the people we expected to lose before we moved."
Morton, who joined Hanger before the company’s relocation but after the announcement of it, says his company offered incentives for employees who helped smooth the transition. For example, it gave a "stay bonus" to some employees (including his predecessor) who chose not to move to Austin and remain instead in temporary facilities in Maryland for roughly two months to help with the transition.
Typical group-move benefits include cost-of-living adjustments, elder care, career counseling for dual-income families, school placement, support for special-needs children, and housing sale and purchase support. Additionally, group-move consultants strongly recommend taking employees on pre-decision trips. Many benefits are tailored to address a move’s unique nature. Polycom, for example, paid for an employee shuttle service (which had Wi-Fi as well as staggered departure and arrival times) for two years after the move to lessen the burden of the commute for relocated employees.
Retention efforts and incentives should be handled carefully. Weed says legal issues can arise when employees in similar roles are not treated equally. While "key employees" can be offered additional benefits, he says these benefits "need to be administered carefully" so that the designation of "key" is justifiable from a business perspective without discriminating against protected classes.
Step 4: Hiring
HR professionals managing headquarters relocations "definitely need to be well-aware of labor laws in the new location," says Brian Acker, SPHR, HR director for Paulding County Board of Commissioners in Georgia. Acker maintains a good working relationship with his public-service colleagues in the Paulding Chamber of Commerce and economic development agencies, who regularly come to him to address talent, compensation and other employee-related questions posed by HR professionals in companies considering a relocation to the Atlanta area.
Morton credits the Austin Chamber of Commerce’s role in helping Hanger and other companies relocate. One of many relocation support programs the Austin chamber offers is an HR round table in which HR professionals at the prospective moving company meet with members of state workforce agencies and local staffing groups to ask detailed questions about the local labor market.
HR’s role in relocations does not end with hiring. Morton worked closely with his executive leadership colleagues to help them understand that Austin’s quirky, informal vibe meant that its highly educated citizens, including new Hanger employees, tend to treat every day as casual Friday. For more than a year after the move, Morton and his staff organized family picnics, volunteer activities and other outside events to help relocated employees and new Austin-based hires get to know each other on a personal level.
This integration, along with post-move workforce productivity, tends to be optimal, of course, when the story behind the relocation has a happy ending. Hanger’s move, which was undertaken to achieve more growth, has helped the company grow to 5,000 employees nationwide (220 of whom are at headquarters). And Polycom’s new marketing campaign, which promotes the tech company’s ability to help customers "defy distance," also happens to describe the value that Sonsino and the company’s HR professionals provided to their own relocation effort.
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