The challenge for organizations today is to implement frameworks for talent retention and development that will address the changing face of competition.
While global issue centers around talent retention and development, the Indian industry is specifically facing one of its biggest challenges – how to retain talent and bring out the best in talented employees. The Indian economy has grown at an average rate of over 7% in the last decade. This growth has led to new opportunities for employees in both private and public sectors. We have a free market economy where employees can choose to change jobs with a relatively short notice to the employer. Employees are now also open to geographic relocation for better opportunities. During the last two decades, the Indian economy witnessed an unprecedented entry of foreign-origin companies that established offices either to provide back-office support for the western markets or to cater to the growing Indian market. This expansion has fueled a demand for quality employees. The rising aspirations of over a billion people looking to better their position from bigger salaries present a major challenge to businesses in the country. In such a scenario, how do companies retain their talented employees? When talented employees leave, they take away valuable institutional knowledge, dampen the momentum for growth strategies, and not to speak of the time, cost, and energy, that senior members in the organization spend in seeking replacement – valuable time and energy that could have been better spent in driving growth strategies.
The challenge for companies is to devise innovative programs to retain their talented employees. Interestingly, one of the statistics available in the public domain shows that a leading reason for people leaving their jobs is because of dissatisfaction with their immediate managers. In a country like India, we have a young working population that produces many managers with relatively short work experience and they manage large, diverse groups of employees. How competent are our managers to lead the young breed of employees who have high aspirations with lucrative jobs options in front of them?
There is a need to assess whether we have the bandwidth to develop managers with strong leadership capabilities that include mentoring, motivating, and leadership in a manner that will encourage employees to build a career in the organization as opposed to perpetually seeking jobs outside. In a market-driven economy, where everything is viewed in the short-term, are our business managers myopic about the most important asset of the organization – talented employees who work towards the company’s goals? It is very important to understand the abilities and personality of employees when employee-related decisions are made. Most employers limit their recruitment process to job interviews. What needs attention is how much do we really know about an individual through interviews? Are we able to motivate them? Do we have a good job fitment for the individual? Are the current rewards programs in organizations leaving a lot of employees feeling dissatisfied? Monitory rewards give only transient satisfaction, and many are not motivated solely by monitory consideration anyway. Perhaps recognition, achievement, learning, or a challenging work environment, are drivers that motivate them to wake up in the morning and cheerfully report to work. Some of the personality dimensions and values that drive employee behavior can be assessed at the time of recruitment, and such information will be extremely useful as employers make hiring and employee development decisions.
A less-than-adequate education system, that emphasizes rote learning over intellectual development, might be creating an army of semi-qualified individuals entering the workforce every year, while technically sound and otherwise talented employees depleting in number. The high demand for this limited pool of talented employees gives rise to the propensity to change jobs frequently. Although employers view frequent job changes in a resume as unfavorable, given the talent shortage, they sometimes do not have the choice but to hire such frequent job-changers even when these employees have a greater likelihood of leaving the company and contributing to high turnovers. The most pertinent question then is whether companies tend to be reactive to crisis situations of employee exodus or do they view the issue of talent retention and development strategically.
The challenge ahead for businesses, small and big, is to implement frameworks for talent retention and development that are informed by factors such as the changing face of competition, limited talent pool and personal variables of employees. Talent retention and development today is not a supplementary task that enjoys a passing mention in HR practices, but a core activity deserving serious attention and resources, and upon which lie the present and future success of the business.
by Sushil Eapen, MD, Pearson Clinical & Talent Assessment.
As appeared in People Matters, on 15th April 2011. The article is available at: http://peoplematters.in/articles/leadership/talent-strategy-no-more-a-supplementary-task