Talent Acquisition, Development, and Retention in Emerging Markets
By Frank Waltmann, Ph.D., Head, Corporate Learning, Novartis
The business environment in emerging markets for the next 10 to 20 years will be challenging due to talent shortages and fierce competition for competent, trained employees. A strong leadership brand may be just the elixir as data continues to show talent looks for, and places a high value on, personal and professional growth when choosing where to build a career.
Recently, Novartis Corporate Learning and the European Foundation for Management Development (EFMD) hosted a workshop on leadership development in emerging markets to discuss this issue. Presenters and attendees were experts in the field of emerging market talent acquisition, training, and retention, representing smaller enterprises to Fortune 500 organizations. Together, they shared the latest research and facts pertaining to BRIC nations and other emerging economies, including many firsthand experiences in this essential area.
Focusing on these countries, they debated the key factors at play in emerging economies that will influence corporations and their learning organizations now and for the next two decades. Stemming from this discussion, let’s take a closer look at three of these factors and how they might drive your approach the development of talent in these areas.
Factor #1: Emerging Markets Are Not Bystanders
Over the next 15 years, emerging markets will not be a place to just sell your products. Rather, as they are upward aspiring societies, they very soon will develop products and companies to compete with you and your markets.
The reason for this is threefold:
- GDP is expected to double over the next 20 years.
- Projections indicate 500 million people will move to urban centers by 2025.
- There is a high correlation between urbanization, innovation, and education. These 500 million people, then, will be in markets not only as resources, but also as competitors on the global stage.
Factor #2: Emerging Markets Need Leaders and Managers Now
Today, a talent void remains in emerging markets. Investment in talent and leadership around the world is just beginning to yield a harvest. And in some cases, robust talentpipelines have not yet been developed. Also, there are “talent-ready” gaps betweenuniversity graduates and the capacity to work in a corporation, running at about 10 to 25 percent.
For example, in 2011, India had 600,000 engineers who graduated college, but only about 125,000 were qualified to work in companies that needed employees. So, in general, while leadership development is catching up with new generational and geographical forces, the volume of need still overwhelms ready resources and available training.
Factor #3: Emerging Markets Tend to Create High Employee Turnover
Talent retention is, and will continue to be, a challenge as experienced employees are continually sought after by competitive interests. Therefore, what attracts and keeps a good worker at a company for the long haul must be understood, nurtured, and effectively communicated. What may come as a surprise is that according to the latest data, almost everywhere, attracting and retaining talent is more than just salary and bonus.
So, if money alone is not the driving force behind staying at a job, what is it that employees in emerging markets want from their employers? Quite simply, it is based on four fundamentals—brand, opportunity, purpose, and growth.
The Four Fundamentals
An eight-month study conducted in 2008 interviewed dozens of executives from more than 20 global companies. They were asked to identify the factors that differentiate successful firms in emerging markets in the area of attracting and retaining talent (Douglas Ready, Linda Hill, and Jay Conger, “Winning the Race for Talent in the Emerging Markets,” Harvard Business Review, November 2008). They found there are four key attributes that go beyond salary and bonus: the company brand, opportunities in the company, a purpose beyond profit, and a continuous growth culture.
Brand: A desirable company brand associated with growth and personal advancement is particularly attractive when the brand challenges employees to develop themselves as leaders. Emerging market talent wants a company that plays on the global stage and is growing so they can help it grow further—or it is not worth it for them to be there. This is critical.
Opportunity: Employees want challenging work, stretch assignments, continual training and development, and competitive pay. Also, the work must imply an accelerated career track to senior positions. You will not get good talent coming to your company if they don’t see a continuous learning process, and if they don’t feel the company is centered on learning and promotion. Here, mentoring is a key strategy, as is spreading salary bands so promotions can be awarded more frequently. Also, job titles can be modified with key words such as Senior, Junior, etc., to keep the growth going.
Purpose: Emerging market talent seeks agame-changing business model engaged in redefining their nation and the world economy. They want a mission that helps the less fortunate, due to their own experiences growing up. They want to work for a company that expresses—in both word and action—the value of global citizenship and sustainability.
Growth: A continuous growth culture in a company is crucial to incoming talent in an emerging economy. Research shows emerging market talent wants a story or brand promise that feels authentic, company rewards based on merit, a personal connection to teams, and a talent-centric culture so they know they are critical to the success of the company. In short, they want to see a company that is serious about their talent strategy, or they’re gone.
Ultimately, regardless of country or region, developed or still developing, executing a company’s business strategy means possessing the ability to operate effectively in a global economy. A commitment to long-term employee and career developmentwill make the difference in attracting talent in emerging markets. By articulating your company’s corporate brand, opportunity, purpose, and growth culture, there is a greater likelihood that you will have an edge on producing—and keeping—leaders who are globally oriented and wise in the ways of business. It would be prudent, therefore, to promote the proper educational and talent development measures in your company to prepare for the next wave of change that is bound to come in these exciting, growing, emerging market economies.
Frank Waltmann, Ph.D., is head of Corporate Learning at Novartis, a Swiss-based pharmaceuticals and life sciences company.