SO, IF… Series – Part 1: Guaranteed Home Sale Plans
Welcome to our “SO, IF” Series
SO, IF I climbed a mountain. SO, IF I could see forever. SO, IF I could change the world… the world of relocation. What would I do next?
Following our series: The Good, The Bad & The Ugly, our “SO, IF… ” series pokes at traditional processes and provokes some ‘out-of-the-box’ progressive thinking… because you never know…
Here is the first in our series:
SO, IF we removed the Guaranteed Home Sale/ Guaranteed Price Plan (GHSP/GP) from our relocation program, what would happen? What can we expect? Well, this is something many legacy program managers have contemplated.
Does the phrase “being thrown to the wolves” ring a bell? There are lots of consequences here, especially if not approached in a sensitive and cautious manner.
Corporations looking to limit their financial exposure, especially during recessional periods when the corporation has little appetite for huge unbudgeted expenses, will often look at ways to limit or remove the financial exposure to a GHSP.
The Pack of Wolves Approach
Only recommended in dire situations where the corporation has an appetite for a big push back from employees. Outright removal of the GHSP could have a big impact on large global populations of long term employees who expect this level of support by reducing mobility very quickly. Employees are seeing their housing equity as part of their retirement plan given the reduction/elimination in corporate retirement plans, and putting their housing equity at risk, especially late in their careers, will cause lots of concern.
The one Small and Friendly Wolf Approach
What we see in some instances is a gradual elimination of the GHSP by a phased approach. This phasing can be done in various ways, e.g. by tiered policies. A policy can be split into two or more parts offering different levels of support depending on circumstance. The circumstances could be defined as job level or relocation need (high potential, career development, permanent, etc.).
Sharing cost with employees, placing limits or introducing percentage sharing arrangements allows you to reduce the cost to the corporation, but not eliminate it totally.
The Climb a Tree Approach
Corporations could keep the policy as is but look for different options such as hiring locally, asking for employee to ”volunteer” for the move as part of their career development thus engaging an alternative policy that does not have GHSP or posting jobs with modified policy agreements.
The “Oh, that’s just a dog” Approach
Some corporations will embark upon a process of gradual removal, first reducing cost through a sharing approach as above, then by offering GHSP to only a limited group through tiers and then through elimination. Employee push back can be managed successfully through an employee engagement process, whereby employees are asked to provide input and direction, ongoing communication with reasoning, and then a soft launch with moderate exceptions being allowed, followed by elimination.
Look for our next SO, IF topics:
- So If.. we dispense with the traditional ‘guarantee’ program as a safety net …
- So If.. employee and employer both assume responsibility for risk on disposal of difficult (normally ineligible) properties…
- So If.. we step away from the traditional mobility model and individually define a corporation’s optimal ‘in-house to-outsource’ model…
- So If.. we change the way we view and treat real estate brokers and agents…
- So If.. we adopted a lump sum approach for new hires…