Global Nomads: What Are They And What Do We Pay Them?

Sometimes I like to think about possible new scenarios in the business world that will stretch compensation specialists' ability to find creative solutions.  Lately I've been thinking about one scenario that is already happening in a few companies.   I'm talking about a group of people called "global nomads".

Global nomads are detached from country and culture. They may have been born in Algeria, lived as a child in Brazil and the UAE, gone to school in Switzerland and are multilingual.   They have worked in multiple countries ----for example China, Argentina, Germany and Saudi Arabia.   They may not be sure what country to call their homeland.    

They are travel-ready at all times.   They are on the road 70%-80% of the time.  Because of their chaotic life, most are single, divorced or widowed.  They may be in one country for one year; move directly to a second country for three months; and then to a third country for six months.  Many times they report directly to the CEO, and are used mainly as “trouble-shooters” and “problem-solvers”.   They provide top management feedback and recommendations on strategic issues such as projects, markets and competitors. They are high enough in the corporate ranks to have decision-making authority.

The big issue is that these skills are highly sought after and highly transferable from company to company. Global nomads know their value. To CEOs they are like gold.

Read carefully: 

1)    I am not talking about C level executives who have had global experience, reside at headquarters and whose role is part of top management (although it would be nice to have more globally experienced top management).

2)    I am not talking about expatriates who may once/twice in their career reside/work overseas and then return home.  

3)    I am also not talking about young employees that are being groomed for future management positions by providing them several overseas assignments.

Now that we understand who they are ---- how in the world do we pay them?   Currently, the few global nomads that exist have contracts that are individually negotiated.

For the vast majority of employees, compensation specialists rely on compensation surveys for each country where employees work/live.  This includes traditional executives.  With global nomads, traditional compensation models are best left on the shelf.  Why?  The emphasis on local country benchmarks as the sole determinant of competitive pay breaks down.  What country are you going to use for a competitive market when they may be working/living in multiple countries during the year?

I know what you must be thinking:    “Vilet is crazy.  This would never work due to legal and tax issues from country to country.”   I may be crazy, but there have been all sorts of issues in the business world that have strained credulity in the past, and I’m sure this one won’t be the last.   In fact there is a school of thought that says over time CEO pay will converge worldwide.  That will be a very complex issue too.   But that’s a different subject.

In the meantime let’s ask ourselves some questions:

1)    Where does the global nomad “live” when not on the road?  If he/she always goes back to the same country, maybe we could just treat him/her as an expatriate from that country?

2)    In what currency do we pay him/her?

3)    Will there be so few of them we should just ignore creating a policy and treat each one as a “one off”--- with a compensation package that is individually negotiated?

4)    If we do create a policy/structure, how do we benchmark  externally to arrive at a competitive compensation package?

5)    What is their career path?  Do they not even want one because they love their “nomadic” life?   Maybe they don’t want to become part of management and have to “fit” within a corporate system.

6)    How do we create a retirement plan for them?

7)    How are other companies that have global nomads handling these issues?

I’m sure that corporate and labor laws and taxation will act as obstacles along the way. Laws and tax issues are not typically “show-stoppers” for most companies.   There is usually a legal way to make things work.  The usual "culture" issue won't be a problem as these people are adaptable to any culture.

If global nomads are hired, it will definitely send the lawyers and tax specialists scrambling---- along with compensation specialists!  But I firmly believe that where there’s a will, there’s a way.

What do you think?

Jacque Vilet, President of Vilet International, has over 20 years’ experience in International Human Resources with major multinationals such as Intel, National Semiconductor and Seagate Technology. She has managed both local/ in-country national and expatriate programs and has been an expat twice during her career.   Her true love is working with local national issues.  Jacque has the following certifications:  CCP, GPHR, HCS and SWP as well as a B.S. and M.S in Psychology and an MBA.    She belongs to SHRM, Human Capital Institute and World at Work.   Jacque has also been a speaker in the U.S., Asia and Europe, and is a regular contributor to various HR and talent management publications.  She lives in Dallas and has 3 four-legged children and one Chinese daughter (it’s a long story).  She’s had a life-long love of animals and the ocean.   So why is she living in Dallas?

Image courtesy:  http://web.ash.nl/echo/index.php?option=com_content&view=article&id=127:whats-so-great-about-being-a-global-nomad&catid=4:opinon&Itemid=9

 

 

 

Comments

[Dan Walter]

Interesting article on a seldom discussed topic. Global nomads are outliers for whom survey data does not, and cannot not, apply. Survey data by its nature flattens outliers. The data associated with these people is too small, too varied and too scattered to be accurately portrayed in compensation surveys.

1) Where does the global nomad “live” when not on the road? If he/she always goes back to the same country, maybe we could just treat him/her as an expatriate from that country?
DW: Most of these nomads, live where they are. In my experience, the good ones are simply paid at levels, for their skills set, equal or greater to the highest paid country in which the company operates

2) In what currency do we pay him/her?
DW: Again, special circumstances. Often paid in the home currency of the company and equalized, converted as needed.

3) Will there be so few of them we should just ignore creating a policy and treat each one as a “one off”--- with a compensation package that is individually negotiated?
DW: Yes, unless your company has a plethora (some big consulting firms and energy companies have large populations)

4) If we do create a policy/structure, how do we benchmark externally to arrive at a competitive compensation package?
DW: For companies with large populations, where a standard policy can be created, there are usually a few other peers to use for comparison.

5) What is their career path? Do they not even want one because they love their “nomadic” life? Maybe they don’t want to become part of management and have to “fit” within a corporate system.
DW: I find these people often find a "favorite" country after 7-15 years. They tend to settle down an find a more traditional career path at that time.

6) How do we create a retirement plan for them?
DW: We need to pay them enough to create their own retirement plans

7) How are other companies that have global nomads handling these issues?
DW: I would love to hear more about this too.

Of course, my brief answer above do not apply to every situation, and are based only on my experience with these people and their careers. I hope others who read this article will take 5 minutes to provide their own answers to these questions. I would love to see what kind of disparity actually exists.

[Jacque Vilet]

Thanks for your comment Dan. Lot's to think about. Can't wait until we get to the "CEO convergence" issue! Bring on the fun!

[E. James (Jim) Brennan]

You have described the typical Swiss second son. For decades immemorial (but particularly since they began restricting the growth of jobs in Switzerland so "excess" population were forced to go elsewhere), their tri-lingual skills have made them the mobile global transferees of choice. Other nationalities supply candidates, too, of course. In fact, many of my immediate neighbors are TCNs, one from UK, another from China, one family from Japan and another from Korea.

Agree with Dan. Since they hold unique KSAs, they are not easily accommodated by standardized policies and practices. Special people command special treatment.

[John A Bushfield]

I have no experience with this breed of cat, but my instinct is to use them on a contract or special project basis. An analogy might be made to government agencies that utilize various 'assets' in countries where they can obtain information and provide intelligence (or maybe I watch too many movies/TV). My hunch is that you are trying to force fit these folks into a corporate culture, using existing norms, which by their unusual nature/function will not work.

[Jacque Vilet]

Thanks for your comment John. Yes, this is a different breed of cat --- and they make a ton of money. With globalization I suspect we will see a lot more of them.

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