Sometimes the perfect job isn’t down the street, but rather thousands of miles — or perhaps even an ocean — away. If you’re offered a job in a different location, how do you know if it’s worth relocating? Who should help you make the decision? And, how do you weigh the potential upsides like money and opportunity against costs like the impact on your family or the loss of your existing network?
What the Experts Say Whether or not to relocate for a new role is a big decision both professionally and personally. “There are so many factors to consider, says Jennifer Petriglieri, an assistant professor at INSEAD and the author of “Talent Management and the Two Career Couple.” “What’s the opportunity? What’s the longevity [of the job]? And what’s the family situation?” Indeed, the decision is especially complicated if you have a partner and children, says Matthew Bidwell, an associate professor at Wharton whose research focuses on patterns of work and employment. “It’s not just, what does this mean for your career, but what does this mean for our family?” he says. Relocating for a job can often be “great for your personal and professional development,” but it’s also “a risk and a leap into the unknown.” Here are some ideas to help you think through whether the move is right for you.
Think holistically When you’re wrestling with a big decision, “there’s a temptation to get out an Excel spreadsheet and weigh the pros and cons,” says Petriglieri. But this is an instance where Excel comes up short. “When you’re choosing one life over another, it becomes an identity choice: Who do I want to become? What kind of family will we be?” The job is only one piece of the puzzle. Consider your “holistic happiness and satisfaction.” Think about the lifestyle that the new location affords or lacks. Are you suited for small town life? Or do you prefer a big city? Do you want to spend your weekends traveling? Or do you want to feel rooted in a community? The answers to these questions will help you uncover what this “move means for you, your partner, and your children,” she says. “When it’s a difficult choice, it means that no option is clearly better than the other.” Try to think beyond the immediate move,” suggests Bidwell. “Ask: What is best for us in the long-term?”
Talk through the move with your partner a lot… The most important person in this equation is your partner, says Bidwell. “The big issue is what does this move do to your partner’s career?” Will he or she be able to find meaningful work in the new place? If not, how big of a setback will it be? “There’s quite a lot of research showing that people suffer from putting their career on hold,” he says. If your partner won’t have a new job in the new location, “the move brings up other issues because you’re taking them away from their support network.” He points to a certain unhappiness known as trailing spouse syndrome. “You have a new job, new office, and all sorts of new people to meet; your spouse has been dropped in the middle of nowhere and knows no one.” Petriglieri notes that trailing spouses often bear the brunt of move-related household tasks. “It’s tough,” she says. “Whenever you move, for the first six months, you are in the trenches.” And it takes a huge toll. “Research on why relocations fail always points to the unhappiness of the trailing spouse,” she says.
…And talk to your kids a little “It’s possible to move at any time with kids, but certain ages are more difficult than others,” says Petriglieri. Many people, for instance, are reluctant to move when their kids are teenagers; when kids are younger than eight, the prospect of uprooting them is much less daunting. Petriglieri says that while obviously you need to speak with your children about a potential move, she cautions, “there is a danger of consulting them too much because it brings up a lot of anxiety unnecessarily.” Children, she says, “have a harder time imagining what their life will be like” in a new place. They might become resistant to move, which will make things much harder on you. Bidwell concurs: “The kids may complain, but they will adjust.” Keep your eyes on the prize. The relocation “is a potentially enriching and stimulating experience.”
Consider your development Moving to a new job in a new city is a surefire way to help “round out” your skills and experience, says Bidwell. “You’ll get to know people from different parts of the company; you’ll be exposed to new ideas; you’ll be able to build a broader network.” And if you’re relocating overseas, you’ll gain an “understanding of a different culture.” Indeed, in many organizations, “some form of international experience is necessary to get that top job.” But you must recognize that the relocation poses “long- and short-term trade-offs” to your development. For instance, “the new cultural context you’re learning comes at the expense of your loss of network back home.” To keep that from happening, you need to “make sure you’re on the radar screen” with your home office “having conversations with all the right people on a regular basis,” Bidwell says.
Find out what’s next… You must also think about the opportunity within the context of your long-term professional path. “Most companies are not likely to offer you a relocation unless there’s something pretty big in it for you, meaning a significant promotion and raise,” Petriglieri says. But the question you need to ask is, “What’s the next move after this?” If, say, you’re an American considering a three-year stint in London or Paris, that question is less complicated. “It’s a no-brainer that you will probably return to the U.S.” But if you’re asked to “head up operations in Denver or Cleveland,” the calculation is a little trickier. And yet, while it’s important to think about next steps, you need to have reasonable expectations, says Bidwell. “There is a tension there,” he says. “On one hand you want to have a conversation about where do I go after this? But realistically, the company can’t give you a definitive answer.” And besides, “career paths tend to be haphazard for most of us.”
…And whether there’s an escape hatch Worst-case scenario: you and your family are miserable. What then? “You need to think about an escape hatch if you don’t like it or if it doesn’t gel for your family,” says Petriglieri. It somewhat depends on the location itself. “When you are relocating to a hub city and it doesn’t work out, there are often other options, but if you’re moving somewhere more isolated, it’s harder.” The specifics of the role you’re considering are also key. Make sure you’re not professionally pigeonholing yourself “by taking on a specialist role,” she says. Another danger, says Bidwell, is “staying too long” in your adopted city. “There’s a risk that if you stay in a role for a long time you become a specialist for that region,” he says. This is why he recommends “talking with your partner beforehand about how long you’re going for and agree on an exit plan.”
Seek advice It’s often helpful to solicit input from others — with one caveat, however. “You want to talk with people who are not too close to the issue,” says Petriglieri. Your boss, for instance, may try to convince you to go. After all, there’s presumably “a business need” and a reason you’ve been asked to move in the first place. And friends and family members have a vested interest in your choice. “No one is neutral and these conversations can become charged.” Ideally, she says, you should talk with “a group of trusted peers” who “have similar family issues and similar career aspirations.” These people can be “a good sounding board” as you evaluate your options. Bidwell agrees. He suggests seeking advice from colleagues who’ve done similar stints as well as others in your industry. “You need moderately unbiased views of what to expect.”
Request a try-out If you’re uncertain, it may be worth asking your organization if you could do a temporary stint or job swap in the proposed location before making a big move, says Petriglieri. “Relocations are extremely costly,” she says. “Failed relocations are even worse.” She says companies are “increasingly willing to allow employees to do short-term relocations or secondments” to maximize the likelihood of success. In essence, your employer would be giving you a chance “to try before you buy.” Even if your organization does not offer this opportunity, “you can always ask,” says Bidwell.
Don’t overanalyze Whether or not to relocate is a big decision — but beware of analysis paralysis, overthinking a situation so that a decision is never made, or one is made by default. Try to have perspective. “As you get older, there are very few decisions in life where you don’t feel some ambivalence,” says Petriglieri. “A career is long,” she adds.“We can all afford a few adventures, and we have plenty of time to experiment and explore.” However, don’t assume that this is your one chance at trying something new. Remember: Nothing is forever. If you’re miserable, you can course correct, says Bidwell. “You have to take risks in your career,” he says. “Sometimes it doesn’t work out, and so, you figure out what to do next.”
Principles to Remember
Think about the decision as an identity choice. Ask yourself: Who do you want to become? What kind of family do you want to be?
Make your partner’s happiness a priority.
Propose a temporary stint or job swap to test out the new location.
Only focus on the immediate consequences of the move. Consider how it will impact you, your partner, and your children in the long-term.
Ruminate all alone. Solicit advice from trusted peers.
Overthink the decision. If you go for it and you’re unhappy, you can come home. If you decide against it, have faith there will be another opportunity down the road.
Case Study #1: Think about the next phase of your career Anne Chow spent the first 15 years of her career at AT&T, earning promotion after promotion, at the company’s headquarters in New Jersey. “It was very easy to move around the company without geographically moving my family,” she says.
In 2005, after AT&T was purchased by SBC, Anne was asked to move to Texas, where the new company was based. At the time, Anne had young children, and she was reluctant to move away from her parents. She was also hesitant about Texas itself. “I am a Jersey Girl and East Coast through and through,” she says.
She declined to move. But by 2014, her perspective had changed. Her career was going well; her kids were older — middle school and high school; and her husband was retired. “I was questioning what I wanted to do next and what I wanted the next phase of my career to look like,” she says.
She briefly considered outside opportunities, but after 24 years at AT&T, she wanted to “double down on [her] commitment to the company.” She broached the topic of moving with her family. “My husband was supportive and my children were in,” she recalls. “I declared myself mobile to move to Texas.”
Shortly thereafter, the CEO tapped her to take on a new job leading sales operations and solutions. Once the relocation became real, her children changed their minds. “When we told the kids, they said we should go without them,” she says.
She and her family had many long talks. “We talked about who we wanted to be,” she says. “My husband had 51% of the vote. I was worried about his social infrastructure because it was his life that would change the most. The kids would assimilate.”
After three years in Dallas, Anne has already had three different positions. Today she is the president of the national business.
Despite her career success, she admits that the first year was difficult for her spouse and kids. “It definitely made us a stronger family,” she says. “But I don’t know if we’ll ever call it home.”
Case Study #2: Seek advice and input from others Oliver Cooke was only a couple of years into his job in London at Selby Jennings, the financial recruiter, when he was asked to relocate to New York.
“My manager was going over to lead the U.S. business, and he asked several of us to join him,” he says. “I’d always been interested in travel, and I’d always wanted to live and work abroad.”
But still, it was a big decision for Oliver, a native Londoner. He had spent only a handful of days in New York in his life, and although he was in his mid-20s at the time and unmarried, the move meant leaving behind his family and friends.
Oliver sought advice on what he ought to do. He spoke with friends and colleagues who’d done similar stints overseas. “I did my due diligence,” he says. “I wanted to get an idea of what this type of move would be like and what kinds of opportunities there were.”
Oliver says he didn’t necessarily think about where the job would lead, but he was confident that the opportunity was a good one.“It was a chance to do something entrepreneurial and to build a new business,” he says.
He also knew that he could leave if it didn’t work out. “I figured that, worst-case scenario, I could always come back and get a new job internally,” he says.
In the end, he decided to do it. “I thought I would go out there for a year or two, work hard, and see how it goes. I thought I’d take it year by year.”
Today, nearly six years later, Oliver is the executive director and the head of North America at the company. He says he has already laid down roots here and has no plans to return to the UK. Moving to New York, he says, “was the best decision” he ever made.
“My business is all about building relationships and networking,” he says. “I see myself as someone who’s carved out my own niche in this part of the world. At this point, I would find it very difficult to go back to London. I love it here.”
Voices against dual-class shares, which violate the principles of corporate democracy and the precept of “one share one vote,” have increased over time. An influential 50-member Investor Stewardship Group (ISG), overseeing $22 trillion in assets, demands a total elimination of dual-class stock. Council of Institutional Investors (CII), representing managers of $25 trillion assets, recently demanded limiting any company’s dual-class share structure to seven years. Yet this year, Hong Kong and Singapore stock exchanges, which initially barred the listing of dual-class shares, went the opposite way, by allowing their listing.
Who is right? Influential institutional investors or Hong Kong and Singapore stock exchanges? Should dual-class stock be totally eliminated or, at least, have a mandatory sunset clause?
In our view, while the proposal to ban dual-class shares raises important issues, its implementation would do more harm than good, given the challenges from the digital revolution and the growing imperative for established firms to transform their business models.
For readers who haven’t been following this debate, here’s a quick primer. Companies with dual-class shares have two designations of common stock, typically A shares and B shares, with one class having more powerful voting rights than the other. Holding the more powerful shares allows some group of shareholders—often the founders—to control boardroom decisions even as economic interest in the firm is dispersed more widely. Some of the largest companies of recent times by market capitalization, such as Facebook, Alphabet, and Alibaba, carry dual class-shares. So do some older, family-controlled firms, such as Ford Motor Co. and The New York Times Co.
The use of dual-shares has been growing recently: One-fifth of companies that listed on U.S. stock exchanges last year had dual-class shares. Curiously, Warren Buffet strongly demands the elimination of dual-class shares, but Berkshire Hathaway continues to maintain two classes of voting stock. While most dual-class companies have superior Class B shares, which provide ten times more voting power than the inferior Class A shares, other companies such as Alphabet, Under Armour, Blue Apron, and Snapchat have taken this practice to an extreme by offering common shares with zero voting rights. Yet, investors price Alphabet’s Class C stock, which carries no voting rights, almost no differently than Alphabet’s Class B stock, which carries voting rights. Investors’ continued clamor for inferior-voting shares, even those with zero voting rights, suggests there must be some economic reason for their existence.
While media companies, such as The New York Times Co., Comcast, DISH Network, AMC holdings, Liberty Media, News Corporation, and Viacom have traditionally had dual-class shares — arguably to maintain news independence — a more important recent development is the widespread adoption of dual-class structure by technology companies. Almost 50% of recent technology listings have a dual-class status. We explored reasons for the growing use of the dual-class structure in an HBS case study among technology companies. Our nickel summary is that their growing popularity is due to the increasing importance of intangible investments, the rise of activist investors, and the decline of other protection mechanisms available to existing management such as staggered boards and poison pills. A dual-class structure, offering immunity against proxy contests initiated by short-term investors, could be optimal if it enables founder-managers to ignore pressures from the capital markets and avoid myopic actions such as cutting research and development and delaying corporate restructuring.
So, in our view, outright ban on dual-class shares would not be costless. For example, one principal reason for decline in the number of initial public offerings is the increasing reluctance of technology companies to list their stock, which is largely caused by rising shareholder activism. At the margin, a ban on dual-class stock would encourage more technology companies to remain private, or motivate listed technology companies to go private, eliminating common investors’ chance to buy even the inferior voting stock. This growing possibility is likely why Hong Kong and Singapore stock exchanges have reversed their earlier stance and allowed dual-class shares.
But how can one argue against a mandatory sunset clause? This clause automatically converts a superior voting share to a low-vote class at a fixed time after IPO. For example, Groupon’s and Texas Roadhouse’s shares converted after five years of listing, and Fitbit, Kayak, and Yelp carry clauses for automatic conversions. This structure allows a dual-class structure for a defined period early in a company’s life to allow founders to pursue risky and bold initiatives without subjecting themselves to the pressures from short-term investors. Research shows that the benefits of dual-class structure dissipate over time. The costs of letting management entrench itself eventually outweigh the benefits of shielding the company from short-term investors. This argument is supported by the decline in the valuation premium of dual-class companies over comparable single-class companies as firms grow older.
In our view, a sunset clause would be ideal if there exists a fixed, predetermined time after which all companies become mature enough to need no further changes in their business models. However, we cannot completely endorse this idea for two reasons. First, the firm age at which sunset clause should kick is far from clear. We calculated the years after IPO when a growth company becomes a mature company in its lifecycle for the stocks listed on U.S. stock exchanges. We find that this age-to-maturity has been declining. In the late 1980s, we estimate it was ten years. It declined to 7.6 years in 1990s and has further declined to five years in the 21st century. The period to maturity differs based on the firm’s technology and business model. So, a one-size-fits-all policy would not work.
Second, and more important, we are unsure whether any of the today’s companies can bask in their established business models forever, given the increasing pace of creative destruction and the emerging competition from digital companies. Well-established companies, such as Ford, Caterpillar, Walmart, Macy’s, Sears, Boeing, General Electric, and John Deere, Duke Energy, and Thompson Reuters, are facing disruptions that require complete overhaul of their business models. Many large and mature companies, such as Amazon, Alphabet, IBM, and Apple, have had to reinvent themselves multiple times over. To the extent that a dual-class structure facilitates a company’s transformation, the assumption that a company predictably reaches a permanent business-model stage, and therefore does not need further transformation, would be detrimental to the nation’s innovation and shareholder value. For example, Pepsi’s transformation from a purveyor of sugary drinks toward healthy snacks would have been hindered had hedge funds succeeded in their demands.
In sum, instead of recommending a total ban on dual-class shares, or even a mandatory sunset clause, we recommend a more flexible shareholding structure. Companies with dual-class structures could be required, after a period of predetermined years, to gain approval from a majority of all shareholders to continue the dual-class structure. Furthermore, single-class firms should be given an option to convert to dual-class shares through a shareholder vote, in order to carry out significant transformations, instead of having to completely delist in order to achieve that goal.