EY thoughtful woman writing

Reimagining cross-border remote workers

Authored by: James P. Egan, Senior Counsel, EY Law LLP

New opportunities in global strategic workforce planning


Three questions to ask

  • Is the structure of cross-border remote work outdated?
  • What trends are driving the opportunity for reimagining cross-border remote work?
  • How can your business drive return on investment in your global deployment strategy?

The art of progress is to preserve order amid change, and to preserve change amid order.

This insight has usually been attributed to Alfred Whitehead, an English mathematician. The conundrum expressed neatly summarizes the challenge businesses face today in striving to adapt new technology and workplace attitudes in global strategic planning.

One field in which this ongoing, if quixotic, quest to preserve order amid change is global assignee deployment. That may be somewhat surprising, since the pattern in seeking and securing work authorizations abroad appears to be standard. A company in country A identifies an objective to be developed in country B and chooses an assignee, who then goes off for a year or more to establish processes, hire and train local staff, deliver contracts of supply or service, and gain insight as to the peculiarities of and possibilities in the selected foreign market.

Mix and repeat; variations would most often come down to whether the assignee was to be accompanied by family, if they were to extend their term longer, or if they had lost touch with and/or lost the confidence of HQ.

Increasingly, however, that pattern has come under question. Cognizant of the significant changes in technology, connectivity, and workforce attitudes, is there a more cost-efficient way to get even better results? Can remote work be structured to continue to gain market share, drive productivity gains and maximize profit from international operations — all without resorting to the difficulties and expense of sending an assignee(s) on a multi-year mission to foreign soil?

Outlay and return is central to any business discussion. Much work has been done in the development and nurturing of global supply chains over the past 30-plus years. The deployment of countless skilled professionals has been central to this effort. Yet the world has changed immensely over these past decades, as have the expectations — if not the shape — of remote work. How can businesses most benefit from their longstanding investments in developing the green fields of global business while seizing the opportunities available in better aligning workforce structure with technology?

Simply put: how can we make better use of the tools at our disposal to make remote work more effective, more economical, and more responsive to key stakeholders?

Defining remote work

When we use the phrase “remote work” these days, it almost always refers to a local employee working from home rather than in the office, as happened when the COVID-19 pandemic and our response to the challenge took the term over from the traditional idea of global mobility.

When immigration and international deployment professionals use the phrase, however, they are referring to those employees deployed to a foreign location for an assigned period to better achieve a specific business objective — the traditional assignment model. There are many variations on the theme, so it’s worthwhile to define our meaning more precisely by referring to these assignees as cross-border remote workers, or CBRWs.

Dr. Seema Farazi and her team at Ernst and Young LLP United Kingdom immigration practice set out several situations wherein the dynamics of cross-border assignments could be more closely catalogued. Their analysis, included the following observations:

  • CBRW and “work anywhere” are terms often used interchangeably. But while “work anywhere” certainly encompasses CBRW, the concept of “working anywhere” usually refers to an employee working both from their home office and a local office.
  • “Borderless work” denotes work that is not limited or dictated by geography or physical borders.
  • “Anywhere jobs” refers to jobs that can be done from anywhere in the country of the employee’s residence, or from anywhere in the world.
  • “Agile working” is a concept where employees perform their duties from where it is most expedient from a professional or a personal perspective, travelling across borders as required to undertake aspects of their role.
  • Finally, the new term “digital nomad” refers to a more defined role than the traditional overseas assignment. These are location-independent workers who use technology to perform their job, often living a nomadic lifestyle.

What links all these concepts is flexibility, drawing on technology in a manner expedient to both the business and skilled individuals. Call it what you will, but the common element in these roles is a desire to better employ technology to break free from the defined box of a rigid overseas assignment. This is an objective shared both by businesses and, increasingly, prospective CBRWs themselves.

Trends leading the opportunity

In seeking to answer the questions posed above, we need to examine three trends pointing the way forward. The first is a by-product of the restless pace of technical advancement. The second is in the (virtual) clouds that increasingly cover us all. And the third is a workforce attitude that was significantly accelerated by the pandemic.

1. Computer says yes — the remote office with all the bells and whistles

Computers have, of course, long been a necessary component in any business location. What has accelerated tremendously over the past 20 years is the scope and viability of computer programs to efficiently sift data, reduce duplicity in tasks and establish formats for standardization. These three tasks are usually at the forefront of any mission statement entrusted to a CBRW. The core role is to bring an overseas operation in line with the proprietary approaches and mandates established by head office. The greater sophistication of computer programs and the broader familiarity by the international workplace in their use has been a significant productivity multiplier.

Consider, for example, the most common of computers, the modern mobile phone. According to the World Bank, the earliest mobile phones were so expensive that as recently as 1990 only 2% of all people in the US owned one. Today, there are more cell phones in the US than there are people. More important, by 2016, 73% of the population of Sub-Saharan Africa had cell phones. Globally today, there are more than 100 mobile phone subscriptions per hundred people. In consequence, people throughout the world, even in the poorest regions, are now accustomed to the use and utility of computers and application-reliant devices.

This portfolio of technology demonstrates that earlier generations of traditional remote workers have done their job. Today’s CBRWs are no longer being asked why and how to introduce computers into production and service delivery. These devices and approaches are, pardon the pun, no longer a foreign concept.

Simultaneously, the measure of computational power is also rapidly increasing. The speed of computer processors can be expressed in floating-point operations per second, or “flops.” One billion flops are called a gigaflop. In 1984, the cost of one gigaflop was US$18.7 million, about $60 million today. By 2000, the cost of a gigaflop had fallen to US$640, about $1,000 today. By late 2017, the cost had declined to $0.03 per gigaflop. The net result is a decline in the cost of using computers since the turn of the century by more than 99.99%.

This reality serves to illustrate that overseas business assignments today are not beginning from a standing start; all participants in the race had better understand both the rules of the game and the tools and technology designed to help them. Moreover, the utility, scope and cost effectiveness of computing power is better than ever before, and more adaptable to a multitude of tasks.

It can be anticipated that much of this leverage will be devoted to the broader introduction of artificial intelligence (AI) in production and service centers worldwide. CBRW assignments will play a key role in these efforts, but once introduced it is an open question as to how AI will impact domestic and international supply chains. For the immediate term, however, CBRWs can build on the foundations and investments made by travellers of days gone, if recently, past. Capitalizing on both this hard-won experience and the advancements in computer programming creates a head start to innovation and provides an opportunity to redesign future CBRW assignments.

2. In the air tonight — the telecommunication highway, facilitating communication with ease

Yet even the most sophisticated computer is merely a lump of plastic and components. The second trend to consider in reimagining remote work arises from the dramatic improvement in worldwide connectivity. The explosion in global access to the internet has been nothing short of miraculous. Relying again on data collected by the World Bank, the share of the world’s population with gateway to the internet rose from zero in 1990 (yes, the internet is that recent) to more than 52% in 2020. In the economies most likely to host CBRWs, the average figure approaches 80%, and is higher in business locations. The most common infrastructure investment in expanding economies, after electricity and sanitation, is the strength and reliability of the internet signal.

Investment in connectivity through private enterprises and by investments of states throughout the world has meant that stable, if often censored, internet coverage is now globally available. The ability to chat, data share and monitor cross-border activities has never been greater. Assignments can be outlined, shared, expanded on or critiqued through multi-user mailboxes or dedicated assignment rooms without the need for a physical managerial presence. Employees can be evaluated, praised, sanctioned, reassigned or, yes, even “counselled out” through the computer.

The expansion of internet coverage has been complemented by the vast reduction in the cost of computer data storage, or memory. Consider that in 1980 one gigabyte (1,000 megabytes) of such storage would have cost US$300,000 — more than a million dollars today. By 2018, 8 terabytes of storage (each terabyte is 1,000 gigabytes) cost less than US$200. That means that the cost of storing data in clouds had fallen to $0.019 per gigabyte, or by more than 99.99% over this period, a trend that is only accelerating.

Both memory and computing power are now essentially free; costs are limited to the programs and applications that deliver results. And with humanity projected by the International Data Corporation to be generating 175 zettabytes (1 zettabyte is one trillion gigabytes) in data annually by 2025, a tenfold increase since 2016, an increasing number of CBRWs will be focused on driving that computer power, memory and data to ever more efficient and productive ends.

A related factor is the issue of data security. The ghost in the machine of connectivity, sophisticated data hacks and ransomware are increasingly challenging issues for all businesses, particularly those engaged in international operations. Additional reliance on computer system interface would only accentuate possible vulnerabilities. It is, however, a reality that must be addressed and overcome in any transnational operation, and is yet another assignment that can be supported through the investment in select assignee deployment.

Notwithstanding the vulnerabilities of connectivity, the impact of such massive drops in the cost of both computer memory and computer power, together with the growth of global internet converge, creates the framework to reimagine how businesses can work globally. Yet appreciation of the final trend to consider suggests this opportunity need not translate into prolonged international assignments.

3. There and back again — an argument in favour of short-term assignments

The global pandemic demanded we all reimagine from where we work, what genuinely drives productivity and our relationship with the office. The third factor to be considered in the reimagining of remote work is the siren call of employees for more flexibility to be incorporated into work arrangements. This approach is increasingly sought in CBRW structures as well.

Companies are beginning to find that candidates for the traditional model of multi-year, location-focused assignments abroad are harder to source. The glamorous life of the international assignee bouncing from location to location is an increasingly rare experience. Stories abound of repeated poor experience from assignees being re-integrated back into the home office after prolonged time overseas.

Costing restraints have now reduced incentives, perks and pay bumps for those willing to be internationally deployed. Assignees have more health, safety and security concerns arising from deployment abroad. Moreover, the quality of the actual work arrangement in the posting is usually found wanting, with long hours, mandatory on-site attendance and the numerous frustrations arising from the unfamiliar. Such difficulties are not the employees’ alone. Often, their family members need to integrate, seek their own work or school visas, and set up a new home in an unfamiliar location. The net result is that, for many, such assignments are a slog to be endured rather than a glamourous and highly sought-after experience.

The mutual frustrations of both the employer and assignee point towards a desire for shorter, multi-entry and purpose-focused mobility. Deployments will be charged with achieving many of the same results as traditional long-term postings, but in briefer, mission-centric, bite-sized situations. A lighter touch on the ground is sought, with less displacement from ongoing roles back in the home office, while increasingly using computing power, applications, and connectivity to sustain ongoing results.

Combined, these trends point to an approach where increasingly a team of rotating specialists will replace the current, staid model. Going forward, this “flying squad” — a conga line of assignees — will each be charged with delivering narrowly defined results from shorter-term assignments. This chain of assignees can be deployed to multiple locations and can remain connected to ongoing projects — and to their lives and careers back home — through business trips rather than formal placements. With each remote worker executing their segment of the broader assignment, management can then increasingly rely on the technology and the connectivity to realize the business’s objectives.

The regulatory environment

Governments are often out of step when it comes to understanding and embracing the approaches sought by businesses in creatively using technology. The principal reason for this is that the interests of government are different from those of commercial enterprises. A state will seek to maximize wholly domestic interests and revenues and is less interested in cross-border economies of scale than is a business with international concerns.

A case in point is the process of securing authorization for foreign nationals to work in a host location. In the classic multi-year assignment, competition with local labour, wage levels and the skill development of locals are among the primary concerns before a work authorization is granted. Governments also tax on a national basis. Their focus remains on taxing the authorized foreign worker during their stay, and on placing a low bar for the creation of a “permanent establishment,” whereby the presence of a foreign worker could lead to local corporate tax filing obligations for the foreign employer.

If the true objective is to facilitate domestic prosperity in this interconnected world, governments will need to calculate the inherent benefit differently. The state will need to better recognize the accruing value to productivity enhancement, trade opportunities and broader wealth creation arising from the combined efforts of CBRWs and technology in their market, and to embrace long-term facilitation of this driver.

Opportunities in this space do present themselves. Hybrid work models and alternative workforce structures abound, and their merits should be reviewed with regulatory authorities. The opportunity for reimaging is widening. As part of their remote work studies, for example, Seema and her UK immigration team reviewed the willingness of more than 40 governments around the world to accommodate “digital nomads” and other short-term business assignees; Canada is among the countries where such a concept is being developed. It was determined there is increasing flexibility being explored by governments, and a promising opportunity to employ defined work authorization schemes that could better adhere to our proposed CBRW concepts.

A related intangible is the value of direct face-to-face interaction brought by the assignee to the host workplace. How can such ongoing presence be measured or valued? What is lost if the opportunities for such interaction and relationship building are minimized — or lost? In an increasingly remotely connected world, that is an issue that must be addressed in numerous contexts, including the value considerations in designing and executing ongoing deployments.

Key takeaways for HR and mobility professionals:

Initiate an internal discussion on the needs/structure of your current global immigration/mobility program.

Consider whether your internal technology/connectivity/system programs can be better optimized to facilitate cross-border management and minimize people assignments and related turnover?

Identify those projects and tasks that are necessary to undertake now to better take advantage of cross-border remote management opportunities. What would it take to move the dial?


Summary

Remoteness, as always, is the adversary. As the opportunities for bridging this gap have increasingly been addressed through technology, the question becomes how best to complement and enhance this reality with CBRW programs. Challenging ourselves to think differently, we can unlock more efficient approaches. The need is receding for the continued physical presence of foreign assignees to secure the success of integrated business operations. Seizing the initiative, we can redefine what is meant by and the possibilities of “remote work” by better employing the tools, attitudes and creativity at our disposal.

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