Time for action - Talent managers get a wake-up call

This time last year, all business eyes were on the recession. Retrenchments and wage cuts were the order of the time, and most workers were only too happy to cling to the positions they had. But things can turn around very quickly, and in May 2010, the downturn is now behind the majority of Asian economies.

Skilled workers meanwhile have developed itchier feet. While they may not be formally leaving their employers just yet, they are certainly much more open to new roles and opportunities than ever before. New research shows staff retention is set to become a number one business issue in the months ahead.

As part of an advanced economy, Singapore HR should be well on top of these and other people issues. But the same data suggests there is certainly room for improvement. Professional workers are aware their stock is high at the moment, and in many organisations that may be enough for them to leave.

The time to move

During the financial crisis, many organisations took necessary and accepted action on their headcounts. Whether it was freezing hiring or salaries, cutting bonuses or even downsizing their total employment, most saw these as reasonable responses to the drastic cut in demand that occurred throughout the first half of last year.

But with the Asian recovery now in full swing, workers are expecting much more from their organisations. And they appear prepared to switch jobs in order to get it.

Towers Watson’s Global Workforce Study, released on April 15, shows this is a particular issue in Singapore. Only a quarter of the more than 1000 local staff it spoke with said they had “no plans to quit” their current positions. The majority were much more ambivalent, with a significant 47% saying they would “consider” any alternative offers that were made.

Hong Kong workers, by contrast, are showing nearly twice as much loyalty to their current employers. Some 48% told Towers Watson they had no plans to quit, with the next 33% considering a better job only if it was offered.

Brent Ruge, Head of Employee Survey, Southeast Asia, Towers Watson, says Singapore's was the highest rate of apparent discontent in Asia but organisations do have time and space to correct any issues. “It’s not necessarily a red flag, but it’s a yellow flag,” he tells HRM. “Companies need to step up their efforts to address the things that are of most concern to their employees.”

Dave Ulrich, Partner of the US-based RBL Group, says talent issues are vital for Singapore in particular. “Because Singapore depends so much on knowledge, managing talent is critical to industry and government success,” he tells HRM. “Talent matters in (both) up and down business cycles; talent enables other business outcomes (such as innovation and service); talent ensures future success.”

The value of leadership

So what’s driving employees away, or at least pushing them slowly towards the door? According to Towers Watson, it’s gaps in leadership and career development most at fault. These were the top two responses (respectively) to questions on what drives retention and engagement in the Singapore workforce.

“People felt that their current leadership was really good at executing on goals and objectives,” Ruge says. “But the people issues aren’t being handled as effectively.” Instead, workers are looking for top-level leadership to take more of an interest and higher buy-in into their individual work efforts and development opportunities.

“Only 46% of workers felt that their leaders were doing a good job on poor performers,” Ruge says as an example. Even more importantly, staff are becoming anxious about their own opportunities for promotion and advancement.

“Sometimes people feel that the number of job levels has been flattened so there are fewer opportunities available,” Ruge says. “So 72% of workers (surveyed) want a better defined career path – that’s a real gap that management can focus on.”

The situation has become so desperate in some cases, that it is cited as a reason to leave current positions. The survey found that 57% of workers felt that their only option for career advancement was to leave their present organisation for an opportunity elsewhere, setting up the second half of 2010 as a year with great potential for job hopping and retention issues.

“When you have more than half of the workforce saying their only viable option is to go elsewhere, that will potentially create a lot of churn in the job market.”

Insights to focus on

These are issues HR needs to address as early as possible. But what should be the primary focus? Ulrich says there are a number of things HR and line managers can do to ensure talent returns to the forefront of business strategy. “Throughout Singapore, line managers must take ownership, primary accountability, and responsibility for talent,” he says.

The problem can be when these key staff become “overwhelmed” with the wide range of ideas, frameworks and tools that fall under the “talent” umbrella. “Almost daily, another invitation shows up with the latest talent gimmick that is the secret sauce for organisational success,” Ulrich notes. Instead, the RBL Group offers 11 insights for HR and line managers to focus on in their talent deliberations.

From recognising talent as the key source of growth to championing diversity and HR’s role in talent strategy design, these insights (see below) offer businesses a clear framework for reworking their talent and retention plans.

Some work ahead

As we get closer to the second half of this recovery year, Singapore’s HR appears to have a lot of work to do in addressing these insights. As part of its talent study, the RBL Group surveyed a range of employers throughout Asia, asking each how they ranked themselves according to its 11 criteria.

The responses came back largely in the “average” range, most organisations giving themselves three (out of five) stars for their ongoing responses to the 11 RBL insights. But interestingly, the 320 Singaporean employers rated themselves lower than the Asian regional average in each of the criteria (see table below).

Ulrich says this doesn’t necessarily mean Singapore organisations are actually further behind the eight ball – there are a number of other possible explanations. “This may be a response bias where (survey participants) respond with a sense of humility,” he says. “It also may indicate that while talent management matters in Singapore, the efforts to define and deliver talent are underdeveloped.”

Peck Kem Low, Director, National Human Capital Office and People Matters Department, Ministry of Manpower, has one more possible explanation, saying local organisations are more aware of these issues than many of their counterparts around Asia. They have therefore set the bar higher in terms of what they feel they should be achieving in the field of talent management.

“Lower talent dimension scores do not necessarily conclude that the quality of the talent practices in Singapore is inferior to those in Greater Asia,” she tells HRM. “Singaporeans may have higher standards or expectations compared to the Greater Asia workforce.”

Of course, that doesn’t mean there isn’t room for improvement. “It also suggests that there is indeed more work to be done to improve talent management practices in Singapore,” she says, urging companies to seriously study the latest research.

Low says three of the 11 insights hold particular value for Singapore in this recovery period. She says investment in talent should be a priority for all organisations, as should creating an alignment between talent management and overall business strategies, and building more synergy and collaboration between HR and line managers.

She says these will help to build the added goal of improved productivity throughout the local economy. “Companies need to help their employees continually upgrade their skills, find ways to work more efficiently and look at innovative ways to produce higher quality products and processes,” she says. “HR plays a very important role here to support and facilitate.”

Leading by examples

There are a number of local employers leading the way in terms of talent management practices. The Ministry of Manpower says these investments are giving each of them a clear competitive advantage, while also helping to attract and retain talent.

Singapore’s world famous Raffles Hotel is one example. It has placed all its managerial-level staff on a compulsory 90-day training course outlining the fundamentals of leadership within the hotel. Low says this worked to equip leaders with the skills to effectively select, orient, develop and retain their workers. It inspires them to also build engagement, manage performance and celebrate and reward successes.

Low says smaller organisations can also make their mark. She cites Quayside Dining, a small chain of five family-owned restaurants in Singapore, as another standout effort when it comes to best talent management practices. “Despite being relatively small, Quayside Dining is committed to provide its employees with a good working environment and attractive compensation and benefits to attract the best talent in the industry,” she says. Quayside recently invested in its first full-time HR professional to help the organisation formalise and professionalise its HR and talent management processes.

The critical difference

Low says strong talent management is likely to be the key difference for organisations as Asian economies move into what is expected to be a highly-competitive new phase. But while redirecting focus may be difficult or time consuming, there are significant long-term gains available for business.

“Workers who are given training opportunities for personal and professional development, and are well-compensated and fairly treated, will likely be happier, more motivated, and more productive as a result,” she says. “HR must convince management this is an important business strategy regardless of the industry.”

Ulrich is in strong agreement. “Understanding and managing talent will continue to be an important factor in business performance, especially in a knowledge economy such as Singapore’s,” he concludes.

The RBL Group's original analysis of the Singapore workforce, can be found at: http://www.hrmasia.com/news/features/managing-talent-in-singapore/46102