We have been flooded with many ‘hot topics’ on human resource issues in the past 10 years. At times, these reflect real concerns in business, but other times, they make us wonder if they were not created by some people just to make their jobs interesting.
So, could talent management be one of these trending topics? Will it soon vanish like smoke in the air?
According to the sixteenth Annual Global CEO Survey by PricewaterhouseCoopers Rwanda, 80 per cent of the local chief executives said the lack of key skills was a threat to growth, while 93 per cent said strategies for managing talent were a priority on their agendas. They are not alone. Globally, 77 per cent of CEOs in a PwC survey done in 68 countries said they anticipated changes to their talent management strategies this year. Talent management is not a mirage, but rather a real concern in Rwanda and beyond.
Talent management is the integrated process of ensuring that an organisation has a continuous supply of highly productive individuals in the right job, at the right time. It is a continuous process that plans talent needs, builds an image to attract the very best, ensures that new hires are immediately productive, helps to retain the very best and facilitates the continuous movement of talent to where it can have the most impact within the organisation. All this is aimed at increasing the overall workforce productivity through the improved attraction, retention and utilisation of talent.
We hear about talent management in different fora, but have we asked ourselves what happens to the millions of youth who graduate anually from universities worldwide?
Where do all these people go? Are job offers higher than the supply of talent? Is there a skills gap between the graduates and the market needs? Why does a CEO in Boston in the US share the same concern about talent management with his counterpart in Kigali? Are China and India with their population advantages hit as hard as smaller countries?
Even though the problem is common to business leaders everywhere, the intensity varies depending on industry, geographic location and market position. Globally, the pharmaceutical sector is facing the worst talent shortage, with 51% of employers facing hiring difficulties. Talented middle managers are also the hardest to find. As odd as it sounds, lack of talent is already having a big impact in China and India.
The talent challenge in the developed countries is different from that of Africa. Compare Europe’s aging workforce combined with low birth rates to Africa’s rising middle class, youthful population and improving education systems. Globally, however, many business leaders share a concern about the quality and relevance of skills, particularly among recent university graduates.
In Africa, in theory, if the issue was purely demographic, we should not suffer from talent scarcity. In reality, the African Association for Public Administration and Management observes that the continent has not been able to recruit and retain well-trained and skilled personnel.
The identified challenges are mainly poor compensation, uncompetitive working environment and brain-drain. Many businesses in Africa spend millions of dollars annually to recruit and pay a few expatriates, but fail to spend even a third of that to attract and retain the African professionals now working in other continents. Other companies have found that the global economic downturn has led to a rise in Diaspora interest in home markets, where growth and opportunities are stronger. Still others actively poach talent from local competitors or from neighbouring countries in Africa.
The consequences of a talent shortage are many, including unexpected rise of talent-related expenses, lack of innovation and the reduction of quality.
So, as a senior executive and HR practitioner, have you identified your talent needs? Do you know who your talented employees are? What are the pivotal roles in your company? Do you have any data about your people return on investment? Do you have a plan? Have you aligned your business plan and talent strategy?
Firms cannot grow without the people to make it happen. Getting it right means that you worry less about your talent problem and more about your business opportunities, Rwanda is no exception.
The writer is a people and change consultant at PwC Rwanda.