Winning the war for talent 2.0 in sri lanka daily ft by prof sattar bawany-6_sept_2013by

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Latest Article on "Winning the Art of War 2.0 in Sri Lanka" by Prof Sattar Bawany, CEO of Centre of Executive Education (CEE), Managing Director of EDA Asia Pacific and Strategic Advisor of Ipma Asia …

Latest Article on "Winning the Art of War 2.0 in Sri Lanka" by Prof Sattar Bawany, CEO of Centre of Executive Education (CEE), Managing Director of EDA Asia Pacific and Strategic Advisor of Ipma Asia Pacific for Daily FT (Financial Times) on Friday, 6 September 2013. Visit: http://www.ft.lk/2013/09/06/winning-the-war-for-talent-2-0-in-sri-lanka/

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  • 1. www.ft.lk FRIDAY SEPTEMBER 06, 2013 13 Opinion Introduction In 1997, a groundbreaking McKinsey study exposed the “war for talent” as a strategic business challenge and a critical driver of corporate performance. Then, when the dot- com bubble burst and the economy cooled, many assumed the war for talent was over. It’s not. Subsequently in 2001, the authors of the original study revealed that, because of enduring economic and social forces, the war for talent will persist for the next two decades. McKinsey & Company consultants Ed Michaels, Helen Handfield-Jones, and Beth Axelrod argued that winning the war for leadership talent is all about much more than frenzied recruiting tactics. It’s about the timeless principles of attracting, devel- oping, and retaining highly talented man- agers – applied in bold new ways. And it’s about recognising the strategic importance of human capital because of the enormous value that better talent creates The outcome of the study is applicable to Sri Lanka companies as it was fortified by five years of in-depth research on how com- panies manage leadership talent - including surveys of 13,000 executives at more than 120 companies and case studies of 27 lead- ing companies – the authors propose a fun- damentally new approach to talent manage- ment. They describe how to: create a winning EVP (employee value proposition) that will make your company uniquely attractive to talent; move beyond recruit- ing hype to build a long-term recruiting strategy; use job experiences, coaching, and men- toring to cultivate the potential in managers; and, strengthen your talent pool by investing in A players, developing B players, and acting decisively on C play- ers. Central to this approach is a pervasive talent mindset – a deep conviction shared by lead- ers throughout the company that competitive advantage comes from having better talent at all levels. Using practical examples from companies such as GE, The Home Depot, PerkinElmer, Amgen, and Enron, the authors outline five impera- tives that every leader - from CEO to unit manager – must act on to build a stronger talent pool. Written by recognised authori- ties on the topic, this is the definitive strate- gic guide on how to win the war for talent. The Sri Lankan context In today’s tight labour market in Sri Lanka, companies are facing intense com- petition for talent – and are giving increased attention to ways to retain talent rather than rely on costly replacement and retrain- ing. Retention of talent with critical skill sets is vital for achievement of business growth and to build organisational competencies, which represent a competitive advantage. The loss of needed talent is costly because of the resultant bidding up of market salaries for experi- enced hires to replace them, the costs of recruiting and assimi- lating new talent, the lost invest- ment in talent development, and the hidden costs of lost produc- tivity, lost sales opportunities, and strained customer relation- ships. Can companies win the “war for talent”? Will we be able to define and implement a reten- tion strategy that will give us the stable, committed, capable workforce required to achieve a competitive business advantage? Consulting firm and research organisation reports, published books and articles, and internal company retention studies suggest that everyone is following the same overall plan. How will this approach give a compa- ny an edge? Few, if any, organisations today have an adequate supply of talent. Gaps exist at the top of the organisation, in the first- to midlevel leadership ranks, and at the front lines. Talent is an increasingly scarce resource, so it must be managed to the fullest effect. During the current economic downturn we may experience a short ceasefire in the war for talent, but we’re all seeing new pres- sures put on the talent running our organi- sations. Are today’s leaders able to do more with less? The A-players can, and there should be a strategic emphasis on keeping those leaders — and developing their successors. Many organisations are reducing their workforces, but let’s be careful not to cut so deep that talent is scarce when the economy rebounds. The supply of leadership talent is criti- cal to any organisation’s prosperity and is, therefore, a central element of talent man- agement. The increasing trend of growing leaders from within is based on a dawning realisation that a popular alternative for acquiring talent — poaching key people from competitors — ultimately leads to frustration. Outstanding leaders who can ‘ramp up’ quickly are hard to find, increas- ingly expensive, and even when successful- ly recruited, tend to move from company to company. So the best approach, usually, is to develop systems and processes to identify available leadership talent. Many studies have shown that an impor- tant factor for commitment and retention is the effectiveness of immediate manage- ment. Employees say it is an important ele- ment of the work environment; research shows it highly correlated with commit- ment and retention scores, and employees cite poor management as a key reason for leaving a company. Accordingly, there have been many books focused on manager effec- tiveness. One big seller was ‘First, Break all the Rules,’ reporting on the Gallup Organisation’s findings and recommenda- tions for better management of people. Integrated Talent Management System So, what do we mean by talent manage- ment? In the broadest possible terms, it is the strategic and tactical management of the flow of talent through an organisa- tion. Its purpose is to assure that the sup- ply of talent is available to align the right people with the right jobs at the right time based on strategic business objectives. The term “talent management” is often used to denote e-recruitment and automated appli- cant tracking systems. This emphasis on staffing and recruiting is more appropriate- ly called the talent acquisition phase of the talent management cycle (see Figure 1), an important but preliminary step in the over- all process. The Talent Management Cycle includes the proactive analysis and planning to assure long-term strategic development and deployment of critical leadership and other resources through systematic identi- fication, assessment, planning, and devel- opmental action. The Talent Management Cycle is com- posed of several essential elements: 1.Talent Acquisition: Proactively recruiting world-class, diverse leadership talent and providing on-boarding support for them to accelerate their assimilation into their roles. 2.Talent Development: Developing and executing learning and development pro- grams, processes and assessment tools to grow current and future leaders 3.Performance Management: The process of creating a work environment in which people can perform to the best of their abilities. 4.Succession Planning: This is critical towards developing a leadership pipeline or assuring near-term leadership conti- nuity by thoughtful consideration of the availability, readiness, and development of internal talent (including High Potentials) to assume critical “priority” leadership roles. 5.Organisational Results: Achieving favourable and desired results is obviously the ultimate outcome expected out of any effective integrated talent management system. However it is a lagging indicator and business leaders will have to focus on the organisational climate which will have an impact on the other elements of Talent Management Cycle as explained earlier. The flow of effective communication and the systems of recognition and rewards are integral part of the climate which influences the talent’s performance effect- ing productivity, creativity and in driving results with the right impact. The climate is impacted by a values-driven leadership team. Conclusion Your organisation can create a new prod- uct and it is easily copied. Lower your prices and competitors will follow. Go after a lucrative market and someone is there right after you, careful to avoid mak- ing your initial mistakes. But replicating a high-quality, highly engaged workforce is nearly impossible. The ability to effec- tively hire, retain, deploy, and engage tal- ent — at all levels — is really the only true competitive advantage an organisation possesses. [The writer is the CEO of Centre for Executive Education (CEE) and Strategic Advisor of IPMA Asia Pacific. CEE is the executive development division of IPMA and offers executive coaching and leader- ship development programs that help profession- als develop the skills and knowledge to embrace change and catalyse success in their industries. Website: www.ipma.com.sg/cee.php Email: cee. singapore@ipma.com.sg.] Winning the war for talent 2.0 in Sri Lanka Sri Lanka faces challenges to ramp up its higher education system to staff its rapidly expanding economy. This creates major changes in the demand for knowledge workers and the skills they posses. Emerging countries that are building their exports need to prepare a large number of people to work in the industry. However, maximising their value requires us to know our talent, upcom- ing skills shortages and understand the impact of the social media infusion. Therefore the investments we make now in education will contribute significant- ly to economic growth and will be key to our current and future competitive- ness. Indeed, if the private returns are so high on these investments, most house- holds on their own accord are like- ly to make adequate investments in human capital development. However, the difficulty of borrowing to send children to school affects espe- cially the poor. Creditors cannot easily stake a future claim on embodied human capital as they can for other types of collateral and therefore many low-income families are forced to invest less in their children’s school- ing. These free market failures in principle suggest making conces- sionary loans available via the state. A more common, alternative is for the Government to reduce the direct costs for schooling by making quality public schooling available free or at subsidised rates. Most interventions gen- erally consist of making schooling available free and sometimes even com- pulsory. Research suggests the difference between social and economic returns from education at a macro level is probably higher at the primary and secondary levels than at the university level. Many positive spillo- vers come from literacy acquired at lower levels of schooling, while the returns from training at the university level are almost fully captured by the higher income of university grad- uates. Vocational training also has high economic payoffs, if it improves worker productivity. More important- ly, evidence suggests that vocational training is most cost-effective if the trainees have a solid base of primary and secondary education. All of this argues for primary and broad based secondary education as a means to improve a nation’s productivity and income distribution. Human capital formation Interestingly, higher shares of national income devoted to education cannot only explain the larger accu- mulation of human capital in some of the East Asian economies. In the ’80s, public expenditure on education as a percentage of GDP was not much higher in East Asia than elsewhere. In 1960s the share was 2.2 % for all developing economies, 2.4 % for Sub- Saharan Africa, and 2.5 % for East Asia. During the decades that followed, the governments of East Asia mark- edly increased the share of national output they invested in formal educa- tion, but so did governments in other developing countries. In the late 80s the share in Sub-Saharan Africa was around 4.1%, and was higher than the East Asian share, 3.7%, which barely exceeded the average share for all developing economies, 3.6%. Research suggests that allocation of public expenditure between basic and higher education is perhaps one of the top public policy factor’s that accounted for East Asia’s extraor- dinary performance in the area of providing basic education. Low pub- lic funding of secondary education results in poorly qualified children from low-income backgrounds being forced into the private sector or entirely out of the education system. Research suggests that the share of public expenditure on education allocated to basic education has been consistently higher in East Asia than most other regions. By giving prior- ity to expanding the primary and secondary bases of the education infrastructure, East Asian govern- ments have stimulated the demand for higher education, while relying to a large extent on the private sector to satisfy the demand at the skills for- mation level. In most developing regions, gov- ernments have subsidised university education which has also benefited families with relatively high incomes that could afford to pay fees clos- er to the actual cost of the university educa- tion. Vocational training For most success- ful export economies the training provided jointly to upgrade the skills of their work force has been crucial since high-level skills are essential for man- ufacturing related activities. But while vocational training is widely recognised as important, such train- ing is rarely cost-effi- cient when provided by the State systems. Most firms there- fore prefer to do their own training, partly because many skills are company specific. There is ample research to show that the return on the training investment is higher in industries that engage well- educated workers and also in envi- ronments where there is rapid tech- nological change. Singapore’s use of training to pro- mote the information technology sector through a concerted program that involved educational institu- tions, providing training subsidies to schools and office workers, and dig- itising of the civil service, helped the country to achieve leadership in tech- nology related ser- vices. This success illustrates the impor- tance of a govern- ment’s ability to fore- see a major oppor- tunity and then pro- mote public-private partnership to invest in human capital for- mation. However, to make it a success, busi- nesses must also stand ready to take advantages of the support the Government is will- ing to provide to pro- mote human capital formation. In addi- tion, the State should ensure that they maintain the per student share, in real terms, of Government fund- ing education. (The writer is a Senior Company Director.) SLneedstopreparealargenumberofpeopletoworkintheindustry Many positive spillovers come from literacy acquired at lower levels of school- ing, while the returns from training at the university level are almost fully cap- tured by the higher income of university graduates Emerging countries that are building their exports need to prepare a large number of people to work in the industry. However, maximising their value requires us to know our talent, upcoming skills shortages and understand the impact of the social media infusion. Therefore the investments we make now in education will contribute significantly to economic growth and will be key to our current and future competitiveness Guest Column By Dinesh Weerakkody Guest Column By Prof. Sattar Bawany