What are the divergent challenges global talent professionals are currently facing?
As the UK, Europe and the US start having the feeling of catching a breath after recession, businesses continue to follow strategies mapped out when an economic recovery appeared within reach, and are under pressure to grow despite an increasingly shaky economy. This has left organisations striving for growth with fewer resources, leading many to rely on growth in emerging markets to propel their businesses forward (few will do it for other reasons, like truly appreciating the potential of these regions).
This has created a dual challenge for global recruiters. In regions and countries in which the organization is well established, organisations struggle to improve the performance of the workforce in the face of declining employee engagement and effort levels as well as cutting through high volumes of applicants to find the often very specialised skills the organisation still requires.
In new markets, organisations are struggling to attract enough talent in very competitive labour markets with short supply of technical and managerial skills and high levels of staff turnover.
As a result, talent professionals are faced with a set of challenges that represent themselves unevenly across global labour markets and find solutions to new challenges in new markets.
Despite an influx of applicants in established markets driven by a soft labour market, recruiters continue to struggle to find the right skills to meet the needs of the organisation.
Another challenge for organisations recruiting for roles in developed economies is that, unlike many emerging economies, the talent they require is becoming even more entrenched in their current roles. Rising unemployment has made the most talented employees fearful of leaving their current roles with just a small part of those employees actively looking for a new job.
The situation is very different in emerging markets or new markets. For multinational companies, attracting talent in emerging markets has always been a challenge, and one that has grown since the financial crisis. Until recently, local employees favoured international companies, believing them to offer better career prospects and higher status than their domestic rivals.
Memories of the economic crisis and the rounds of redundancies made by multinationals however, means that many local employees now perceive local companies to offer more stable career paths and better prospects.
The stakes are high for international businesses operating in emerging and new markets, as their ability to capture market share will be largely dependent on the quantity and quality of their local team. A ‘one size fits all’ approach to talent across global labour markets is destined to fail. While high levels of unemployment in the developed economies have resulted in a flood of applications for every available role for established organisations, it is becoming increasingly difficult for organisations to attract and retain talent in emerging and new markets where their brand power might not be the same.
To cope with the divergence between new and established markets
Differentiate your sourcing strategy across global markets
When recruiting in the markets where an organization is already established, companies need to take a more strategic approach towards recruiting and move away from the mass branding they have undertaken previously to attract candidates. In new markets however, companies need to focus on promoting their employment brand, communicating their commitment to the country, their focus on individual employment development and their overall employment value proposition.
Establish long-term workforce planning and forecasting
In many organisations staffing planning focuses on identifying and responding to current talent needs and does not address longer-term strategic gaps within the organisation. In both established and new markets companies need to think about the skills the company is likely to need in the future and to build a pipeline of candidates that will meet this need.
Focus on skills not just experience
Recruiters need to encourage hiring managers or boards to focus on candidates’ skills rather than their knowledge, experience and education. For example, one friend’s employer, an insurer, wanted to ensure that new hires for a particular role were qualified actuaries. Having struggled to identify candidates the company changed its approach and began hiring people with backgrounds in banking and consultancy and found their new hires to be just as effective as the actuaries hired previously. I believe special approaches to technology and software development could also benefit from such an approach.
Use succession planning to build a pipeline of external talent
Business leaders should be encouraged to consider both internal and external candidates for key roles. Nowadays business leaders focus on strategies such as to identify three candidates who could fill a key role, one of which must be an external candidate, helping to build a pipeline of ready candidates based on the incumbent’s own network as part of the annual succession planning process.
Start building your employment brand in new markets
In addition, there are further, specific steps that we believe companies must take to build their employment brand in a new market:
Develop local career opportunities
While most employees within multinational companies in new markets once hoped to be posted overseas, more and more employees now prefer to advance their careers at home. Companies need to design their international rotations accordingly, at the same time exposing a higher proportion of their global leaders to key new markets.
Provide compelling career paths
While competition for talent has meant that many employees in new markets demand unrealistic, rapid promotions; a more pressing concern is the alignment between their current role and their professional interests. Creating a credible career path that charts a trajectory to personally fulfilling jobs and leadership roles that are managed carefully on an on-going basis will help to reengage employees.
Be clever about pay
In order to secure the right talent, local companies in new markets globally are prepared to pay up to 50% more to lure employees away from multinationals. However, many employees in new markets continue to express strong preferences for careers with international companies, and so a more moderate salary increase is likely to convince employees to remain in their roles.
Develop local roots
International companies that are well established in emerging markets can develop many of the advantages that local companies are perceived to have. A global brand that can demonstrate strong local roots will leave companies better placed to acquire the domestic talent it needs to keep growing in those new countries.
Talent gaps in the English speaking countries and the rest of the world
The talent gaps in both the English speaking countries and the rest of the world are real but not insurmountable if companies focus on tailoring their approaches to recruiting in these markets. Developing a strong team will be crucial for all businesses wishing to compete in an increasingly competitive market place, and so businesses need to focus their talent strategy on a limited number of candidates with the right skills in order to fill requisitions in the established markets, while boosting their brand to attract candidates in larger numbers in new markets.
Note I : In this article I have used the terms “New markets” and “Emerging markets” interchangeably, given that most companies will think of new or emerging markets in terms of emerging and developing economies, but I believe similar phenomena can be observed in countries in which any organization is starting operations without previous support of a strong employer or product brand. The same struggles some of my friends face in the Middle East at the moment, are the same challenges I face in my current role in Germany.
Note II: I refer to “English speaking countries”for the large majority of multinationals have their headquarters or regional offices in English speaking countries. This has a large influence in the way multinationals attack new talent markets abroad. I believe treating a new labor market or searching in a new labor market, as it was the US, the UK, Singapore or Australia (among other regional powers) is a huge mistake that should be avoided.