Presentation on theme: "Meeting the Global Challenge for Talent"— Presentation transcript:
1Meeting the Global Challenge for Talent Professor William Scott-Jackson Director, Centre for Applied HR Research Oxford Brookes University CEO, Oxford Strategic Resourcing Ltd Oxford, UK Director, Mayo Learning International Ltd
2Meeting the Global challenge for Talent: Agenda Talent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and Key action areas
3Talent Management: The threats and the opportunity ‘War for talent’ is a recurrent themeIntangible assets, mainly human, now represent the largest contributor to overall market value for many organisations.The effective acquisition, management and retention of human resources has a direct and significant impact on the bottom line and on share price.Needs surgical precision to identify, acquire and retain the key high-performing talent that will add sustainable competitive advantageGlobal market for talent presents significant opportunities – and risksMany global organisations have no resourcing strategy –many don’t even have a manpower plan,many don’t even know what talent they havemany don’t know what they need
4War for Talent: 1998 recommendations The Old WayThe New WayHR is responsible for people managementAll managers, starting with the CEO, are accountable for strengthening their talent poolWe provide good pay and benefitsWe shape our company, our jobs, even our strategy to appeal to talented peopleRecruiting is like purchasingRecruiting is like marketingDevelopment happens in training programmesWe fuel development through stretch jobs, coaching and mentoringWe treat everyone the same, and like to think that everyone is equally capableWe affirm all our people but invest differentially in our A,B and C playersScott-Jackson 2006 recommendationsWe recruit when we need toWe know what our strategic skills gaps are and we have clear plans to fill themWe know how many we need in defined rolesWe know which critical capabilities will be needed to achieve our strategy - and we know how we are going to build themMichaels.E., Handfield-Jones. H & Alexroyd. B (1998,The war for Talent, Harvard Business School Press
5Top global management issues Top 10 current business issues for senior executivesPercentage of respondents selecting issues1.Attracting and retaining skilled staff35%2.Changing organizational culture and employee attitudes33%3.Acquiring new customers32%4.Developing new processes and products to stay ahead of the competition29%5.Increasing customer loyalty and retention6.Managing risk7.Improving workforce performance28%8.Increasing shareholder value27%Using IT to reduce costs and create value10.Being flexible and adaptable to rapidly changing market conditions26%Developing employees into capable leadersAccenture (2005) Global survey of management issues, July 2005
6How has business responded? at the top level, as a series of one-off responses to unplanned tactical issuese.g. reorganisation, new business stream, resign, retire or diein the mid-tiers as a tactical responsibility of specific line managers working uneasily with HR, preferred suppliers and ‘pet’ search consultants/agenciesat the lower, high volume, levels - a procurement problem to be solved at the lowest cost.89 percent - more difficult to attract talented people now than it was three years ago,90 percent - more difficult to retain them.Just 7 percent strongly agreed that their companies had enough talented managers to pursue all or most promising business opportunities.Only 14% strongly agreed that their companies attract highly talented people.Only 3% strongly agreed that their companies develop talent quickly and effectively.89% said candid performance feedback was essential, only 39% said they received it(Axelrod. E.L, Handfield-Jones. H. &Welsh T.A. (2000) War for Talent updated in 2000)
7Barriers to effective Talent Management McKinsey: interviews with 50 CEOs across 29 global organisations.% of interviewees who rated obstacles amongst the 8 most criticalGuthridge.M., Komm.A.B. and Lawson. E (2006) The people problem in talent management The McKInsey Quarterly
8Meeting the Global challenge for Talent: The Talent Strategy Talent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and Key action areas
9Talent Strategy: What it is and what it isn’t A plan to meet strategic talent needs of the business and create competitive advantage through differentiating capabilities.NOT the plan for HR developments in recruitment, training, employee relations etcNOT simply how HR will deliver various servicesNOT how HR will introduce the latest HR thinkingNOT a plan for HR’s internal activities
10Talent Strategy: main elements Dealing with current resource issues – keeping a ‘seat on the board’Immediate: tactical problem solverMeeting strategic business needs:How will the people (numbers, skills, characteristics) required to achieve the business’ objectives be made available in the most (cost) effective way?Define the demand (predict resource flows – in, out, across)Review supply over the period (5 years?)Gap analysis,Proposals for action: costs, benefits and business case.Medium term: enabler of strategyCreating strategic advantageHow can we create differentiating human resources to provide real competitive advantage?Competitive analysisIdentify potential differentiating resourcesActions to build differentiating resourcesBusiness case to support their developmentLong term: driver of strategyBenefits summary in business termsincrease revenues, decrease costs, shareholder value, cost income ratio etc
11Talent to enable business strategy Supply and Demand Questions Demand - Resource flows: numbers, skills, competencies e.g:We will be reducing sales of ‘x’ but increasing our focus on ‘y’We will be competing in new global territoriesWe will be outsourcing more but will need more people able to manage supplier relationshipsWe will need more specialist ……..We will need far less ….....We want to be seen as the most technically advanced companySupplyAll our competitors will need exploration engineersGIS expertise is only available from 3 UniversitiesChina is starting to hire petrochemical analysts from European UniversitiesEuropean and Japanese workforce is agingChinese Engineering graduates are too theoretical – only 13% usefulWe lose x% of our Dutch graduates within 3 years
12Example – Global Oil Co We will need 200 less programmers by 2006 Resource Implications:Exit strategy?Turnover levels?Redundancy costs?
13Example – Global Oil CoActually we need 500 less Cobol programmers but 300 more C++ programmersResource Implications:Exit strategy?Turnover levels?Redundancy costs?Recruitment?Employer of choice?Retraining?
14Example – Global Oil CoBy the way … we’ll need the C++ people by 2002 and some of the Cobol people till 2005Resource Implications:Exit strategy?Turnover levels?Redundancy?Recruitment?Employer of choice?Retraining?Retention?Temporary staff?
15Example – Global Oil Co … and don’t forget ….. The C++ will be based in Plymouth, Current Cobol people are in LondonBoth Cobol and C++ must be experienced in ‘extreme’ programmingTwice as many Team Leaders needed for C++ peopleC++ salaries are rising fast - they are in demand and not being trained.Takes about £8000 and 12 months to retrain a Cobol programmer – 10% fail!Costs c£60k and 6 months to make a Cobol programmer redundant and recruit a C++ programmer – 15% leave within 1 year!
16Example – Global Oil Co: Actions Training and retention plan for Cobol programmers in C++ and extreme programming.Cobol contracting as exit path (set up own business).Early career counselling to allow self-selection for new roles or exit.New sources for trainee C++ people (non IT/science grads, older people, non IT mid-career people, admin staff with aptitude.Early liaison with colleges worldwide and regional schools/collegesCreating programming centres in Eastern Europe and AustraliaOutsourcing some work to Pakistan
17Opportunity for the business …. And for HR Resource flows are the critical strategic enabler/limitation for most large organisationsThey are poorly understood, rarely analysed properly and, if unplanned, can cause strategy to failNo one has timeThey are completely within HR’s remitThey are quantifiable, business oriented, involve big scary numbers and are extremely important!
18Strategic Capabilities: example Identify strategic intentTop 3 in Australasian Fertiliser market within 5 years -via acquisitionIdentify capabilities needed(particularly ‘key capabilities’)20 M&A specialists with Australian agribusiness expertiseIdentify what we have50 European M&A specialists, 5 ‘worldclass’.Can we develop existing?Do we need to buy-in? Where from?Buy some experience and develop rest?Gap and Flow analysisPlan to meet gaps(+ve and –ve)Redeploy, develop, recruit
19Strategic capabilities – Sources of competitive advantage (e.g.): Global IT providerProject and Deployment ManagersInternational bank‘Friendly’ cashiersCommunications companyGlobal telecoms expertsConsultancyKnowledge ManagersDiverse global holding groupInternal Search consultantsStrategy ConsultancyProduct builders??Global Petrochemicals conglomerate
20The Talent Strategy: Questions for you What are the CRUCIAL talents that you will need in the future?Do we own that Talent now?Do we need to build more of it?
21the threat and the opportunity Summary and Key action areas Meeting the Global challenge for Talent Developing and deploying talentTalent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and Key action areas
22Global Gas Co: the problem Fast track graduates (and high-performers in general) tended to leave after 3 yearsbecause there was no planned career progressionBecause they were no longer treated as ‘special’ or looked afterIndividual Divisions tended to protect and defend their best peoplenot allow them to be moved to other key roles.Hide them - so the organisation’s best talents were invisibleMuch easier to find someone from outside via executive searchMuch easier to leave the company to progress, rather than move internallySolution‘Passport’ to successSolutionInternal Executive search
23Passport to Success (web based) For every senior role (destination):The competencies and skills required to do that roleThe experience necessary to be considered for such a roleThe kinds of jobs and roles necessary to gain that experienceOn-line ‘passport’ for each high-potentialCV and personal detailsJobs done and experiences gained (Visas)Competencies and skills achievedInternal talent marketAll vacant or future roles accessible by everyone on the webEveryone’s passport available via intranetMatching facility via intranetIndividual responsibilityUp to the individual to make sure they moved into jobs to gain the necessary experiences and competenciesNo handholding or career planningInternal search
24Internal Executive search Executive search consultants were allowed to actively search internallyAdvantage:Accessed ‘hidden’ talentLone managers can focus on building., protecting and building loyalty in staff Search consultant focuses on unearthing talent for the business as a whole.Movement is healthyBetter to be poached for an internal job than an externalDisadvantage:Some Managers objectDeliberate ‘unsettling’
25Developing and Deploying Talent: Questions for you How can you encourage people to develop their own talents?How can you ensure that top people are seen as organisational assets and move between business?What would be the advantages of deploying internal search?What would be the disadvantages?
26Meeting the Global challenge for Talent Retaining Talent Talent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and Key action areas
27Retention: A differentiating strategic capability Survey of 500 Global organisations68% - retaining talent is ‘far more’ important than hiringOver 50% altered salaries, bonuses or stock options to retain talentOnly 27% tried to provide employees with advancement opportunities within their organizationsMost companies continue to struggle with retention because they rely on salary increases and bonuses to prevent turnover.Why doesn’t this work?* Accenture: "The High Performance Workforce:Separating the Digital Economy's Winners from Losers”
28Example - High Tech firm losing high value people Project ObjectivesTo reduce turnover in key groupsWho should we retain and how?Identify root causes and solutionswhy do people stay or go?The Manager’s roleWhat can we do?To identify and use non-financial interventionHow can we retain (and spend more wisely)?
29Dimensions of Staff Turnover: Involuntary -organisation decides not to retain the staff member (or retain).Voluntary -individual decides to leave the organisation (or stay).High Value or Low value staffShort term and long termRisk of quittingCatch ‘intention to quit’ early in the processOf course, not all staff turnover is bad. In the first place turnover can be voluntary, where the staff member decides to leave or involuntary, where the organisation decides not to retain the staff member.The other dimension is that turnover can be of high value or low value staff.If someone of low value is at high risk of leaving voluntarily - encourage and celebrate!
30Some turnover is OK! Involuntary Voluntary High Type AType BInadequate selection for dismissal etcRetention ProblemHighValue to the organisationType CType DTaking both of these dimensions we can work out where to focus our efforts.Turnover Type Impact (-ve)Type A 10/10Losing high value people through redundancy programmes etcType B 5/10Losing high value people through retention problemsType C 5/10Paying low value people to leave!Type D 1/10Low value people leave voluntarilyEstimated costs of Type B Turnover (per consultant):RecruitmentTrainingSalary while training 30000Lost revenueMorale, ?productivity ?management time ?At leastObviously can reduce costs of recruitment etc but still a big number!10% turnover - (100 senior consultants) - £3m per annum off bottom line.Also include costs of exits of Type Cs- can be one year’s salaryAnd, even worse, costs of exits of Type Bs - Also 3 month’s salaryAverage services firm with cadre of c100 highly paid professionals. Could be costing over £4m per annum.LowDismissal, etcCareer development moves, management persuasion etc
31Segment the ‘voluntary’ population Low RiskHigh RiskHigh valueTarget retention actionsMaintainThe involuntary are either expensive (to exit) or mistakes (where we’ve exited then wrong people).Ideally, therefore, we would encourage voluntary staying or leaving in line with company requirements always.We can then target different actions to the different segments of our populationTarget improvement or cost effective exitLow valueNo action - or encourage to leave
32The Quitting ProcessThe process of resignation commences with ‘thoughts of quitting’ which in itself is often caused by internal (push’) factors such as low job satisfaction. The thought of quitting may or may not turn into a job search depending on whether the individual believes it will be worthwhile and how serious is the thought of quitting. Once an individual has started a job search then intention to quit will be mitigated by how many offers, at what level and so on the individual receives. It is normally only at the ‘intention to quit’ stage that money is seriously taken into consideration. The action of quitting is then dependent on relative offers and whether the individual’s job satisfaction is still low. Search consultants bypass most of this process by raising the perceived probability of gaining alternative employment and easing the search process dramatically.If a company wishes to retain a key individual then the best place to start is at the beginning of the process. Organisations who try and persuade at the final stages (intention to quit) can only offer more money as the individual will have persuaded themselves that the alternative is preferable in every other way. At the later stages of the process, the phenomena of ‘cognitive dissonance’ will ensure that the person finds lots of reasons to support the intention to quit ( in the same way that once having purchased a car, most people will find difficulty in accepting reasons not to have bought it).
33Type B Turnover - When to attack StageThoughtsof quittingIntention tosearchIntention toquit or stayAction quitor stayJob SatisfactionSelf esteemManagement stylePerception ofjob market vsinternalProbability ofalternative/attractiveemploymentJob offer atsame/moremoneyThe most cost effective place to attack retention is at the front end -‘thoughts of quitting’ as the factors here are to do with management, the person themselves and/or the jobthe least effective is at the end -‘Action’ - as the factors here are money, conditions etcIt has been shown that ‘thoughts of quitting’ are highly correlated with management style and personal resilienceMain factors
34Actions Identify high value groups/individuals Regular confidential survey to identify high risk groups/individualsConfidential interview to identify individual and general USPsConfidential feedback form completedManagers agree individual and group actionsActions and monitor via survey
35Example Value/Risk spreadsheet Use at Department, team or individual levelCan be used at Group or individual level
36Example potential actions Special projects - recognitionGolden handcuffs (stock options, bonus)Patents and publications awardsInternal fellowship & instructor (external publicity)Dual careers (non-managerial ‘Star Tracks’ strategic role)Career counsellingSelf driven working (time, projects, place, invest)Learning accountsCafeteria benefitsInnovation BanksPersonal Growth LeaveManagement attentionCommunicationinvolving employees in company decision-making processes.project-oriented work, employees work on diverse, limited-term assignments.Developing internal "talent exchanges,”Golden handcuffs - Texas 14% of base, Xerox, 10% bonus on profitPatents and publications awards - Dell - application filed = $1000 cash, $5000 stock, Publications - Internet and company recognition, $750 cashInternal fellowship (ICL) & instructor programme (external publicity and credibility)Dual careers (National Semiconductor) Technical positions ‘Star Tracks’ (allows technical strategic role)Career counselling (Pactel, Sorbus, HPS) independent career counselling to allow people to take control - significant increase in retention (ICL)Self driven working (Hewlett Packard, 3m) 15% of time on own projects, place, invest)Learning accounts (Fujitsu)Cafeteria benefitsInnovation Banks (3m, Kodak) - Research grants and funding new ideasPersonal Growth Leaves or Sabbaticals (Apple, Silicon Graphics, Intel etc) up to one year off(10 weeks for 5 years service?) on emergent technology or IT certification etc
37Summary – Targeted Retention: resourcing at its best! Retention much more cost effective than replacementRetention must be targetedAim to minimise involuntary quitting (low or high value)Take control/influence over voluntary staying and quittingNeed information – segment the internal marketWho is valuable?Who is at risk?What they thinkWhat they wantNeed deliberate highly targeted action - MarketingDemonstrable, significant savings possible!
38Retaining key Talent: Questions for you How could you segment its own talentWhich key talents need to be retainedHow can we best retain these people?
39Meeting the Global challenge for Talent Acquiring Talent Talent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and Key action areas
40Strategic Talent Acquisition Proactive continuous searchSearch out the right people – don’t wait for them to come to youLook continuously for key skills – don’t wait till you have vacanciesPlan ahead (see previous section)Global Talent intelligenceKnow where the best talent is and how to reach itWeb based geographic database of universities, competitors, alternative employers etcTracked database of global potential hires – traced from University through career and including searches, applications, etcInternal Talent MarketLine managers build and protect their own talentInternal search helps make sure it ends up in the best placeIs it better for one of your people to be poached by a competitor or a colleague?
41TELECOM PLC Global Talent Intelligence: Aims Use the intranet to access informationknowledge x speed x accessibility = competitive advantageUnderstand the market so well that information can be used to disrupt competitorsExtend information gathering internally – learn from the huge knowledge resource of our current employeesForm relationships with key information ‘nodes’ – databases, professional organisations, publications, universities – to get the inside trackLink to Talent database of current and future candidates – fully tracked!Develop everyone to use the informationCompetitive intelligence isn’t a department – it’s a way of working!
42TELECOM PLC Global Talent Intelligence: Foundations Talent Market Data – in-depth knowledge about skills markets, competitors, strategies and tacticsThird party research (commissioned)Published dataSales & MarketingResearch & DevelopmentProfessional ServicesCustomer ServicesMajor Educational EstablishmentsCompetitive Company ReportsSupporting the business on specific bids and resourcing initiativeResponsive, pragmatic and focusedGlobal Talent databaseTracks potential future employees from graduation through careerFed through employee brand advertising, agencies, University careers offices, our own employees, speculative applications (over 2000 pa).
43TELECOM PLC Global Talent Intelligence: Intranet Portal TELECOMS PLC Global Talent Intelligence PortalHomeNews ArchiveTalent MapsDiscussCV DatabaseBreaking News…Cisco's Components FeastMarconi and Compaq join for service managementQuick CV searchKeywords:Recent discussions…Find a supplier…Search:
46Talent Map – Italy Accessible through TELECOM PLC Intranet and via web Maps now for all strategic countriesAt-a-glance picture of TELECOM PLC’s talent competitionThis map shows ‘associated industries’ – darker colours = more employees in regionStars highlight company sitesGeographic link to ‘prospect’ database
47Italy in Detail – Rome (Lazio) Maps are interactive – zoom in to any regionInformation from regularly-updated database – ‘live’Show all competitors, or slice information by technology, company, skillset etc.Next steps – link this to individual employee details
48TELECOM PLC Global Talent Intelligence: Functions Questions the portal can answer (examples)“What’s the current average salary for project managers in Paris?”“What experience do fellow talent managers have of recruiting in Qatar?”“Who can I ask about recruiting in Holland?”“How many people do Alcatel employ in Japan?”“What is the potential skills market for 3G engineers in Northern Russia?”“Where can I find Thai-speaking Project Managers?”“What have Cisco been doing recently?”“What can I tell my business about Lucent’s recent joint venture?”Search: Italy based GIS experts with GeologyJohn Cvanagh – 1990 MSc Spatial Analysis Milan – 10 years GIS for Shell global £70kAbdullah Kaziz – 2000 BSc 1.1. Oxford Geology – 5 years BP Middle East £50kEtc etc
49Executive Search integrated with Resourcing and Talent Management Resourcing strategy drives search strategyInduction begins with first callDatabase built for future requirementsInternal candidates ‘searched’ and comparedSuccession allows early planningReward data incorporated from searchCompetency frameworks utilisedCompetitive intelligence from market researchMgt development - part of screeningRetention via mentoring for first six monthsPromote company values and ‘Employee brand’Fast track project managed selectionPre-selectionSelectionPost-selection
50Acquiring Talent: Questions for you How can you track and access key external talentShould you recruit key talent – even when it hasn’t got specific vacancies?How can you keep track of all the people who apply?
51Meeting the Global challenge for Talent Talent Management:the threat and the opportunityTalent Strategy&PlanningDeveloping&DeployingTalentRetainingTalentAcquiringTalentSummary and key action areas
52Meeting the Global challenge for Talent: A major source of competitive advantage Identify strategic intentIdentify capabilities needed (particularly key capabilities)Identify what we haveGap and flow analysisStrategic Plan to meet gaps (+ve and –ve)Talent Strategy&PlanningDeveloping&DeployingTalentCreate an internal market for talentSelf development ‘passport’ for individualsInternal executive searchIdentify critical talent that must be retainedAssess ‘propensity to leave’Intervene at early stage of the leaving processRetainingTalentCreate Global Talent Intelligence web toolGlobal database of potential external talentInternal executive searchAcquiringTalent
53William Scott-Jackson Thank you very much!William Scott-Jackson