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Podcast

Podcast

Harvard Business School Professors Bill Kerr and Joe Fuller talk to leaders grappling with the forces reshaping the nature of work.
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  • 19 Feb 2019
  • Managing the Future of Work

Uncertain times for global talent: News Corp's global mobility director on Brexit and U.S. policy changes

The recent wave of geopolitical events, including Brexit and changes in U.S. policies, are creating uncertainties for firms that must manage global talent. Rina Montalvo, News Corporation’s Director of Global Mobility, has an inside look at the impacts. How are these events affecting deploying talent globally? How are large companies gearing up to handle them?

Bill Kerr: Talent is the world’s most precious resource, and access to it has become increasingly important for firms. But recent geopolitical events, with Brexit being top of mind, are making it more uncertain and harder to employ and manage foreign workers.

Welcome to the Managing the Future of Work podcast from Harvard Business School. I’m your host, Bill Kerr. Today, I’m speaking with Rina Montalvo, the director of global mobility and immigration at News Corp. Rina is going to talk with us about the critical importance of global talent to News Corp and how recent events are making it more challenging to deploy. Welcome, Rina.

Rina Montalvo: Thank you. Thank you for the invite.

Kerr: Rina, tell us a little bit more about News Corp and what you’re up to there.

Montalvo: So News Corp is a huge global organization. It’s broken down into two companies. The first company is the News Corp, which is publishing. The second company is 21st Century Fox, which is more entertainment. Under News Corp, we have the Wall Street Journal, Dow Jones. Under 21st Century Fox, we have Fox News, 21st Century Fox …

Kerr: … so a lot of household brands here.

Montalvo: A lot of household international brands, correct.

Kerr: Tell us a little bit about how many countries you cover. Where are you located?

Montalvo: We have 75-plus offices in 46 countries and six continents.

Kerr: Why the very broad reach there? It sounds like you’re one continent short of all of them.

Montalvo: Well, we cover APAC, EMEA, and the Americas. You’re probably going to say we’re missing one.

Kerr: Yeah.

Montalvo: And which one is it?

Kerr: Is it Antarctica?

Montalvo: Exactly.

Kerr: Well, there is news that happens down there every so often, so keep an eye on it. But tell us a little bit about, how often are you deploying people abroad? How long do they go? What’s the type of assignment that you’re dealing with?

Montalvo: The assignment depends on what the reason is for the employee to leave. For example, at the Wall Street Journal, they do most of the moves, and it’s basically based on journalism, good journalism, being in the right country at the right time to get the right story. So it could be that we’re sending a journalist to Iraq for five years. It could be we’re sending them for two years and pulling them back to another country, to India, for example. So it all depends on the business needs and what they’re looking for.

Kerr: We’re going to get in the conversation about the immigration process, but why not just, in each of these countries, hire somebody local to do the journalism?

Montalvo: I think, for example—I’ll just give an example with Turkey—to write a story in Turkey, and for a journalist to be a local journalist in Turkey, if they write something that does not fit well with their government, it could be a huge challenge. We have this challenge anyway when we send journalists from the US or the UK, but it’s easier for us to pull them out. So I think, in order to keep our employees safe, the best approach is to bring journalists into the country where they’re not local.

Kerr: Okay, so the immigration allows some journalistic independence, prevents some censorship, and probably also maps better to what a reader in America or in the UK or elsewhere would value out of the Turkish economy and the news cycles that are there.

Montalvo: Exactly. Just to give you an example, we had a journalist just recently, not to go into too much detail, in Turkey. She wrote an article, it didn’t fit with the government, and we had one day to pull her out. She had to leave all her belongings in her apartment, and she needed to leave Turkey. So just to give you a context around what our journalists go through, it’s a lot of risks.

Kerr: Rina, sometimes this results in tragedy. Daniel Pearl, a Wall Street Journal reporter, in the early 2000s, was beheaded by Al-Qaeda. How has that affected News Corp?

Montalvo: Of course, this is something that we live with on a daily basis, sending journalists to hardship countries. We do report in Iraq, Iran, so there’s always a risk besides all the other risks that we’re facing nowadays. That’s always been something that we’ve been dealing with.

Kerr: So it’s about the caution that you need to bring to that. It’s also about safeguarding people and making sure that you get the best news, but the talent is also protected.

Montalvo: Exactly.

Kerr: So if you think about this, there’s one part, which is the risk you face. There’s also, at a more mundane level, what’s the return on investment? You’re spending a lot of money to put somebody abroad. How do you know whether that was a good assignment or not? How do you judge the performance of this global mobility?

Montalvo: I think, in the past, we weren’t judging them until we had employees come back and then leave the company within the first six months of return. We saw that the return on investment was not for the company but more for the employee. So now, we’re looking into more talent acquisition and looking at ways of retaining these employees. For example, when they come back, giving them more responsibility. Maybe have direct reports, for example. Finding ways to develop the employee. That’s how we see that we are bringing that knowledge back to the country, looking at which employees are staying and not leaving in the first six months.

Kerr: So a full end-to-end of how you get people in, deploy them, then train them, and then also retain them for the long haul.

Montalvo: Correct.

Kerr: Is there one of those aspects that harder or the hardest part that jumps to mind? Like, gosh, I hate when we have to talk about that one. That’s a hard one.

Montalvo: We’re just starting the process, so it’s something new. We’ve seen journalists come back and then go to a competitor. So that is challenging, I think, for us and for the business, and we really don’t want to see it. But we are dealing with it, and we are looking for better ways on viewing the return on investment and how to support the employees and having them stay.

Kerr: Let’s move to the biggest question that’s on many people’s minds in early 2019, which is Brexit. We are in February, and this podcast will be released on a very short cycle. At this point, we don’t know in March exactly what the UK border line will entail. So tell us a little bit about how News Corp is approaching this big question.

Montalvo: So I think Brexit was a shock to everyone, something that keeps me up 24/7 due to the time, me being in the US and in the UK. It’s something that I deal with on a daily basis. What we’ve done is we’ve taken the approach to see which employees, first in the UK, could be and would be affected with their families if Brexit comes into play. We are doing podcasts, Q&As, we’re sending our attorneys to the offices to speak with the employees and their families. So we are supporting all applications of employees who do want to stay in the UK and want to become permanent citizens. So we are very active. There’s not much we can do, because we’re running into the unknown. And I think that’s where the panic is being ... where the alarm is, where the uncertainty is. That’s I think why everybody’s freaking out.

Kerr: Also, to help clarify, the people that are in London, are these the EU nationals that you’re most in consideration from Europe? Or is it Americans that are in the UK? Which is the group that is the first in question?

Montalvo: I think it’s the Europeans. Because, of course, they’re the ones that do not have visas for the UK. The US employees have visas.

Kerr: So you can sort of curtail that a little bit on that front.

Montalvo: Yes.

Kerr: How do you anticipate the new structure looking like? There’s already Denmark, which has released some sort of ideas of the way they’re going to proceed. Tell us a little bit about how this is playing out across the countries in the EU.

Montalvo: So across the countries, we’re doing the same thing that we’re doing in the UK. For example, Spain, Germany, Belgium. We’re looking to see which of our employees and their families could be affected and will be affected. We are supporting them. We did send out a memo letting them know that we’re monitoring the situation accordingly, on a daily basis. And we will support them, of course, with the same approach as the UK with applications. But we’re waiting to see which countries release rules and regulations as to how they’re going to approach these immigration issues.

Kerr: And each country will be doing that by themselves.

Montalvo: Yes. Germany will be doing it by themselves, Belgium … Each country will have their own rules and regulations.

Kerr: And you’ve described this as being the way it used to be. Tell us a little bit about that sort of longer perspective.

Montalvo: You know, the way it used to be in the UK is that anybody who came into the UK, even international from Americas or from within the EU, needed a work visa. So it’s going to be more work for attorneys and immigration professionals, and it’s going to be a higher cost for the business.

Kerr: And at some level, this may play even to your advantage, that the companies like News Corp that put people in 75 different environments will know how to deal with this in ways that smaller organizations or those that are new to this game, who simply relied on the open borders, would not be able to adapt as easily.

Montalvo: Correct.

Kerr: Is this going to be something that you anticipate finding out information over the next week or two on? Or is it one that you ... What’s your best guess as to when we’ll hear more info?

Montalvo: I mean, if your prediction is right, that would be the best for everyone. But I don’t believe it’s going to happen. I think it’s going to be piecemeal. It’s going to be as it is. Every day, we’ll find something new. Each country will release accordingly to their timeframe. I don’t think it’s going to be something that’s going to happen overnight.

Kerr: Okay. Coming back to our side of the Atlantic, we also have some big questions marks about immigration right now. Tell us about the latest between News Corp and the US immigration system. What are you finding good, bad, ugly?

Montalvo: It’s exciting times. The administration travel ban was the first exciting news we received. Had to deal with that. And now we’re dealing with the H-1B process.

Kerr: The H-1B is for temporary visas to the United States. What is changing about that for you?

Montalvo: For example, we’re receiving a lot of RFEs. We’re receiving a lot of denials. Premium processing has been suspended. Just a couple of things there just with the H-1Bs.

Kerr: So, for our listeners, these are things that corporations would have used to get faster H-1B approval rates, request for evidence around the H-1Bs. Tell us a little bit about how that is changing your role in News Corp.

Montalvo: So, I think, basically it started off with the H-1B process. We were okay with it. First, it was no premium processing for H-1B, meaning we couldn’t process the H-1Bs in a quicker timeframe. But now, they’re affecting the L visas. That’s becoming a bit of an issue for us.

Kerr: The L visas are those that do intercompany transfers.

Montalvo: Intercompany transfers, which we would go to, and they would be processed in two to four weeks. Now we’re getting denials. We’re getting RFEs. We are now looking at Plan C, which is O visas. But with an O visa, it’s specialized knowledge, and that’s a lot of paperwork. The employee needs to get a lot of reference letters, educational background. So there’s a lot more that goes into the O visa process. But that’s where we’re finding ourselves right now.

Kerr: Okay, so there’s a higher barrier to meet and will require a lot more paperwork and cost to get there.

Montalvo: Yeah, and we’re also looking at the J-1 visa program, which is not ideal because, after two years, the employee does need to leave the US and stay out of the country for 12 months. Then we can bring them back on the L visa and try the H-1B process.

Kerr: Okay, so the first two options are the ones you’re hoping get some reform around and become a little bit easier, but you’ve got other categories to go through.

Montalvo: I mean, to be completely honest, when we interview employees, the first thing they say is, “I really don’t want to go through the H-1B process. Is there another visa type that I would fall under?”

Kerr: If I was to change this up and say, imagine a world where the immigration system was very friendly to you and was able to get you visas in a week. And we certainly have a neighbor to the north that tries to promise you now in just a few weeks, deliver your visas. How would that change News Corp’s immigration to the US? Or would it not? If you lowered some of these barriers, would that have a material effect to your deployments?

Montalvo: I don’t think so. Because the News Corp, the Wall Street Journal, the majority of employees that move, I don’t think that immigration laws or taxation laws, they change a lot of who we move, how we move. Maybe how we move them, but not about ... It’s not changing the way we move employees or the reduction of the employees that we would move.

Kerr: Just the need to put the people in the right space, you find a way?

Montalvo: Yeah. Because that’s the business. That’s the philosophy. That’s the Wall Street Journal. It’s what we’re built on. We’re built on news.

Kerr: So you mentioned the tax law there, and I don’t know that that’s an obvious one to raise in people’s minds the way H-1B would be. How has the recent change in tax law affected your life?

Montalvo: So the tax reform came out of nowhere, and basically ... just to explain a little bit what the tax reform means, when an employee receives a relocation package, it entails visa, shipment of goods, temporary accommodation, just to name a few. Before, shipping of goods was a nontaxable benefit for the employee and for the company. Now, due to the tax reform, shipment of goods is a taxable benefit, which increases the costs for the business, since the business is responsible for the employee’s costs and taxes.

Kerr: Okay, so overall the cost of deploying a person to a new environment has gone up.

Montalvo: Has increased.

Kerr: How much do you think it’s gone up, like, percentage-wise?

Montalvo: Percentage-wise, I would say ... I was just looking at costs the other day. Shipment of goods cost, it would be $10,000, and are now going up to $25,000.

Kerr: Okay, and other costs that would be included beyond shipment costs?

Montalvo: Yes, temporary accommodation. Before, temporary accommodation for the first 30 days was non-taxable. Now, after the first day, it’s taxable. Temporary accommodations, if we look at New York City, 30 days of temp housing in a luxury apartment …

Kerr: That’s expensive.

Montalvo: $7,000 a month.

Kerr: Yeah, okay. So you’re looking at somewhere in the ballpark of $30,000 to $50,000 higher costs to redeploy a person.

Montalvo: Yes.

Kerr: Thinking about 10 years from now, are you optimistic, pessimistic about future global integration? We’re obviously experiencing over the last three years, and in some countries even longer, a populism backlash against global integration. What’s your view of the future?

Montalvo: I think it’s going to increase.

Kerr: Global integration will increase?

Montalvo: I think it will increase. I think global mobility, immigration, I think it’s all going to increase. I think companies are not going to stop ... Look, I’m not speaking for all companies, I can only speak about the companies I’ve worked for, which are global, international companies, mostly in the entertainment business. In this sector, I do feel that companies will not pull back. But I don’t feel that companies will start, for example, having all the employees work from home in one location, instead of sending employees to different locations.

Kerr: What’s the driver? Is it just the need for ever-better journalism? Or what’s the thing that is impelling you, against rising costs, to say, “We should increase this integration”?

Montalvo: I think that just what you said. I think to get the best journalism, you need to send the employees to the locations to experience and go through what’s going on in that country. I don’t think they could do it in a video conference. I think they need to be there. You need to be at right place, at the right country, at the right time to get those stories.

Kerr: If you think about advice, let me portray, you’ve counseled people and thought with people that would be young about the role of international assignments in their career progression. What advice would you give to someone that’s late 20s, early 30s, about the role of going abroad for a few years as a career step?

Montalvo: I mean, I think that’s essential. It’s so important. And I think anybody that’s in their 20s should experience working overseas. I think it brings to you your perspective in terms of culture; in terms of career-wise, it opens other doors for you. And I think it’s a most important move. And a lot of companies are putting that into talent development, where they’re saying that our employees do need to work in a different country for at least a year before they can move on to the next step.

Kerr: And for many, it’s a requirement for being a top executive.

Montalvo: Exactly, yes.

Kerr: In your experience, in order to get that broader perspective, does it matter as much which country? Or is it just the act of going abroad? So, are you better off if you go to Beijing for opening up your eyes than if you go to London?

Montalvo: I don’t believe so. I lived 25 years in Germany and just came back to the US. I’ve only been in the US five years. So I think living anywhere abroad is just out of your comfort zone—it’s so important. It just takes you out of that comfort zone that you’re used to, and it’s easier for you to deal with any other challenges in life that you’re going to go through.

Kerr: Great. Thanks, Rina for sharing your experiences around Brexit and managing global talent at News Corp.

Montalvo: Thank you so much for having me.

Kerr: And thanks all of you for listening in.

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Manjari Raman
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