Global Talent Management

 

Global Talent Management

Talent management has gained mainstream acceptance in the practitioner community as a key management activity in recent years. This was prompted by research, in the late 1990s, by a group of McKinsey consultants who coined the phrase “the war for talent” to reflect the central importance of employees to the success of top performing companies (for a summary see Michaels, Handfield-Jones and Axelrod, 2001). Although the global aspect of talent management may not have received explicit emphasis in the consultants’ early work (neither multinational, global, nor international appear in the index to the Michaels et al, 2001 text) tellingly the vast majority of companies on which their research ware based all had some degree of international operation.

The interest in talent management has not abated in the past decade. A recent report highlighted that seven in ten corporate leaders spend in excess of 20 per cent of their time on talent management activities (Economist Intelligence Unit, 2006). It seems that Chief Executive Officers CEO’s are increasingly realizing that talent management is so important that it cannot be left to the HR function alone (Economist Intelligence Unit, 2006). The Boston Consulting Group (2007) found that, although viewed as being of critical importance, talent management was one of the areas in which firms were least proficient. Even more recently, a review by Beechler and Woodward (2009) concluded that notwithstanding the current economic climate “talent remains a critical agenda item” for key organizational decision makers.

 While practitioners’ interest in the topic of talent management has been gaining momentum, academic research on the same topic has been developing at a slower rate. This special issue is intended to contribute to the emerging academic literature on global talent management and to advance the conceptual and empirical grounding of this emerging area of interest. We begin by considering some of the debates around the conceptual and intellectual boundaries of global talent management. We then consider the factors which have contributed to the increasing interest in 3 global talent management. Finally we conclude by outlining the contributions to this special issue of Journal of World Business.

 

The conceptual and intellectual boundaries of global talent management

One of the key challenges which talent management has experienced in establishing its academic merits over the past decade has been the unresolved issue around its definition and intellectual boundaries. As Lewis and Heckman (2006: 139) conclude there is “a disturbing lack of clarity regarding the definition, scope and overall goals of talent management”

 

In this regard Lewis and Heckman identify three key streams of thinking with regard to what talent management is. The authors aligned with the first stream appear to be merely substituting the label talent management for human resource management, often limiting their focus to particular HR practices such as recruitment, leadership development, succession planning and the like. A second stream emphasizes the development of talent pools focusing on “projecting employee/staffing needs and managing the progression of employees through positions” (Lewis & Heckman, 2006: 140) typically building upon earlier research in the manpower planning or succession planning literatures. The third stream focuses on the management of talented people. This literature argues that all roles within the organisation should be filled with “A performers”, referred to as “topgrading” (Smart, 1999) and emphasises the management of “C players”, or consistently poor performers, out of the organisation (Michaels et al., 2001). Collings and Mellahi (2009) identify a further stream. This stream emphasizes the identification of key positions which have the potential to differentially impact the competitive advantage of the firm (Boudreau & Ramstad, 2007; Huselid et al., 2005).

The wide variation in how talent management is defined raises two key challenges which apply equally to global talent management. The first challenge is that scholars in this area need to gain clarity and build consensus regarding the meaning of global talent management from practical, 4 conceptual, and theoretical perspectives. The second key challenge is that global talent management needs to differentiate itself from international human resource management. That is not to say that global talent management cannot draw upon international human resource management (Schuler, 2010), but it must differentiate itself from international human resource management to have merit in being studied in its own right

However, as noted above, a separate stream of literature emphasizes (Boudreau & Ramstad, 2007; Huselid et al., 2005) the importance of the positions which these talented individual employees fill in the context of talent management systems and argues that this should be the point of departure for talent management systems. Finally in the global context there is also scope for comparative studies which consider how talent management systems operate in different national contexts.

 

Framework for Global Talent Challenges and Global Talent Management Initiatives

Source: (carin,  and silwa, 2008)

 

Factors influencing the emergence of global talent management

Global talent management is a relatively new multi-disciplinary field of enquiry which has emerged in recent years as a key strategic issue for multinational corporations for several reasons. First, there is a growing recognition both of the critical role played by globally competent managerial talent in ensuring the success of reflecting the intensification of global competition and the greater need for international learning and innovation in multinational corporations (Bartlett & Ghoshal, 1989).

 Second, competition between employers for talent has shifted from the country level to the regional and global levels (Sparrow et al, 2004). There is a growing recognition that multinational corporations need to manage talent on a global basis to remain competitive and that talent may be located in different parts of their global operations (Ready and Conger, 2007). multinational corporations are facing growing difficulties in recruiting and retaining the necessary managerial talent for their global operations and increasingly multinational corporations compete for the same global talent pool (Stahl et al, 2007).

Third, shortages of managerial and professional talent have emerged as the key HR challenge facing the majority of multinational corporations. (Bjorkman and Lervick, 2007; Scullion and Starkey, 2000). Fourth, research highlights that shortages of international management talent have been a significant constraint on the successful 6 implementation of global strategies (Cohn et al, 2005) and shortages of leadership talent in particular was identified as a major obstacle many companies face as they seek to operate successfully on a global scale (Stahl et al, 2007). Finally, the growth of the emerging markets has resulted in a further demand for a distinctive type of managerial talent which can operate effectively in these culturally complex and geographically distant markets (Scullion, Collings and Gunnigle, 2007).

On balance, this suggests that, while the rhetoric of maximizing the talent of individual employees as a unique source of competitive advantage for multinational corporations has been central to the discourse surrounding strategic HRM in recent years, the extent to which organizations effectively manage their human talent  especially on a global scale often fails to live up to this hype (Scullion & Collings, 2006). Research has suggested that multinational corporations are frequently unable to identify who their most talented employees are and where they are located around the world (Collings, Scullion & Morley, 2007). Global talent management is critical because it is impossible for firms to leverage an asset, they do not realize they have.

 

Contributions to the special issue

The paper by Doh, Stumpf and Tymon examines the challenges of talent management of knowledge workers in India, one of the largest and fastest growing emerging economies in the world where economic activity has considerably outpaced the availability of skilled employees. The authors develop and test a model of talent management with data from 28 Indian companies and almost 5,000 professional staff. The paper highlights the importance of intrinsic rewards as a key element of the talent management system in the Indian context and suggests that employers should more closely examine non pecuniary mechanisms to encourage employee retention and employee satisfaction, particularly in challenging labour market environments.

 

Next, McDonnell, Lamare, Gunnigle and Lavelle seek to redress the empirical deficit in the study of Global talent management  through an empirical study using empirical data from 260 multinational enterprises  in Ireland. Their study highlights that many multinational enterprises continue to adopt an ad hoc rather than a strategic approach to the management of their high potential staff and that integrated approaches to talent management are far from universal. One unexpected finding was that multinational corporations operating in low tech\low cost sectors are significantly more likely to have formal global talent management systems.

 

List of References

Bartlett, C.A. & Ghoshal, S. (1989). Managing across borders: The transnational solution. Boston: Harvard Business School Press.

 Becker, B.E., Huselid, M.E. and Beatty, R.W. (2009) The Differentiated Workforce: Transforming Talent into Strategic Impact, Boston, Harvard Business School Press.

Björkman, I.& Lervik, J.E. (2007). Transferring HR practices within multinational corporations. Human Resource Management Journal, 17(4): 320-335.

Boston Consulting Group (2007) The Future of HR: Key Challenges Through 2015. Dusseldorf, Boston Consulting Group.

Boudreau, J.W. and Ramstad, P.M. (2007) Beyond HR: The New Science of Human Capital, Boston, MA, Harvard Business School Press.

Beechler, S. and Woodward, I.C. (2009) “The global ‘war for talent’, Journal of International Management, doi: 10.1016j.intman.2009.01.002

Cappelli, P (2008). Talent on demand: Managing talent in an age of uncertainty. Boston: Harvard Business Press.

Cohn, J.M., Khurana, R. & Reeves, L. (2005). Growing talent as if your business depended on it. Harvard Business Review, 83(10): 62-70.

Collings, D.G. and Mellahi, K. (2009) “Strategic Talent Management: What is it and how does it matter?”, Human Resource Management Review, doi: 10.1016/j.hrmr.2009.04.001

Economist Intelligence Unit (2006) The CEO's role in talent management: How top executives from ten countries are nurturing the leaders of tomorrow. London, The Economist.

Huselid, M.A., Beatty, R.W. and Becker, B.E. (2005) “A Players’ or ‘A Positions’? The Strategic Logic of Workforce Management”, Harvard Business Review, December, 110-117