10 | 2011

The Magazine of WorldatWork

BEST PRACTICES FOR MANAGING

GLOBAL TALENT
More organizations have recognized the scale of the
opportunity from developing a global talent portfolio.
As global organizations become
more complex, they mirror societies
relentless pace of change, placing
evermore and quickening pressure
on human resources to respond. Add
the broad social, geopolitical and
economic trends, and the challenges
facing global HR functions are far
more multifaceted, complex and
fast moving than ever before. But
while the challenge is greater, the
opportunities for human resources
to cement its strategic value, develop
new high-value capabilities and
attract the best available talent to the
profession areimmense.
This article outlines five key
trends confronting multinational
organizations as they operate across
borders and cultures, and shares
best practice insights gained from
the authors experiences consulting
with leading international organizations at the cutting edge of
managing globaltalent.

TREND NO. 1

Global TalentPortfolios

Multinational organizations are quick

to converge financial systems across
borders and build integrated global
supply chains, but, in the authors
experience, are often much slower
to think of their talent portfolios
in a joined-up manner. This lack
of alignment can be attributed to
cultural issues, differing educational
standards, local labor laws and, of
course, language. One consequence
of this approach is that top talent
typically originates almost entirely
from headquarters, and the most
senior positions remain the exclusive
preserve of those from the companys
country oforigin.
In recent years, however, more organizations have recognized the scale
of the opportunity from developing
a global perspective of their talent
portfolio. The process often starts
with high-potentials, a much soughtafter group that drives organizational
performance in the short term and

By Paul Dinan and Marc Timmerman, Axiom Consulting Partners

2011 WorldatWork. All Rights Reserved. For information about reprints/re-use, email [email protected]

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builds leadership bench strength over

the mediumterm.
At one London-based global
consumer packaged goods company
that operates in both mature and
emerging markets, implementing
a global high-potential program
addressed one of its most pressing
business risks, namely Western
Europes ticking demographic
time bomb comprised of an aging
workforce, mass retirement of Baby
Boomers in senior positions and a
lack of highly skilled workers. By
identifying and developing highly
capable and mobile talent from
emerging markets with excess supply,
and embedding a significant portion
of these people in mature markets
with excess demand, the company
was able to implement a global talent
arbitrage strategy. But unlike the
typical developed-emerging world
version where lower-value work
migrates to lower-cost economies, in
this case roles were reversed and
the people moved to the work. The
benefits of this creative thinking
were both operational and financial
in terms of filling key roles at a
reasonable cost, but also cultural
based on the infusion of talent from
across Eastern Europe and Russia,
helping to develop a much more
diverse and culturally sensitive organization. For example, in corporate
headquarters where key investment
and strategic decisions were made,
the company was able to use its
much improved understanding of the
high-growth emerging markets where
many of its new hires were from to
make better decisions about those
markets and improve commercial
and financialperformance.
These kinds of benefits are on
offer to international organizations
that think about and act on their
talent from a global perspective. And
fast-tracking this approach does not
necessarily require a massive revamp
of existing HR and talent management systems and processes, which
seems to keep many organizations
from taking the first step. Rather,

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october 2011

this approach is often best achieved

by engaging leaders throughout
the organization to have structured
conversations about the capabilities
required to support strategic and
operational objectives, and then evaluating existing talent against these
criteria at local, regional and global
levels. In this way the cream will rise
to the top, regardless oflocation.
TREND NO. 2

VanishingTalent

Many international companies operate

in fast-growing markets serving
the seemingly insatiable demands
of emerging economies like Brazil,
Russia, India, China and South Africa,

taken extraordinary measures, such

as doubling average compensation
over the past five years, but cannot
escape the fact that they are fighting
over an increasingly stretched pool of
resources that one senior executive
descriptively calls vanishing talent.
Vanishing, or peak, talent is right at
the top of the agenda for leaders at
many growth-focused international
organizations. To ensure this issue
doesnt negatively impact financial
objectives, it is critical to take a
proactive long-term perspective
when considering what talent will
be required to support growth and
expansion strategies, and how that

Consider tightly integrating your

strategic workforce planning
process with your organizations
annual business planning process ...

the so-called BRICS. Unfortunately,

while demand can scale up pretty
quickly in these markets, it can take
much longer to develop well-stocked
talent pools to service thisdemand.
The energy sector is a great example,
as demand is closely linked to the
maturation and increasing living
standards of these economies. With
demand for oil increasing against a
backdrop of tight supply, oil companies are drilling in deeper, more
complicated and less hospitable locations. And unlike the 1980s, when a
lack of capital was the primary brake
on growth, today its a lack of talent
that frequently crimps growth and
financial performance in the energy
industry. With money no object as oil
hovers above $100 per barrel, many
companies familiar to the authors have

talent will be deployed in the right

place, at the right cost, at the right
time. Consider tightly integrating your
strategic workforce planning process
with your organizations annual business planning processes, and help to
expand talent pools by encouraging
hiring managers to evaluate candidates based on skills, knowledge,
behavior and potential, rather than
just the appropriateness of their
prior workexperience.

Economic
BattleFatigue

TREND NO. 3

There are signs that involuntary

employee turnover is on the rise
again, even within a relatively challenging labor market. More worrying,
the authors experience suggests that
it is disproportionately top talent who

are moving on at this time, as a result

of their recentexperiences.
During the economic crisis of the
past few years, smart leaders put their
most talented and best-performing
employees in the most critical situations and jobs. In order to minimize
the effect of the recession, employees
were asked to work harder, perform
better and deliver more. For many,
the companys very survival was at
stake, placing inordinate pressure
on the most critical employees. The
consequences are similar to those
experienced by armies in modern
warfare when the military sends its
best platoons on extended missions
with compressed downtime between
tours of duty; the companys foot
soldiers suffer from what the authors
call economic battle fatigue. But
as the economy improved, rather
than offering a welcome break for
top talent, much like soldiers being
moved from Iraq to Afghanistan, key
talent was redeployed to a new front
chasing market share and increased
profits, while implementing strategic
projects all within an environment of fewer supporting resources
following broad-baseddownsizing.
The consequences of economic
battle fatigue among top talent are
potentially extremely serious for even
the best organizations and extend
beyond involuntary turnover. For
example, already stretched leadership
bench strength is being sapped further
as many high-potentials earmarked for
promotion are turning down seemingly attractive new roles in search
of better work-life balance, often to
the astonishment of senior leaders
who willingly made similar sacrifices
to attain their positions in the past.
Requests for long-term sabbaticals are
also on the rise, which can have an
immediate impact on an organizations
ability to implement strategic projects
and initiatives. Motivation and productivity are also an issue, with previously
high-performers missing targets for
the first time in theircareers.
The challenge for those in HR and
leadership positions is to proactively

find ways to provide affected talent

with some rest, a fresh start, a new
beginning and even some time for
closure. The best starting point for
those who believe economic battle
fatigue may be an issue in their
organization is to find an appropriate
forum or channel to engage in a
dialogue with those most likely to
be affected, and then to develop
appropriate actions to address their
issues andconcerns.
TREND NO. 4

CorporateWikiLeaks

Some companies have struggled to

figure out what social media is, how
it works and how it can be harnessed
effectively. This was previously an
annoyance to executives, who instinctively knew there was potential in
new media and tired of hearing how
competitors had managed to monetize
it. But given the magnitude of other
issues competing for their attention
in recent years, social media rarely
made it to the top of theiragenda.
That seems likely to change in
the very near future, as companies
follow governments in springing
to contain the fallout from social
media. The risks presented by social
media are immediately obvious
once organizations begin to consider
them. Many companies have seen
years of hard work and millions of
dollars spent developing corporate
and employer brands consigned to
the scrap heap in a matter of hours
based on negative news going viral.
In Ireland, for example, one of the
leading professional services firms had
to scramble to react after news rapidly
emerged that new female recruits were
being rated based on their physical
appearance by some male employees.
No doubt their considerable investments in talent and expanding
diversity over many years wont have
achieved anywhere near as many
newspaper column inches or become
a topic of water coolerconversations.
While leak containment is an important reactive strategy to develop and
have ready to deploy at a moments
notice, the permanent required

response is for organizations to strive

for sincerity from the entire leadership
team. Where Baby Boomers could
reconcile differences between the
walk and the talk. this proved to
be more difficult with GenerationX
and is now almost impossible with
Generation Y. These demographic
groups want complete consistency
between what the leadership team
preaches and how the team behaves.
And looking toward what the future
has in store with Millennials based
on their current behavior, such as
teenagers all over the world writing
blogs about their teachers perceived
competence with no sense of disciplinary ramifications the need
for transparency, accountability and
sincerity will onlyincrease.
TREND NO. 5

MassCustomization

Human resources has typically

championed a one-size-fits-all
approach, or in the case of many
international companies, a onesize-fits-headquarters approach. The
somewhat predictable outcome has
often been a lowest common denominator, with nobody being particularly
happy with his or her deal. But as
organizations became increasingly
complex, and more sophisticated
roles required highly developed and
commensurately demanding talent,
the employer-employee relationship
morphed into one that more closely
resembled that of a company and
its customers. With the correlation
between employee engagement,
performance and retention well
established, human resources in many
leading international organizations is
implementing a mass-customization
approach to talentmanagement.
Mass customization requires that
organizations translate their vision,
strategy and values into a flexible
employee value proposition that
resonates for as broad an employee
population as possible. Some organizations go one step further by
suggesting a need to develop multiple
unique employee value propositions
to appeal to particularly diverse

october 2011

workspan

49

subgroups. Analyzing and segmenting

employees into families or archetypes
enables surveys and focus groups
to develop a comprehensive understanding of what really matters to
each group, and consequently where
investments should be made to sustain
the most appropriate and highestimpact employee valueproposition(s).
The results of tailoring the value
proposition to unique groups can be
profound. Consider the IT department of a U.S.-based fixed-line phone
company that was experiencing high
turnover and low performance among
its programmers. To stem the significant costs associated with replacing
these specialists, management made
several significant investments in base
salary based on information from both
an employee survey and exit interview
process. To managements surprise,
attrition remained stubbornly high.
Following an analysis, the authors
identified that for this particular
employee group, employability and
using the latest technology were more
important than salary increases over
a certain threshold level. By rolling
back some of the salary increases
and replacing them with a personal
training budget and five days of paid
training leave per year, turnover fell
and performance improved. Furthermore, the organization was able
to leverage new cutting-edge Web
development skills, which would never
have been a development priority for
IT managers focused on maintaining
legacy mainframesystems.
A critical early step in mass customization requires that organizations
segment their employee population.
Achieving the greatest business
impact and returns requires that
you evaluate each roles strategic
impact during this process, meaning
that roles and subsequent investments are prioritized based on their
relative strategic importance. Many
organizations struggle with this
concept, believing that everyone
is important to the organizations
success. While this may be partially
true, by focusing on roles rather

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october 2011

than individuals you can dispassionately develop a powerful

segmentation framework that forms
a solid foundation for all future
HR initiatives and investments,
which in turn can dramatically
improve most employees satisfaction with their respective
employee valueproposition.

Conclusion
Human resources is playing a
different game today as a consequence of becoming an integrated
business function that significantly
impacts both performance and
strategy execution, and because of
the global socioeconomic changes
that are affecting economies worldwide. The stakes are higher and the
potential rewards greater. For organizations operating across national
borders, the issues are magnified and
complicated stillfurther.
Moving forward, leaders will need
to accomplish much: 1)champion
personal and systemic transparency
and authenticity; 2)ensure that highpotentials and other top talent are
treated sympathetically as human
beings as well as challenged like
superheroes; 3)develop and upgrade
creativity and business acumen;
4)find hidden gems wherever they
are in the world, whatever their age,
gender and cultural background;
5)remember that keeping people
engaged and motivated wont be
achieved by writing a check; and
6)deepen employee relationships
with line management while also
cooperating more closely with
strategy and marketing functions
to formulate and communicate
their programs and messages, and
to ensure complete alignment
with both business strategy and
external marketbranding.
For those working with international
organizations it sometimes seems
like the world is spinning faster and
faster around its axis, with ever more
competing priorities and increasing
execution complexity. A laundry list
like the one in the previous paragraph

The results of
tailoring the
value proposition
to unique groups
can be profound.

can seem pretty daunting, but at the

same time, the authors are convinced
that HR professionals around the world
wouldnt have it any other way, as they
all point toward tighter integration of
their efforts with business strategy and
leadership decision making. Indeed,
the common calling for all leaders
operating across our inconceivably
integrated world is to continually
appreciate and respond to the challenge articulated almost a century ago
by Paul Valry, a famous French writer,
who sagely noted: The problem of our
times is that the future no longer is
what it once was.
Paul Dinan is a partner at Axiom Consulting
Partners in Dublin. He can be reached at
[email protected].
Marc Timmerman is a partner at Axiom
Consulting Partners in Brussels. He can be
reached at [email protected].

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Global talent
High potentials
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