Challenges of Acquisition and Retention of Talent in an era of Brain Drain

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Challenges of Acquisition and Retention of Talent
in an era of Brain Drain

• Global Human Resources Development Symposium on
  Human Capital Development
• Coventry, United Kingdom 21-25 July, 2008
•  
• Mike Nxele,
• Human Resources Officer
• Telecommunications Development Bureau

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65 YEARS AGO

• The empires of the future will be
• the empires of the minds.
• -Winston Churchill, 1943

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11 YEARS AGO

• Take away our 20 most important
• people, and I tell you we would
• become an unimportant company.
• -Bill Gates, 1997

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10 YEARS AGO

• Having better talent at all levels
• is how you outperform your
• competitors.
• - McKinsey, 1998
• The War for Talent

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2 YEARS AGO

• To be sure, the old battles are still with us,
  but
• they are being supplemented by new ones for
• talent not just among companies (which are
• competing for human resources) but also
• among countries (which fret about the balance
• of brains as well as the balance of power).
• - The Economist, 2006
• The Battle for Brainpower

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TODAY

• In an age in which growth is largely a product
• of creative and technological advancements,
• companies that want to dominate their industries
• must be able to attract and retain talented
• employees.
• Deloitte Consulting LLP, 2007
• Coming of age

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TODAY

• Companies failing to address their Talent
• Management challenges over the next three
• years will feel the pain where it hurts most
• in limited growth, reduced innovation, damage
• to customer relationships.
• Deloitte Consulting LLP, 2008
• Competing for Talent

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Relating Talent to Growth!!
Source Deloitte Consulting LLP, 2008 Talent
Management for the Technology Sector
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Characteristics of the Talent Shortage

• It is global
• Every country is experiencing the shortage, from
  the developed to the developing.
• It is cross-sectoral
• Every sector, from Telecommunications to health,
  aviation, legal, finance, technology.
• It is across functions
• From skilled artisans to middle managers to
  leadership levels.

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Characteristics of the Talent Shortage

• The shortage is more in some countries than
  others and in some sectors than others.
• It is acknowledged that the shortage in the
  health sector for example is acute. There is a
  shortage of doctors, nurses, health care staff.

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TALENT SHORTAGE IN TELECOMS
Current and anticipated talent shortages
leadership
Current and anticipated talent shortages
technically skilled talent
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CAUSES OF THE CURRENT GLOBAL TALENT SHORTAGE

• An imbalance between demand and supply,
• with demand far exceeding supply.
• Demand side
• Global Economic Growth in past 20 years)
• Growth in the Technology and Telecoms Sector
• Supply side
• Retirement of Baby Boomers
• Declining Student Intakes
• Changing working patterns

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DEMAND SIDE

• 10 expected growth in Technology market by 2012
• 45 growth in professional categories(2004-2014)
• Systems engineers(55) software publishers(68)
  by 2012.

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CAUSES OF THE GLOBAL Talent Shortage

• Demand side - some statistics
• 30 growth of IT industry in India for past
  10years. An anticipated shortfall of 500,000
  professionals by 2010.
• China will need over the next 10-15 years 75,000
  leaders able to work in multinational
  corporations today they have only 3,000 5,000.
• More than 2m job openings in science, technology
  and engineering by 2014 .

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CAUSES OF THE GLOBAL Talent Shortage

• Supply side some statistics
• Retirement of the Baby BoomersThe prime-aged
  share of the workforce face a steady decline of
  7 up to 2020.
• The number of graduates in science and
  engineering graduates is constant for 2 decades
  despite an anticipated growth in demand of 26.

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THE BRAIN DRAIN

• Increasingly, countries are beginning to behave
  and act like organizations. When they have a
  shortage of something, they lure it from
  somewhere.
• The developed world met their talent needs by
  tapping from the developing world, causing what
  has come to be known as the Brain Drain.

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THE BRAIN DRAIN

• As the Talent Crunch bites more,
• Threat of Brain Drain heightens.
• But
  unlike before, this
• time
  everybody is
• 
  growing, and needs
• the
  Talent too!!!

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THE BRAIN DRAIN (Defined)

• Loss of Skills through emigrations.
• Sometimes called Lost Human Capital.
• Developing countries and LDSs in particular tend
  to be the victims.
• Loss is usually permanent and one way.
• The West experience Brain Circulation and Brain
  Exchanges where the movement is two way, with
  skills moving among different countries.

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Talent Acquisition Strategies

• The USA uses the Green Card.
• The Germans introduced a version of a Green Card
  in 2000 to lure IT professionals.
• EU just introduced its own Blue Card.
• New Zealand uses a Scoring System.
• Singapore has introduced automatic work permits
  for students from developed nations.

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BRAIn drain BRIEF STATISTICS

• One million skilled persons from LDCs were
  living and working in the developed countries in
  2004.
• Some LDCs have been losing more than 30 of
  their skills.
• 300,000 African professionals in the Diaspora,
  30,000 of them hold PhDs, 20,000 lost each year
  and US 4 billion lost through recruitment of
  expatriates.

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BRAIN DRAIN IN SOME LDCS
Source UNCTAD, Least Developed Countries Report
2007
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BRAIn drain BRIEF STATISTICS (Contd)

• African governments have a great responsibility
• to ensure that brains remain on the continent,
• otherwise in 25 years time, Africa will be empty
  
• of brains.
• Dr Lalla Ben Barka,
  ECA(2000)

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RETHINKING BRAIN DRAIN

• Is the Brain Drain an inevitability for the
  Developing World?
• Some think Brain Drain is outdated, we can have
  Brain Circulation or Brain Gain by reversing the
  Brain Drain.
• To do this you need to address the reasons why
  Talent leaves in the first place.
• Do what the West does. If you cant beat them,
  join them.

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What exactly do talented people want?

• A growing economy that provides for opportunities
  for growth, employment and wealth creation.
• A good return for their skills.
• Good government, good government policy and
  political stability.
• Flexible immigration laws.
• Freedom, Space, Challenge.

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HOW ABOUT THE PAY CHEQUE??

• Telecom companies have been accused of using
  financial rewards to attract and retain Talent.
• This is considered old-fashioned, and works only
  in the short term.
• Pay is a knee-jerk approach rather than a real
  strategy.

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Brain drain reversal the evidence

• India
• India has the worlds 4 largest GDP (PPP)
• Poverty halved in 20 years (27.5 PDL in 2004-05
  51.3 in 1977-1978)
• Adult literacy rose from 50 to 61 (1990 - 2004)

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Brain drain reversal the evidence

• IT industry has been growing at an average 30
  for the past 10 years.
• The big 6 software companies alone recruit over
  100,000 people in 2007-2008.
• Colleges cannot cope with demand graduates are
  being recruited a year before completing College.
• Indian companies now pay global salaries.

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The Result??

• 40000 arrivals in Bangalore in 2007 from overseas
• 72 IIT graduates see India as having most
  promising future (only 17 mention USA)

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The result??

• Indian officials are talking of a Brain Drain
  Reversal.
• Drop in numbers of graduates thinking of
  emigrating, from 75 in 80s to 28.
• From Body Shopping to Off-shoring, Outsourcing is
  helping with the Brain Drain Reversal.
• India is ranking on the Brain Drain Index
  improved from 3.0 to 6.76.(Score 10 less danger
  of Brain Drain)
• India is in the top 10 in the Global Talent Index
  and its position is estimated to remain steady
  until 2012 (no. 10).

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Brain drain reversal the evidence

• China
• 2nd largest economy in the world after the US in
  2007 average 10 p.a. growth
• Will catch up the US (PPP) as an economic power
  by 2020
• Job opportunities far outstrip the skills
  available

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The result!!

• Number of Chinese students not returning after
  studies abroad has been declining. Of the 100,000
  going abroad each year, 20,000 returned in 2008
  25,000 returned in 2004 and 30,000 returned in
  2005 and the number has been increasing.
• Compared with the period 1978-2006, out of 1.06
  million who went overseas, only 275,000 returned.
• China is ranked 8th on the top in the Global
  Talent Index and it set to improve this ranking
  to 6th position by 2012.

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CHINESE STUDENTS RETURING HOME
Source The Economist, 2006-10-07 The Battle for
Brain Power, a survey of talent
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REASONS FOR RETURNING HOME
SourceInterviews with CAS scientists, 2002 and
2004, N-86. Note People could select more than
one reason.
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Lessons from China and india

• It is possible to attract back Skills and Talent
  that has been lost.
• It requires a set of policies and programs at the
  national level to attract returnees and make them
  feel welcome and valued.
• More importantly, it requires local companies to
  be competitive with the organizations in the
  global market.

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The holistic approach

• Good Talent Management looks at the entire Talent
  Management Value Chain, not just the Acquisition
  and Retention elements.
• HR must adopt a Talent Mindset and be the
  Organizations Talent Advocate.
• Treat Talent as a Strategic National Asset

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Parting shots

• If you dont value your talented people, somebody
  else will.
• Valuing your talent is the first line of self
  preservation.
• ASK them what they VALUE.
• Think Global, Act local.
• In a global talent marketplace, politics is
  economics, and economics is politics.
• A new Role for policymakers and Regulators.