Talent management 2020

Almost two decades after a McKinsey study first coined the term ‘war for talent’, how are the battle lines for global talent management moving amid rising employment, flatter hierarchies, international talent pools, skills shortages, and multigenerational workforces?

talent management
The war for talent, as originally outlined in the 1997 paper reporting a year-long McKinsey study, described talent – people who are technologically literate, globally astute and operationally agile – as the most important corporate resource over the next 20 years, thanks to demographic change and knowledge intensive work.Nearly 20 years on, these ideas still hold sway. After two tumultuous decades of disruptive technologies, increasing competition, and rapidly evolving new sectors and economies, people ultimately create competitive advantage. Yet most economies the world over still face a shortage of people with the right skills.Manpower Group's 2015 Talent Shortage Survey found that 38 per cent of 41,000 hiring managers in 42 countries had problems filling jobs – a two percentage-point rise from 2014 and the highest rate since 2007. For around three quarters of employers in the survey, the battle to hire workers was due to candidates' lack of experience, skills or knowledge.Regionally, 48 per cent of Asia Pacific's employers have difficulty filling vacancies, versus a global average of 34 per cent. Employers in Japan, Hong Kong and India (83 per cent, 65 per cent and 58 per cent respectively) report the greatest shortfalls. Across the Americas, it is employers in Peru (68 per cent), Brazil (61 per cent) and Mexico (54 per cent) who have the greatest difficulty recruiting.The data for EMEA tells a similar story, with employers in Romania (61 per cent),
Greece (59 per cent) and Turkey (52 per cent) struggling most. Despite the different geographies, the issues are the same: not enough people with the right skills to fill the gaps.It is, therefore, easy to see why talent management is featuring increasingly in the global mobility sphere. Brookfield's 2015 Trends and Insights for Asia Pacific, for instance, shows that it has come to the forefront as an issue for employers. Mobility has a key role in addressing global talent shortages, with GM and HR practitioners on the front line of bringing together talent in more-dynamic ways.

Talent: make or buy?

Arguably, the issue of the movement of people around the world has never been higher on either the political or the enterprise agenda. This summer's migrant crisis in Europe, and the UK's parallel debate about how the country can bridge its skills gap, is colliding with companies competing hard to attract, recruit, manage and develop a more diverse workforce.The Economist's New Work Order talent management summit, which took place in London in June, picked up these themes. Talent management and leadership expert Clare Moncrieff, HR executive adviser at business insight and technology company CEB, presented findings from CEB's research at the event.Speaking to Re:locate, Ms Moncrieff described the summit's four key themes."First, the work environment is more complex than ever before. HR leaders agree that the magnitude of change today is greater than just three years ago; organisations face more new and unexpected situations, which have created a moving target for anticipating talent needs."Work is also more interconnected. As workflows become more interdependent, employees and business units rely more on each other to achieve their goals."The workforce make-up is changing. Shifting workforce demographics mean that companies should abandon one-size-fits-all talent strategies, and instead understand the diverse preferences and expectations of different talent segments to meet current and future business needs."Finally, talent management is more distributed. The line is increasingly engaged in talent management, which leads to more fractured ownership of a function that was already dispersed and disconnected within HR."

Talent management 4.0

One of the upshots of this shifting context is that half of HR professionals lack confidence in their programmes for high-potential workers – those traditionally targeted for talent management initiatives – according to CEB's research, Improving the Odds of Success for High-Potential Programmes.CEB found that half of programme participants dropped out within five years and 46 per cent of leaders moving into new roles failed in their objectives. The CIPD's Autumn 2014 Employee Outlook paper echoes this from an employee perspective, one in three reports that their career has failed to meet their expectations.Paul Turner, professor of management practice at Leeds Beckett University and co-author of Make Your People Before You Make Your Products, has also observed the need for a more broad-based, progressive approach to talent management than in the past."The global recovery means that talent management has come back onto the agenda for chief executives," said Professor Turner. "There is a great demand for skills. What is different to before is that we now have an opportunity to take a fresh look at talent management, especially in the context of multigenerational, multicultural, global and more transparent companies."Alongside these social trends, organisational design has moved on to matrix organisations and is much less hierarchical. In the past, talent management often relied on supporting an upward movement through an organisation. Now, talent management is different, as organisations are designed around matrices and networks, and often communities of interest that operate across silos and international borders."Employers, therefore, need a new strategic narrative in terms of talent that speaks to these new realities and makes sense of them for people in the organisation."Today, talent management is less about presenting to an audience and more about engaging and creating a community of talent. For leaders, this requires people who are confident in this age of ambiguity and complexity; people who can work with and understand technology and its implications; and people who can bring together diverse groups of people and have international experience and exposure."Clare Moncrieff agrees. "To drive real impact on the talent outcomes that matter most, organisations must integrate talent management goals and activities – both HR and line-owned – across teams and between individuals. Leaders must focus on encouraging productive collaboration across company lines to create the greatest enterprise-wide impact."Approaches to talent management, the CEB research suggests, therefore need to be more segmented, diverse and flexible, as companies seek to build the capacity for firms to be more adept in this fast-changing world.

Putting insights into practice: talent identification

Addressing the challenges of managing and leading through ambiguity and complexity, research by Roffey Park Institute's Peter Hamill, Alex Swarbrick and Sharon Varney, Leading International Teams: The Challenges and Competencies of Leading Virtual and Crosscultural Teams, identifies nine characteristics of high-performing leaders.A passion for working internationally, energy and resilience, flexibility and balance, communication, influencing, involving and valuing individuals, results focus, planning and organisation, and interface management are all key competencies for leaders working internationally in today's volatile, uncertain, complex and ambiguous world."Leading international teams can be rewarding and challenging. The people we spoke with had a clear passion for international working, strong curiosity about local differences, and a willingness to learn, even with many years of experience under their belt," observed the authors."They influence widely, actively involve and value individuals, demonstrate great range and flexibility in their style, and combine that with an ability to carefully balance multiple competing needs."

Attracting talent

With HR and GM both managing the issue of how to balance local and global policies and approaches and segment offers to meet diverse needs, employer branding is playing an increasingly important role in attracting and retaining candidates with the attributes needed for today's new work order.HR and global mobility practitioners are seeing greater segmentation through the growing use of alternative hiring practices, for example, and the increasingly diverse assignee profile.Joao Araujo, UK and Ireland country manager for Universum, an employer-branding specialist, explains what this means for Generation Y – one of the most sought-after groups."International careers are definitely an important topic for Gen Y. They have fully understood that, in today's world, you are unlikely to be successful at work unless you have the skills to work in an international environment."More than 38 per cent of Gen Y want to work for an employer that offers opportunities for international travel/relocation, while interaction with international clients and colleagues is a preference for around 21 per cent."Data from Cartus suggests that 71 per cent of its network surveyed expects to see younger job transferees in the coming years. Janine Barnes, Santa Fe Relocation Services' Asia director, has also observed the change in assignee profile and population needs across this diverse region."Local talent pools are becoming much more competitive for employers. Highly educated people who have sought-after international experience are returning to their home countries after graduating from top international business schools, universities and management programmes. We are seeing lots more young Chinese returners, for instance, and more intra-regional moves."

Developing and retaining international talent

Getting the balance right between global and local approaches to talent management is, therefore, becoming a more critical issue.On the one hand, international companies that lack recognition locally often struggle to fill highly skilled vacancies. In a less accommodating legislative environment, there is a risk that recruiting to key roles is made doubly difficult, particularly when faced with caps on expatriate pay.On the other hand, a strong push for global standardisation might enable a company to build a large talent pool, but one that is less likely to offer the diversity needed.Some leading companies are finding that a more project-based approach to learning and development opportunities is helping to bridge this gap."International projects are a really good development tool," says Paul Turner. "They help to build cross-cultural experience and great teams across boundaries."This trend is reflected in mobility sector trends, which have seen the type, volume and length of assignments increase.So it seems that, while battles may be being won through good company practice and insightful research, as technology and economics march on, the war is still to be won.For a case study on global mobility's contribution to talent management, click here.For more Re:locate news and features on talent management, click here.Click here to read the full digital issue of Re:locate magazine Autumn 2015
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