What does the Asian Century mean for global mobility?

In the second article of a two-part series, we look at the potential impact the Asian Century could have on the global mobility industry.

China - East Asia, Shanghai, Stock Market and Exchange, Global Business, Global Finance
The Asian Century – the time when the collective Asian economies will be larger than the combined economies of the rest of the world – has arrived. It will have significant implications for global politics, economics, trade and global mobility. The first instalment of this series focused on putting into perspective what the Asian Century is and what it means for the world at large. This second instalment will further explore the impact on the global mobility industry and how we might begin to prepare for what is to come.Global mobility from the 1970s through the 1990s wasn’t entirely global. In fact, it was quite one-sided and consisted mostly of US and European multinational companies sending employees abroad. The US industry is still struggling with that legacy, using terminology defining domestic relocation as anything in the US and international as anything outside of it.The 1990s and onward saw an expansion of movement that was not only West to East. New types of assignments were developed and new countries joined the ranks as both departure and destination locations. The PWC Mobility 2020 report was published in 2010 and focused on the next generation of international assignments. The report accurately predicted where global mobility finds itself today: a multi-directional flow of assignments, with more balanced participation from every region of the world: Europe to North America, Asia to Africa, Africa to Europe, etc. Moving forward through the next ten years, the number of assignments with Asia as the origin has a high potential to continue expanding.

Tracking the growth of Asian companies

A clear indication of increasing relocation out of Asia lies in the growth both in number and size of Asian companies. China, for example, has 110 Global Fortune 500 companies, which is comparable to the US. A significant difference is revealed when examining domestic vs. international revenue distribution. US companies earn over 50% of revenue outside the US.Almost 80 per cent of Chinese corporate revenue is still made domestically, per current research from the McKinsey Global Institute. Chinese corporations' domestic focus won’t last for much longer and global expansion has already begun. Asian brands such as Uniqlo and H-Mart have already opened in multiple countries around the world and their current pace of growth continues. China’s two major payment companies – Alipay and WeChat – are now being accepted at stores around the world. Luxury retailer, Neiman Marcus Group, based in Dallas, TX just this year adopted Alipay for online and in-store purchases, as did Walgreens drugstores in the US.As Asian companies begin looking to new markets and grow their global value chains, there will be an even greater need for assignments into and in between these markets and Asia.

What does Asia-inclusive global mobility look like?

The situation faced in Western countries by Asian expatriates may not look all that different than Asia did to Western expatriates during the 1980s. That is when Relo Network Asia was founded, originally as Orientations, to assist the needs of the growing number of foreign employees who found themselves trying to navigate a sometimes radically-different environment in Asia. That environment presented multiple challenges, including cultural, language, educational, and procedural, to name a few.The world was a very different place back then. The Internet, as we know now it, hadn’t been invented and mobile phones were a novelty. The connectivity of the world relied on fax machines and printed newspapers. In the current, connected environment, it can seem that the world has become a very small place.While today’s assignees know much more about their destination than ever before, many of those challenges faced 1980s Asia are still relevant. Progress has been made, but cultural challenges still exist in personal and business relationships. To varying degrees, language can be prohibitive outside of the business environment for accompanying family members. Not reading or speaking the local language still presents barriers for getting a driving license, opening a bank account or signing a lease. Finding a school for accompanying children that fits their language needs and educational curriculum is a primary concern and an issue that can still prevent assignment acceptance.
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These issues are widely discussed and addressed, as they relate to assignments going into Asia; however, until recently, the importance of applying them to assignments with a departure from Asia has been limited. Slowly, we are starting to see which solutions will be created to serve Asian expats and, in some cases, the past repeating itself.

Expatriates: finding a home from home

In India, Japanese and governmental agencies have been establishing housing compounds that cater to the needs of Japanese expats. One of these towns called Sataku (Japantown) exists in Haldia, India, where Japanese restaurants, a local news station and movie theatres that show Japanese films cater to the residents, many of whom work for Mitsubishi Chemicals Corp.While entire towns aren’t always created, this arrangement isn’t entirely dissimilar to how citizens of Western countries have congregated together in Asia. It can be comforting to have a home that is familiar, complete with others who speak the same language, eat the same food and share the same holidays. This is especially true for accompanying partners who may not have the ability to work and may not have the same level of local language skills.Education issues will universally endure as a prominent factor in an assignee’s willingness to move. Around the world, as in Asia, there have been multiple schools established that cater to foreign students. Cities like Shanghai, for example, boast 36 international schools offering British, American, German, French, Chinese, Singaporean, Australian, Canadian, and International Baccalaureate (IB) curriculum. Bangkok has more than 22 international schools offering the same and Kuala Lumpur is additionally home to Chinese Taipei and Japanese schools.

Read about China's expanding international school options

International schools and schools offering the IB are found throughout the world. Most of these institutions, however, provide instruction in Western languages or via Western education curriculums. Japanese curriculum and language schools are the most available Asian international schools abroad, which is one indication of where education solutions may present themselves. An outlier in Asia, Japan has enjoyed participating in the global economy for many years and Japanese companies have operated overseas since the 1980s. There are multiple Japanese schools across Europe, the US and Canada, for example. As corporations from other Asian countries grow abroad, the need for educational institutions will increase.

A greater need for multi-lingual support

Procedural and language differences also make the 'simple' acts of everyday life challenging. The destination support services that guide new arrivals through them will likely be in higher demand. Large cities such as New York, LA, London and Chicago offer an increasing amount of foreign-language assistance and translation for services like public transportation, ATMs and some government documents. The expansion in the availability of multi-lingual services has arisen from a need that smaller cities such as St. Louis, Charlotte and Manchester have yet to experience. That is not dissimilar to translation and foreign-language support in Asian cities. Larger cities will have a superior support structure for foreign languages than smaller ones.

China's tiering system

In China, a tiering system is in place to group cities according to commercial resources, ease of transportation, etc., diversity of lifestyle and city development. Will the cities of large Western countries like the US and Canada adopt a tiering system similar to what has been in use within China? Upon what will those tiers be based? The time and resulting cost differences can be substantial based upon the availability of suitable housing communities, availability of services in the required foreign language and access to international schools, which vary from Tier 1 to Tier 4 cities. And what other challenges to assignment acceptance will present themselves from the Asian perspective? What parameters will define a hardship location and will that have any impact on the assignee benefit package provided?
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There are many as-of-yet unanswered questions. How Asian companies will interpret the needs of their employees and redefine assignment types and benefits remains, in some cases to be seen.

Success will require the ability to see things from the Asian viewpoint

For an industry that has been defined by the needs and cultures of Western companies and employees, the answer to what comes next is an unknown factor. What is known is that the culture of Asia is different than the cultures that shaped the current set of relocation benefits and assignment types. Gaining an understanding of the Asian perspective will be critical to meeting future needs. Having the ability to see things from the Asian point of view goes beyond developing an understanding of cultural differences and how to overcome them. For those in the West, it will also require overcoming the associations and understanding of Asia built upon the foundation of the Orientalism of the 19th and 20th century.Orientalism’s basic tenets divided the world into East and West, or Orient and Occident. It depicted Asia and Asians as exotic, colourful and sensual. What has been consumed in media, books and films based upon those interpretations has unwittingly created a generally accepted knowledge of Asia that has become Asia in the mind of those who have never been there. At its most flattering, it glorifies Asian culture for its tradition and wisdom. More often though, it categorises the differences found in Asia as unfamiliar and, therefore, disorganised or wrong.The Orient is essentially a western construct, as is the concept of Asia. The vast region comprised of unique countries and cultures can be defined territorially and even as an economic zone called Asia, but there is no single homogeneous Asia. The Asia title is given to collectively represent the exceptional diversity in size, economic advancement, language and cultures of the people who live there.Within Relo Network Asia, diversity is built into our mission, values and goals. We consider the different perspectives of our team derived from their varied cultures, languages and experiences to be a critical asset, which permits us to creatively mitigate challenges and deliver services. As Asian companies continue global expansion and more assignees depart Asia for other destinations, their voices will add to the diversity of perspectives available to and impacting the world of global mobility. The result will bring changes that, depending on one’s viewpoint, will either be seen as challenges to overcome or opportunities to embrace.

Read Part 1 of Welcome to the Asian Century

For more news, visit our Asia section.

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