There is a storm brewing that threatens to disrupt the global marketplace — the baby boomers’ impending retirement in developed countries, aging populations worldwide because of declining birth rates and longer average life spans, a widening skills gap and an insufficient amount of people entering the workforce are all factors that, when combined, could create a perfect storm that will threaten every type of industry and employee group.
Some of the storm warnings are already out there. The United Kingdom predicts that it will face a shortage of up to 500,000 professionals with top-end networking skills within the next three years. This means South Africa can brace itself for some serious headhunting from U.K. companies, a situation that could exacerbate a local shortage.
It is estimated that by 2010, the number of 35- to 44-year-olds (those normally expected to move into senior management ranks) will have declined by 10 percent. This age group is expected to shrink by 19 percent in the United Kingdom, by 27 percent in Germany and by 9 percent in Italy.
By 2010, India will need about 250,000 leaders at different levels, according to the country’s National Association of Software Services Companies, but it is expected there will be a shortfall of one-third of that number.
We are receiving many such storm warnings from all over the world. The question is: Will global leaders heed these warnings?
During the research for my book “Leadership Without Borders,” I surveyed and interviewed hundreds of senior leaders around the globe, and I found that the need to attract and retain talent is on the mind of every global leader.
“We are experiencing a shortage of skilled labor globally,” said Luc Bollen of Hilton Hefei in China. “The economic growth of China surpasses even the rate at which China graduates people through its universities. There is still a serious shortage of skilled labor and management in the labor-intensive hospitality industry.”
Clive J. Pegg of Bayer CropScience in India echoed the sentiment.
“There appears to be less loyalty to particular companies than there has been in the past,” Pegg said. “Even though you have succession plans in place, unplanned turnover is dislocating businesses.”
So, how does a leader attract and retain the best talent? Here are two methods world-class leaders use that can be implemented easily throughout your organization:
1. Leaders should help their organization be an employer of choice. Characteristics of an employer of choice include high visibility and name recognition, approachable senior leaders (especially the CEO), a reputation for being successful, a high number of applications received for each opening and a corporate culture that is held in high regard. People also want to work for companies in which the existing employees are content, turnover is low and job security is considered high. Companies that wish to attract and retain talent should assess how they treat their employees. Those that treat their employees poorly or think that just increasing compensation retains talent will lose their best people to other companies offering a better package of benefits.
2. Leaders should make it easier to stay than to leave. Many companies have rules regarding how and when people can transfer from one part of the organization to another. For some, it is as short as six months, and for others, it as long as two years. But when an employee wants to try something new, if the organization does not make it available, its leaders are actually creating an environment in which it is easier to leave the organization than to grow within it.
When I was at Booz Allen Hamilton, our chairman, Dr. Ralph Shrader, repeatedly said: “I would rather see Booz Allen on your business card than on your resume.” The company established a career mobility program that allowed employees to apply for internal positions.
At Satyam Computer Services, my current organization, movement isn’t only encouraged — it is rewarded. Movement is available to the company’s top performers as a way of motivating, rewarding and encouraging broad experiences. Those who have the greatest variety of experiences are those who move up the career ladder the fastest.