Visegrad Fund
Integrated Talent Management Challenge and Future for Organizations in Visegrad Countries
Dana EGEROVÁ, Ludvík EGER, Milena JIŘINCOVÁ, Drahoslav LANČARIČ, Radovan SAVOV, Ladisla SOJKA, Viktória ALI TAHA, Michaela SIRKOVÁ, Zuzana KAŠČÁKOVÁ, Csilla CZEGLÉDI, László HAJÓS, Zsuzsanna KUNA MAROSNÉ, Tadeusz LECZYKIEWICZ, Agnieszka SPRINGER, Katarzyna SZYPUŁA
Plzeň, 2013
Dana EGEROVÁ, Ludvík EGER, Milena JIŘINCOVÁ, Drahoslav LANČARIČ, Radovan SAVOV, Ladislav SOJKA, Viktória ALI TAHA, Michaela SIRKOVÁ, Zuzana KAŠČÁKOVÁ, Csilla CZEGLÉDI, László HAJÓS, Zsuzsanna KUNA MAROSNÉ, Tadeusz LECZYKIEWICZ, Agnieszka SPRINGER, Katarzyna SZYPUŁA
INTEGRATED TALENT MANAGEMENT CHALLENGE AND FUTURE FOR ORGANIZATIONS IN VISEGRAD COUNTRIES
Plzeň, 2013
Project: “Integrated Talent Management - Challenge and Future for Organisations in the Visegrad Countries“
International Visegrad Fund, Standard Grant No. 21220142 01/2013 – 12/2013 Scientific exchange and research Project co-ordinator CZ – University of West Bohemia Project partners
SK – Slovak University of Agriculture in Nitra SK – University of Presov in Presov HU – Szent István University, Gödöllő PL – Poznan School of Banking
The monograph was published with the support of International Visegrad Fund and the University of West Bohemia.
Authors PaedDr. Dana EGEROVÁ, Ph.D. doc. PaedDr. Ludvík EGER, CSc. Ing. Milena JIŘINCOVÁ Ing. Drahoslav LANČARIČ, Ph.D. Ing. Radovan SAVOV, Ph.D. doc. Ing. Ladislav SOJKA, CSc. Ing. Viktória ALI TAHA, PhD. Ing. Michaela SIRKOVÁ, PhD. Ing. Zuzana KAŠČÁKOVÁ doc. Csilla CZEGLÉDI, Ph.D. prof. László HAJOS, CSc. Zsuzsanna KUNA MAROSNÉ prof. Tadeusz LECZYKIEWICZ Agnieszka SPRINGER, PhD. Katarzyna SZYPUŁA, MA.
Chapters Chapters Chapter Chapters Chapters Chapters Chapters Chapters Chapter Chapters Chapter Chapter Chapter Chapters Chapter
Editor PaedDr. Dana Egerová, Ph.D. Reviewers doc. PhDr. Josef Malach, CSc. prof. Ing. Iveta Ubrežiová, CSc.
Scientific review by NAVA ISBN 978-80-7211-454-2 Published in the Czech Republic by NAVA, 2013
1.1, 2.1, 2.2 2.1, 3.1 3.3 2.1, 2.2 2.1, 2.2 1.1, 3.4 2.1, 2.2 2.1, 2.2 3.4 2.1, 3.5 3.5 3.5 1.2 2.1, 3.2 3.2
Contents INTRODUCTION ..................................................................................................................... 7 PART ONE: TALENT MANAGEMENT - THEORETICAL FRAMEWORK ................... 9 1.1.
Talent Management - Critical Issues ................................................................................... 10
1.2.
Talent Management - New Challenges for Contemporary Organizations ..................... 42
PART TWO: TALENT MANAGEMENT IN VISEGRAD COUNTRIES - RESEARCH SURVEY ................................................................................................................................. 61 2.1.
Applying the Concept of Talent Management in Visegrad Countries ............................ 62
2.2.
Comparison of Talent Management Practices in Visegrad Countries ............................ 80
PART THREE: CASE STUDIES ........................................................................................ 91 3.1.
Talent Management - Mondelēz International .................................................................. 92
3.2.
Integrated Talent Management in Carlsberg Accounting Service Centre Sp. z. o. o. . 99
3.3.
Talent Management in the Telecommunication Company ............................................. 108
3.4.
Talent Management in T-Systems Slovakia s.r.o. .......................................................... 116
3.5.
Integrated Talent Management at K&H Bank .................................................................. 126
REFERENCES..................................................................................................................... 140 SUMMARY ........................................................................................................................... 148
Introduction As a result of the dynamic demographic, economic and social changes the concept of talent management has become one of the most important topics in today´s organizations. Organizations are beginning to realize that talent is a core competitive asset and a key factor of organizations´ success. It has become obvious that talent management is one of the key challenges to the organizations in Visegrad countries today and in the future. This monograph is concerned with the concept of talent management in the context of business organizations in the Visegrad countries. It has been designed to uncover how these organizations are developing and implementing talent management. Our research regarding organizations in the Visegrad countries is one of the first research studies to examining talent management in the given context. The monograph is organized in three parts and nine chapters. Part one establishes the theoretical framework of the concept and the essence of talent and talent management. This part has two chapters, each of which looks at the concept of talent management from a different perspective. Chapter one starts by examining the factors influencing the development and implementation of talent management in organizations and explores why organizations need to consider these concepts. Next it defines and critically examines basic terms such as talent and talent management in general and more specifically in organizational setting. Various approaches and definitions related to the talent management are reviewed. Specifically this chapter introduces the concept of integrated talent management that represents paradigm shift for both talent management and human resource management. Talent management tools and relationships between human resource management and talent managemnt are another issues that are also addressed in this chapter. Chapter two covers a set of critical issues that include defining the essence of talent and the scope of talent management, transforming human management and talent management in organizations and factors facilitating talent management. The chapter also includes some of the related issues such as Talent Management Model in the Organization or Strategy and Program for Talent Management. Part two summarizes the research implemented as part of the Visegrad Fund project called "Integrated Talent Management - Challenge and Future for Organizations in the Visegrad Countries". The research survey was conducted to explore the current state of applying the concept of talent management in the organizations of the Visegrad Four countries. It also provides a summary of what makes the research survey worth paying 7
attention to. We believe that the results of the present research survey might be seen as an appeal to organizational managers, executives, policymakers and to academics as well. Part three includes six descriptive case studies conducted by an international research team. The presented case studies provide evidence into effective talent management practices in business organizations in Visegrad countries, as well as evidence of their potential challenges. We hope that these case studies may contribute to a deeper understanding of how organizations develop and implement talent management and thus contribute to a deeper theoretical and practical understanding of the talent management concept. This monograph brings together theory and practice in the area of talent management and thus tries to fill the gap in the talent management theory and practice, specifically in the context of the organizations in Visegrad countries. Hopefully, the monograph may be of interest to organizational managers, executives and human resource professionals developing and implementing talent management in their organizations. It may also initiate further research into the area of talent management.
Dana Egerová
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Part One TALENT MANAGEMENT THEORETICAL FRAMEWORK
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1.1. TALENT MANAGEMENT – CRITICAL ISSUES Today’s highly competitive and uncertain business environment coupled with the requirements of the knowledge society, the development of information technologies and changes in the structure of labour force is a reality which poses new challenges for organizations and their management. It is obvious that the quality of the human capital and the practical implementation of the human resources development are the key factors of organizations success and competitiveness. Organizations can hardly compete without highly skilled workers and without the continual investment in the human capital. To have the right people in the right places and in the right time is critical for any organization to achieve the competitive advantage. Furthermore, the success of any organization depends strongly on having talented individuals. Therefore, the ability to deal with talent and talent management (TM) effectively has been and will be one of the biggest challenges facing organizations today. A recent study conducted in the given area (CIPD, 2009, Deloitte, 2010) found that the talent management is becoming one of the main tools of business competitiveness. The term talent management became popular at the end of the 1990s thanks to McKinsey Company. That time the company conducted a research study concerning talent and company performance. The study was summarized in the year 1997 and more than 6,000 companies took part in it by handing in completed questionnaires. The objective of the research was to find out what way the most successful companies built strong reserves of their managerial talent. Case studies of eighteen most closely observed companies were worked out for this purpose. The expectations assumed that the most efficient companies had better adjusted processes of human resources management (HRM) than the less efficient ones. But it turned out that this assumption was not correct. The processes of human resources management were approximately at the same level both in the most efficient companies and in the less efficient ones. When discussing talent management with the managers of the individual companies these managers did not talk about their processes of succession planning, the processes of performance evaluation, recruitment processes, motivation processes or any other processes related to human resources management. The thing they were talking about in connection with the issues of talent management was their belief that it is talented people that are the critical precondition of any company performance and success. It is not the processes of human resources management that distinguish the most efficient companies from those less efficient. The difference consists in the attitude of the leaders across all the company. This attitude reflects the strong belief about the importance of talents and, subsequently, the activities leading to the continuous strengthening of the talent pool. 10
One aspect of primary importance was given special attention during all the research – the attitude towards talents. Without this attitude the process of staff recruitment is only one of the activities. The research also showed that despite all the theories concerning talent management in the media and in the managerial rhetoric, all of which highlight the fight for talents, only one out of four companies regards strengthening their pool of talents as one of their main priorities. It has been confirmed analytically that more talented people perform better but a number of companies seem to neglect this opportunity. Excellent talent management is not about formal processes of human resources management but about the inner belief of leaders, their attitude and acts related to talents, something that is known as the Talent Mindset in professional literature. Talent management has experienced a dramatic development, from the 1980s through 1990s up to these days. It has always reflected the reality according to the parameters stated in the following chart: Figure 1: Comparison of priorities of the environment in the past and at present
Source: Michaels, Hanfield-Jones, Axelrod: The War for Talent, 2001, p. 6
Changes in the business environment call for the need to respond to them adequately and flexibly. As for organizations this new reality creates the necessity to deal with the fight for talents and also the inevitability to re-evaluate their existing procedures and practices in the field of talent management and to choose the ones that best reflect the changed reality. Excellent talent management is becoming the decisive competitive advantage. The fight for talents must be won. The rise of the knowledge economy and the new generation of workforce means that the traditional human resources management is no longer a sufficient tool, its effectiveness is bound to decrease because its activities are oriented to homogeneous workforce. The new workforce, however, is less experienced, more global, highly virtual and significantly diverse. Its autonomy and independence requires introduction of a new generation of human resources management – talent management. Talent management includes the following parameters: 11
1. predictive monitoring of the workforce and strategic decisions about talents, 2. flexible provision of sources of talent, 3. orientation towards customer, personalized remuneration and communication, 4. decentralized and authoritative leadership, 5. unanimous and empathic corporate culture. In practice, there are significant differences in the extent to which talent management is implemented in organizations. While some organizations have a fully integrated management system or are mainly focused only on partial aspects of talent management, there are organizations which are not used to talent management in any way. With regard to the above mentioned facts, the authors Silzer and Dowell (2010) noted the following stages of the management integration:
Reactive – this stage is focused on short term and immediate talent issues. Organizations often adopt off-the-shelf programme to meet urgent needs. Little attention is given to long terms needs. The programs and tools do not take into account the organization culture and strategic issues.
Programmatic – talent management programs and processes are implemented in organizations. They are consistent and repeatable, but not always effective. The programs often fail because they do not adapt to the changing talent needs.
Comprehensive – talent management systems and programs are fully and rigorously developed. They are implemented to achieve specific program objectives and they focus on a single aspect of talent needs. These programs and initiatives are not connected with one another and function in isolation.
Aligned – talent management systems and programs are coordinated and linked with other HR systems and objectives. They are coordinated with the talent management objectives and linked together. But they are not completely integrated to bring the full possible synergistic benefits to the organization.
Strategic – talent management programs and processes are driven by business strategies and talent strategies. They are also fully integrated with other HR systems and processes and managed as core business practices.
Based on our experience we think that effective talent management needs organizations to have a fully integrated talent management system.
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Factors that influence talent management There is a range of factors influencing the corporate talent management. Bersin (2013) in his study has identified the following six drivers affecting corporate talent and HR:
Rapid Business Change - acceleration of business changes;
Shift towards Emerging Markets - the growth of emerging economies such as China, India, Brazil and Eastern Europe;
Borderless Workplace - creating a virtually borderless workplace, disappearing of corporate hierarchy, diverse teams with flatter organization structures;
Specialization Creates New Job and Career Models - more specialized and more contingent jobs need specialized and flexible career models, social reward programs and facilitated talent mobility;
Twenty-First-Century Models of Leadership - workplaces demand new styles of leadership;
Intense Competition for Talent - today’s talent markets are highly competitive. Employees with the required skills are hard to find.
According to many authors (Hatum, 2010; Schuler, Jackson and Tarique, 2011; Collings and Mellahi, 2010) the main factors affecting talent management are as follows:
Globalization – provides organizations and employees with new opportunities, makes the world more diverse and more integrated, competition is more intense, multifaceted and extremely widespread;
The Knowledge economy – knowledge is used as the most important source of the organization's competitive advantage, the so called knowledge workers are becoming strategically important for organizations;
Changing the world of work - characterized by creating new forms of work as well as new jobs, by the disproportion between the required and available skills, by the shortage of high-skilled workers, by the rise in the global and virtual workforce. Today, work life is characterised by complexity, unpredictability, and insecurity);
Demographic changes - are accruing in the age profile of the workforce (ageing workforce vs. generation Y and younger generations) and in the structure of the workforce (increasing diversity, different skill sets, varied expectation);
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Technology – makes the world faster and more connected, has a significant effect on workplaces and the workforce.
It is important to note that the above mentioned factors:
do not represent all factors influencing the practice and scope of talent management;
do not exist in isolation from one another;
are not applied in all organizations evenly;
should be taken into account by organizations;
should be viewed in terms how and where they might suit the organization conditions and requirements.
“As far as searching for and retaining talents is concerned, the Department of Human Resources Management is obliged to deal with a number of demanding tasks. The most important fields for improving the processes and strategies of talent management are as follows: 1) building sufficient talent reserves at each level, 2) creating such a culture that makes employees want to stay in organization, 3) identifying differences between the existing abilities of the job candidates and the requirements for job positions, 4) creating such a policy that would encourage the career growth and personal development.” (Fegley, 2006) Talent management is the issue that gains great attention in many countries across the world. The focus on talent management has met remarkable acclaim in the literature published by many authors, like Levis and Hackman (2006), Bennett and Bell (2004), Fegley (2006), Brewster et al. (2005), Boudreau and Ramstad (2005), Cappelli (2000), Morton (2004), Phillipps and Rooper (2009), Rothwell (2012) and many others. Despite this fact, there is still a debate going on between the academic community and practitioners about the definition of talent and talent management. This has serious consequences for organizations that attempt to design and implement talent management programmes and policies.
The need for talent management The need for introducing talent management results also from the characteristics of the existing workforce which is currently in the process of transformation and liable to significant changes. The changes are as follows (Sojka, 2010):
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Changes in the workforce trends Global organizations realize the alarming reality that significant demographic, economic, social-political and technological changes dramatically transform the workforce too. Changes in the birth-rate, in the age of retirement and the workers´ requirements reduce the volume of the workforce and cause significant skill shortages, while, on the other hand, the removal of the business barriers, progress in communication and the latest economic findings highly prioritize the global and virtual workforce. Degradation in cultural norms, decrease in birthrate and diminishing migration barriers create preconditions for significant workforce diversity. The knowledge of the economy, of information technologies as well as the altered employment contracts give rise to the origin of an autonomous and strengthened group of workers. The workforce finds itself amidst unstoppable and radical transformation. It is getting:
smaller in numbers and insufficiently skilful;
more and more global;
virtual;
significantly diverse;
autonomous and self-contained.
Understanding the complexity of this trend of the workforce is crucial as these changes characterize the future generation of talents from which organizations will benefit in the years to come. Workforce smaller in numbers and insufficiently skilful For organizations all over the world the issue of taking new job positions is a huge and potentially long-lasting struggle. This phenomenon consists in the necessity to change both the numbers, specifically the quantity of workers available, and the quantity of workers who are available and who, at the same time, also have the required skills. The demographic development in the last period shows a radical decrease of graduates and this tendency is about to increase further. The population in the productive age is reduced significantly also by groups of middle-aged people who retire much earlier as a result of strengthening the advantages of the planned retirement and the growing prosperity. The governments of numerous countries try to reduce the workforce shortage on their domestic labour markets by supporting employment for graduates, women and the disabled people.
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Global dimensions of the workforce The traditional geographic borders surrounding the workforce are disintegrating fast. The reforms opening economic markets and technological progress create global labour market. Workers are no more limited in their abilities to only one region or country. Now they can work for organizations located anywhere in the world. In this global labour market workers are ever more redeployed to places where their utilization is the most effective. This global labour market is typical not only of jobs in information technologies but more and more of workers in industry and of professions which used to be isolated in the past. And, similarly to workers, the job positions are allocated to places where the needs of organization are best linked in relation to the workforce, abilities, costs and capacities. Low cost communication technologies and the growing level of education in the developing countries create possibilities of redeploying work positions for the purpose of reducing the operation costs all over the world. Globalization causes principal changes in the way organizations trade, work and compete with one another. It is necessary for the top management to understand the dynamics of the workforce in the areas, such as culture, cooperation, seeking, retaining and motivating. These special activities aim at problems and trends influencing the strategy of the workforce leadership: shifts in payments for performance efficiency, future perspectives of outsourcing, and new approaches to recruiting, training and developing global talents. Virtuality of the workforce The definition of co-workers and the meaning of the collocation “to be at work” have changed and nowadays the above terms mean workers on the other side of the globe linked by means of the latest communication technologies. Employees worldwide and in each industry are liberated from their desks and their working schedules. Increased use of high speed broadband networks and PDAs – personal digital assistants - in combination with the growing proportion of products that can be transmitted electronically have changed the notion of workplace and workday completely. A fixed workplace is no more the requirement for work to be carried out. A number of workers available on the phone, i.e. they are available for work any time, is increasing. This characteristic brings a new level of satisfaction and synchronization of work and life to some workers. Other workers may develop unhealthy workaholic tendency. Many workers are simply afraid of slowing down, of disconnecting from work altogether from fear of losing jobs in the environment of growing competitiveness of the global labour market. The number of virtual co-workers grows together with the virtual workspace. The increasing number of new groupings, discussion forums and social chains reduce the geographic and social barriers. Workers are becoming a larger part of the global offer of 16
talents all the time; they take part in virtual teams consisting of the best employees from all over the world. In this network of offers formed by workers from diverse countries, social groups, associations, professions and work groups a simple infrastructure is being created and protocols are designed to connect people on the basis of the same interests. Diversity of workforce Changes in the birth-rate, migration patterns and cultural norms have absorbed the workforce of all ages, origins, nationalities and lifestyles. Workers enter a workforce group earlier and stay longer. There are more generations in a workforce group than in the previous years. The growing consumer society connected with the growing prices necessary for education motivates ever more teenagers to enter a workforce group. They are followed also by older workers who are motivated by expectations of a longer life, cultural changes and marketability of their experience and hence they stay in their work longer. After reaching 55 years of age workers stay at work, on average, by fifteen years longer, and the same can be said about a number of workers aged 50 to 70 who return to work to stay agile and to increase their income. A great number of women are made to join the workforce especially by loosening of the cultural norms and economic necessity. Men and also women take jobs which, in the past, were carried out by the workers of the other gender. Ever more men carry out the traditionally women´s jobs, such as a librarian, secretary, nanny, kindergarten teacher, nurse or typist. Unfortunately a lot of men in the traditionally women´s jobs show a high level of stress and discrimination and also the majority of women are convinced that they do not have the same job opportunities as men. The level of migration and the birth-rate strengthens the proportions of national minorities. Today every tenth person in the developed countries is a migrant and millions of people live in the countries which are totally different from those in which they were born. The birth-rate of ethnic minorities grows, while the birth-rate of ethnic majorities mostly decreases. This development results in the fact that minorities are the fastest growing segment of the workforce. The workforce is diverse not only as for the demographic characteristics, such as age or nationality, but the difference is also in the lifestyle and habits. Some workers participate in the traditional way of life – education, work, family, leisure time. On the other hand they mix habits in a unique way. They move, repeat and change their positions in life much more frequently. In the end this increase in diversity creates workforce which resists stereotypes and generalisations.
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Autonomy and self-containment Workers themselves start to take control of the direction and structure of their working life. Technological and economical forces give them the space for bigger authority at work and on the labour market. The trends aiming at the work related knowledge and communication based on technology give workers the ability to decide how they are going to carry out their work. Educated workers have expert systems available which are not subject to the management and enable them to make logical decisions in many fields. By means of the Internet and Intranet they have access to the news about the competition, information about business trends, which increases their ability in decision making. Information technologies, economic findings and the changed relationship employer – employee provide employees with better possibilities on the labour market. Today most workers have access to a number of top quality information. Employees can find on the Internet details about the newly emerging work positions, possibilities of alternative jobs, benefits but also career opportunities. The Internet information reduces costs when looking for a job and the same can be said about the change in the relationships employer – employee. Looking for job opportunities on the external labour markets is no more a problem; on the contrary, it is a symbol of business sharp-wittedness. The experience of working for more employers is seen positively. Workers use the new information for their dealing with employers and change their jobs when they find a better offer.
Who is talent The first issue which should be considered before starting the talent management implementation is the term talent. Organizations and TM professionals need to understand who they regard as talented people before implementing the talent management policies and practices (Zhang and Bright, 2012). Gaining consensus on the meaning of talent is a foundation of being able to manage talent well. The term talent is used differently in the organizational practice, see below (Tansley, 2011):
No use of the term talent in policy or processes and absence of an organizational definition;
Limited use of the term in policy and processes and emerging understanding of an organizational definition;
Widespread use of the term in the strategy, policy and processes and common understanding of an organizational definition.
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Whilst a number of definitions of talent exist, none of them is widely accepted. Broadly, talent is defined as “a natural ability to do something well” (Longman Dictionary of Contemporary English, 2006). According to Gagne (2000) the term talent designates the superior mastery of systematically developed abilities and knowledge in at least one of the fields of the human endeavour. Thorn and Pelant (2006) define talent as “someone who has the ability above others and does not try hard to use it. These people excel with easiness and grace. A talented person has a certain aura in his/her ability that others wish to emulate and from which lesser mortals draw inspiration”. Michaels et al. (2001, p. 3) define talent as “the sum of a person’s abilities, his or her intrinsic gifts, skills, knowledge, experience, intelligence, judgment, attitude, character, and drive. It also includes his or her ability to learn and to grow potential for further development. To summarize the above definitions the talent is mostly regarded as an innate disposition and ability to do something well in a particular field. In the context of the workplace the term talent generally refers to an employee who significantly contributes to the organization´s performance. According to Avedon and Scholes (2010) the term talent means those individuals or groups that are strategically important to the purposes and goals of the organization. “Specifically, talent refers to those individuals and groups with strategic competencies that enable a company to achieve its short and long term goals.” (Avedon and Scholes, 2010, p. 75). The Chartered Institute of Personnel and Development (CIPD) sees talents as those who can make the greatest difference to the organization´s performance, either through their immediate contribution or in the longer term by demonstrating the highest levels of potential (CIPD-Centred Institute of Personnel and Development, 2007). According to Silzer and Dower (2010) talent in organizations refers to:
individual skills and abilities (talents) and what the person is capable of doing or contributing to organization;
a specific person (he/she is talent) with specific skills and abilities in some areas;
a group (the talent) in an organization – a pool of employees who are exceptional in their skills and abilities.
Talent can be defined in one of the following two ways: exclusively or inclusively. The exclusive (narrow) approach focuses on such individuals who demonstrate high potential. The key people with high performance and potential are regarded as talents. The narrow 19
definition SHRM (Society for Human Resources Management, 2007) defines talent as a core group of leaders, technical experts and key contributors who can drive their business forward. Many other experts hold the same positions and some of them only consider senior managers to be talents. Another exclusive approach is the position-related understanding, which views the right people in the key positions as talents (Zhang and Bright, 2012). The inclusive approach views all employees as potential talents; everyone is regarded as talent and has the ability to contribute to the organizational success. Stainton (2005) argues that everyone has the capability and potential to display talent and everyone can go through a talent identification process. According to Armstrong (2006), everyone in organization has talent; therefore talent management should not be limited to the favoured few. Therefore the empirical evidence showed that many organizations have adopted an exclusive approach, but our experience suggests that a mixture of both approaches may be more appropriate for organizations. As talent is specific in any organization, its meaning should be defined with regard to the context of the organization. For the purpose of our research study let us define a talented person as “a person of high potential, who stands out as far as his/her knowledge, skills, experience, capabilities and development potential are concerned and who contributes to his/her organization's efficiency increase”.
Talent mindset In connection with talent the expression talent mindset is an important term. Talent mindset is a deep-seated belief that having better talents at all levels allows your company to outperform its competitor. It is the recognition that better talents pull all the other performance levers. This belief gives leaders the determination to strengthen their talent pool and the courage to take bold action to do so. Talent mindset does not only mean that people are organization´s most important assets but it means a deep conviction that better talent leads to better performance results. Another change in thinking is the fact that the responsibility for people management cannot be in the hands of the human resources department only but strengthening the talent pool is the task for all managers.
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Defining Talent management Talent management is one of the biggest challenges facing organizations in today’s rapidly moving and highly competitive global environment. It is a multi-faceted concept that can be considered as a philosophy of human resources management, as an organizational mind-set, as a discipline with specific subjects and research methods or as a set of HR practices in a particular organization. Talent management has been used either more narrowly - focusing on a single process or a selected group of employees - or more broadly – including a variety of processes, components and a large group of employees. The term “talent management” is perceived and defined in various ways. For somebody it is the management of important or talented individuals, while others understand it as managing people in general – i.e. on the assumption that everybody has talent that should be identified and applied. Armstrong (2007, p. 327) defines talent as a set of linked organizational activities enabling organization to attract, retain, motivate and develop talented people who it needs and who it will need in the future in order to stay successful. Another specialist in the field of human resources management Smilansky (2005, In: Armstrong, p. 327) is convinced that talent management serves the purpose of improving quality and flexible use of exceptionally efficient workers (i.e. workers with high potential) who can significantly influence the organization performance. According to Armstrong (2007) talent management should not only focus on the high-flyers, but it should concern all the assiduous and efficient workers. On today´s competitive market talent management is the basic driving force for the company to be successful. In broader context talent management is the implementation of integrated strategies or systems created to increase productivity by introducing improved processes aimed at attracting, developing, retaining and utilizing people with the required skills and abilities for them to meet the existing and future-oriented business needs. Owing to the external factors, such as economy, global expansion, mergers and acquisitions, the crucial factor of the success of talent management is its linking with strategic objectives and active participation of the top management and human resources management. An important role in the development of talents is also played by line mangers (Lockwood, 2006). Although the term talent management has become increasingly popular and is widely used, it does not have one single, authoritative definition and, therefore, various definitions are being used. Lewis and Heckman (2006) identified the following three key concepts of talent management definitions:
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Talent management as a set of typical personal processes, functions and activities. From this perspective the talent management is considered more or less synonymous with human resource management or is viewed as a specific area within HR. Talent is viewed as a substitute for HR. Generally, this concept is closely related to the traditional definition of HRM and hence the talent management is mostly associated with typical human resource management practices and activities.
Talent management is a set of processes aimed at the creation of databases of talents (talent pools). This perspective highlights the concept of ‘talent pools ‘and emphasizes the development of talent pools focusing on “projecting employee / staffing needs and managing the progression of employees through positions” (Lewis and Heckman, 2006, p. 140).
Talent management is closely related to either high-performing or high-potential employees or to talent in general. From this perspective which takes a more general view, talent management has no concern for organizational boundaries or specific positions and it is primarily focused on sourcing, developing and rewarding employee´s talent.
Collings and Mellahi (2009) add the fourth stream which emphasises the identification of the key positions contributing to the competitive advantage of the organization in different ways. The systematic identification of the key positions is at the core of this concept rather than talented individuals per se. Talent management is defined as a systematic and dynamic process of discovering, developing and sustaining talent. What works, depends on the context and the way the organization implements the practices. So talent management may be organizationally specific and dependent on the context and could be defined as follows:
Talent management is a systematic attraction, identification, development, engagement, retention and deployment of those individuals with high potential who are of particular value to an organization (CIPD, 2006);
Talent management means the implementation of integrated strategies or systems designated to increase the workplace productivity by developing improved processes of attracting, developing, retaining and utilizing people with the required skills and aptitude so that they can meet the current and future business needs;
Talent management is defined as an integrated set of HR practices or functions, such as recruitment, selection, development and performance appraisal aimed at increasing the capacity of organization (SHRM, 2006; Fegley 2006; Mercer 2005); 22
Talent management is a learnable skill. Every leader should learn how to manage talents. It is the same problem as to learn how to manage strategic planning, innovation etc. (Handfield-Jones et all, 2001);
Talent management competencies is a set of behavioural patterns that the line managers need to attract, select, engage, develop and retain talented employees in order to reach specific desirable business objectives for the organization (Oehley and Theron, 2010).
For the purpose of our research survey we define talent management as „a set of activities comprising identification, search for and recruitment, effective exploitation, assessment, development and retention of high potential workers which are undertaken and performed in the organization in order to implement its strategy.” Owing to the fact that talent management focuses on in-depth building and strengthening leadership, it creates flexibility when adapting to the changing market conditions. The integrated process of talent management will systematically overcome the gap between the human capital which the organization currently has at its disposal and the need for leadership talents which the organization will need in the future so that it might know how to respond to the future business challenges. Talent management focuses on:
The appropriate selection of people – talents; but it is not just the selection of the best people but it is the search for the “appropriate material” which is to be dealt with in such a way that the long term company strategy is considered;
Selection of job positions to which talents are to be placed;
Motivation of talents so that they may perform at their best for their company;
Development of talent potential with the aim of earning the company as good business results as possible.
In the closer context talent management provides:
Identifying employees´ strengths and areas for development;
Preparing talent for executing demanding tasks and problem solving;
Full and effective utilization of talents in connection with achieving the possible results for organization;
Engaging talents;
Measuring the effectiveness of talents; 23
Creating career advancement of the individual talents;
Talent development in connection of extending their knowledge, abilities, skills and competencies;
Basis for remuneration and care for employees;
Basis for placing employees and creating their job content;
Development of leaders and building leadership community;
Creation of positive working conditions and working environment.
Effective talent management is an integral element of high-performance and successful business culture. One of the most important factors of the successful integration of talent management in organization is active support of the top management. From this point of view the importance of talent management in organization is the same as the importance of other business processes. Organizations which continuously support talent management focus on building organizational abilities by bringing talents into the processes and systems. They focus on the development of a high level of awareness and the abilities to support talent management in three groups: the individuals themselves, the line managers, and the professionals in human resources (Ali Taha and Sirková, 2012). The main methods of successful talent management implementation consist in:
The predictive monitoring of the workforce and strategic decision making in the field of talent management and in predicting the future needs of organization in the field of the demographic development of the workforce as well as the necessary skills, behaviour and attitudes of staff;
Flexible and anticipatory provision of sources of talents from a wider spectrum of the labour market – external labour market, employing the elderly, former employees, people from other geographical regions, women and such like. This way the sources of the workforce and talents for the future organization potential may increase;
Individually adapted remuneration and communication, flexible ways of remuneration which, apart from the traditional way of remuneration, include the possibilities of choosing work assignments, employee´s placement, providing time and funds for education, flexible working hours; in the field of communication it involves creating the culture of the individual care for an employee enhanced by the individual approach to the personal development;
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Well distributed and straightforward leadership – elimination of authoritative methods by means of delegating leadership responsibilities within organization and by means of changing the traditional perception of leadership from giving orders to influencing;
Cohesive and percipient culture – the culture that motivates and retains employees, ensures the elimination of conflicts and work stress by supporting the joint values and appreciating the benefits of each employee for organization, culture that eliminates any forms of discrimination, supports the balance of work and personal life (Tucker, Kao and Verma, 2005).
According to Hroník (2007, p. 109) it is necessary to distinguish talent management from vocational training which is closely focused on the fact that an employee in a given position is able, as quickly as possible (in terms of weeks up to months), to take the position in which he is placed or will be placed shortly. Talent management works with a wider perspective – temporal and professional. It is also necessary to distinguish talent management from the adaptation process which focuses on all workers entering organization.
Talent management versus human resources management The relationships between human resources management and talent management have been frequently discussed in recent years. Many authors argue that talent management is only a new buzzword for old activities. Undoubtedly, there are many similarities between human resource management and talent management. The main HR functions are the planning of human resources, attraction, selection, retention, development and allocation of HR. Many researchers mentioned that talent management has been serving the same function albeit with a different focus. Creelman (2004) defines TM as the process of attracting, recruiting and retaining talented employees. But there are key differences between HRM and TM (Chuai et al., 2008). TM is talent focused, with a more directed and detailed focus on certain groups of people. TM, unlike HRM, focuses on all staff. One of the differences that should be noted is that the talent management system is integrated with other activities. Egalitarianism, which is typical for HR activities, is acceptable in talent management only with difficulties. Well-proportioned resource allocation, typical for HRM, is not suitable for talent management. On the other hand HRM is more focused on the development of people. Talent management is viewed as a strategic process mandatory for the global strategy (Vladescu, 2012). Talent management supposes the implementation of methods for recruiting and selecting employees, and it also applies methods to scout out talents. The talent mindset implemented in talent management is another difference between TM and HRM.
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Company´s approach to human resource management is important for the success of talent management. In fact, it is the core of talent management, and so it makes sense that effective processes in all the traditional areas of HRM are an essential part of talent management. Building the employer´s brand is an important role of HRM. A positive employer helps to attract the best talents for organization. Human resources management focuses on all employees, while talent management focuses on “key employees” or “talent” or “top talent”. Top talent can be defined as a person “who routinely exceeds expectations while exhibiting the right behaviours and is agile in the learning approach. These are the people whom customers pay a premium and others strive to work with (Morgan and Jardin, 2010, p. 24.). Human resources (HR) departments can set the stage for success by hiring and training capable employees. But developing such personnel into a team of dynamic, motivated, longterm participants in the company's processes must be the responsibility of all managementfrom the CEO to a floor supervisor. TM is a part of HRM. Talent management, which incorporates the cooperation and communication of managers at all levels, has become an imperative in the face of today's business challenges. In addition, talent-management processes must be more strategic, integrated, and broad-based than ever before. Talent-management processes (practices) include workforce planning, talent gap analysis, recruiting, staffing, training and development, retention, talent reviews, succession planning, and evaluation. To drive performance, deal with an increasingly rapid pace of change, and create sustainable success, a company must integrate and align these processes with its business strategies. By assessing available talent and placing the right people in their best roles, organizations can survive and thrive on today's increasingly competitive markets. Effective talent management becomes even more important with the forthcoming talent shortage as many experienced leaders approach retirement. The above mentioned theoretical review implies that talent management is not only a new buzzword, it is the challenge of the knowledge based economy. The question is not if to implement or not to implement talent management, but how to implement it effectively. Most of the currently used processes of talent management were created almost half a century ago, and now the time has come to create a new model (Cappelli, 2008). The organizations need to rethink their approaches to talent management. Although there are a variety of approaches to talent management we want to indicate that the integrated talent management is the paradigm shift for organizations and can be defined as an innovative and holistic approach to talent management which enables an organization to respond to changes in business environment adequately and flexibly. 26
The concept of the integrated talent management integrates the business strategy, the human resources strategy, talent management processes and the organizational culture (Silzer and Dowell, 2010). Figure 2: Model of Integrated Talent management
Source: Silzer and Dowell, 2010. p. 96
Mutual integration and linking the individual components of the given model is a necessity and at the same time a precondition of successful handling the concept of integrated talent management. At the same time it is necessary to realize that it is important to modify the given model so that it may suit the specifics of a particular organization. It means that the given model will have different forms with different organizations and also the individual components will be given different priorities. We would like to point out here that other approaches to the integration of talent management in organizations can be found in professional literature.
Talent management tools For the successful implementation of talent management organizations look for some new tools, principles, practices and processes that need to be developed and implemented. By means of these tools theoretical knowledge is transformed into organizational documents and measures to be taken. In the process of the elaboration of principles and practices the organizational context should also be taken into consideration.
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In accordance with Stahl et al. (2012) it is needed to differentiate between practices and principles. The best practices are the best only in the context in which they have been designed. The principles have broader application. Practices can be built on the basis of principles in the given context. The below stated principles have been developed in line with Stahl´s findings and completed on the basis of the author´s experience. The principles are depicted in Figure 3. a) Involvement of top management in talent management, including the talent mindset; b) Definition of talent management in the context of a particular organization; c) Linking the talent management strategy with the organization strategy; d) Linking the talent management strategy with the HR strategy; e) Embedding TM principles in the corporate culture; f) Providing internal consistency - integration of TM activities; g) Creating and dividing groups of the work positions according to the requirements for talents; h) Evolving and implementing TM practices, notably:
attracting employees;
selecting employees;
learning and development;
engaging employees;
rewarding employees;
retaining employees;
evaluating TM programs.
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Figure 3: Talent Management Model
Source: own processing
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Top management involvement The talent management implementation needs to involve managers at all levels, especially the top level management. The talent management mindset must cascade from the top, with the top manager as a driver (Morton, 2005). In accordance with Michaels et al. (2001, p. 54) the talent mindset is defined as a deep-seated belief that having better managers at all levels allows your company to outperform its competitors. It is the recognition that better talent pulls all other performance levers. This belief gives the leaders the determination to strengthen their talent pool and the courage to take a bold action to do it. Leaders who have adopted the talent management mindset understand that this responsibility cannot be delegated. They consider talent management a critical part of their own jobs. Talent management must be the central part of running a company. Companies that practice outstanding talent management have the talent management mindset embedded in the institution.
Definition of talent management in the context of particular organization Talent management may be defined as a comprehensive, integrated approach spanning the whole enterprise and the employees´ entire lifecycle. As has been already pointed out above, the comprehensive definition of talent should be transformed according to the organizational context. Talent means something else for each organization. Some of the above mentioned definitions can be adopted for a particular company.
Linking the talent management strategy with the business strategy Creating the strategy of talent management that is based on the organization strategy and is in compliance with it is one of the principal preconditions of effective talent management. Business strategy is the starting point of the talent management strategy. Mutual linking of the organization strategy with the given strategies enables to identify the processes of talent management which are crucial from the point of view of meeting the organization objectives. The right talent strategy starts with the organization strategy and continues by understanding the organization position in the business environment. The business strategy indicates the product to be produced, strategic goals to be reached and the competitive advantage to be won. Talent management should underpin this strategy by attracting, selecting and engaging suitable talents. The first and very important step in the process of the talent management implementation is the formal creation of the business strategy. One way to do it is to transform the strategic goals into the organizational capabilities. This process should guarantee the organization to win the competitive advantage. The talent management strategy, 30
the practices and processes can help create a high-performance organization that can survive and prosper in the rapidly changing business environment. The role of talent management is to enhance the creation of the organizational objectives (Cappelli, p. 2008). Peters (2006) speaks about ten principal ideas concerning talent management by which the noble-minded rhetoric can be transformed into the strategic reality.
Put people first – for real. The following phrase hides a lot of insincerity: “People are our most important asset.” The problem is that it is often just a pretended duty, the organization´s self-contentment but not what the organization really does or how its leaders spend their time.
Be obsessed. The most important trait associated with mastery is attention, or time spent. The plan and the tactics of talent management have to be put at the top of the agenda and be kept there. The pursuit of talent is either an obsession, or the company is not serious about it. Either the organization spends all of its time on it, or none at all.
Pursue the best. If the organization is to be the leader in the field of talent it will not put up with anything less than the best. It will leave a job open until it fills it with a talent. Great talents are not kind to those who can´t excel. Talented people should not be surrounded by second-raters. Organization is in the talent business – full time. The only objective to meet is: “Don´t tolerate non-excellent talent. Anywhere.”
Weed out the rest. When a new head coach takes over a national football team, he rarely holds on to more than a couple of assistant coaches. He has a new philosophy and brings a new atmosphere of performance. And he needs new talent – in the coaching and player ranks. When a new captain comes aboard, must all the old crew be fired? Of course not. But often the new outsider comes into an organization that has let things drift by allowing seniority to drive promotions. So while the number of newcomers whom the new leader brings in vary, he should have a free hand in picking his/her staff.
Focus on intangibles. When it comes to talent, quite often all sorts of statistics, facts and figures are to be looked for. Great leaders look something more behind the statistics. They know that something more matters far more than raw statistics. In fact, one of the great tests of leadership maturity is the ability to deal with the intangibles. Lack of ability can be compensated for by a lot of heart and personal attitude.
Take reviews seriously. It is OK that organization acknowledges the fact that staff is important. But does the organization have any formal talent review process – one that
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is treated as seriously as the budget process? If “Talent Review” is not in the organization´s calendar in big block letters, then they are not serious about talent.
Pay up. To think that offering people great pay will win the great war for talent is totally out of place. It is the opportunity without which nothing is possible. On the other hand, if one is given a great opportunity, and one responds with exceptional vigour, than one should be rewarded accordingly.
Set up high standards. Recruit great people. Urge them to sign up for great quests. And then set absurdly high standards. It´s true in sports, in the theatre, in ballet – and there is no reason that it should not be routinely true in the finance or purchasing department or in the field of human resources.
Reward people skills. If organization hopes to thrive on talent, it should promote according to who has the best development skills. These people are not soft. In fact, the best of them are very tough – performance-oriented, determined to collect the best talent they can, willing to go the extra mile to show their concern for their employees´ family and community concerns. People are attracted to and retained by leaders and organizations that make them feel good about themselves and give off good vibes on the integrity and quality dimensions.
Create opportunities to lead. The way to create leaders is to let them lead. If somebody great is found, it is fantastic but it is necessary to put that somebody in charge of something right now. Each project contains a lot of tasks, which means a great number of leadership opportunities. Use these opportunities. Divide the project into a number of subtasks and find a young talented person with a bit of spirit and a lot of intelligence and put him/her in charge. Leading is not about age.
Talent management is adventure-creation business. The chief goal of the talent obsessed leaders is to engage people in mutual discoveries in an environment marked by energy and enthusiasm – an environment that vibrates positively.
Linking talent management strategy to HR strategy Human resources strategy defines what organization should do and change in the human resources management in order to meet the objectives. The strategy should be formulated in connection with the organization strategy. Formulating the talent management strategy should be done in a similar way. The initial step is, as has already been said, the organization strategy. Similarly as with the previous level, the human resources strategy should be linked with the talent management strategy while the talent management strategy should be formulated in connection with the human resources strategy. The integration of talent 32
management with the human resources strategy may be done in various ways, from applying the philosophy and principles that are the basis of the human resources strategy, through applying various HR systems, up to applying the competency models.
Talent culture The corporate culture is considered a source of the sustainable advantage. The culture supporting the processes and practices of talent management is a precondition of its successful integration in the organization. All the TM principles must be embedded in the corporate culture. The company has to make deliberate effort to transform all the TM principles in the corporate documents into the training programs for employees. Specifically, it must be included in the search for employees and in the selection process. The transformation should be done by means of incorporating the TM principles into the existing corporate culture. All staff of the organization should be informed about the new or transformed corporate culture. The TM principles should be included in the relevant documents and learning plans. To introduce the talent culture the organization should:
Ask for commitment from all leaders. All leaders at all levels must demonstrate their support for implementing the talent management mindset;
Define what good leadership is. Formulate competency models, decide what sort of leadership is necessary for the particular roles and what types of behaviour are linked with successful leadership;
Use multiple methods for judging the leadership potential and development in order to evaluate suitability for the particular post and demonstrate competency;
Implement the performance based culture and reward the results based on the performance;
Create good working environment from the point of view of the physical arrangement of the workplace, and also from the point of view of human relations;
Observe the conditions of the psychological contract and give the employees the feeling of job security.
Internal consistency The internal consistency or integration of TM components means, that various talent management practices and HR activities, systems and processes are aligned with one another. It is necessary for the individual processes of talent management not to be isolated or 33
independent but to be interlinked to a certain extent at least and also integrated with other HR processes and systems. It is, at the same time, necessary for them to be managed as key processes. For instance, if the company has accepted the talent mindset, this must be cascaded top-down. All the workplaces must be divided and later organized in separate groups according to the requirements for talented employees. The requirements for talents are estimated by means of job analyses. Then the company must adopt tools for finding the best talents. Further training will be developed on the basis of the comparison of the real skills present at the workplace. If the organization invested money in the development of employees, measures must be taken to engage and retain employees. To evaluate the efficiency of talent management it is necessary to create evaluation methods for its performance and the system of rewarding.
Key position identification Key position identification is one of the first activities in the talent management implementation. It is possible to see two main streams of approaches to this problem. One stream (Michaels et al., 2001 and many other scholars) emphasizes the identification of A performers, B performers and C performers. Emerging literature and authors hold another opinion consisting in identifying the key work position (Boudrou and Ramstad, 2005; Huselid et al., 2005). This stream proposes that having identified the pivotal position within an organization, the key role of talent management is the development of a talent pool to fill these positions.
Evolving and implementing TM practices TM practices are evolving from HRM practices. They constitute the superstructure of HRM practices. TM practices are usually elaborated by HRM departments and TM principles and organizational context are taken into consideration. The main practices are as follows: Recruitment of employees According to Towers Perrin´s study (2005, p. 17), the following factors are considered as recruitment drivers: competitive base pay, work/life balance, carrier advancement opportunities, competitive benefits, challenging work, salary increase linked to the individual performance, learning and development opportunities, competitive retirement benefits, the calibre of co-workers and the reputation of the organization as a good employer.
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Selection of employees The process of selecting talent is more sophisticated. The requirements resulting from a job analysis are the basis for selecting employees. On the basis of the analysis it is possible to compile the required competencies and the performance indicators. The talent performance and the potential is an important dimension in connection with talent identification. The performance is measured against specific objectives. The potential expresses future competencies and future performance. It is determined by a combination of the observation assessment and discussion. The potential is difficult to determine because it requires inferring future contribution based on the current data. Talent management requires both the performance and the potential. There are processes and activities how to define the sources of talent and how to search for them. The requirements for future talents, especially for future leaders depend on the needs of organization and the nature of work. Frühwald (2000) speaks about the following characteristics of talents when searching for them:
They can manage facts fast, they remember and apply information, they need minimum guidance for mastering routine tasks;
They have rich vocabulary, they can express their thoughts accurately both in speaking and writing;
They show above average abilities to abstract, they can see the essential principles and can integrate various fields;
They want to discover the causes and reasons of things, they are enthusiastic observers and explore things in detail;
They can work independently and they need minimum guidance, they accept the assigned tasks, arrange and analyze them accurately;
They show persistence in the target oriented behaviour and spend a lot of time solving specific problems;
They have rich imagination, are flexible in thinking and acting, they are willing to take risk and they are original and creative;
They can utilize a limited number of sources, of time and of people to achieve excellent results; they create new ideas and perspectives; 35
They read a lot of professional and scientific literature and can find satisfaction in contemplating and debating scientific issues.
Frühwald (2000) also mentions three motives to support talents:
Personal motives – to find self-fulfilment;
Motive of usefulness – important for the organization;
Integrated motive – the aim is to make use of person´s capabilities, to achieve progress.
A talented person should learn especially from the information gained from activities and not from static information gained from tests, questionnaires and such like. Successful integration of all the components of talent – including the psychological ones - can only really appear in activities. “People, the intellectual capital and talents are ever more the most decisive criterion of the organization´s strategic success. Nowadays, this finding is so common that it is beyond any discussion. The digitalization, the lack of manual workers, the growth through gaining, the concurrent process of decrease and increase, demographic changes in the workforce, and globalization, those are only some of the trends that have made talent “a decisive priority” (Lawler and Mohrman, 2003). Other traits characterizing talents are as follows:
Strong will;
Critical thinking;
Interest in teamwork;
Prioritizing work assignments;
Identification with organization´s objectives;
Combinatorial thinking;
Criticality;
Vigour;
Creativity, as well as other qualities.
The requirements for talented people can be divided into two groups (Davies B. and Davies B. J., 2010, p. 420): How a person thinks:
Ability to understand things in their complexity and to make connections;
Ability to take initiative, be self-motivated, be a self starter; 36
Intellectual curiosity, capacity and flexibility to think differently;
Ability to solve problems.
How a person cooperates with the others:
Empathy, ability to learn from the others;
Passion to make a difference;
Inspiration for the others, care for the others;
Self-confidence and credibility;
Rothwell (2001) points out that a person with high potential is characterized as someone identified through the assessment process as a future leader of the organization and typically someone who has the potential to advance two or more levels above the present position. The talent review is an important part of the talent management process. The talent review is a competency-based assessment of employees. The aim of the talent review is to identify a high potential employee and a future leader, to determine the bench strength of a particular level (e.g. senior management), to identify the talent gaps, organizational vulnerability and risks, and to develop the view of the organizational capability. The talent review assesses employees from the point of view of the competency clusters and the results from the input to multiple processes and strategies, such as the human capital management etc.” The process of talent reviews involves various data collection techniques, such as central assessment methodology, and a range of standardized and validated psychometric tests. It also involves the processing and integration of data in a format that can be used for the interpretation and feedback. Talent maps are interesting tools. A talent map is a visual output of a talent review. Psychometric tests are convenient tools for identifying talent. Well constructed psychometric tests and questionnaires used by qualified people provide a realistic basis for making a decision on potential and capacity. They should be used together with other data. Learning and development The personal development possibilities are one of the important factors for retention and engagement of employees. The Human Resources Department has to create a development plan to harmonize the employees´ current competencies with the competencies required for a specific position or the work environment. The same must be done regarding the future 37
requirements. Employees at all level value learning. Especially people in the business services, IT technology and construction show above-average preferences to learn and grow (Philips and Rooper, 2009). Organization should implement a knowledge management system and should provide for inter-organizational and intra-organizational knowledge transfer for both the explicit and tacit knowledge. Individual development plans should be evaluated regularly and the employees should be given feedback. Talent retention People are the best assets of each company. In case of the talented people it is even more important. Company should have programs for employees´ retention, especially for the talented people. There are many reasons for talent retention. Firstly, talented employees are the competitive advantage against competitors. Secondly, if a company invests money in recruitment, training and development, the money is lost if they leave. Thirdly, talented people represent the knowledge, especially the tacit knowledge which is difficult to share or to retain in a codified way. The loss of important knowledge can have fatal consequences. Similarly, in a situation when the economy faces a temporary decline, each company has to provide three rules to stress the importance of recruiting quality talents during the period of downturn. In these cases it is, firstly, necessary to avoid the lay-off of the key talents at all costs, secondly to guarantee constant recruiting and to ensure that talent channels are open, and thirdly, to maintain the talent development programs. Other measures that have a great impact on the retention of employees refer to the promotion and transition programs and the personal development planning. The talent management process needs to give a chance of equality and to maintain diversity in organization. It is necessary to create some standards concerning competitive salaries, to emphasize opportunities of training and development. Leadership development and talent management should be incorporated into a system-wide approach to develop the skills and potential of the entire staff. Perrin (2005, p. 17), in the international study of 86,000 full time employees from 16 countries, found that the factors for talent retention are nearly the same as the factors for attracting talent. Other factors include treating people with respect and trust, conducting effective performance reviews, and holding people accountable for the performance goals. One of the causes for the talented and skilled workers leaving the company is the nontransparency of their further professional growth and career advancement. Nowadays most private companies and businesses are trying to solve the problem of filling the key posts in the company by “buying” managers outside. They consider it a fast and simple solution of getting a “fully fledged” person into a certain post. The management should, however, look for 38
suitable candidates from within the home company. This problem should be dealt with by using the methods of talent management. The concepts of identifying and training the most efficient and promising employees are not new in the development of the work positions. In the past, the concept of supporting talent was not paid much attention, and if so, it was only by means of informal discussions in which only company managers participated. Today, talent management should play a much more important role in the company managerial activities. If an organization wants to retain talented people it has to motivate them well enough. The motivation for the talented, capable and wise people does not consist only in the amount of salary but also in their need for further and constant development and self-fulfilment as well as the system of remuneration on the basis of their capabilities and performance, taking on more responsibilities in connection with delegating competencies and, last but not least, the possibilities of career advancement. Employee´s engagement Engagement is very often cited in connection with talent management. Employee´s engagement is similar to talent management, but it does not have any precise definition. A talented employee has no value for organization if he/she is not engaged. A definition by Gibbons (2006) is very often cited in connection with engagement. It goes like this: “employee´s engagement is a heightened emotional and intellectual connection that an employee has for his/her job, organization, managers, or co-workers that in turn influences him or her to apply discretionary effort to his/her work. Gibbons (2006, p. 6) identified the below stated top engagement drivers. They include:
Trust and integrity - the extent to which the organization´s leadership is perceived to care for employees;
The nature of the job - the extent of employee´s participation and autonomy;
The connection between an individual and the company performance - the extent to which employees understand the company´s objectives, current levels of performance and the ways to contribute to them;
Career growth opportunities - the extent to which employees have opportunities for “career growth and promotion” or have a clearly defined career path;
Being proud of the company - the extent to which employees derive self-esteem from their work;
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Co-workers/team members - attitudes and perspectives of co-workers towards their jobs and the jobs of the company;
Employee´s development – the extent to which employee´s skills are developed;
Personal relationships with the employee´s manager – extent to which the employee values the relationship.
Emotional drivers, such as employee´s relationships with a manager and being proud of their work are very important drivers for employee´s engagement. Emotional drivers have much greater impact on discretionary effort than rational drivers. Performance management and rewarding Organization should implement a performance management system. Strategic goals must be cascaded top-down. Individual key performance indicators and a performance evaluation system have to be adjusted for each employee and a sufficient amount of information has to be given as well. The performance system has to be interlinked with the reward system. Evaluating the effectiveness of talent management Currently there are no generally accepted and standardized methods for the TM effectiveness evaluation. Not enough effort has been devoted to find suitable methods, not even from scholars. The problem is that the gathered data on effectiveness tend to be more qualitative than quantitative and therefore more subjective. In general, there are two possibilities how to evaluate the talent management effectiveness:
Qualitative methods;
Quantitative methods.
Qualitative methods are based on the specifications of the talent management practices. Principles for each of the practices will be determined for any required level. This level is based on the talent management requirements. Let´s take, for example, the principle of the Talent mindset. Description: talent mindset is a formal document elaborated by HRM department and it is accepted and confirmed by the top management of the organization. This mindset is in the form of cascade and is itemized into several levels. Everybody, from a manager to an employee, understands what it means. Duties based on the philosophy of talent mindset are included in the employee´s formal work contract and the psychological contract. In case of TM the evaluation is based on the comparison of the reality with the given description. Each employee is provided feedback. The CIPD (2001) research indicates feedback as an important tool for the talent management effectiveness.
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Quantitative methods are based mainly on the estimation of ROI by measuring the expected outcomes and conducting the cost-benefit analysis.
Conclusion remarks
Talent management is a real challenge for all organizations that do not only want to survive on the market, but they would rather thrive on today’s highly competitive business environment;
A range of factors influences the corporate talent management;
Organizations need to fit and tailor their talent management approaches to their own context;
The first step in being able to manage talent effectively is the definition of talent and winning agreement on it;
There are significant differences in the extent to which talent management is implemented in organizations;
Companies need to align talent management with their business strategy, HR strategy and the organizational culture;
Business strategy is the starting point of the talent management strategy. Talent management must be driven by the business strategy;
Talent management is perceived as part of the company culture. The talent management implementation needs to involve managers at all levels;
Talent management does not only need the co-existence with other organizational programs and systems but its role is also to support and coordinate them.
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1.2. TALENT MANAGEMENT - NEW CHALLENGES FOR CONTEMPORARY ORGANIZATIONS In the 1980s in the USA one could observe consequences of a shortage of people being able to provide continuity of succession in top managerial positions, and specialists with specific competences. At that time one could also observe an organization’s increasing interest in the recruitment, development and retention of high-potential employees. That period also saw the emergence of talent management concept. The concept was popularized not earlier than the late 1990s when the war for talent was proclaimed.1 Various surveys conducted at that time aimed, among others, at determining how and which of the human resource management (HRM) processes affected a company’s success.2 The last 20-30 years have seen an increasing interest in talent issues. It has been so because of the key role of human capital in knowledge-based organizations and changes taking place on the labor market.3 According to a new approach to human capital management, people in the organization are not longer treated as resources but as talents creating added value. An increasing significance of and demand for high-potential (talent) employees being strategically important for the organization make it more and more difficult for the organization to recruit, develop and retain them. It is so because one can see a shortage of talents which is caused by their limited inflow to the labor market, low efficiency of identification and education systems, and the impact of inter- and external organizational factors. Limited supply of talented employees on the labor market has brought about a change in attitude towards the fulfillment of personnel functions in the organization. Its goal is to create such strategic configurations, processes, methods, techniques and instruments for human capital management that are conducive to satisfying organizational competency needs
1
The War for Talent concept was formulated by E. Michaels, H. Hanfield-Jons and B. Axelord. It does not focus only on the best employees but it defines individualized attitude towards searching for and identifying talent potential and its utilization for the benefit of an organization including its transfer across organizational units or functional/project teams. Thus it is a different attitude from the competency model in which an employee’s capabilities and skills are assessed according to the job description requirements and performance results. (Jamka 2011. p. 192-193) 2 In 1997 McKinsey&Company, while working on the results of research conducted in 77 large US companies, pointed out that what differentiated the best companies from average ones was not necessarily the quality criterion of HRM processes but rather the importance of talent and action taken for strengthening its organizational potential. As a result of the research repeated in 2000 a new business reality was defined. In the view of the authors of this research the new reality was created through the war for talent and five imperatives for companies which wanted to win the war. Those imperatives are: 1/ take a new, talent-based mind set; 2/ create a valuable proposal for winners; 3/ rebuild your recruitment strategy; 4/ incorporate development into your organization; 5/ differentiate and assure your people. (Jamka 2011, p. 188-192) 3 The factors that trigger these changes include: dynamic development of knowledge-based economy, technological changes, aging societies, migration of people and obsolete educational systems. (Pocztowski 2008. p. 14-35)
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through the acquisition, development and retention of high-potential employees. Their rational utilization determines gaining and keeping competitive advantage by the organization. That approach has created need for developing, within HRM, a talent management concept that requires a distinct strategy and personnel programs.
New Look at Human Resource Management The recent years have seen a large number of publications on HRM, which indicates great interest in this area by both researchers and individuals desiring to acquire specific knowledge. These publications most often present changes in HRM theory and practice, different approaches to selected elements of this process, used techniques and procedures, and used tools. It is obvious that changing internal and external conditions cause HRM in organizations to be subject to permanent change. As a result new HRM approaches, concepts, models and programs are created. Adjusting to the recommendations stemming from them in the area of unification and standardization are not conducive to organizational processes. It is manifested in limitations of creativity and innovativeness, keeping hitherto prevailing procedures or making use of traditional methods, techniques and tools. As a result employees are forced to take on routine behavior, avoid full involvement in the organization’s life, and are more often affected by burn-out syndrome. At the same time they try to keep work and life balance (Szaban, 2011). The necessity of counteracting negative phenomena present in employees’ attitudes and behavior leads to HRM being regularly adjusted to new challenges. It exerts a significant impact on the modern approach to the fulfillment of the personnel function which, first of all, should meet the needs of organizations aiming at staying in the competitive market. The time when it sufficed to formally deal with HRM issues in organizations, (e.g. within standard and usually costly approach to staff recruitment and selection, or training courses that produced competences without any links to business results) is gone. HRM’s increasing interest in the role of intangible resources results from a growing role of human capital, especially in knowledge-based organizations, and from the changes occurring on the labor market. An increase in significance of and demand for knowledge employees being strategically important for the organization has brought about greater interest in management of high-potential employees. A new goal of HRM has been to create such strategic configurations, processes, methods, techniques and tools for human capital management that are conducive to satisfying organizational competency needs through the acquisition, development and retention of employees classified as talented employees. Their rational utilization determines gaining and keeping competitive advantage by the organization.
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In the new business reality people started to be treated not as resources as such but as individual talents, or rather as, according to Jamka (2011, p. 192) “talent carriers whom should be treated adequately to value, that is, adequately to a company’s added value.” In the aftermath of this approach there appeared the need to develop and implement talent management concept into HRM practice, which was a response to “the war for talent” that centered around the search for, identification, acquisition, activating, development and retention of talents in the organization. However, actions taken in these areas call for specific strategies and programs that are in line with the organization’s personnel (HRM) strategy and overall business strategy.
Concept and Essence of Talent The review of the literature leads to the formulation of the conclusion that authors of different publications find it difficult to clearly define the concept of talent, and the essence, goal and scope of talent management. Thus they attempt to find consensus between different views on what talent is and its classification. These attempts would become easier if authors assumed such criteria as: uniqueness (scope) of aptitudes, connection of aptitudes with goals (organization’s strategy) and type of aptitudes (Pocztowski, 2008). The concept of talent usually has two meanings pertaining to HRM: subjective “human being equipped with outstanding creative gifts” and attributive - “unique, outstanding creative gift; outstanding aptitude for something” (Słownik języka polskiego, PWN). They express relationship between talent management and knowledge management, and intellectual capital. They also refer to competency management especially if one makes attempts to identify these unique gifts. According to Strelau (2007) talent is a combination of aptitudes realizing in man’s specific activity thanks to the interaction of internal and external factors that make it possible to creatively perform a certain task at the highest level. However, some other authors state that talent is a “sum of a given person’s aptitudes - their inborn gifts, capabilities and knowledge, experience, intelligence, opinions, attitudes, character and will to act. It includes their ability to learn and act” (Jamka 2011, p. 198). If, according to this definition, one recognizes talent as a form of potential, one can refer to the “gift matrix” that includes such notions as: intelligence, talent, specialist, creator and genius (Jamka, 2011). Talent is a high-potential person, a very competent employee who can rise to challenges resulting from profit-making and quantitatively limited top positions in an organization operating in the knowledge-based economy (Pocztowski, 2008). According to Listwan (2005) talents are people having a high level of competencies required by an organization that guarantee that the organization’s strategy will be efficiently realized. According to the most popular concept developed by A. J. Tannenbaum (1984) talent is an effect of interactions of the following factors: general abilities (proper level of intelligence, ability to reason and conclude); specific abilities; environmental factors conducive to development of these 44
abilities; personality features stimulating action (temperament, emotionality, motivation, concentration etc.); accidental factors (right place and time); creative thinking, own activity (Jamka, 2011). Referring to works by different authors one can assume that the components of talent are: outstanding general abilities (elevated intellectual potential) and specialist abilities (in a specific area); creativity (sensitivity, emotionality, original thinking, unconventionality, dealing with new problems, taking risk, tolerance for uncertainty, and acceptance for changes); involvement in work (self-discipline, diligence, work fascination, persistence in achieving goals, trust in one’s own capabilities, tendency to sacrifice) (Pocztowski, 2008). A slightly different perspective indicates that the ingredients of talent are the following features or competencies: ability to strategically think, leadership skills, emotional intelligence, ability to exert influence, entrepreneurship, goal orientation, flexibility and adaptation to changes, ability to work in teams, technical abilities within one’s own specialization (Kwiecień, 2005) Talent can also be interpersonal skills which, according to E. Schein (2006), indicate individual predispositions submitted to practical verification and explaining a person’s professional choices. The “career anchors” mentioned by E. Schein are: technical skills, managerial skills, cognitive openness, curiosity, personal motivation, involvement, low tolerance for stereotypical thinking, orientation on independence, stabilization, creativity, challenges and life style, sacrifice and providing support for others. They determine a high level of a person’s predisposition to performing a specific job and achieving exceptional success. From the social point of view one can distinguish the following types of talent: critical, distinctive, excessive and redundant. Among the elements of talent structure one can identify the following: intellectual potential, specific skills and certain features or their configurations. Additionally, one can find extra-intellectual factors including personality traits such as: persistence, diligence, endurance, self-discipline, originality, emotionality and trust in one’s own capabilities (Pocztowski, 2008). The above-mentioned quite general analysis of talent is sufficient to assume that various understandings of the talent notion lead to different interpretations, and consequently different applications of talent management concept.
Goal and Scope of Talent Management In the literature one can find attempts of defining the essence, goal and scope of talent management. A more and more growing significance of intellectual capital in creating organizational added value means that the essence and, at the same time, goal of talent management is an increase in efficiency of managing potential vested in employees belonging 45
in the group of talents. The concept of talent management, being a response to the organization’s need for high-potential employees and supporting its market competitiveness, is understood as an active shaping of relations with people endowed with talents, that is, inborn predisposition to achieving success in a specific area (Pocztowski, 2008). Referring to the subjective approach to talent one can, following Klimkiewicz (2007), assume that talent management “aims to attract, develop and retain in the company the most valuable employees, the so-called talents”. As the basic determinant of talent is its potential, “the policy of managing talent is about creating conditions under which talented employees develop their potential and use it to the benefit of the company as long as possible.” (Klimkiewicz 2007, p. 38). According to Listwan (2005, p. 21) “talent management is a collection of activities pertaining to exceptionally talented people taken with the aim to develop them and achieve the organization’s goals.” In a more specific notion talent management is understood as the identification, acquisition, development, retention, involvement and proper utilization of talents in concrete organizational conditions (Sienkiewicz, 2007). Maliszewska (2005, p. 79) expresses it in a more practical manner: “Talent management encompasses searching for talents in their own company or acquiring them outside, taking more care of them by providing development opportunities, training, and career paths. Moreover, managing talent is to provide appropriate remuneration (not only in the form of wages or salary) so that talents can be resistant to temptations coming from other employers and so that they can be willing to stay in the company”. Listwan (2005), Postowski (2008) claim that the talent management process includes the following stages: entry into the organization - internal identification of or external acquisition of talents for the organization (recruitment and selection), specifying career paths, planning and managing talented employees’ careers; transformation - development (improvement), assessment, utilization, relocation, motivation and talent retention; exit from the organization - observing a talented person with the aim of identifying signals for leaving the organization, monitoring reasons behind parting with talented employees, finding consequences of their leaving. According to Jamka (2011) to success in the use of talent management in practice lead the following ways: improvement of methods to identify sources and factors of human intellectual capital - talents, creating conditions for interactions of talent components (activating potential), more effective utilization of talents (in appropriate roles, functions and tasks) taking into consideration transfers, turnover, promotion, business trips and the like. The review of the literature on talent and talent management indicates that action taken by organizations within talent management should focus on:
searching for and identifying (discovering), attracting and acquiring, choosing (recruitment and selection) people with potential for further development; 46
assessment of employees’ competency match to the present and potential roles, adaptation and induction in the workplace, implementation of processes guaranteeing an appropriate flow of potential employees in the organization so that their skills could be well used in the organization;
diagnosing (measurement and assessment of potential), assessment, specifying career paths, planning and managing careers, creative utilization along with transfers within the organization;
strengthening diagnosed potential through activities supporting the development of individual competencies (stimulation through motivational interactions, mobilizing for activity, activating in development of potential, continuous professional education, self-realization);
retention and solving problems connected with dismissals from or leaving the organization (identifying signals for leaving the organization, monitoring the reasons for leaving, determining consequences of leaving, taking remedial measures, outplacement) (Jamka 2011, p. 194).
Thus it encompasses the same or similar key processes which are taken towards the organization’s all employees within typical HRM with the use of, what many authors emphasize, more sophisticated (innovative) methods, techniques and tools. This view is a new organizational approach towards the personnel function, including high-potential employees categorized into the group of talents.
Talent Management - Stage in the Evolution of Human Resource Management The consequence of desire to gain and keep competitive advantage is an increasing significance of shaping the organization’s image as the one that attracts and hires employees migrating after newer and newer challenges. If we acknowledge that these are the employees especially valuable for the organization, the ones who predetermine the organization’s market success, it is essential for the organization to change its approach to HRM and search for solutions corresponding to current problems, challenges and trends. It is connected with the need to develop new personnel concepts and models; to take new action in this area; to improve concepts, models, methods, techniques and tools of personnel marketing; and to radically depart from instrumental treatment of talented employees. This new approach to talent management should be regarded as a very essential element of HRM. The analysis of the shaping processes of personnel function over the years indicates that it has evolved from an administrative and personnel function, through the realization of 47
particular HRM stages, enhancing the significance of HR Department, and appreciation of human capital and knowledge workers, to investment in employees’ competencies, especially in high-potential employees (talents). That was evidence of the relationship between previous HRM functions and planning, and realization of its strategic functions. Nowadays there has emerged a new stage in the development of personnel functions. The phenomena typical of this new stage are as follows: advanced computerization and virtualization of personnel processes, outsourcing of personnel issues, and managing employees’ and organizations’ competencies. That and also the creation and utilization of competency models and structures have become the foundation for new solution in the area of HRM systems4. The essence of contemporary HRM is the fact that it is an element of organizational management. Yet the relationship between an organization’s business situation and an organization’s HRM is so important that it is recommended to realize all the personnel processes in combination, including talent management of course. The processes within its scope are not so much different from typical HRM processes and should result from both an organization’s general strategy and HRM strategy. Then it is justifiable to state that talent management is not a new, but rather, a further stage in the development of HRM, during which its “soft” rather than “hard” aspects are used. These aspects let organizations shape high-potential employees’ expected behavior, develop their competencies (knowledge, skills and experience) and benefit from their satisfaction and loyalty. The above-mentioned view refers not only to strategic planning of resources in a group of talents (including its quantitative and qualitative aspects, and expected competencies corresponding to strategic assumptions of organizational development), to choice (recruitment and selection) and adaptation, but also to motivation, development, assessment, rewarding, promotion, retention and leaving work. In all these processes one can observe the utilization of not only typical but also new, unconventional methods, techniques and tools, which are especially useful while staffing top managerial positions or highly specialist positions.
Factors Facilitating and Inhibiting Talent Management Talent management needs the ability to use not only these factors which allow the organization to identify, acquire (recruitment and selection), utilize, develop and retain talents, but also these factors which, being barriers, make these processes more difficult through the risk of not spotting talent, its irrational utilization, and even wasting it.
4
Characteristic features of developmental stages of personnel function are discussed by a large number of researchers. See e.g. Szaban 2011, p. 50-54.
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Referring to the literature on talent management one can observe that some authors mention, among talent constituents, environmental and accidental conditions which can be both internal (intrapersonal: cognitive abilities, motivational features, individual motivation and specific skills) and external (environmental). Both of these groups can have factors supporting talent (talent facilitators) and internal or external factors limiting talent (talent inhibitors).5 Other researchers mention, among factors making talent management more significant, primary factors (extra-organizational) and secondary factors (interorganizational).6 In some other researchers’ works there are other critical factors that make it difficult for the organization to attract talents. These factors are: shrinking resources of talented workers and limited sources of acquiring them; changes in life priorities of talented workers and candidates for them; a wider range of employment opportunities, cultural differences. However, in their opinion the negative effects affecting e.g. the retention of talents in the organization are conflicts of goals.7 The factors facilitating or inhibiting talent management not only allow organizations to determine directions for improving personnel functions but also show that talent management calls for a specific strategy included in an organization’s general business strategy and HRM strategy. Moreover, they can be treated as a sort of assumptions used at the
5
The internal talent facilitators encompass e.g. sense of perpetration (inner-direction, influencing one’s own life and taking responsibility for it), self-reflection, distancing from oneself and the surroundings, adequate selfesteem, resistance to stress and orientation on self-realization. The internal factors inhibiting talent include, among others, other-direction (lack of perpetration and influence on one’s own life, and responsibility for it), superficial self-reflection, and lack of self-criticism, erroneous (low or too high) self-esteem, low selfacceptance, emotional lability, admiration for oneself, distance and neglecting others. The external talent inhibitors operating in the family, educational and organizational environment include: limited knowledge of decision-makers, limited professionalism of HR specialists, undervaluation of the significance of human resources in the processes of market competition, lack of procedures connected with identifying and acquiring talents, untypical and rigid organizational structures, inadequate management style, low tolerance for diversity. (Pocztowski 2008, p. 43-44) 6 The extra-organizational factors are: transition of society and economy from the industrial era to the information era; substantial dependence of organizational efficiency on human capital quality; speed and high frequency of changes in management models and strategies which do not allow the match and development of competencies, and changes in employees’ behavioral attitudes; demographic changes in highly developed countries; shortage of talented workers in the global, regional and local scale; competitive war for talented workers between organizations; possibility to reach a global collection of talents that is connected to cultural diversity management; difficulty reaching employees whose specialist competencies are linked with creativity; mobility (migration) of human capital. The inter-organizational factors are: need to increase organizational efficiency; difficulty acquiring talented employees, need to prepare successors for managerial positions; need to retain talented employees in the organization; organization’s HRM policy; need to efficiently use tangible and intangible resources for training and development of talented employees, and extending the range of motivational tools. (Pocztowski 2008, p. 11-14, 80-81) 7 These factors are connected with e.g. inability to reconcile professional and private life, young generation’s impatience with regard to speed of career development; competition - war for talents; performance-based rewards; inability to early identify key talents; limitation to horizontal careers; work overload (burn-out syndrome); dehumanizing working environment (e.g. by creating virtual organizations). (Kwiecień 2005, p. 164)
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stage of designing detailed action plans for the purpose of acquiring, developing and retaining talented workers. It is these workers on whom, to a large degree, is dependent the organizational ability to build and keep competitive advantage. The scope of this action was presented in the subchapter Strategy and Program for Talent Management.
New Challenges and Trends in Talent Management Talent management like HRM is determined by its internal and external environment, to be more precise, by changes taking place on the labor market. It is reflected, first of all, in a limited number of available high-potential employees (talents). It results from new challenges connected with: technical and technological changes; necessity to manage migrations of employees; historic and social conditions; degree of standardization in the area of concepts and practical procedures, and in the area of modernization of HRM and TM processes; social changes taking place because of limitations connected with demographics and availability of new generation candidates on the labor market; opening of the European market and emerging opportunities for free flows of talented workers; employees’ desire to keep work and life balance, and to develop their own professional careers; possibility of telework; development of outsourcing and offshoring in the area of HRM and TM (Szaban, 2011). The consequence of the above-mentioned challenges is that TM, like HRM, has to keep up with political, economic and social changes, and also talented employees’ changes of expectations. The anticipation of probable changes leads to the formulation of trends, some of which are already visible in the practice of HRM and TM. According to Szaban (2011) these trends are as follows:
building competitive advantage upon employees’ knowledge and talents; knowledge management, talent management and managing key employees;
making use of personal marketing, including e-branding;
careful choice of employee/talent recruitment model;
new, unconventional approach to the selection of employees/talents;
building employment reserves and succession plans;
shaping employees/talents’ involvement and loyalty;
change of the motivation patterns for employees/talents;
transition from cooperation to co-opetition, combining cooperation with competition;
combining formal and informal leadership;
improvement of internal and external communications;
introduction of employees/talents’ participation in management and management by objectives; 50
reducing organizational distance to authority;
diversity management in the organization;
implementing innovation;
quality management, conflict management, crisis management and time management;
network management;
introduction of sustainable development and corporate social responsibility,
controlling.
The above-mentioned challenges and trends cause HR departments to start playing new roles in the organization. If they want to play a strategic role they should:
adopt an appropriate general and HRM strategy and all the consequences resulting from it;
match available concepts, models, processes, methods, techniques and tools to new challenges and trends as well as to external business conditions;
take such HRM action that creates highest added value;
manage the efficiency of talents (setting norms and standards, building incentive schemes, assessment systems, systems of reward and punishment);
define tasks, responsibilities and organization of work for HR officers;
improve information channels pertaining to talents (implementing communications strategy and systems, managing information and communications in the organization);
develop HR officers’ competencies.
These recommendations also refer to TM, as a further stage in the evolution of HRM. It is especially TM where one can see the need and necessity to take action directed at the creation of additional organizational values in the area of human capital.
Talent Management Model in the Organization A new approach to the personnel function, the ambiguity of talent concept and various approaches to the essence, goal and scope of TM mean that the creation of its model should, on the one hand, result from strategic principles of a specific organization in the area of HRM and TM, and on the other hand, from the creative utilization of theoretical model solutions
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which indicate the most crucial areas, basic principles and recommendations for acquiring, developing and retaining talents in the organization. Diverse conditions under which contemporary organizations operate make it impossible to design a universal TM model.8 That is why each organization should create its own TM model, adjusted to the specific conditions under which it operates. The TM model in the organization should be linked with the categorization of employees according to their significance and preciousness for the organization. Among these employees one can distinguish: key workers, managers of knowledge processes, senior specialists and promising talents who make up an organization’s knowledge-oriented community. Getting to know their differences gives mangers hints how to deal with them at the stage of recruitment, motivation, development, career building, promotion and work organization (Morawski, 2009). An organization’s multidimensional approach to managing such employees is the key to transferring human capital into intellectual capital. The talent management model, named by Morawski (2009), a layer model, is based on the realization of various functions which make it possible to:
8 9
model recruitment, motivational processes and the ones connected with professional career development that enable the organization to plan action, take rational staffing decisions and forecast their consequences;
introduce a coherent personnel strategy with regard to particular groups of employees (especially talents) so that their promotion from one category to another could mean a real and noticeable enhancement of position and status (both in material and extramaterial sense);
rationally utilize and develop human capital connected with decisions with regard to the division of financial resources, cost reductions, investment in selected employees (e.g. talents), dismissal of those who do not meet expectations etc.;
develop solution packages directed at selected groups (e.g. talents); the solutions should be internally coherent and should enable to achieve a synergy effect in the area of enforcements and relationships;
specialize HR officers in the so called services for particular knowledge workers.9
A general TM model was presented e.g. in: Pocztowski 2008, p. 61. The functioning of this model is based on principles presented in: Morawski 2009, p. 85-88.
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The review of the literature indicates that action taken by organizations for the purpose of implementing organizational TM should comprise: the identification of people with potential for further development, assessment of employees’ competency match to the present and potential roles, strengthening diagnosed potential through activities supporting the development of leadership skills, creation of processes guaranteeing an appropriate flow of potential employees in the organization so that their skills could be well used in the organization (Jamka, 2011). In practice the TM model usually focuses on: identifying, attracting, acquiring (recruitment and selection), diagnosing (measurement and assessment of potential), individual development (nurturing, stimulating, self-realization, motivation, mobilizing for activity, activating in development of potential, continuous professional education), creative utilization and retaining talents in the organization. The need to acquire, hire and retain talents in the organization means that each organization should create its own TM model adjusted to the specific conditions under which it operates. The organization should also creatively use model solutions which pertain to the most important areas, basic principles and recommendations. The analysis of various models presented in the literature makes it possible to formulate basic guidelines with regard to organizational TM model building principles. The guidelines are as follows:
identifying basic values of a professional organization rooted in the concept of intelligent organization based on partner approach to knowledge employees, including talents;
defining the vision, mission, strategic goals from the perspective of acquiring, developing and retaining talents;
determining key competencies of the organization that guarantee the organization’s competitive position on the market ;
singling out groups of key knowledge employees and determining which of them have competencies especially crucial for building an organization’s competitive position;
designing personnel strategies for particular groups of knowledge workers having different methods with regard to identifying, acquiring, measuring, and assessing professional development of, and retaining knowledge workers, especially talents, in the organization;
monitoring an organization’s environment from the perspective of the market of ideas, capital and talent by means of formal and informal relationships;
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determining alternative TM strategies with regard to specific strategic goals (e.g. choosing management methods, career and development management, management by objectives, effects, motivation or participation, competency management etc.);
analysis, evaluation and selection of a TM strategy appropriate for given conditions, and its implementation in the organization;
continuous improvement of particular elements of the model especially in the area of attracting, acquiring, developing and retaining talents;
conducting continuous assessment and modifications of the TM model along with working out methods of dealing with the existing barriers and threats (Morawski 2009).
A new approach to the personnel function, the ambiguity of talent concept and various approaches to TM in the organization make it difficult to develop a universal TM model.10 Consequently its development and implementation in a specific organization should result, first of all, from the strategic assumptions in the area of HRM and TM.
Strategy and Program for Talent Management Dynamic changes occurring on the market result in a shorter employment period of talent workers in the organization. This state of affairs, alongside growing difficulty in acquiring high-potential employees (talents), induce managers to take various measures to deal with these phenomena via, among others, setting TM goals and working out appropriate strategies that can be realized in practice. Strategic choices connected with an organization’s approach to TM result from the HRM philosophy professed by the organization’s managers, quality evaluation of human capital and the situation on the labor market. These three variables should determine the strategy and specific action taken with regard to talents being at the disposal of the organization. The strategic TM assumptions adopted by the organization should become the foundation for formulating a TM strategy and for creating a TM system. It is essential that this strategy result directly from the HRM strategy. This means that the TM strategy should be an elaboration of HRM strategy. In turn the HRM strategy should be an elaboration of the organization’s general strategy. If one assumes that talents, e.i. people with specific and unique traits, are important for an organization with regard to gaining and keeping its competitive market position, then the development and implementation of TM strategy will enable to take personnel decisions
10
A general form of the TM model in the organization was presented e.g. in: Pocztowski 2008, p. 61.
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concerning the identification of talents on the internal and external labor markets. It will also be easier for the organization to build and properly use talents’ capital and activities taking into account a specific situation on the labor market and current TM trends. The consequence of it will not necessarily be the development of the current personnel function or modification of its traditional model, but rather professionalization of HR practice in the area of talent management. The TM strategy is a configuration of goals, action plans and main TM processes oriented on: identifying, acquiring, diagnosing (measurement and assessment), individual development, motivation, rational utilization and retention of talents in the organization, as well as measurement and analysis of the efficiency of processes realized within TM. This enables the organization to modify not only practical action already taken, but also the very strategy at the level of its assumptions. However, TM actions resulting from the TM strategy and directed at talents should take the form of concrete HRM programs, in which one can use similar methods, techniques and tools found in HRM, but in a more sophisticated manner. Many of them presume, among others, active participation of managerial staff and their responsibility for TM, conducting periodical reviews (diagnosing, measuring and assessment) of talents, and adjustment of organizational culture (Pocztowski, 2008). The analysis of the literature on TM strategies leads to the conclusion that some of the concepts promote mainly activities connected with acquiring talents, while others promote issues connected with retaining talents in the organization. Yet in practice, the TM strategies that are being more and more promoted are the ones that focus on the internal development and retention of talented people in the organization. It is these strategies that are most often desired also on the Polish labor market. The utilization of TM strategy, whose goal is mainly the development and retention of organizational talent employee resources, is considered to be one of the most effective tools used by contemporary organizations in the war for talent, even if it entails large financial expenditures for appropriate investments (Pocztowski, 2008). The principal elements of TM strategy are references to: building appropriate organizational culture; talent development through training, internal transfers and work structuring; building a monitoring system of talented employees’ work efficiency and productivity; building a system of work appraisals taking into consideration employed talents; development of managerial staff who manage talents; changes of reward systems in the direction of relating managerial staff’s salaries with qualitative and quantitative TM goalachievement (Pocztowski, 2008). In TM strategic analyses the greatest emphasis is usually put on getting to know a worker categorized into a talent group. It is not common to take into consideration activities for the retention of talents in the organization, the more so that with that are connected 55
specific costs resulting from the necessity to determine which procedures, methods, techniques and tools can be used to retain them in the organization. These aspects should be specified not only in the TM strategy, but also in appropriate action programs for acquiring, utilizing and retaining the most valuable workers in the organization. They are undoubtedly the foundation for organizational success in preventing talents from resignations or limiting their resignations. The principal undertakings included in TM action programs are as follows:
intensifying actions for promoting an organization’s brand as a good employer;
linking TM strategy and programs with HRM strategy and an organization’s general strategy;
giving priority to and implementing TM strategy;
continuous analysis of the internal and external work environment and its modification;
analysis of competition on the labor market in the group of talents;
defining subjects responsible in the organization for TM (top management and line managers) and subjects supporting this process (consultants, advisors, HR officers);
creating a new HR function - specialist for talents (talent manager) whose task would be to identify, acquire and support talents;
defining managers’ roles in supporting and assisting talents in their decisions corresponding with their professional aspirations, specifying developmental directions that are in line with their values and life goals, designing and pursuing career paths;
improving procedures connected with the identification and acquisition of talents (recruitment and selection) ;
setting rules and specifying the scope of talented employees’ work so that their potential can be used in positions conducive to innovation;
formulating tasks within talents’ interests;
conducting research of talents’ satisfaction from work;
introducing additional, special and preferential clauses into employment contracts or into contracts containing unconventional personnel solutions (e.g. diverse and flextime forms of employment, short-term contracts, autonomy at work, individual work time 56
taking into consideration work/life balance, reward system, additional incentives, loyalty clauses that could attach talents to the organization, and which regulate mutual obligations, regulations concerning partial or complete refunds of expenditures incurred by the organization in case talents leave the organization);
building a team atmosphere conducive to rational utilization of talents’ and their coworkers’ potential, fulfilling mutual obligations connected with retaining talents in the organization (e.g. via building good relations with coworkers);
realization of actions for creating good working conditions which improve one’s wellbeing and give the feeling of an employer’s care (e.g. creating conditions for work/life balance, improving the physical work setting in the organization);
building a good working atmosphere conducive to development and to going beyond the hitherto prevailing achievements (e.g. via participation in the company’s bonding events, socializing in the workplace, creating conditions for healthy competition);
implementing effective employee motivational programs for both talents and their coworkers that take into consideration talents’ aspirations and their desire to develop competencies (e.g. special incentive schemes for talents, rules for talents’ evaluation, promotion and demotion);
implementing special remuneration systems for talents (e.g. cafeteria plans, compensation packages, higher pay rates);
involving talents in the process of knowledge creation, utilization and sharing, and also making use of them as trainers for other employees in the organization;
eliminating discrepancies between work breakdown structures and inappropriate utilization of talents’/employees’ potential ;
specifying expenditures for talent management;
investing in individual development of talents;
leading dialog and consultations on the talents’ career development and designing individual career plans;
creating conditions for talents’ professional career development via specifying their career paths, and working out their individual horizontal and vertical promotion tracks;
evaluation of talents’ behavior, development and work progression in order to design and implement individual programs adjusted to the talent’s diagnosed competency gap 57
and further development (e.g. training courses, international internships, sabbaticals, privileged access to the organization’s information and knowledge, participation in attractive tasks and projects);
analysis of reasons for and scope of talents’ resignations;
defining and taking effective preventive actions (e.g. in case of talents’ resignations);
realization of procedures in the event of talents’ resignations, including the creation of a good resignation atmosphere and building good relationships with them;
fulfilling mutual obligations connected with talent management in the organization;
adjusting organizational culture to the requirements resulting from talent management;
implementing internal and external PR policy that is in line with talent management strategy (Pocztowski, 2008; Rojewska and Gera-Pikulska, 2005; Stegenka, 2005; Morawski, 2009).
The implementation of TM strategy is connected with the realization of the above mentioned TM tasks and activities. However, the scope of controlling mechanisms for TM strategy comprises determining the degree of the realization of action plans, analysis of specific activities with regard to achieving specific targets, comparing the final results with the adopted assumptions and taking corrective action (Pocztowski, 2008). Talent management in the organization requires not only the careful development of strategy and consistent realization of HR action plans, but also - maybe in the first place - good communications and cooperation between managers and talents, appropriate PR policy aiming at building an organizational caring image and operating in line with business ethics. Because of the complexity of activities and actions it is necessary to involve in these actions all the subjects connected with TM (board of directors, line managers, HR officers, consultants and advisors, talents and other employees). Their involvement is indispensable as regards both undertakings connected with acquiring, utilizing and developing organizational talents, and the analysis of reasons for their fluctuations (resignations and dismissals). Their involvement is also essential in determining the scope of preventive and corrective actions aiming at their retention in the organization.
Conclusion The war for talents is becoming more and more widespread. Its essence and significance indicate that TM is becoming more and more important for contemporary organizations. It results from the development of knowledge-based economy, changes on the labor market, 58
development of new technologies, mobility and migration of high-potential employees, and changes in HRM concepts, models, methods, techniques and tools, caused by an increasing significance of intangible assets as a competitive factor. It is no wonder then that TM is regarded in the literature as a further, more and more popular, stage in the evolution of HRM concepts. It is so because it is conducive to building and keeping the organization’s image as a good employer. The organizations who want to compete against one another should take care of the development, implementation and continuous improvement of TM system. It will enable revealing strengths and weaknesses of high-potential employees categorized into a group of talents, and it will also enable better management of their professional careers. It is also connected with the selection for talents of such roles, functions and tasks which are in line with their predispositions and are conducive to acquiring and retaining competitive advantage by organizations. The employees categorized into the group of talents are now becoming main subjects in strategic HRM. Thus HRM needs an appropriate management model, and also strategies and action programs in the area of talents’ identifying, acquiring, choosing (recruitment and selection), diagnosing (measurement and assessment), utilization, activating, development, career management and retention in the organization. All of this should be coordinated with the organization’s HRM strategy and general business strategy. The use of typical (traditional, conventional, standard) methods, techniques and tools, applied so far to HRM, is no longer sufficient because they are less and less effective. Thus it is advisable to search for and use in HRM untypical (nonstandard, unconventional) methods, techniques and tools. It will result in, on the one hand, acquiring for the organization highpotential candidates, rational utilization of talents’ potential for the more effective realization of their tasks, and, on the other hand, increasing talents’ motivation and self-esteem for achieving and retaining the organization’s competitive advantage. Thus it is justifiable to conclude that it is necessary to conduct scientific research in the area of talent management and implement its results in practice of the organization’s human capital management.
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Part Two TALENT MANAGEMENT IN VISEGRAD COUNTRIES - RESEARCH SURVEY
61
2.1. APPLYING THE CONCEPT OF TALENT MANAGEMENT IN VISEGRAD COUNTRIES In this chapter we deal with the research implemented as part of the Visegrad Fund project: "Integrated Talent Management - Challenge and Future for Organizations in the Visegrad Countries" and its results. The research survey was conducted to explore the current state of applying the concept of talent management in the organizations of the Visegrad Four countries.
Research Methodology In this chapter “Data and methodology“ we describe the way of the research implementation and the methods used for processing the data gained from the research. Data collection As stated in Munk, Kapusta and Švec (2010) good quality data are a prerequisite for a wellimplemented data analysis. If there is “junk” at the input, the same will be at the output, regardless of the method for the knowledge extraction used. With this statement in mind the theoretical survey about the issues to be solved was created on the basis of the studies of the printed and non-printed information sources relevant to the topic of talent management. Selective survey was used as a method of the data collection. According to Munk (2013) the selective survey means that the chosen data are only part of the basic file and therefore the accuracy of the results is limited. The selective file was determined randomly in each country. A scaled questionnaire of the authors´ own construction was used as a tool of collection that apart from the introductory classification items (size of the company, proportion of administrative staff, form of ownership, economic situation of the company, foreign capital, field of activities, work position of the respondent and the company seat) contained 41 items divided into five core fields - the implementation of talent management into business strategy, the identification of talents, the evaluation of talents, the development of talents and the retaining talents. The individual items of the questionnaire were scaled. Likert scale from 1 to 5 was used, where figure 5 corresponded to the absolute consensus of the respondent with the statement in the wording of the item (formulated as a positive statement), and figure 1, on the contrary, to the absolute disagreement of the respondent. Figure 3 expressed his/her irresolute attitude and the added figure 0 enabled the respondent not to comment on a given item. All such “answers” were excluded from further processing. The questionnaire was partly distributed in person and partly electronically by means of an online form of the Google documents system. On the whole 450 respondents from the Slovak Republic, Hungary, Poland and the Czech Republic participated in the research (also thanks to the personal 62
distribution of questionnaires which provided for high returnability). Each respondent represents one business subject. Methods applied Because the questionnaire did not consist of dichotomized items, its reliability was verified by means of Cronbach´s alpha. As stated in Nunnally and Bernstein (1994) the evaluation of scales is based on examining the correlations between the individual items or measurements in relation to the variability of the items. The values of Cronbach´s alpha 0.7 and more mean sufficient internal scale consistence. The method of the split-half measurement instrument was used as the second method of verifying the reliability. Initially tests were divided into half parts and a host of split-half reliability coefficients were derived (for reviews and details, see, for example, Feldt and Brennan, 1989). The oldest and probably most widely used splithalf coefficient calculates the correlation between scores on two halves of the test (X1 and X2) and estimates the correlation – reliability – for a full length test with the Spearman– Brown “prophecy” formula. The construct validity was verified by means of a factor analysis. The factor analysis allows researchers to make inferences about the nature of a construct by examining the factor structure of a valid measure of that construct (Deacon and Abramowitz, 2005). The validity was furthermore verified by expert evaluation. Owing to the character of the collected data non-parametric statistical methods were used. To verify the existence of statistically significant differences between the individual groups of respondents (depending on a particular factor, see classification units) the KruskalWallis test, Jonckheere-Terpstra test (Jonckheere, 1954, Terpstra, 1952) and Mann-Whitney U test were used. According to the authors Pavelka and Klímek (2000) the Kruskal-Wallis test is a non-parametric parallel of a simple classification of the dispersion analysis (dispersion analysis for one factor). It is a direct generalisation of the Wilcoxon two sample test (when k ≥ 3). According to Rimarčik (2007) the aim of the test is to find whether the differences of the medians found in the sample of the individual groups are statistically significant (there is a relationship between the variables) or whether these are coincidental (there is no relationship between the variables). A null statistical hypothesis with parity of all the medians is tested. If the p-value is lower than the chosen level of significance (traditionally 5% = 0.05), the null hypothesis is rejected. This means that the difference between at least one pair of the medians calculated from the sample is too big to be a result of only random selection, i.e. it is statistically significant – there is a relationship between the variables. If the p-value is equal or higher than the chosen level of significance, the null hypothesis cannot be rejected. This means that the difference between each pair of the medians calculated from the sample
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can only be a result of random selection, i.e. it is not statistically significant – there is no relationship between the variables. When the Kruskal-Wallis test confirmed the existence of a statistically significant difference, suitable methods of “post hoc testing” were used (Tukey`s HSD test). Nonparametric correlation was applied to explain the identified difference in more detail. These methods were used when the random selection did not stem from the two-dimensional normal division or when it contained some remote observations, which was the case of our research. The Spearman coefficient is the most frequently used ordinal coefficient which can be calculated from the formula used for the calculation of the Pearson coefficient where instead of the original values their ordinal numbers are used. Therefore the Spearman correlation coefficient is difficult to interpret. Unlike Spearman coefficient, Kendall coefficient expresses the extent of dependency between two ordinal variables, i.e. it expresses the difference between the probabilities that the values of two variables are in the same order as opposed to the probability that the values are not in the same order. The values of both the nonparametric correlation coefficients do not equal and are not mutually comparable. Kendall´s tau states values lower than Spearman´s ρ. But in both the coefficients there is the same amount of applied information included in the analyzed values, and therefore they have, as far as the detection of the relationship is concerned, the same weight. Statistical software SPSS 20.0 was used for calculations. Research questions The objective of this research survey was to explore the current state of applying the concept of talent management in the organizations of the Visegrad countries. In order to achieve this objective the following research questions were developed:
What factors (characteristics) influence the applying the concept of talent management in organizations most significantly?
Are there any regional differences in the way the concept of talent management is implemented?
Does the existence of the HR department in the organization cause differences in the way the concept of talent management is implemented?
Is the form of ownership an important factor in applying talent management in the organization?
Does foreign capital cause differences in applying talent management in the organization?
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Are larger companies more successful in retaining talented employees than the small ones?
When looking for the answers to the above questions we also found other interesting facts and these are given either in the respective parts of the text or in the Subchapter 2.4.
Verifying reliability and validity of the measurement instrument The reliability of the questionnaire was verified by means of the method described closer in Chapter 1.2. Table 1 summarizes the gained results. Table 1: Reliability of the used questionnaire Cronbach`s Alfa Cronbach's Alpha Based Cronbach's on Alpha Standardized Items 0.751 0.759
Strategy
Split-half Guttman
Number of items
Equal
Unequal
0.802
0.804
0.801
9
Identification
0.674
0.695
0.480
0.481
0.425
11
Assessment
0.848
0.849
0.845
0.848
0.840
7
Development
0.758
0.767
0.690
0.694
0.651
7
Retaining Total reliability
0.791 0.914
0.789 0.920
0.842 0.756
0.844 0.756
0.842 0.750
7 41
Source: own processing
As is obvious from Table 1, both the item and the overall variability correspond to the recommended value 0.7 and in some cases even exceed it. With regard to the achieved results it is therefore possible to regard the reliability of the measurement instrument as sufficient even if in case of the field of identification the results did not correspond with the recommended value. The construction validity was verified by the factor analysis by means of the varimax rotation of factors. The suitability of applying the factor analysis was verified on the basis of the KMO test and the Bartlett´s test of sphericity. The condition of the minimum number of respondents (150) was met. The results of both the testing statistical methods were satisfactory (In the Bartlett´s test p <0,05, KMO >0,7, the value reached was 0.878.) The suitability of applying the factor analysis was confirmed. The factor analysis identified nine background actors which altogether explained almost 70% of the total dispersion. Based on the correlation of the factors with the individual items it was possible to identify the below factors:
factor 1 – linkage of talent management with the organization strategy;
factor 2 – retaining talents;
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factor 3 – demandingness of implementing talent management;
factor 4 – identifying the key work positions;
factor 5 – linkage of the systems of evaluation and rewarding employees;
factor 6 – knowledge of the needs for talents in the future;
factor 7 – importance of talent management for the organization;
factor 8 – ability to meet the financial requirements of the talented workers;
factor 9 – development of the talented workers on the key positions.
Based on identifying the factors fully corresponding to the questionnaire content we regard the construction validity of the measurement instrument as satisfactory.
Empirical Results In this subchapter we present the gained results and offer suggestions for further research. Sample characteristics The last nine items of the questionnaire served as a possibility of more detailed characteristics of the sample from the point of the size of the company, proportion of the administrative staff, form of ownership, economic situation of the company, foreign capital, field of activities, work position of the respondent and the company seat. Table 2: Seat of the company Frequency
Percent
Valid Percent
Cumulative Percent
Slovak Republic
139
30.9
30.9
30.9
Hungary
97
21.6
21.6
52.4
Poland
108
24.0
24.0
76.4
Czech Republic
106
23.6
23.6
100.0
Total
450
100.0
100.0
Source: own processing
As can be seen in Table 2, the representation of the respondents from the individual countries was relatively well-balanced, the highest number of the respondents (almost 31%) being from the Slovak Republic. On the other hand, it is necessary to say that the completeness of the answers of the respondents was the lowest. The total number of respondents was 450.
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Table 3: Size of the company Frequency
Percent
Valid Percent
Cumulative Percent
10-49 employees
136
30.2
30.7
30.7
50-249 employees
122
27.1
27.5
58.2
Over 250 employees
185
41.1
41.8
100.0
Total
443
98.4
100.0
7
1.6
450
100.0
System Total
Source: own processing
From the total number of 443 respondents who stated the number of the employees in the company they work for, 136 respondents were from the so called small businesses, 122 respondents from the so called medium sized businesses and 185 from the so called large businesses. Once again, it can be stated that the representation of the individual size groups was well-balanced. Table 4: Area of the activity of the company Frequency
Percent
Valid Percent
Cumulative Percent
Industry
99
22.0
22.4
22.4
Civil engineering
24
5.3
5.4
27.9
Handle
66
14.7
15.0
42.9 100.0
Services
252
56.0
57.1
Total
441
98.0
100.0
9
2.0
450
100.0
System Total
Source: own processing
We reduced the field of the activity of the company to the fields given in Table 4. As expected, the most represented group was the group of companies working in the service sector (57%). The least represented group was formed by companies from the building industry (5%). Table 5: Ownership of the company Frequency
Percent
Valid Percent
Cumulative Percent
State/public
71
15.8
16.0
16.0
Private
373
82.9
84.0
100.0
Total
444
98.7
100.0
System Total
6
1.3
450
100.0
Source: own processing
Private ownership prevailed in the structure of the respondents (84%). Six respondents did not state whether the organization they worked for was a state organization or whether it was owned privately. 67
Table 6: Foreign capital in the capital structure of the company Percent
Yes
197
43.8
44.4
44.4
No
247
54.9
55.6
100.0
Total
444
98.7
100.0
System Total
6
1.3
450
100.0
Valid Percent
Cumulative Percent
Frequency
Source: own processing
More than a half of the organizations (55%) in which the respondents work is without the participation of foreign capital. The proportion is well-balanced again, which creates good conditions for finding out about the influence of the participation or non-participation of foreign capital in the capital structure of the organization on the implementation of talent management in it. Table 7: Share of administrative staff Frequency
Percent
Valid Percent
Cumulative Percent
Up to 9%
93
20.7
24.7
24.7
10%-49%
158
35.1
42.0
66.8
Over 50%
125
27.8
33.2
100.0
Total
376
83.6
100.0
System
74
16.4
Total
450
100.0
Source: own processing
A relatively large part of the respondents (16%) could not adopt any attitude in that issue. 158 respondents (42%) stated that the proportional representation of the technicaladministrative workers varied between 10% and 49%. The second largest group was the group with the proportion of the technical-administrative workers exceeding 50%. From the above we can conclude that those were namely companies from the public sector (authorities or educational institutions). Table 8: Change of the economic situation of the organization in comparison with the year 2012 Frequency
Percent
Valid Percent
Cumulative Percent
Better
139
30.9
37.1
37.1
Without change
142
31.6
37.9
74.9
Worse
94
20.9
25.1
100.0
Total
375
83.3
100.0
System
75
16.7
Total
450
100.0
Source: own processing
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It is obvious from Table 8 that the number of the respondents who stated that the economic situation of the organization in which they worked either improved or remained unchanged was equal (identically 37%), 25% of the respondents stated that the economic situation worsened. The results must not be taken too seriously because with regard to the work position (see Table 10) not all the respondents had good knowledge of the overall economic situation in their organization. Table 9: HR department in the company Yes
Frequency
Percent
Valid Percent
Cumulative Percent
292
64.9
67.7
67.7 100.0
No
139
30.9
32.3
Total
431
95.8
100.0
System
19
4.2
Total
450
100.0
Source: own processing
More than two thirds (almost 68%) of the respondents confirmed that the organization in which they worked had a fully fledged HR department. This result can be considered positive because the existence of a HR department, in our view, increases the probability that the concept of talent management is applied in the organization.
Table 10: Work position of the respondent Frequency
Percent
Valid Percent
Cumulative Percent
Owner
28
6.2
6.6
6.6
Director
37
8.2
8.7
15.3
Head of HR department
42
9.3
9.9
25.2
Employee of HR department
88
19.6
20.7
45.9
Other
230
51.1
54.1
100.0
Total
425
94.4
100.0
System
25
5.6
Total
450
100.0
Source: own processing
28 respondents were at the same time the owners of the company, other 38 respondents were managing directors. 130 respondents worked directly in the HR department out of whom 42 were the heads of the department. The remaining 230 respondents worked in the positions different from those above.
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The influence of the selected characteristics In the following part we are going to pay attention to the influence of the individual characteristics on the fields which were dealt with by the questionnaire within the issues of talent management, namely the linkage to the strategy, the identification and recruitment of talented workers, their development, evaluation and retention. We looked into the influence of the following characteristics (in brackets there are also the sorts of tests applied for each individual characteristic):
seat of the company (Kruskal-Wallis test, Jonckheere-Terpstra test);
size of the company (Kruskal-Wallis test, Jonckheere-Terpstra test);
field of activity (Kruskal-Wallis test, Jonckheere-Terpstra test);
ownership (Mann-Whitney test);
foreign capital (Mann-Whitney test);
share of administrative staff (Kruskal-Wallis test, Jonckheere-Terpstra test);
economic situation (Kruskal-Wallis test, Jonckheere-Terpstra test);
HR department (Mann-Whitney test);
work position (Kruskal-Wallis test, Jonckheere-Terpstra test).
The place of talent management in the business strategy The first part of the questionnaire (formed by items 1 – 9) dealt with the issues of integrating talent management into the overall business strategy and the way its significance is perceived by the company. By means of tests (see Subchapter 1.2) we verified whether the above characteristics influenced the respondents' answers or whether there are statistically significant differences and if so what are they caused by. The results of the tests are visualised by Table 11, the statistically significant differences in the respondents' answers caused by the influence of any individual factor are highlighted. The results gained by means of the Kruskal-Wallis test were confirmed also by the Jonkheere-Terpstra test. Table 11: Test results – the field of implementing talent management into the company strategy Characteristic Seat of the company Size of the company Field of activity Ownership Foreign capital Share of adm. Staff Economic situation HR department Work position
Item p level p level p level p level p level p level p level p level p level
I_1 0.021 0.046 0.327 0.210 0.025 0.145 0.013 0.110 0.923
I_2 0.102 0.005 0.914 0.876 0.198 0.080 0.021 0.014 0.210
I_3 0.467 0.020 0.944 0.317 0.012 0.649 0.548 0.151 0.091
Source: own processing 70
I_4 0.014 0.355 0.653 0.355 0.343 0.346 0.064 0.911 0.028
I_5 0.248 0.033 0.449 0.034 0.013 0.558 0.170 0.174 0.389
I_6 0.187 0.103 0.681 0.087 0.102 0.729 0.269 0.832 0.400
I_7 0.297 0.024 0.224 0.034 0.065 0.859 0.064 0.032 0.057
I_8 0.062 0.008 0.782 0.694 0.234 0.505 0.449 0.094 0.287
I_9 0.003 0.358 0.311 0.207 0.579 0.832 0.370 0.260 0.562
The results of the tests showed that the area of the company activity and the proportion of the technical-administrative employees have no influence on the linkage between the company strategy and talent management as in none of the items the existence of a statistically significant difference was confirmed. On the contrary, the size of the company expressed by the number of its employees proved to be the most significant factor influencing the implementation of talent management into the company. Seven out of nine items show statistically significant differences in the respondents answers and the Tukey´s test showed that in each of these cases it was the differences in the answers of the employees of the so called small companies (10-49 employees) and the so called large companies (more than 250 employees). This fact can, in our view, be attributed to the fact that a higher number of employees require a more complex personnel policy and this opens space for implementing the concept of talent management. Apart from the influence of the company size the tests also showed a relatively significant influence of the “seat of the organization” and “foreign capital”. The Tukey´s test revealed that namely the Slovak Republic had its own specific features in the field of the linkage of the company strategy and talent management as in case of item 1 the test revealed a statistically significant difference between the answers of the respondents from Slovakia and Hungary, in case of item 4 the answers of the Slovak respondents were different from the answers of the respondents from the Czech Republic and in item 9 the attitudes of the Slovaks differed from those of the Hungarian and Polish respondents. Statistically significant differences were identified in the answers of the respondents also on the basis of the “foreign capital”. The respondents working in the organizations with a proportion of foreign capital tended to have more positive attitude to talent management than the respondents working in the organizations without the participation of foreign capital. What we considered surprising was the fact that the influence of the existence of the HR department could only be visible in two out of nine items. We had assumed that the influence of this characteristic on implementation of talent management would be more significant. We had also assumed a more significant influence of the form ownership. Field of identification and recruitment of talents The second and the most extensive part of the questionnaire (items 10-20) dealt with the issues of identifying and recruiting the talented employees either from the internal or external surroundings. We were also interested whether organizations are familiar with the need for
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talented workers in the future and whether they respond to those findings by creating plans and by applying any specific methods. Similarly to the field of strategy, we also examined the influence of nine characteristics on the field of identification and recruitment of talents. The test results are summarized in Table 12, in case of the existence of a statistically significant the p value in the respective item of the questionnaire is highlighted in the relevant factor. The results gained by means of the Kruskal-Wallis test were also confirmed by the Jonckheere-Terpstra test. Table 12: Test results – the field of identifying and recruiting talents Characteristic Seat of the company Size of the company Field of activity Ownership Foreign capital Share of adm. staff Economic situation HR department Work position
Item p level p level p level p level p level p level p level p level p level
I_10 0.006 0.846 0.544 0.703 0.913 0.237 0.596 0.654 0.292
I_11 0.250 0.115 0.909 0.921 0.717 0.348 0.810 0.162 0.192
I_12 0.398 0.300 0.659 0.335 0.120 0.161 0.889 0.230 0.242
I_13 0.399 0.036 0.507 0.147 0.725 0.450 0.737 0.714 0.069
I_14 0.211 0.596 0.290 0.858 0.285 0.970 0.332 0.947 0.044
I_15 0.220 0.186 0.542 0.671 0.186 0.143 0.680 0.292 0.351
I_16 0.346 0.122 0.175 0.596 0.038 0.975 0.732 0.117 0.388
I_17 0.717 0.000 0.704 0.085 0.082 0.488 0.520 0.058 0.029
I_18 0.012 0.010 0.531 0.458 0.760 0.986 0.967 0.330 0.015
I_19 0.153 0.413 0.907 0.868 0.782 0.980 0.644 0.817 0.589
I_20 0.179 0.826 0.341 0.634 0.284 0.315 0.140 0.610 0.319
Source: own processing
The items related to the second field of the questionnaire are less influenced by the individual characteristics. With five characteristics (particularly with the field of the activity of the company, ownership, the proportion of the technical-administrative staff, the development of the economic situation of the organization and with the existence or nonexistence of the HR department) the tests did not confirm the existence of statistically significant differences in the respondent´s answers. Similarly as in case of the field of the linkage of the company strategy and talent management the size of the company (organization), expressed by the number of employees, proved to be a significant characteristics also in the field of identifying and retaining talents. But its influence does not seem to be as significant as in case of the previous field and it was only evident in three items (13, 17 and 18). The Tukey´s test revealed again that the respondents answers working in the small and large businesses were different but in items 17 and 18 there already was a statistically significant difference also in the answers of the respondents from the so called medium sized businesses as compared with the respondents from large businesses. Here we can see space for further research aimed at the methodology of identification, recruitment and selection of talented workers applied by large companies. As is obvious from the test results, another significant characteristics is the work position of the respondent, which influenced the respondents answers in three items (14 and again 17, 18). In the above items namely different answers of the employees from the HR department became evident as opposed to other work positions. We assume that this 72
difference in answers was caused by better knowledge of the personnel specialists as far as the issues of talent management are concerned. Field of evaluation and rewarding Items 21-27 were devoted to the field of evaluation and rewarding. Among other things we were interested whether the evaluation is systematic and whether organizations use a specific set of criteria and whether the results of the evaluation are used in creating personnel plans, or, as the case may be, whether these are reflected in rewarding employees. We had assumed that larger companies had a more elaborate system of evaluation, which may be helped by the existence of the HR department. The test results are shown in Table 13. Statistically significant differences are highlighted. The results gained by means of the Kruskal-Wallis test were also confirmed by the Jonckheere-Terpstra test in each case. Table 13: Test results – the field of evaluation and rewarding talents Characteristic Seat of the company Size of the company Field of activity Ownership Foreign capital Share of adm. staff Economic situation HR department Work position
item p level p level p level p level p level p level p level p level p level
I_21 0.602 0.158 0.306 0.172 0.624 0.512 0.315 0.568 0.326
I_22 0.213 0.003 0.592 0.985 0.375 0.917 0.373 0.241 0.006
I_23 0.024 0.041 0.782 0.659 0.253 0.896 0.612 0.002 0.333
I_24 0.199 0.552 0.121 0.827 0.188 0.450 0.851 0.859 0.552
I_25 0.126 0.012 0.381 0.441 0.154 0.407 0.598 0.037 0.325
I_26 0.471 0.041 0.248 0.420 0.111 0.772 0.365 0.024 0.115
I_27 0.002 0.028 0.432 0.417 0.017 0.554 0.856 0.032 0.007
Source: own processing
The test results even in the third field confirmed a strong influence of the size of the organization on the respondents answers (there are statistically significant differences in five out of seven items). The Tukey´s test confirmed that in each case the statistically significant difference in the respondents answers was caused by different answers of the respondents from the so called small and large businesses. Once again there is a gap for further research into the differences between the methods used for evaluation applied in small and large organizations and into what their results and benefits for an individual organization are. For the first time in the course of the research the issue of the existence of the HR department became evident as a significant factor influencing respondents answers. This phenomenon was spotted in an organization where one of the respondents works. The difference in answers based on the existence or the HR department was confirmed by a test in four items (23, 25, 26 and 27). The respondents working in companies where there are HR departments confirmed in their answers that the results of the employees´ evaluation and their application in creating personal plans and in rewarding employees were given higher priority than in the organizations where the HR department is missing.
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Field of the development of talents The care for talented employees and their further professional development is a very important field of talent management (as well as personnel management in general). The test results (Table 14) confirm that a large part of the respondents is aware of this because the influence of the individual factors is the lowest in the field of the care for talented employees. Statistically significant differences are highlighted in the table. The results gained by means of the Kruskal-Wallis test were in each case, once again, confirmed also by the JonckheereTerstra test. Table 14: Test results – the field of the development of talents Characteristic Seat of the company Size of the company Field of activity Ownership Foreign capital Share of adm. staff Economic situation HR department Work position
Item p level p level p level p level p level p level p level p level p level
I_28 0.613 0.080 0.832 0.822 0.263 0.446 0.127 0.989 0.152
I_29 0.199 0.431 0.487 0.398 0.836 0.720 0.660 0.063 0.004
I_30 0.015 0.268 0.894 0.581 0.920 0.914 0.137 0.096 0.057
I_31 0.285 0.025 0.287 0.581 0.286 0.447 0.215 0.249 0.067
I_32 0.532 0.051 0.977 0.897 0.445 0.997 0.977 0.122 0.010
I_33 0.062 0.001 0.699 0.504 0.535 0.663 0.832 0.104 0.117
I_34 0.853 0.999 0.964 0.947 0.786 0.979 0.704 0.935 0.051
Source: own processing
Only three out of nine characteristics caused the existence of statistically significant differences in the respondent´s answers and even these appeared only in two items out of seven at the most. In particular, these were the company seat (item 30), the company size (items 31 and 33) and the work position of the respondent (items 29 and 32). What we consider interesting is the fact that the respondents working in the so called large company stated that their organization had enough time for the development of talent, which in our view corresponds to the reality, because namely larger companies have elaborate educational systems enabling such development. Smaller companies often need a “readymade” person and they do not focus on talented employees because they are not yet ready to perform at the level corresponding to their potential. This fact calls for a change in the attitude towards the personnel policy of smaller businesses, namely from the point of view of the reorientation from the maximization of the current performance to the future performance of the organization, and this may increase its potential (also thanks to the induction period and the development of the talented employees) significantly in comparison with the existing state. Field of retaining talents The last field we examined from the point of view how it was influenced by the above characteristics was the field of retaining talents. It is not unusual that after completing a retraining course and a possible follow up study programme employees do their best to 74
make good use of their newly adopted qualifications and they look for more lucrative jobs and they may leave the company that enabled them to achieve the higher qualifications. This fact may often be reflected in the decreased level of willingness to invest into the development of the company´s employees. Therefore we were interested how the organizations in which the respondents work try to retain their “talents” (financial benefits, special ways of communication, system of motivation) and whether they are successful in their effort. The results are given in Table 15. Statistically significant differences are highlighted. The results gained by means of the Kruskal-Wallis test were in each case, once again, confirmed also by the Jonckheere-Terstra test. Table 15: Test results – the field of retaining talents Characteristic Seat of the company Size of the company Field of activity Ownership Foreign capital Share of adm. staff Economic situation HR department Work position
item p level p level p level p level p level p level p level p level p level
I_35 0.130 0.001 0.709 0.531 0.052 0.284 0.292 0.040 0.106
I_36 0.448 0.416 0.558 0.512 0.354 0.623 0.292 0.293 0.282
I_37 0.002 0.009 0.723 0.621 0.394 0.632 0.100 0.025 0.840
I_38 0.000 0.396 0.432 0.812 0.771 0.691 0.650 0.321 0.486
I_39 0.031 0.003 0.420 0.050 0.495 0.597 0.296 0.066 0.130
I_40 0.077 0.054 0.149 0.453 0.152 0.186 0.212 0.015 0.382
I_41 0.005 0.000 0.843 0.063 0.001 0.985 0.091 0.000 0.000
Source: own processing
The tests confirmed the influence of three factors: the company seat, its size and the existence of the HR department. All the three characteristics identically caused differences in the respondents answers in four items (see Table 15). In case of the seat of the company the tests show certain differences in case of the Slovak Republic which especially in item 38 (problems in communication) caused that the answers of the respondents from the Slovak Republic varied from the other three countries. Once again there is an opportunity for further research into those specific features in applying the concept of talent management that are typical of the Slovak Republic. As in each of the previous fields dealt with by the questionnaire even in case of the field of retaining talents a strong influence of the company in which the respondents work (expressed by the number of employees) was confirmed. What is relatively surprising here is the fact that the employees from the so called larger companies stated that their companies did not succeed in retaining talented employees in spite of applying some special attitudes to their self-development. The existence of the HR department was the third significant factor. The difference in respondents answers was most significant in item 41 which dealt with applying special procedures in support of the talented employees. The respondents from a company where there is a HR department stated that special procedures were being applied whereas the 75
employees from the organizations without HR departments seemed to adopt rather a negative attitude in this issue
Verifying dependencies In verifying dependencies we tried, by means of the methods of non-parametric correlation, to explain the connection between the individual items in more detail. The size of the organization We were interested whether the following facts depended on the size of the organization:
clearly defined strategies of talent management (item 5) – we assumed that larger companies paid more attention to defining such strategies,
enough funds for the development of talented workers (item 34) – we assumed that larger companies invest more funds into the development of the talented employees,
the success in retaining the talented employees (item 35) – we assumed that larger companies were more successful in retaining the talented employees than the small ones.
Recoding of the size of the organization into a numeric value was as follows: 1 – a small organization (10 – 49 employees), 2 – a medium sized organization (50 – 249 employees), 3 – a large organization (more than 250 employees). The respondents expressed their attitudes by means of scale 1 to 5 where 1 means complete disagreement and 5 means total consensus. Therefore the direct proportion (positive correlation coefficient) indicates that the respondents from small businesses had, in a given item, a tendency to adopt a negative attitude towards the statement stated in the item, and the inverse proportion (negative correlation coefficient) means rather a positive attitude of the respondents from large companies. The gained results are summarized in Table 16. Table 16: – Verifying the dependency of the selected items on the size of the organization SIZE
I_5
I_34
I_35
*
-0.002
0.149**
-0.002
0.171**
Kendall's tau
Correlation Coefficient
1.000
0.099
Spearman's rho
Correlation Coefficient
1.000
0.116*
*. Correlation is significant at the 0.05 level (2-tailed). **. Correlation is significant at the 0.01 level (2-tailed).
Source: own processing
As is obvious from Table 16, the sizes of the correlation coefficients in items 5 and 34 are minimal but despite that the dependency is statistically significant in item 5. The most interesting result was gained in item 35 where the result confirms the statement stated in 76
Subchapter 2.2.5, namely that the so called large companies are not more successful in retaining talented employees than the so called small companies. This fact is worth further examining. The existence of the HR department We were interested whether the existence of the HR department contributed to:
dividing positions into the key ones and the others (item 10),
identifying the need for talented employees in the future (item 18),
creating plans for the development of talented employees (item 31,
applying specific methods for further development of talented employees (item 41).
In all cases we had assumed a positive influence of the existence of the HR department and therefore the inverse proportion (negative correlation coefficients). The recoding of the questionnaire was as follows: 1 – the HR department exists, 2 – the HR department does not exist. The scale on which the respondents expressed the extent of their consensus with the statements in the particular items is described further in the methodology as well as in Subchapter 2.3.1. The results are given in Table 17. Table 17: Verifying the dependency of the selected items on the existence of the HR department HR_DEP
I_10
I_18
I_31
I_41
Kendall's tau_b
Correlation Coefficient
1,000
-,020
-,044
-,053
-,239**
Spearman's rho
Correlation Coefficient
1,000
-,022
-,048
-,059
-,266**
**. Correlation is significant at the 0.01 level (2-tailed).
Source: own processing
In items 10, 18 and 31 the influence of the HR department in the organization was not confirmed. A high statistically significant dependency was confirmed in item 41. It may therefore be stated that the existence of the HR department in the company has a positive influence on applying specific methods in further development of the talented employees.
Conclusions
The size of the organization is the factor that most influences applying the talent management in organizations. Its influence was evident especially in the field of the linkage of talent management with the company strategy and in the field of evaluation and rewarding employees. On the contrary, the factor the influence of which was not visible at all was the proportion of the technical-administrative employees.
The results showed that there were regional differences in the way the concept of talent management was implemented. The influence of the seat of the company was 77
evident especially in the field of retaining the talented employees. The Slovak Republic seems to be the most specific in this respect.
The existence of the HR department in the organization was most positively reflected in applying specific methods for further development of the talented employees. In the field of retaining the talented employees the influence of this factor was generally strong and therefore we state that the HR department contributes to the successful retention of the talented employees in the organization. The negative phenomenon here is the fact that the influence of the HR department was not evident at all in the field of identifying and recruiting talents.
What can be considered surprising is the fact that the form of ownership is not an important factor in applying talent management in the organization. We had expected more significant differences between the public (state) organizations and the private ones. We had assumed that the profit oriented subjects would be more ahead of the non-profit organizations in the field of applying talent management. Our assumption was not confirmed.
Foreign capital can be considered an unimportant factor as well. We had assumed again that by means of foreign capital and the know-how that comes along with it the difference in the way talent management is applied would be bigger between the organizations with foreign capital and those without it. This assumption was not confirmed either.
When asked whether larger companies are more successful in retaining talented employees than the small ones we have to answer negatively.
Other findings:
a higher number of employees requires a more complex personnel policy and like this there is new space for implementing the concept of talent management;
the respondents working in the organizations with participation of foreign capital tended to adopt a more positive attitude towards talent management than those working in the organizations without participation of foreign capital;
there were differences in the attitudes of the employees working in the HR departments as compared with other work positions; we assume that this fact was influenced by better knowledge of the personnel specialists in respect of the issues of talent management;
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the respondents working in the companies where there is the HR department confirmed in their answers that in their organizations they attribute more importance to the evaluation of the employees and the application of its results in creating personal plans and in rewarding them than in the organizations where there is no HR department;
the respondents working in the so called large organizations stated that their organization had enough time for the development of the talented employees and this, in our view, corresponds with the reality because especially larger companies have elaborate educational systems enabling such development;
in case of the Slovak Republic the attitudes of the respondents were different from the other three countries, namely in item 38 (problems in communication with talented employees).
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2.2. COMPARISON OF TALENT MANAGEMENT PRACTICES IN VISEGRAD COUNTRIES This chapter deals with the comparison of talent management practices in Visegrad countries. The comparison is based on the data gained from survey described in subchapter Research Methodology. The data in the figures represent averages (central tendency) of responses in individual countries (CZ, SK, HU and PL) for each item. The higher the arithmetic mean (average) of responses, the higher is the tendency to agree with the statement. Since the questionnaire included negative items (I3, I9, I16, I20, I23, I27, I29, I32, I33, I36, I37, I41) for the purposes of statistical processing the scale for these items was reversed. In the following text we interpret the results of the statements reformulated to positively formulated sentences.
Strategy The first rated area was the “strategy”. In this field respondents expressed agreement with nine statements, namely: 1. Talent management is essential (I1). 2. Talent management is an important part of our company's mission (I2). 3. Top management worked out a joint attitude towards talent management (I3). 4. We have a clearly defined human resources management strategy (I4). 5. We have a clearly defined talent management strategy (I5). 6. Talent management strategy is connected with strategic goals of our organization (I6). 7. We are currently modifying the list of key talents indispensable in our company (I7). 8. We search for talent in every single person that has just been employed (I8). 9. Formulated talent management strategy is not difficult to realize in our company (I9).
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Figure 4: Strategy
Source: own processing
The data in Figure 4 shows that the respondents in our research from the Czech republic (CZ), Hungary (HU) and Poland (PL) expressed that talent management is very important for their organizations (I1) (the average of the countries ranged from 3.32 to 3.77). In this item is visible little differences in evaluation of respondents from Slovak republic (SR) (3.32) - compared with other countries - although it is on a five-point rating scale still slightly above average. Respondents in all countries tend to agree with the statement “Talent management is an important part of our company's mission” (I2) although even in this item was lower tendency to agreement among respondents from Slovakia (SK). In the third item concerning the attitude of top management towards talent management (I3) there are visible bigger differences between countries especially between Poland (2.71) and Czech Republic (2.84) with disagreement, Hungary (3.02) with neutral attitude and Slovakia (3.24) with slight agreement. In the item no.4 we investigated whether the respondents' organization have a clearly defined human resources management (HRM) strategy. The results range between 3.01 (in CZ) and 3.45 (in SR). Thus, on the basis of the results obtained we can conclude that there is slightly prevailing tendency of organizations to have defined HRM strategy. Next item was aimed at detecting the existence of clearly defined talent management strategy (I5). The results were not as positive as in the previous item concerning the HRM strategy. In this area have the organization the largest gaps because the average of response was the lowest among all the items within the category “strategy” i.e. respondents expressed 81
the slightest degree of disagreement with this statement. In HU and CZ the average response even the lowest among of all nine items in the category. Sixth item was associated with previous one because questioned whether the talent management strategy is connected with strategic goals of an organization. Surprisingly, a little better results and thus slightly higher agreement with the statement was observed in this item compared to item 5 although respondents from three countries (SR, PL, CZ) disagreed with the statement. In expressing agreement with the statement “We are currently modifying the list of key talents indispensable in our company” (I7) were no significant differences in the arithmetic mean of responses between three countries (HU, PL and CZ). In mentioned states there was found moderate disagreement with the statement. The highest average of responses was found in SR (3.04). Organizations in all four countries tend to search for talent in every single person that has just been employed since average of responses ranges between 3.05 in Czech Republic and 3.48 in Hungary (I8). Finally, within this category, we also investigated the situation in the implementation of talent management strategy (I9). As positive we consider the fact that most organizations regardless of country do not find it difficult to realize (implement) formulated talent management strategy in their company since they expressed the agreement with the last statement. The lowest degree of agreement was expressed by respondents from Slovakia (with the average of 3.19) and the highest degree of agreement was expressed by respondents from Hungary (with the average of 3.52). Thus, it looks like that the biggest problems with implementation of talent management strategy have the organizations in Slovakia and Czech Republic.
The identification and recruitment The survey were also examined the field “identification and recruitment”. In this field respondents expressed agreement with following statements:
All positions in our company have been divided into key and peripheral positions (I10).
Our workers' competences are adapted to their position requirements (I11).
We are currently identifying talents among all the workers employed in our company (I12).
We are currently identifying positions we need to recruit candidates for from the external environment (I13). 82
We apply a plan of attracting talents from the external environment (I14).
Our worker recruitment system makes it possible to acquire people of the highest development potential (I15).
We know quite a lot about talents our employees have (I16).
Talented people are willing to get employed by our company (I17).
We know what talents we are going to need in the future (I18).
We know how many talented people we are going to need in the future (I19).
We perform some special activities designed to attract talents (I20).
Figure 5: Identification and recruitment
Source: own processing
The first item in this field (I10) was aimed at detecting whether the organizations divide the positions in company into key and peripheral. In Slovakia and Poland was measured the highest mean. The averages in responses between Czech Republic and Hungary were almost equal (value of 3.11). In the statement “Our workers' competences are adapted to their position requirements” (I11) respondents expressed the highest agreement with the statement among the items (statements) in the field “identification and recruitment”. The highest average of responses was in answers of respondents from Poland (3.74) followed by Slovakia (3.58), Czech Republic (3.52) and Hungary (3.49). In survey we also examined what is organizations' focus in identifying talent - whether they focus on their own resources or on finding talent from external environment. These facts have been identified in items I12 and I13. The results have shown that organizations in all countries are paying attention to both areas i.e. to search and identify talents within their 83
existing staff, as well as to search talented people from outside. In all countries was the lower degree of agreement (smaller average) measured in item 12, except of the Czech Republic where the responses average points to nearly neutral stance (2.95). To the item 13 directly forges the item 14 in which we examined whether organizations apply a plan of attracting talents from the external environment. Results in all four countries indicate that organizations have certain problem with application of mentioned plan to attract talents from the external environment. The highest level of agreement with the statement was expressed by respondents in Hungary (3.0) that represents neutral answer. Answers from other three states have negative affirmative tendency. In next item (I15) respondents expressed their agreement with the statement “Our worker recruitment system makes it possible to acquire people of the highest development potential”. Results obtained in different countries were very similar, with an average of responses ranged from 3.01 (CZ) to 3.36 (HU). In the survey, we also investigated whether the organizations are aware of talents they currently have (among existing staff) (I16). In all countries except Slovakia dominated positive responses; in Slovakia the responses were actually neutral (2.95). As positive we consider is the fact that the predominant tendency – willingness of talented people to get employed by companies in all countries (I17). The arithmetic mean of responses was 3.51 in Czech Republic, 3.41 in Slovakia, 3.35 in Hungary and 3.27 in Poland. Whether queried organizations in Visegrad (V4) countries are paying attention to talent in terms of longer-term time perspective researched the statement “We know what talents we are going to need in the future” (I18). It seems that companies are considering future needed talents because the responses average takes the values from 3.12 (CZ) to 3.55 (SR). A little less are organizations clear about the number of talents needed in future whereas the agreement with the statement “We know how many talented people we are going to need in the future” (I19) shows negative affirmative tendency in responses than previous one. In three from Visegrad countries (SR, PL, CZ) was measured disagreement with the statement. The last surveyed phenomenon in the category “identification and recruitment” was whether organizations perform any special activities designed to attract talents (I20). Companies in all three countries (SR, HU, PL) have a tendency to perform some special activities for attracting talents since responses average range from 3.13 (SR) to 3.24 (PL). Most negative results have been achieved in CZ due to indeterminate tendency of answers. 84
Assessment The next examined field was “assessment”. In this field the respondents were asked to express their agreement with these statements:
We systematically assess our workers' performance (I21).
We promote our workers on the basis of objective criteria (I22).
We draw conclusions from the workers' performance assessment (I23).
Talent management is linked to the workers' reward system (I24).
Talented people's assessment is performed on the basis of specially designed criteria (I25).
The results of workers' performance assessment are used to formulate talent development plan (I26).
We have clearly defined criteria of workers' performance assessment (I27).
Figure 6: Evaluating and rewarding
Source: own processing
Within this field we investigated whether organizations systematically assess workers' performance (I21). Not surprisingly, organizations in all countries pay considerable attention to the employees' performance which is an integral part of human resource management. It confirms a very high agreement with the statement concerning this area, specifically responses average of 3.71 (CZ), 3.66 (PL), 3.59 (SR) and 3.49 (HU). In relation to this question we also researched if companies do some conclusions from performance assessment (I23). Relatively high tendency of approval points out that in all V4 countries organizations not only implement employees' performance assessment but also use assessment results for drawing conclusions or consequences. 85
In detecting agreement with the statement “We promote our workers on the basis of objective criteria” (I22) the responses average range from 3.43 in Slovak republic to 3.03 in Poland. Part of our research was to identify the linkage between talent management and workers' reward system (I24). The arithmetic mean of responses was very similar in the couples of countries: in Hungary (3.03) and Slovakia (3.01) were detected a neutral attitudes; contrast, in Czech Republic (2.75) and Poland (2.77) were detected a disapproving attitudes. In the next statement: “Talented people's assessment is performed on the basis of specially designed criteria” (I25) was less affirmative tendency than in previous one, the highest rate of agreement with the statement was demonstrated by respondents from Hungary (3.14). In other three countries respondents disagreed with the statement. Part of our survey was detection of agreement with the statement that investigated whether the results of workers' performance assessment are used to formulate talent development plan in the surveyed organizations (I26). The responses average ranges from 3.02 (SR) to 3.34 (HU). The major differences between countries, particularly between SR and HU were recorded in the last statement within the category “assessment”. In the statement regarding to existence of clearly defined criteria of workers' performance assessment (I27) has been identified notable difference in responses. While in Slovakia there is evident disagreement (average of 2.73), the HU it was quite stronger agreement (3.61). Agreement with the statement expressed also respondents in the Czech Republic and Poland. From this perspective, the worst situation is in Slovakia.
Development of the Talent An important part of effective managing talents is their development and training. That is why this field was part of our survey. Within the category “development of the talent” respondents rated the following statements:
We use a wide range of forms and methods of our workers' competences development (I28).
In the recruitment process we take into consideration some above-average competences of potential workers (I29).
We have well-formulated career paths of talented workers (I30).
We develop talents thanks to the plans we implemented (I31).
In most cases the positions where our employees work make it possible to develop their talents (I32). 86
We have enough time to develop our workers' talents (I33).
We do have sufficient financial resources to support talent development (I34).
Figure 7: Development
Source: own processing
There were surprisingly contradictory results in evaluating a statement: “We use a wide range of forms and methods of our workers' competences development” (I28). The results did not show a clear tendency (to agree or disagree) since the most of answers in the three from V4 countries except Poland were near the neutral value of 3. The item no. 29 we investigated whether companies during recruitment process take into consideration any above-average competences of potential workers. The responses averages were very similar in the three countries – HU, CZ and PL. Only answers of respondents in Slovakia (3.17) significantly differed. In all countries there is affirmative tendency to answer. In the following item (I30) concerning the formulation of career paths of talented workers (I30) the answers have negative affirmative tendency. This area is probably quite underestimated because the arithmetic mean of responses were 2.90 (SR), 2.89 (HU), 2.54 (PL). The respondents from the Czech Republic expressed relatively strong disagreement with the statement (responses average of 2.44). Not much better is the area of implementation of the plans. In countries dominated negative responses (i.e. disagreement) relating to the statement “We develop talents thanks to the plans we implemented” (I31), Hungary excluding were the average of answers was nearly neutral (with the value of 2.99).
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As positive we consider the fact that most of the positions within the surveyed companies develop talents. The evidence is the agreement with the statement no. 32 which achieved the value of 3.32 in Czech Republic, 3.28 in Hungary, and 3.17 in Poland. The mean of responses of Slovak respondents has the value of 3.03. Greater differences in responses were measured by respondents from Slovakia in comparison with the remaining three countries in the statement which relates to time for developing workers' talents (I33) whereas only in this country the average of respondents' answers was less than 3 which represents disagreement with the statement. Finally, in the area of funding to support the development of talents was observed a rare consensus in the answers of respondents in all four countries (I34) while in all of them was recorded disagreement with the statement.
Retaining The last surveyed area was “retaining” which included seven statements:
We successfully retain talented people (I35).
Talented people have financial requirements that we can meet (I36).
We have a clear system of motivating workers (I37).
We encounter problems as far as the communication with talented people is concerned (I38).
We manage to retain talented workers by supporting them in their self-improvement process (I39).
Talented people leave our company in search for new challenges (I40).
We support talented people in a special way (I41).
Figure 8: Retaining
Source: own processing 88
In the first evaluated item related to success of retaining talents (I35) was found an interesting similarity of responses between two countries – Slovakia and Hungary with the average of 3.2 representing agreement. Respondents' answers in Poland ranged around the neutral value of 3 (2.99) and in Czech Republic (2.9) there was observed predominant disagreement. Frequent obstacles in acquiring and retaining talents are the financial possibilities of businesses. Therefore, we wondered whether surveyed organizations can meet financial requirements that have talented people (I36). In this statement there were found similarities in responses of respondents from Visegrad states - in all prevailed negative answers. On this basis we conclude that most of the organizations have problems to financially satisfy their talents. When asked about the existence of motivating system (I37) there were significant differences detected in the answers of respondents from Hungary (predominance of positive responses) and that is why in the area of “motivating system” the most positive situation is in this country. Conversely the worst situation is in Slovakia where dominated negative responses (mean value is 2.75). Communication with talented people seems quite problematic as confirmed affirmative trends in responses of respondents from all V4 states. Respondents were asked to comment the statement: “We encounter problems as far as the communication with talented people is concerned” (I38). The highest average of responses was in answers of respondents from Poland (3.63) followed by Czech Republic (3.47) and Hungary (3.38). On the contrary, respondents from Slovakia expressed disagreement (average of 2.85). As positive we can consider the results of the assessment of statement: “We manage to retain talented workers by supporting them in their self-improvement process” (I39) in which it was recorded positive affirmative trend in responses in three of the four countries (SR, HU, PL). The item no. 40 is formulated as follows: “Talented people leave our company in search for new challenges”. Since it is negative phenomenon, the lower level of agreement represents more positive result. In this context the most positive situation is in the Slovak enterprises (responses average of 2.67) followed by Czech Republic (2.87) and Poland (2.98). Companies in Hungary tended to answer this question in the affirmative. In the last item of the questionnaire we questioned whether and how is the support of talented people in companies. Due to the favourable (positive) responses in Czech Republic and Hungary, the best situation is in companies in these states. On the contrary, in Slovakia
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(average of 2.63) and Poland (2.94) the situation is probably worse as evidenced by the discordant response.
Conclusions In the field “strategy” the significant differences between the countries were identified in the field of “joint attitude of top management towards talent management” (I3) where have been wide spectrum of responses – from mostly positive answers in the SR through the neutral responses in HU to the dissenting response in CZ and PL. Greater differences were also found in the sixth item concerning the “connection of Talent management strategy with strategic goals of organization” (I6) in which positive affirmative answers of Hungarian organizations differed from negative responses of organizations in other three countries. Within the field “evaluating and rewarding” the differences in responses were apparent in the item relating to talents' assessment and its performance on the basis of specially designed criteria (I25). In this field the favorable response tendency of respondents from Hungary was in contrast with discordant responses of respondents from Slovakia, Czech Republic and Poland. In the area of “clearly defined criteria of workers' performance assessment” (I27) major differences were found in organizations in Slovakia. Most of Slovak companies – unlike those in other Visegrad countries – do not have defined criteria of employees' performance assessment. It is worth mentioning also the differences in the item relating to time dedicated to the development of employees' talents (I33) within the field “development of the talent”. In this item the answers of Slovak companies have negative affirmative tendency (disagreement) while answers of companies in other three countries were affirmative. In the last field “retaining” were the significant differences found in three items I37, I38 and I41. The results showed that only in Hungarian organizations dominates the tendency to have a clear system of motivating workers because only in Hungary the respondents agree with the statement. In determining the level of agreement with the statement “We encounter problems as far as the communication with talented people is concerned” appeared significant differences in companies in Slovakia, because (unlike the respondents in CZ, PL and HU) they disagreed with the statement. Finally, large differences between the organizations of the Visegrad countries were also found in the area of supporting talented people in a special way (I41) –different were responses of Slovak respondents compared with respondents' answers in the other three countries.
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Part Three CASE STUDIES
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3.1. TALENT MANAGEMENT - MONDELĒZ INTERNATIONAL Company profile Mondelēz International is the world’s leading producer of confectionery and snacks, established on October 1st 2012 by dividing Kraft Foods Company into two separate companies. Its most famous brands include Milka chocolate confection, Jacobs coffee and Oreo cookies. According to the official numbers, the company earns annual revenues of approximately $ 35 billion and is active in 165 countries. The company has already been present in the Czech Republic (CR) and the Slovak Republic (SR) since 1992 and currently dominates the chocolate confectionery and biscuits markets in both countries. In overall 5 factories in the CR and the SR, the company employs over 3,000 people. The brands Bebe Dobré ráno, Brumík, Fidorka, Figaro, Kolonáda, Miňonky, TUC or Zlaté present a significant part of the Czech and Slovak portfolios. Since April 2013 the official name of the company in the CR is Mondelez Czech Republic. Furthermore in this short introduction to the case study, we would like to stress the Mondelēz International’s vision and values as they in short represent the company’s strategy that affects its human resource development and thus the analyzed issue of talent management11. Our Values Guide Us
Inspire trust.
Act like owners.
Keep it simple.
Be open and inclusive.
Tell it like it is.
Lead from the head and the heart.
Discuss. Decide. Deliver.
Our dream is to “Create delicious moments of joy” in everything we do.
11
Mondelēz International. Our Values [online] http://www.mondelezinternational.com/ABOUT/ourvalues.aspx
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Situation diagnosis Statement: Mondelez International is known as a company that uses, attracts and works with talents and perceives this practice as a necessary part of achieving the best results. Mondelēz International hopes for its employees to be the essence of its success. Its relationship towards employees may be demonstrated by a public on-line source, related to recruitment of new employees. 12 Company declaration – staff recruitment We know how to appreciate your enthusiasm for the job, result-orientation and willingness to develop yourself. Hence we are looking for team players, communicative and flexible personality, in short, reliable colleagues who are not afraid to be responsible for their work. We prefer creative, motivated, initiative people, who are open to changes and challenges that our business brings. We guarantee to our employees:
Fair treatment
Career and professional development
Respect
Competitive salary and benefits
Safe and healthy workplace
The company further states: “We have a lot of experience in creating a workplace which enables career and personal development of employees. We believe that our common capabilities and effort are critical to our success.“13 Development of employees is regarded as a lifelong process in Mondelēz International. The company supports active learning by hands-on experience. The managers are expected to play a key role in developing the employees that they lead. By active participation in the high quality educational programs the company offers specializing and at the same time emphasizes focusing on diversity and a healthy and safe work environment.
12
Kraft Foods: http://kraft.jobs.cz/praxe-v-kraft-foodscr/?brand=g2&exportRCM=12518273&trackingBrand=www.google.cz&rps=186&ep= 13 Ibid.
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Preparing and implementing a Talent Management Model A Leadership Competency Model is being implemented in the company since 2009. Opportunities for career development rely on the following points14:
Orientation programs to get employees introduced to a good start;
The Mondelez Leadership Competency Model which defines leadership at all stages of career;
A core training curriculum linked to career stages;
Performance appraisal and development feedback for everyone;
Senior Leaders as trainers in training programs;
A regional-based action learning program to unlock potential of talent;
A global aligned succession planning process to identify and promote talent development;
Formal and informal mentoring or coaching programs;
Community outreach and volunteer opportunities;
Easy intranet access to development and career management information and tools;
International exposure for employees with excellent performance and potential.
In this regard, three E’s are mentioned: Education, Experience and Exposure, which implicates that there are combined classroom training, self and on-job learning, mentoring and coaching etc. in order to achieve the demanded effect on development of employees. Talent management and performance management are essential to the company’s human resource development. The application of the Lominger’s Competency Model15 is based on the researches and studies of Lominger International that focus on talent management and that currently significantly emphasize Learning Agility. (There are 7 global focus areas in the model identified as critical to success.) The competency model creates a foundation for the company’s integrated talent management system.
14
Kraft Foods: http://www.kraftfoodscompany.com/cn/en/about/peopledevelopment.aspx It should be noted, that in the common practice of the Czech Republic there are opinions questioning application of competency models. We may state that such assumption does not apply to major companies with international know-how. Usage of theory and competency models in respect to HR management and thus to talent development suited for a specific company is presented for example by Orr, Smeltjes or Dai (2010).
15
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It is used across all HR processes. The managers are aware of the essence of the mentioned model and they use it in their work. From the viewpoint of the talent management, important areas include: Innovation Management, Understanding Others, Building Effective Teams and Work-life Balance. Each competency is identified by 3 levels - skilled, unskilled and overused skill. The 67 mentioned competencies (Black, 2013) are grouped into 6 factors (strategic skills, operating skills, courage, energy and drive, organizational positioning skills, personal and interpersonal skills). The HR managers play a vital part, mostly in these two areas: Talent Manager/Organization Designer (HR tools for talent management, organization development, internal communication and use of benefits etc.) and Talent & Change Steward (facilitation of change management, organizational culture support etc.). From the point of view of human resource development, the role of the HR managers as business partners plays an important part in the company. It is the HR manager who has in this position an overview of all HR processes and operates as a generalist for the departments he/she is the only contact person. The main pillar of a successful relationship between an HR manager and a department leader is mutual trust. The HR Business Partner plays a role of an internal coach and his/her important task consists of maintaining the organizational culture in the whole company. Talent Manager/Organization Designer can be described as an HR professional who knows the theory, research and practice, both in talent management and in the process of organization development. Talent Management focuses on working with individuals within the vertical and horizontal mobility. Organization Design focuses on organizational structure, management and processes that create methods of company operations. It is important to remember that talented people need a supporting environment. Reciprocally, the organization cannot exist in the long run without talented people. Talent & Change Steward recognizes, reflects and helps to create the organizational culture. The HR managers, as the inspectors of the organizational culture or as the agents of change, respect the previous culture and are also able to support construction of a new 95
organizational culture. The agent of change helps to overcome resistance to change and supports its followers. This strategy is focused on the company’s employees. But this role is not only a task for the HR managers but also for the line managers. The line managers should play the main role in managing changes. HR plans and succession Planning of career development of employees is considered to be crucial to the human resource development in the company. The company uses the so-called process Succession Planning. It is a career planning process which is considered to be a strategic planning tool for the human capital in the company. The process is closely connected to the basic HR tools and processes in the company. It is a comprehensive tool for assessing and developing talents across the organization. Succession Plans represent another tool used by the company. The so-called Succession Sheets help with planning of career development of employees promoting. Talent management and performance management play an important part of the human resource development in the company. Talent management – processes and tools The key parts of implementation of the company’s human resource strategy are talent management and succession planning. This implicates that the main focus is on the middle and senior management of the company. Selection, staffing, succession planning, support and assessment of talents are realized through specific tools.
An important tool is a matrix that records 2 directions - performance and potential (ability to learn and develop).
Another key point is the annual employee evaluation. It is given in the two mentioned directions as well.
The company uses special software to monitor special characteristics in relation to the competency framework.
The company has been using its own internal evaluation tool since 2012.
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For the personnel assessment relating to the talents, not only it is important to focus on the long-term performance, but it is equally important to focus on potential. Understanding of the term potential is based on the expert approach: Learning Agility as a Prime Indicator of Potential. Learning Agility is the ability to learn something in one situation and to apply it subsequently in another one or in a new one. The concept is based on the Lominger‘s Competence Framework and on focusing on vertical leadership. Diagnostic outputs are then used among others in the educational area, which is for talents divided into two main parts:
Development programs – are designed for employees with potential to develop. External programs and special corporate trainings events are used for this purpose.
Training programs – these activities rather follow the competency framework and are oriented on the partial competence development.
Assessment of implementing the strategy, model and programs of talent management The presented case study points out in its introduction the company’s publicly declared statements and human resource strategy. There is also noted that talent management is a significant part of the company’s HR management and that the company uses in-practiceimplemented and applied tools and cooperation between an HR specialist and management on appropriate level. The outputs of system diagnostics are among others used in the educational area which is divided into two elemental parts. In this case study we see that the company pays great attention to talent management and potential of its employees. In connection with the competency model, great focus is concentrated on the Learning Agility Factors that go hand in hand with the desired orientation on people who possess the ability to learn and manage tasks and changes the company has to face. The Learning Agility Factors are utilized there to identify men and women who are potential leaders (Eichinger, Lombardo, 2000). With regard to the mentioned evaluation tool, we stress that the company is not only pursuing performance but in particular, concerning talent development, Learning Agility. The primary precondition is: „People learn, grow and change across time (and consequently
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develop new skills).“ (Eichinger, Lombardo, 2000, 321). Detailed description of the four basic parts of Learning Agility follows. The Learning Agility Factors are assessed in the following areas16:
Mental Agility
Describes people who think through problems from a fresh point of view and are comfortable with complexity, ambiguity and explaining their thinking to others.
People Agility
Describes people who know themselves well, learn from experience, treat others constructively, and are cool and resilient under the pressures of change.
Change Agility
Describes people who are curious, have a passion for ideas, like to experiment with test cases, and engage in skill building activities.
Results Agility
Describes people who get results under tough conditions, inspires others to perform beyond normal, and exhibit the sort of presence that builds confidence in others.
Conclusion This case study, based on public sources and internal information approved by the company, presents an interesting example of an approach to talent management of a major multinational company that also operates in the Visegrad countries. It specifically emphasizes, within the scope of talent management, focus on the Lominger’s Competency Model and the Learning Agility Factors. We would like to emphasize the recently introduced Learning Agility orientation in the presented case study, including application of the outputs of publicized researches and methodical materials of a respected advisory firm. Such approach is without a doubt an inspirational idea for many organizations not only in the CR but as well in other Visegrad countries.
16
Lominger International, Eichinger, Lombardo (2000), De Meuse (2008)
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3.2. INTEGRATED TALENT MANAGEMENT IN CARLSBERG ACCOUNTING SERVICE CENTRE SP. Z O. O.17 Company Profile18 The subject of the analysis concerning talent management is Carlsberg Accounting Service Centre Sp. z o. o - an independent Shared Service Centre that provides services to other companies within the Carlsberg Group. The Carlsberg Group is the fourth largest brewery in the world which employs 41,000 people and is characterised by a high degree of diversity of brands, markets, and cultures. Originally Carlsberg ASC was created to provide accounting services, today it is also responsible for Master Data and Procurement across the Group in Europe. Currently Carlsberg ASC employs 320 people, ranging from professionals to people taking their first steps in the business. The Carlsberg Group decided to create Carlsberg ASC in Poznań (Poland) in early 2006 and the first employees were hired in August that year. On 1 November 2006, Carlsberg ASC started providing accounting services for Carlsberg Polska, covering the three processes of Accounts Receivable, Accounts Payable and General Accounting. These services were extended to Germany, Switzerland and the UK in 2007, and to Denmark, Sweden and Norway in 2008. In June 2010 Carlsberg ASC started providing accounting services for Carlsberg Latvia, in January 2011 for Lithuania, in May 2011 for Estonia and in January 2013 for France. Carlsberg Accounting Service Centre Sp. consists of the following departments:
Market to Cash - is responsible for correct registration of transactions generating Carlsberg Group companies payments. This includes the following elements: sales invoices booking, payment settlement, reconciliation of accounts with customers as well as numerous items connected with clients’ credit control.
Source to Pay - is responsible for payments of goods and services to vendors. In order to achieve this goal it deals with bookkeeping for purchase transactions.
Record to Report is responsible for a wide range of accounting and reporting processes that can be systematized with the following categories:
Fixed Assets - maintenance of fixed assets and intangible assets register according to IAS/IFRS, and in case of Carlsberg Polska also according to the Polish accounting
17
Information on talent management strategy was given by Magdalena Dzikowska, HR Manager, Carlsberg Accounting Service Centre Sp. z. o. o. 18 Written on the basis of http://www.carlsberggroup.com
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regulations, as well as in the tax area; periodic depreciation as well as corporate reporting to the Group and local statutory reporting from the area of fixed assets,
General Ledger - processing journal entries in general ledger, calculation of reserves, prepaid costs, settlement of balance, issuing other sales invoices along with debit/credit notes,
Cash Management- booking bank statements and processing payment orders in the bank system,
Intercompany - issuing VAT invoices for sales of services and other sales to the affiliated companies, balance confirmations with the affiliated companies at the closing of the reporting period, reporting Intercompany transactions to the Group,
Reporting - preparing a consolidation package for periodic consolidated financial statements of Carlsberg Group Breweries according to IAS/IFRS and support for audit of the package, reporting to the national central bank and statistical office, preparing individual statutory financial statements of the serviced companies and support for the statutory audit;
Non Finance – the department was set up in 2012 as a result of growing demand of Carlsberg Group for centralized service of processes not linked directly with accountancy. At present this department covers the following fields:
Master Data - operation of fixed data focusing on a wide range of subjects in Carlsberg Group individual companies’ SAP systems. The scope covers both basic client, supplier and material data and maintenance of price patterns for final clients, discounts etc.,
E-Procurement - a structure supporting centralized Carlsberg Supply Chain unit located in Switzerland. Its main tasks are the following: support towards and collaboration with global category buyers, organizing internet auctions and tenders, technical support and service of system supporting ARIBA and CombineNet, contract management.
Apart from the above mentioned functional departments, there is HR Department in Carlsberg ASC comprising the following positions: two, the so-called, Business Partners, communication specialist, training and recruitment specialist and a person responsible for administrative work. One of the Business Partners is also HR Department Manager and is responsible for coordinating all the activities and working out strategies. Due to the specific character of Carlsberg ASC, the communication specialist is mainly responsible for internal
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communication. The person responsible for administration deals only with the preliminary data processing as other activities in this area are centralized. Human Resources Department, despite its relatively small size, is able to satisfy all the needs in this area and is organised according to modern concepts of organising personnel function. Within the organisation, beside internal services centres, there are Business Partners who are responsible for achieving corporate strategic goals by means of personnel activities. (Ulrich, Brockbank, 2009).
Integrated Talent Management in the company Talent Management Strategy In Carlsberg Accounting Service Centre Sp. z o. o. personnel strategy is the element of the corporate strategy beside the other elements of the Carlsberg's Strategy Wheel which consists of the following elements: People, Effectiveness and Efficiency, Society and Reputation, Customers, and Consumers, Brands and Innovation (Figure 1). As far as the corporate strategy is concerned, it is created by all the departments of the company, including the Human Resources Department. That means that workers from all the departments influence the shape of personnel strategy. The above mentioned approach is fully justifiable. Bearing in mind that personnel actions concern all the people employed in the company, it is appropriate to take into consideration multiple and various needs of workers from different departments. In the personnel strategy, three main goals have been set: implementing high efficiency culture, increasing the workers' involvement and attracting, developing and retaining the best employees. The last from the mentioned above elements is the key element of talent management strategy in Carlsberg ASC. Perceiving talent management strategy as a coherent element stemming from the corporate strategy is the prerequisite of the effectiveness of all the actions undertaken in this area (Pruis 2011). It needs to be emphasised that within the personnel strategy work on talent involvement, development and retention, as separate elements, needs to be conducted jointly creating the proper approach towards the worker. Distinguishing and joining these three areas has been discussed in the literature as well. In the works by Bhatti et al. (2011) talent is perceived as a variable referring to motivation and involvement on one hand, and work efficiency, on the other hand. In the above mentioned concept, it is not sufficient to take care of the appropriate motivators selection in order to achieve high results. Motivating actions which are undertaken should refer to the right people - namely, talented workers.
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Figure 9: Carlsberg's Strategy Wheel
Source: http://www.carlsberggroup.com/Company/Strategy/Pages/Strategy.aspx
In Carlsberg Accounting Service Centre's talent management strategy the notion of talent is not clearly defined, which is related to the changing approach towards talent in the whole Carlsberg Group. For the past three years every single worker has been perceived as a potential talent, which means that it is virtually everyone who can become talent. It also means that every worker has been able to make use of various tools and programmes aimed at talent development. The above described approach is in line with corporate culture and the values presented by Carlsberg ASC. Human Resources Manager points out that during the professional career, workers' personal situation changes several times, and that is why, they are not talents once and for all. Previously, there was a small group of workers called talents (selected every two years) that functioned in Carlsberg Group and for whom a special development programme called International Talents had been created. This previous approach towards talent offered selected workers the feeling of being unique, which was a powerful motivator. However, the very fact that the group was exclusive and hardly accessible for the majority of workers, on the other hand, had a demotivating effect onto the remaining employees. The changes with respect to the way in which talent is defined in the analysed company partially result from the lack of systematization of terminology in both talent management practice and theory (Tansley 2011). There are many different definitions of talent, and in many corporate strategies talent is not defined at all. Talent is sometimes
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defined as an innate gift, intelligence, knowledge, skills, experience, attitudes or the ability to acquire knowledge and to develop (Earle, 2003, p. 244). Recruiting Talents The process of acquiring talents is executed by both internal and external recruitment. Carlsberg ASC focuses mostly on internal talent acquisition. The basis for talent identification is annual workers' appraisal which is conducted on the basis of two groups of criteria. The first group is connected with work effectiveness and refers to the extent to which a particular worker achieved a goal that had been set and also to the way in which this goal had been achieved (involvement and competence assessment). The second group is concerned with the worker's potential understood as the potential to exercise managerial functions. The appraisal is performed by both the worker himself or herself and also by his or her line manager. The essential stage of this appraisal is so called People Board which is the meeting of all the Department Managers and Human Resource Department workers, during which each worker's performance is discussed. This is how all the workers are located on the so called 9 Grid (Figure 2). This division is conducted on the basis of two variables presented on the chart as potential and performance axes. The major reason for applying this tool is to single out the group of workers characterised by high potential. The effectiveness of the above described activities is conditioned by the objectiveness and accuracy of the appraisal conducted by immediate superiors. This, in turn, requires conducting training courses for the purpose of the assessment and the tools which are used. Otherwise, overestimating becomes a real problem, as it leads to the lack of workers' differentiation. Figure 10: Grid
Source: own elaboration
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Apart from talent identification from within the company, Carlsberg ASC also recruits talented people from outside of the organization. Due to the fact that staff turnover in the analysed company is relatively high and fast development brings about an increase in employment level, Carlsberg ASC runs systematic staff recruitment. The tools which are used in the recruitment process are based on competence description of particular positions. The company does not use in this process any special tools aimed at talent identification. Graduates constitute 90% of new recruits and each of them can become talent. In the recruitment process the company cooperates with Poznań higher education institutions, however, this cooperation is not of permanent character. In the company's personnel strategy it is internal talent identification that is of higher significance. Promotion and development opportunities are a significant motivating incentive which the company uses with reference to existing employees. Unnoticed and unused potential lowers internal motivation, or, which is even worse, increases the risk of workers' fluctuation as they will probably seek self-realization opportunities in other organizations. Additional benefit connected with internal talent utilization is diminishing the risk of difficult interpersonal situations which usually occur during recruiting external talents. It is much more difficult to assess the person's ability to cooperate with others during the recruitment process (Leigh, 2009). Talent Development Activities The definition of talent adopted in the organisation together with the focus on internal talent acquisition requires various development activities (Porter 2011). Carlsberg ASC offers its workers numerous tools and programmes of development support. This process is planned and realized with the cooperation with every single worker. The important tool used in this process is preparation of an individual development plan after interim employee appraisal. It is essential for this plan to be, on one hand, ambitious, but, on the other hand feasible, and therefore, it is prepared with the leader's assistance. The very first stage of this process is framing the worker's expectations, as the important element of talented worker retention strategy is enabling the person to indicate where, in what area he or she wants to develop (Porter 2011). The very next stage is verification of the prepared plans by Human Resources Department. There is a tendency in Carlsberg ASC to maintain the proportion 80/20, which means that most of the worker's development should be realized in the work place and only 20% on external training courses. A significant criterion taken into consideration while verifying the prepared plans are financial and organisational limitations. The key element of the whole process is the manner in which feedback on worker's plan feasibility is given. It is obvious that declining the plan generates frustration and therefore, the manager responsible for giving feedback needs to have highly developed communication skills.
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The worker's individual development plan is prepared for a year (occasionally for two or three years) and comprises the following activities: training courses, work shadowing, project work, cross-functional work experience, self-management learning group, leadership forum and coaching. Within cross-functional work experience several people a year have an opportunity to face the challenge of working in a totally new work environment, in another division of the Group in Poland or abroad. This form of development is very popular among the employees, also due to attractive locations. Self-management learning group, on the other hand, was the example of discussion forum which was used with reference to such topics as, for example, fixed assets. Unfortunately, this form is no longer in use due to organizational problems. Leadership forum consists in organizing quarterly meetings for all the managers, to which business guests from within or from beyond the company are invited so that they can present important issues concerning the company's line of business. Carlsberg ASC makes also use of internal coach whose main responsibility is to support top managers. Carlsberg Accounting Service Centre makes use of a number of various tools supporting employee development together with informal meetings of team leaders and Human Resources Department workers. A skilful selection of these tools and their exploitation requires a lot of awareness and also envisaging the image of oneself in the organization in the future. It should be both the line manager and the HR Department that should play an essential role in the process and to display the full range of available development tools. In Carlsberg Group there is also an exclusive programme for leaders that lasts for about 1.5 years. Training modules are conducted by world famous business trainers and are quite often realised in exotic locations. This programme is aimed at medium and top managers with a few years experience in the organization and a very good command of English and it consists in exchanging experience between people working in very different positions. Talented Workers Motivation and Retention The motivation system used in an organization should be aimed at raising workers retention especially as far as key employees are concerned. In Carlsberg ASC apart from material incentives it is non-material motivators that are especially important, including the above described tools of worker's development. In spite of a wide range of undertaken activities the company perceives certain difficulty in keeping the key employees. Currently, staff turnover does not exceed 3-4%, which is within the set target (5% among key workers and 15% among other workers). In general Carlsberg ASC does not use any loyalty tools. It is only in the case of very expensive training courses (when the costs exceed PLN 10,000) that such contracts are prepared and signed. However, as the experience shows, this procedure is not necessarily satisfactory as the worker who really wants to leave the organisation will always find the way 105
to do it. HR Department Manager recognizes the need of preparing and implementing the tools building up workers' loyalty. The assessment of the situation in Carlsberg Accounting Service Centre can be justified not only in terms of organisational costs (costs of finding and training a new worker). It can also be viewed from the financial perspective. All the activities connected with replacing a key worker constitute a considerable cost for a company. Research shows that the cost of replacing lost talent is from 70 to 200% of this worker's annual salary (Kay, JordanEvans, 2000, p. 4). Mihelic and Plankar (2010, p.1257), on the other hand, estimate that this cost could be even higher. They claim that in order to replace a specialist, an engineer or a team leader 200% up to 400% of his or her salary is required. As far as talented people are concerned it is usually lack of work satisfaction and of challenges which is the main reason for their resignation from work (Mihelic, Plankar, 2010, p.1261). Carleton K. (2011) emphasises that the amount of pay cannot be the basis for keeping talented employees. Only the job that is challenging and perceived as interesting contributes to building up satisfaction. While analysing the process of motivating talented workers in Carlsberg ASC it seems to be justifiable to refer to 6 areas that according to R. Remillard (2012) are key areas in terms of this particular group of workers. These are: culture based on effectiveness, well-defined values, listening to and including talents in the decision-making processes, framing feedback, praise and development. All of the above mentioned areas are realised in the company in question, with a special emphasis directed at workers' development support and culture aimed at building up involvement. Current and Potential Problems Concerning Talent Management Implementing and realising talent management strategy is not an easy task and it brings about many problems. As far as Carlsberg Accounting Service Centre is concerned these problems include:
adopted definition of talent, according to which each worker is a talent. This assumption might lead to workers' excessive expectations which the company might not be able to face up;
difficulties with passing on feedback - in the process of talent management particular attention should be paid to enhancing leaders' communication skills, as it is them who participate in the process of appraisal and framing individual development plans;
organisational problems hindering the exploitation of the existing tools that support development - heavy workload and workers' habits make it difficult to use such tools as self-management learning group or work shadowing; 106
talent retention - the increase in key workers loyalty requires creating the tools which will be tailored to workers' individual needs.
Conclusions In the above described organization talent management strategy has been implemented and currently it constitutes one of the elements of a general strategy of Carlsberg Accounting Service Centre. The effectiveness of this strategy realisation is guaranteed by integrated activities from various functional areas of the organisation, their versatility and regularity. The changes in the attitudes towards Carlsberg Accounting Service Centre presented by business partners and workers prove that the undertaken actions, including the shift from exclusive towards egalitarian attitude to talent management, have been successful. Entrusting Carlsberg ASC with more and more advanced financial services results from the increase in its workers' competences and trust that has been placed in the company. Simultaneously, the results of the annual satisfaction and involvement study show a significant improvement with this respect, which, in turn, proves that the actions undertaken by Carlsberg ASC have been accepted. Among the challenges that Carlsberg Accounting Service Centre Sp. z o. o. takes up in terms of talent management one might point out taking actions aimed at a decrease in staff turnover and improvement of communication with respect to appraisal process and building up workers' individual development plans.
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3.3. TALENT MANAGEMENT IN THE TELECOMMUNICATION COMPANY Company profile Historical and business background of the company This case study describes a British multinational telecommunication Group (hereinafter “Group“) that wishes to stay anonymous. The Group was established in 1983 and nowadays it owns networks in over 30 countries and has partner networks in over 50 additional countries. It employs more than 86,000 people and has more than 471 million customers worldwide. The case study focuses on the Group´s branch in the Czech Republic, which has been in existence since 2006 (hereinafter “Company“). It was formed by acquisition of a Czech telecommunication company by the above multinational Group. The number of its employees exceeds 2,000 and it has more than 3,365,000 customers in the Czech Republic. The company has adopted some global strategies of the Group but it has also developed its own local programmes and strategies. The Company´s HR management The company places great emphasis on its employees. The Company’s Human Resources Management is divided into several parts. “The Centre of Expertise“ is a group of experts who care for the employees´ well being and suggest ways of their remuneration, training or development. The Department of “HR Services & Projects“ ensures consultancy in industrial issues for the company managers and employees. ”The Department of Care for People” consists of business partners who give advice and consultancy to TOP managers in the HR field. The Department of “Internal Communication“ provides internal communication for more than 2,500 employees and it also deals with external communication of the Company including PR and the company magazine.
Talent management in the company Definitions and terms Almost everyone in the company may be perceived as a Talent. In this sense the definition of talented people can contain two levels of hierarchy:
A higher level : people having the potential to become leaders
A lower level: people having the ability to learn & develop, to increase their area of knowledge and expertise.
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Talent management is a process that enables to build a strong leadership pipeline by giving the right people the right career experience at the right time. Communicating, building a tailored talent development agenda and working together with the talents to its delivery, this is what the process is all about. The talent management strategy Talent management should be considered as a part of the business strategy and it can be said that in case of this company the strategy has been fulfilled. Talent management is an important part of the company's mission. The top management supports the ideas of talent management and implements it into the business strategy. On one hand the company adopts the global talent management strategy from the Group but on the other hand the company is also very active in this field as it strives to create its own local strategy for talent management. The Group‘s attitude is that every person has a talent and it only remains to be discovered. The Group as well as its Czech branch seek after talent in every employee. The aim here is to attract, develop and retain the very best people by offering a motivating and inclusive workplace in which talent is recognised and developed, and wellbeing is promoted. The Group tries to listen to its employees to be able to understand their views, to respond to their feedback and to take action to improve their weaknesses. Therefore it monitors the employees´ engagement and the level of satisfaction by means of the annual Group-wide survey and uses the findings to assess managers according to the employees´ experience. Finding and recruiting talents In most cases the company recruits new people through classic selection processes and methods and then it tries to find and develop their talent. The Company wants to use headhunting in the future for better recruitment of talents. Identification of talents in the company Talent Reviews The so called “Talent Reviews“ assesses talent within the company. The Talent review, apart from the formal indicators and measuring tools, considers an employee´s learning ability to be the best predictor of his/her future success. An open dialogue between the manager and his/her direct subordinates about their performance and potential is seen as the basic element of the talent review process. The performance defines success as seen through the prism of the employees´ current roles, it relates to the present. The potential is about the future. It is the expectation that the manager has about his/her subordinates but also the expectation that the employees have about themselves. 109
Any potential assessment is based on 4 indicators: Engage (40%), Change (20%), Applied Thinking (30%) and Drive (10%). Engage describes people who treat others constructively, know themselves well, they learn from experience, and are resilient to pressure. Change describes people who are curious, have a passion for ideas, they like to experiment with skill building activities. Applied Thinking describes people who think about problems from an unusual point of view and are comfortable with complexity, ambiguity and are able to explain their way of thinking to the others. Drive describes people who get results under tough conditions, inspire the others to perform beyond normal, and exhibit the sort of presence that builds confidence in the others. The evaluation of performance and potential evaluation is carried out every year and it is called “Employees Review“. Employees review their own performance and set clear goals and development plans for the year ahead through the annual “Performance Dialogues“ with their line managers. Talent Matrix The output of the Talent Review is the “Talent Matrix“ where employees and their “competences“ are arranged hierarchically. Employees are divided into groups with a differrent level of performance and potential (see Figure 11). By using the Potential Indicators managers obtain one of the 3 levels of the potential of their subordinates:
C- Confident to a future high position
B- Bigger, broader role
A- At level
People from the best groups are called “Rising Stars“; these are the most talented people with high development potential. Managers pay the most attention to these employees and their development. However other employees are also monitored and their managers try to find out where their problem is. They try to answer the questions why these people do not want to improve themselves, why they aren’t efficient enough or whether their job position is appropriate. These people get their individual plan for improvement. They either become better or they have to leave the company.
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Figure 11: Talent Matrix
Source: Internal documents, 2013
In the box 1 there are Rising Stars. They are the best the company has. They perform well in everything they take on. They are resourceful, curious and adaptable. In the box 2 there are also Rising Stars but their characteristic is slightly different. They know their job well; they can take on new and different challenges with ease and quickly get up to speed. In box 3 there are Adaptable Professionals who are usually the experts in something significant. They are also resourceful and productive and can perform without much support. The box number 4 represents Unusuals. They are underperforming but they show potential to adapt to new/different situations where they might be more efficient. Key Contributors are in the box 5. They are solid performers, flexible and competent. They can adapt to new situations and challenges but could be hesitant when going outside the comfort zone. The box 6 contains High Professionals who perform very well and keep up with their professional development actively. They provide continuity in expertise and achieve good results and can be good mentors to the others. In the box 7 there are Low Performers. They may show willingness to learn new skills or they may have shown some evidence of higher performance and potential in the past. They could also be on a learning curve or they could be frustrated. They are often loyal, popular with the others and long serving. The box number 8 represents Contributors/Professionals; a range of people with whom it is necessary to differentiate between their low and high level of performance. They meet targets consistently but sometimes they are inconsistent in new areas of focus. They could have lack of interest in 111
improving. The last box number 9 shows Low Performers. These people have poor and inconsistent performance all over the time. They are unable to adapt to new and changing situations. Talent development programmes Developing talents has a form of 70/30/10. This means that 70% of time is spent by on-thejob training, 30% by mentoring and 10% is off-the-job training. Development programmes should help employees to gain new skills and experience through a range of learning solutions including formal training, on the job experience, coaching, mentoring and learning through social networking. Training usually includes finance, human resources, marketing, supply chain and technology. Mentoring and coaching is not used very often locally. These possibilities exist only for a few people. The company has some highly trained mentors but there is still space for improvement. Coaching is not so widespread either and the company uses more external coaches for only a few managers. The company has its local development programme focusing on investing into their own people. It invests into their development and training and then it wants to get something back from them. The chosen people (talents) have to work out a project within approximately one year. They invent a new project, its design and implementation and after that the best of them present their results. The projects can be varied - for example a project for simplification or improvement of company processes, a project based on customer experience, a project of increasing revenues etc. This programme is designed especially for future managers. The company does not have any programmes for line employees and there is not any programme for experts either. The Group wants people to develop and encourage progress in their careers, either through promotion or through a change of role so that they may broaden their experience. Vacancies across the Group are advertised on the intranet, which encourages the transfer of talent between local markets. The company uses this possibility and offers this to its employees. Each employee can apply for a work position in any other branch of the Group all over the world. Their acceptance depends on their references and the selection procedure. Development procedures based on Talent Matrix Box 1: Rising Stars It is important to get such people into a position in which the stakes and accountability are high. Managers should give them enough time to make them familiar with the new job and be held accountable for the results; these are the prime candidates for an international move. These people could get a mentor or coach. They hold career aspiration discussions and work 112
to develop a career plan with their manager. Critical skills or any lack of experience should be identified at this stage and a medium term plan should be created to offer improvement. Box 2: Rising Stars These employees should be developed in-place through challenging and visible projects that drive business results and focus on senior management. Their supervisor has to ensure they have the right level of support and they are able to continue the development of their technical skills by means of mentors and/or follow up courses. The relevant supervisor should also ask “What’s missing in their work history or skills that stops them from being assessed in Box 1?“. Critical skills or any lack of experience should be identified at this stage and a medium term plan should be created to offer improvement. Box 3 - Adaptable Professionals The supervisor of these employees has to identify and develop the leadership competencies necessary for these individuals to assume the roles of general manager and/or business leader. The development plan should focus on changing jobs, or part-time assignments that would increase their scope or broaden their skills level. The manager looks for ways to keep on challenging these individuals in their current job (i.e. with advanced courses or mentoring) if they are unable to move. He/she checks ‘the experience history profile’ carefully to see what key assignments and challenges may be missing. Box 4 - Unusual The supervisor of these employees has to ask questions as follows: “What is the issue underlying the poor performance? What’s causing them to go off the rails? Is it a personal or motivational issue? Have they been moved into a role that is not a good fit for them?“ If they are successful, the manager builds the technical skills they may be deficient in. He/she gives them plenty of feedback and provides them with a coach, and, at the same time, monitors their progress closely. Box 5 - Key Contributors The manager identifies the specific ‘people management’ skills the employee lacks by means of the 360 degree assessment. Then he/she tries to build these skills on the job and through part-time assignments/projects. He/she considers the methods of job rotation or lateral move to have more comprehensive view of the business. The supervisor’s questions might be: “What steps should be taken to increase their adaptability? Is this employee a ‘niche player’? That is, he/she performs a unique role and therefore should not be moved OR is he/she possibly a ‘utility player’ that could broaden his/her technical base.“ 113
Box 6 - High Professionals The supervisor will have a discussion with employees to determine whether they are interested in pursuing a technical track within the company. If they are considering a more general management position, the manager pursues a discussion about leadership skills and a different career track. The manager then considers courses, training programs and informal feedback as a way to begin developing the ‘people management’ skills. Box 7 - Low Performers Supervisors would probably have plenty of questions regarding these employees. “Does this individual have the motivation and desire to be successful? What is the underlying trend in their performance? What specific skills need to be developed to increase performance? Is there a mismatch related to personality / skill / role in their case?“ Managers should determine the objectives / deliverables that are time-bound, measurable and specific and should offer technical training and learning from in-place, technical assignments. Box 8 - Contributors/Professionals Supervisors of these employees have to ask: “How can they increase their performance? What is the underlying trend in their performance? If it is steady or decreasing, should they be dismissed? Are they good enough to be considered for the professional pipeline? What do they need to do to get even better? Are they good enough to become High Professionals?“ Then the supervisor has to find a solution based on the answers. Box 9 - Low Performers If an employee is in the box of Low Performers, his/her manager should first confirm that the assessment is accurate. If the answer is Yes, the manager takes action to dismiss the individual from the business as soon as possible. If the answer is No, he/she places the employee in the appropriate box in the Talent Matrix and provides him/her with the relevant development guidelines. Leadership development The key tool to strengthen the succession planning is developing the leadership capabilities of the high-potential employees. The high-potential people are identified through the annual Talent Review Process (see above) and they are given the opportunity to take part in the global leadership development training programme “Inspire“. This programme should accelerate the progress of the high-potential managers into the senior leadership roles. It provides a combination of learning programmes, executive coaching 114
and mentoring provided by senior leaders over a period of 18 months and it may include an assignment to another local market or another function. The Group also conducts quarterly Talent Reviews for senior leaders to identify highpotential leaders, to match their skills to the relevant business needs and to help individuals achieve their development goals.
Conclusion Talent management is strongly connected with the company mission and strategy. The described company adopts the global talent management strategy from the Group but it also tries to make its own programmes and strategies and to manage talent within the company according to the Czech specifics. The company uses a very detailed and precise procedure of talent management that is described in detail in the company internal document called “Interactive Talent Guide” that gives advice and information to managers and supervisors how to treat their subordinates and to develop their talent. The Company conducts the so called Talent Reviews annually aimed at assessing the performance and potential of its employees. The main output of the Talent Reviews is the Talent Matrix where employees are located in 9 boxes. Regarding these locations managers and supervisors have specific instructions at their disposal describing how to treat their subordinates and develop their talent. This company has also a very good leadership development programme for the high-potential people that accelerate their progress into senior leadership roles. The company has a well-developed system of managing talent too. It is well aware of its strengths but it is also familiar with the weaknesses in this field and therefore it plans to improve the issues in question in the near future, for example the recruitment of talents that does not seem to be well-developed as yet.
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3.4. TALENT MANAGEMENT IN T-SYSTEMS SLOVAKIA S.R.O. Company profile T-Systems Slovakia s.r.o. – Limited Liability Company - was established in 2006 as a daughter company of T-Systems International, part of DTAG. The company is located in Kosice, Slovakia, and it currently employs about 2,500 people. T-Systems shape the networked future of business and the society and create value for customers, employees and investors thanks to the innovative ICT solutions. Drawing on a global infrastructure of data centers and networks, T-Systems operate information and communication technology (ICT) systems for multinational corporations and the public sector institutions. T-Systems provide integrated solutions for the networked future of business and the society. The company's 52,700 employees combine industry expertise and ICT innovations to add significant value to customers’ core business all over the world. T-Systems generated revenue of around EUR 10 billion in the 2012 financial year. Over 160 000 companies all over the world rely on a single partner in the area of information and communication technologies (ICT): T-Systems Company. T-Systems Company is the business customer brand of Deutsche Telekom. With 46,000 employees the company offers – as one of the few service providers on a global scale integrated ICT solutions from a single source. This integration is understood in a wider range than just IT plus telecommunications. We talk about "the real ICT", because we start with an integrated approach to information and communication solutions from the very basics. The goal of T-Systems is to help customers grow and develop their business in line with their goals, even in times of the changing markets and increasing competitive pressure. T-Systems Company is an enabler, making their business more simple and competitive. T-Systems‘ services are based on the three core values: innovation, simplicity and competence. T-systems build successful solutions for their business, based on efficient and innovative technologies. T-Systems Slovakia is especially proud of the following awards:
2012 – Family, family equality and equal opportunities friendly employer;
Honorable mention for supporting creative non-work activities of employees from Pontis Foundation;
2011 - Top TREND Company of the Year in Slovakia; IT Company of the year in Slovakia 116
The Slovak Chamber of Commerce and Industry; Grand Prize for ethical principles in business; Award for the long term co-operation and commitment from the non-profit organization Úsmev ako Dar;
2010 - HR Oscar special;
2009 - HR Oscar special;
2008 - HR Gold.
Market position In 2011 the analyst firm Gartner published the “Magic Quadrant for Data Center Outsourcing and Infrastructure Utility Services, Europe”. The report positions T-Systems in the “Leaders” Quadrant. According to Gartner “leaders” perform skillfully. They have a clear vision of the market's direction and develop competencies to maintain their leadership. “They shape the market, rather than follow it.” As a ‘Leader’ T-Systems know the direction in which the market is developing and they meet their customers’ requirements based on cost-efficiency, flexibility and simultaneously on high quality.
Talent management in the company Adopted definition of talent, talented people management and related definitions Based on professional literature T-Systems have adopted their own definition of talent. Talent is somebody working on an existing job position who can take on a more complex task or role responsibility immediately or in the period of 1-2 years (in vertical or horizontal development) and manage it successfully. Based on the internal definition this should be an employee whose performance and potential is evaluated annually under the terms of Jumper or Grower. The process of evaluation consists in the fact whether the employee has the potential to develop himself/herself into a more complex position. This potential should be observed by his/her superior and supported by means of the Human Resources programs. Additionally this is usually an employee who meets the challenges in his/her current job successfully, actively asks for more responsibilities in addition to the defined responsibility, takes actions on his/her own, meets the expectations of his own as well as of the others and is willing to develop himself/herself in the process of growth. T-Systems have developed a quick check questionnaire where a manager can ask questions to be able to asses and evaluate all employees and to get the answers about their potential. The findings are important in the process of identifying talent and potential. 117
The relation between human resource management and talent management The responsibility for creation, implementation and update of the talent management process as well as the concept in general is in the hands of the Human Resources Department. Every manager / leader, when taking up a position in the company, takes part in an Introduction Training Course where all the HR related processes are introduced and explained to him/her. Then it is the leader’s responsibility to work along the instructions and follow all the rules. In case of any doubts he/she can contact the HR Department. If there is any specific requirement related to the company needs, the leader contacts the HR Department so that they can create or update the specific training courses in the portfolio to adjust them to the company needs. Each employee is unique so it is not possible to have the same training and tools for everybody. This means that in the organization HR creates a framework for the Talent management but it is up to any individual leader to choose the right tool to be used appropriately for a specific situation. Implemented practices in talent management, talent management tools
Talent and development program for Leaders – level 1 – focused on a newcomer to a leading position;
Talent and development program for Leaders – level 2 – focused on further growth to a higher leading position;
Talent and development program for Female Leaders – meant to support and empower women to become leaders;
Discussion forum for Leaders – the purpose is to share the best practical experience across the leading community in organization related to specific topics focusing on leadership of employees;
International talent programs – for IT Specialists;
International talent programs – for Leaders (at any Mgmt level);
International talent programs – for non IT positions;
The assessment and development centers evaluate strong and weak points and support the development plan for employees;
Various internal projects where talents are involved to develop their skills and potential; 118
Various workshops;
On the job development;
Off the job development;
International job exchange program (3-12 months);
International project assignments (3-6 months);
Internal trainers – a program meant to develop and use the potential of talents so that they can also work as internal trainers in order to develop the potential in the desirable direction;
Coaching – external and internal coaches;
Mentoring – internal mentors;
Adaptation program;
Local / International Talent community – experts;
Local / International Talent community – leaders;
Mentor- shadow program;
International campus for experts.
Integration of talent management into other company’s activities, integration of talent management into the company strategy Talent management is part of the company strategy as T-Systems have the principle “Best place to work and grow” as one of the core values. The company invests a lot of money in training and development of employees. Employees are trained according to the company´s and customers´ needs and requirements. T-Systems invest a lot of money into innovations so as they may be prepared for the market needs and they may support the strategy of the company and enable its fulfillment. The training needs are also aligned with the company requirements, which means they are aligned with the processes of headcount planning, recruitment, retention and compensation. The company extends the development of the internal staff to prepare them for various activities in the region and cooperation with universities. The IT sector helps them implement the strategy and be prepared for the future needs of the market.
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Succession planning and management process is a significant part of the talent management too. The initiator of the talent management implementation As a HR representative is part of the executive management of the company, there has always been executive management agreement on the future strategy and actions that lead to the achievement of the strategy. Some initiatives were undertaken by the business department of the company and the HR Department developed the content according to the company needs and requirements. Some initiatives were suggested to the company management by the HR Department and developed further at a later stage. There is always mutual agreement and involvement of all the management in the organization as Talent management is really the key process in T-Systems and the management is highly involved. How the talent management implementation modified the human resources activities, which area has been changed and to what extent The Human Resources Department in T-Systems is quite large. T-Systems set aside the Competence centre and this was dedicated to training and development activities and programs for the company. Its role is to create, update, adjust or implement all the development programs together with the final organization of all the training courses and programs. The role of this Competence centre is also to choose the best provider for the external training courses and to cooperate with internal trainers. The content of the training courses and programs is consulted with the company managers. The HR Competence center is highly experienced as they have developed and implemented a lot of programs and so they became the Competence Center also for other countries in Central and Eastern Europe. Some of the programs were originally created by TSystems and, therefore, these programs are considered to have the status of registered trademarks within the T-Systems International community. Further presentation and implementation of these programs was successful also in other countries. T-Systems also implemented the role of the HR consultant, i.e. the contact person between the company and the HR Department to consult all the specific needs and requirements. The HR consultant provides feedback to the Competence center with regard to what development programs are successful and required so that the HR Department can always have up-to-date programs. The Competence center then prepares updates or creates a new program or training. The cooperation is very successful. The consultant is like a salesman of the HR tools to the company while the Competence center is an architect and designer of the tool.
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The HR Department also monitors the trends on the market in talent management and integrates them into the local programs so that the company can always be on track. The HR Department participates in various local and international conferences to get the latest information. The HR Department has also created a special library where it is possible to obtain specific books and magazines dedicated to the topics of leadership to support the issue of talent management. The HR Department organizes various events for leaders to communicate and share information and best practices to develop the leaders. Principles, functions and elements of the implemented talent management models The major element of the talent management process is to identify and assess the genuine talent. Based on the right evaluation it is possible to prepare the individual development plan for each talented employee. The next element is also the personal inner motivation of an employee to develop him/her further. The development might take some time so it is necessary to be aware of the fact that it requires a certain time period as well as further development and practical experience. It might sometimes happen that the person is already developed and ready to take on a more complex position but there is no vacancy at the moment. So it has to fit the company demands and needs. Sometimes the potential and motivation might get lost so it is very important to keep the talents involved in some development tasks. This is also related to the issue of retention, because if an employee waits for an opportunity too long, she/he may want to leave the company and these results in the loss of the investment into a talented employee. Motivation system for talented people T-Systems motivate employees mostly by development and career opportunities. This is the advantage of the company, because they have quite a big pool of tools. Apart from this, the company has good compensation packages for talents and motivational benefit programs where talents are motivated to work harder to get more if they are successful in their career. It means that with higher responsibilities and a higher position an employee may win a significant benefit as a motivation. We also have a performance management process focused on good results and in this respect we are managed by KPIs where employees are responsible for achieving the targets.
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Diagnosis, assessment and development of talented people T-Systems have developed a concept of internal assessment of talented employees being prepared for leading positions based on the company values. The HR Competence center is the owner and it is also responsible for any updates according to the company needs and the current situation. The assessment takes on the whole day and it consists of various model situations, presentations, group work or individual discussions. We have a group of internal observers who are responsible for the evaluation of the potential of the employee based on observing the behavior and competencies during the day. The observers are usually leaders or HR employees having special training for observing competencies. If an employee passes the internal assessment successfully, s/he becomes part of a special program for the talented future leaders. This program takes approximately 6-9 months and consists of more modules. The modules are dedicated to the key leadership skills required for future roles: time management, communication and conflict management, building and leading a team, change management, labor code, ... The modules are supported by individual mentoring and coaching between sessions by the direct superior or another mentor from the company, together with the on-the-job tasks and follow-up sessions with trainers. This program is provided by an external company specialized in the development of leaders. We search providers via tenders and the contracts are valid for several years. Then the contracts and providers are evaluated, as well as the content of the training. Talent retention The direct superior is the person responsible for retention of the talent. S/he has to ensure that s/he will have a job for the talented employee in the future. If not, s/he has to ensure to provide him/her with other opportunities to use the potential in order not to lose the employee. The HR Department is responsible for creating, developing and consulting specific programs for retention within the framework of the company’s possibilities. T-Systems do not have any special program but the HR Department always advise leaders and provide them with support in their decisions. Based on that the superior can use an appropriate tool to retain the individual employee as each employee has different motivation to work and develop and the direct superior has the best knowledge how to do that.
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Factors supporting the talent management implementation; the discovered limitations and barriers The factors that supported the talent management implementation were the strategy and the company needs on the one hand but also the labor market limitations and the insufficient quality level and the number of university graduates on the other hand. As the local labor market is not able to deliver enough IT specialists for our business portfolio, the company was forced to develop a lot of programs to support this role and train employees to gain the required competencies. But this is not only about the necessary knowledge, but also about the possibility of gaining practical experience that is necessary for graduates in order to become suitable for the market and the company needs. The limitations and barriers that have been discovered include the speed of the training, or, more precisely, the lack of it. We would require a fully fledged employee much earlier as s/he is able to train and apply the knowledge in practice. Sometimes there may be more mistakes as a result, especially in the sphere of people management. Another barrier is that young leaders need more support in the talent identification phase as it sometimes happens that this is done in the wrong way and the employee is not successful. Here we have to support it much more and focus on the future. Sometimes there is more competitiveness between talents at the expense of cooperation and development. Some leaders have the feeling they have to be the best in the team but this is no more required so we have to ensure we have the right leaders in the positions that enable talents to develop. And, as has become customary these days, there is never enough time to absorb all the knowledge and get ready for the new challenges. The advantages or disadvantages of the implemented talent management model and its influence on employees´ loyalty and work satisfaction The motivation of the existing staff to stay with the company and to take on another job can be considered the main advantage. In connection with that we can also mention the lower costs if a position is taken by an internal candidate as s/he has already enough information about the company. Such employees are then also more loyal and satisfied. This influences the attrition rate in the company. Investing a lot of money into training and development is considered to be a big advantage by our employees.
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Methods of the TM evaluation efficiency and the financial effect of the talent management implementation The HR Department keeps statistical evidence of the amount of employees who were promoted from the talent pool and were successful. This ratio shows whether the talent program is sufficient or not. The HR Department also regularly asks managers and participants for the feedback. The leadership is a critical competence in T-Systems as it influences all other processes. That is why the talent and management development is in the scope of international management too. Another part that evaluates the successfulness of the talent management program is the internal fluctuation between the company units and the external fluctuation. T-Systems carry out a regular internal satisfaction survey of the employees whose integral part is also the question about the development possibilities. This result is also important for the management when deciding on the next steps. The most important question in the survey is “How do you feel at T-Systems?”. This question is cross-sectional as by this simple query we can have a brief and quick overview of the employees´ satisfaction. Of course, the survey has more questions where all the important parts are included, including the development possibilities.
Conclusion Talent management is the key process aimed at the fulfillment of the company strategy. One of the core principles in TSSK is “The best place to work and grow” and this slogan reflects the way the work with the talented experts and managers is perceived also from the investment point of view. Talent management is crucial because of its role to motivate and develop the right people for the appropriate positions and to keep the company´s sustainability into the future. Some drawbacks that need to be improved can be found below:
The first weak point concerning the investments into the training & development of employees is the insufficient identification of talents at the beginning. This is the responsibility of the direct managers and there is space for improvement within the whole Talent management process.
The second weak point is that people used to participate in various training programs in the past, when the company was growing dramatically and new skills were required. Nowadays, the company is on its way towards stabilization and there is no more need of such highly skilled employees. Some employees might start leaving the company if they cannot find enough motivation. So we have to focus on the issue of fluctuation
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and retention much more and tailor the training courses to the needs of the targeted group of talents – there is no need of mass training courses anymore. In general, the talent management programs we have been developing since the TSSK Company was established are very good and have brought us a lot of skilled experts. As we are, at present, facing a lot of changes and challenges concerning the organizational development, some programs of TM would probably need some small adjustments so that they might better fulfill the company strategy in the coming future and support the company needs more effectively.
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3.5. INTEGRATED TALENT MANAGEMENT AT K&H BANK Company profile Economists say that talent is crucial and it is the greatest advantage in competition. Companies should choose to find talented employees instead of making their choices based on technology, factory or even capital (Gandossy et al. 2007). Behind the success of a company, there are always the abilities, the talent, and the knowledge of its employees. In the present case study, we are going to show the talent management programme of a company operating in the banking and insurance sector. K&H Bank is the second largest bank in Hungary. It is a market leader in the corporate segment, and the second most important financial institution in retail services. Its primary aim is to find the most suitable solutions to satisfy its customers‘financial needs. That is why they continuously develop their products and services as well as the human resources behind them. K&H Group is one of the leading financial services providers in Hungary. It offers its clients both banking and insurance solutions, which allow them to make smart decisions and choose the most suitable opportunities for themselves. Besides the traditional retail and corporate banking products (account management, investments, savings, loans, bank guarantees, bank card services, deposit management, treasury, project financing, etc), the products range of the K&H Group includes premium banking services, investment fund management, leases, life insurance, property and liability insurance and securities trade. The main structural units of the bank representing its major activity areas are:
K&H Bank,
K&H Insurance,
K&H Fund Management,
K&H Lease Group,
K&H Factor.
The history and business background of the company K&H Bank shares its birthday with the two-tier banking system in Hungary. Both of them were established on 1st January 1978. The bank was founded by the Hungarian government and the companies belonging to its ‘inherited’ clientele including agricultural, food industry, trading and tourism companies. In the period up to 1992, the activity and clientele of the bank was extended; new services were introduced and there was a dynamic increase in the size of its branch network. 126
In 1996, it merged with IBUSZ Bank, which was specialised in retail services. This bank had been owned by K&H Bank earlier. This merger resulted in the emergence of a large universal bank, which had the second largest branch network in the country. It was in the same year that K&H Bank joined VISA and Europay (the present MasterCard), which allowed to create one of the widest selections of bankcards in the country. The winner of the tender, issued as the first step of the Hungarian bank privatisation, was a syndicate of the Belgian Kreditbank and Irish Life, an Irish insurance company. Kreditbank – the predecessor of KBC Bank – entered the Hungarian market as the winner of the K&H Bank privatisation tender in 1997. The Belgian owner, KBC Bank and Insurance Group, merged the bank with the Hungarian interests of the Dutch ABN AMRO in 2001. On 1stJuly 2001, the Court of Registration registered the united K&H Bank in which KBC Bank owned 59% of the shares, while ABN Amro Bank controlled 40% of them. Ownership of K&H Bank and K&H Insurance The ownership structure of K&H Bank as of 1stJune 2012: KBC Bank N.V. 100%. The ownership structure of K&H Insurance as of 1stJune 2012: KBC Insurance N.V. 100%. As a modern financial institution, K&H Bank aims at:
retaining, strengthening and improving its existing market position in all business lines;
building its existing clientele’s trust and acquiring new clients with its prudent operation and continuously developing services and products;
creating client-friendly solutions in its product and service development, thus allowing optimal solutions to corporate and private financial needs in any situation;
providing an exceptionally high level of operation while being sensitive to social issues and trying and helping to find the right responses to them as part of its community involvement strategy (Internal documents of K&H Bank).
The strategic goal of K&H Bank is to keep its stable position in Hungary and to catch up with OTP Bank, the currently largest Hungarian bank.
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Employees Table 18: Statistical data concerning labour force composition Element Top management level / female employees Experts, lower and middle management level / female employees Subordinate level / female employees Indefinite duration contract / female employees Fixed-term contract / female employees Active Non active Male Female Full-time employment Part-time employment 80% < / female employees Part-time employment < 80% / female employees Total active employment
2008
2009
2010
2011
133 / 44
137 / 44
127 / 43
147 / 57
2560 / 1678 2156 / 1859 4 831
2545 / 1676 2019 / 1737 4 689
18
12
4 400
4 261
2183 / 1546 2078 / 1775 4362 / 3345 26/ 19 3 956
2176 / 1511 1931 / 1660 4222 / 3210 32 / 8 3 798
449
458
491
456
1 269 3 580 4 756
1 244 3 457 4 599
6
6
87
53
1 024 3 364 3423 / 2506 8 / 5 82 / 73
1 026 3 228 3693 / 2711 8 / 5 97 / 87
4 400
4 261
4 400
3 798
Source: Internal documents of K&H Bank, [cited 16 June 2013]
Some other characteristic data concerning the employees of the bank:
median age: 38,5 years,
average duration of employment with the company: 9.6 years,
rate of women in managerial positions: 38.8%.
From the figures of the table showing labour force composition (Table 1), we have found that
there were 3798 employees in 2011 (by 14 % less than in 2008),
there were 1026 men in 2011 (by 19% less than in 2008),
there were 3228 women in 2011 (by 10% less than in 2008),
the number of part- time employees did not change in 2008 – 2011,
the rate of women in the top management increased by 6 % in 2008 – 2011,
their rate in the management increased by 3 % in 2008 – 2011,
the proportion of female subordinates remained unchanged. 128
HR management in the company Figure 1 shows the HR functions of the organisation that fall within the competence of the Directorate of Human Resource Policy. The aim of the Directorate is to establish and enforce a human resource policy which is harmonised with the strategy and business policy of the bank as well as with the HR standards laid down by the owners. The Directorate of Human Resource Policy reports to the Head of the Change and Credit Management Division, who is one of the members of the nine-member Executive Committee of the K&H Group. Figure 12: Organisation structure of the K&H Bank HR
Source: Internal documents of K&H Bank
Talent management in the company Talent management strategy The concept of talent cannot be separated from the character of a talented person. People who are involved and developed in talent programmes are those who have high leadership capabilities and can be the successors to top managers. (Interview with Júlia Oláh, Head of Leadership Capability Dept. at K&H Bank Zrt. 2013)
they show an exceptionally high quality performance and they can maintain it for a long 129
time,
they are motivated for self-development,
they have demonstrated language proficiency to a degree appropriate to negotiate.
Thus, according to the philosophy of the bank, someone is considered a talent or a key employee if they perform more and higher than an average employee does and if they demonstrate outstanding leadership potentials. This area of management is closely related to succession planning. In the philosophy of the bank, talent management is a systematic approach to succession planning. Its most important function is to prepare the talents of the future for key positions in a more concentrated and organised way. Furthermore, it is important to make them envision the attainable goals. By talent management strategy the bank means the selection of talented employees having leadership potentials and showing excellent performance; facilitating their development in a way that goes beyond the regular training programmes; and ensuring job rotation between professional areas. It is important for the bank that there be proactively prepared successors to the branch managers in its extended branch network. Besides, paying attention to employees who might be in demand elsewhere and trying to retain them is also of primary importance for the bank. All these are necessary in order to have managers and potential successors who are capable of fulfilling the Top 100 managerial positions and the key positions in the network. Before the depression, in 2005, the Hungarian labour market was much more mobile than e.g. the Belgian one. At that time, life-long employment was self-evident at the parent company of K&H. Since we started speaking about life-long career opportunities, the majority of employees in Belgium have been changing their jobs every 3 or 4 years to ensure renewal on the organisational level and to avoid employees’ burnout. The Belgian expat management is open to job rotation on the local level and supports it as part of the career programmes. Finding and recruiting talents
Career-starters
One of the most important priorities is finding talents among potential employees and recent graduates - first of all among graduates with degrees in economy and finance. In order to facilitate finding talents and keeping contact with potential career starters, K&H Bank provides 6-15-week long traineeship opportunities for university or college students. 130
119 students participated in a 6-week traineeship and 12 students took part in a 15week traineeship programme in 2011. It means that the number of trainee students participating in these programmes increased as compared to the previous years. Within the career–starter programme of K&H, four young people had the opportunity to be acquainted with the different job areas of the K&H Group and to extend their professional knowledge within the framework of a 9-12–month rotation programme in 2012. All four of them are now the employees of the bank: a junior marketing manager, a junior process manager, a junior corporate strategy counsellor and a private portfolio analyser. K&H expects only talented applicants with leadership potentials to participate in this programme. They will later take part in the rotation programmes, and after a couple of years of experience, they will become young potentials. In 2011, the bank organised the K&H Student Cup for the third time. It is a banksimulation competition among college and university students who compete in teams of three. The growing popularity of the competition is demonstrated by the fact that the number of participants was 456 in 2009, 713 in 2010 and 743 in 2011. The winning team could go on a three-day study trip to Brussels and had the opportunity to visit KBC Bank there.
Future employees
When it comes to the fulfilment of a vacancy in a managerial post or in a senior employee position, the bank always considers how important it is to ensure a higher level of succession in the given area and only then, they select the new person to fulfil the position. Talent development programmes The primary goal of the programmes is to ensure organisational continuity and the succession to key positions; to shape the key employees’ future consciously and to retain them. The KBC Talent Bank and K&H Network Manager Programmes accomplish these purposes. The Hungarian management of K&H launched the K&H Young Talent Programme locally in 2005. The aim of this programme was to retain motivated young employees. They also launched the K&H Network Manager Programme, which is still going on and has remained unchanged. The parent company also introduced a talent management system (KBC Top Talent Concept) in 2007. This programme functions at the international group level. It took precedence over the K&H Young Talent Programme and resulted in an annual talent review.
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The local young talent programme could not be operated any more. However, some of its successful elements were built into the new talent management system. At present, it continues functioning within the international system as the so-called ‘Young Potential ‘level. The bank’s own succession planning system was introduced in 2009. According to this system, potential successors for the TOP100 positions are planned for 2 years first, and then annually. This resulted in new guidelines for recruitment and in internal job changes: employees who are included in the succession plan are given preferences when there is a vacancy. The so called TOP40 and TOP100 programmes are organised for the top management with the aim of providing a platform for joint-up thinking, relationship building and shaping management approaches, thus facilitating more effective cooperation between the divisions and sharing current trends and knowledge among themselves. KBC Talent Bank In accordance with the KBC system, the aim of KBC Talent Bank is to select and develop the highly talented employees with outstanding leadership capabilities so that the managers and successors suitable for filling the TOP 100 positions can be available all the time. Based on their competences, talented employees are divided into three categories. These categories can be distinguished according to age and professional / managerial experience:
Young Potential,
High Potential,
Top Potential.
Young and High Potential programmes focus on development and both of them last 4 years. Employees who have broad professional and managerial experience and who might be successors to top management positions in 2 years’ time, fall into the Top Potential category. Employees are selected into the programme annually. The process of nomination and approval starts in January. Those concerned are notified of their nomination by the end of June at the latest, and later they are informed about their participation in the programme following the selection. The participants of the programme take part in an annual talent-assessment, and they have to meet specified criteria by the end of the programme.
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K&H Network Manager Programme The aim of the programme is to ensure the long-term internal succession of retail branch managers by means of conscious, preliminary preparation and development of highly talented employees with outstanding leadership capabilities in a two-year training programme. The programme is launched every two years. The fifth programme is going on at present. Those who are interested can apply to the programme. However, they need their superior’s support to take part in the selection process. The programme includes compulsory and optional blocks. The goals of the Compulsory Blocks are as follows:
to develop certain professional and managerial competences,
to give an overview and knowledge of the most important functions, processes and business solutions of the retail division of K&H Bank.
The goals of the Individual Blocks are:
to ensure individually-tailored additional development opportunities on the basis of the Personal Development Plan (PDP),
mentorship,
monitoring, feedback - a 360 degree assessment of career interviews.
Programmes as reflected in figures 72-74-64 employees participated in the KBC Talent Bank Programme in the period of 20102012. On average, 35% of the participants took a step in their careers (laterally, upwards or by job enrichment) annually. This percentage was 35% in 2010, 36% in 2011 and 23% in 2012. During the years 2010-2012, the total number of participants of the KBC Talent Bank programme who were appointed to TOP100 positions was 21. On average, the participants of the programme spent 18 days per year taking part in development activities. The K&H Network Managers’ Programme was launched in 2005, and the fifth one is going on at present. 54 employees took part in the first four programmes. 45 of them (83%) were promoted at least once, 42 employees (80%) were appointed branch managers. On average, each participant of the K&H Network Manager Programme spent 17 days per year taking part in development activities.
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Identification of talents within the company The selection of the participants of the KBC Talent Bank programme The Country Team (CT) approves the participants of the KBC Talent Bank programme annually:
First, the HR Directorate consults with the managers of the relevant field of expertise about the potential participants of the KBC Talent Bank.
After that, the division heads together with the top managers of the relevant field review, modify and complete the list of candidates in their annual competence management meetings.
Following the discussions, the proposal is submitted to the CT (Country Team) for finalisation.
The candidates write a proficiency test in English in the Assessment Centre (AC).
The selected talents who have achieved successful results are notified of the approval.
When there is a vacancy in a key position, first, the employees included in the succession plan, and especially those taking part in the Talent Programme, are considered as potential candidates. The suitability of a candidate is evaluated by using a competence-based assessment. The first two levels of the KBC Talent Bank programme (Table 2) consist of four-year programme cycles. By the end of the fourth year, each participant completes the Young Potential / High Potential development programmes. When employees have completed the development track leading to the upper limit of their potentials, they do not enter a higherlevel programme automatically. They can get onto a higher-level track only if they are deemed to have potentials which are worth developing. Employees might drop out of the programme if they do not fulfil its basic criteria (performance, self-development, representation of the PEARL values, functional flexibility). The annually conducted structured interview is an essential part of the programme. The purpose of this interview is:
to review what happened to the talent since the previous career interview (changes in motivation, responsibilities, possible changes in his/her job, etc.)
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to find out the person’s short- and long-term career plans and the development tracks he/she intends to pursue in the coming period in a one and half-hour interview based on the PDP completed by the talent,
to provide guidance on the talent’s career orientation,
to confirm the participant’s belief that the organisation considers him/her a talent and they pay attention to the retention of this talent as well as to his/her career development.
Figure 13: KBC Talent Bank selection criteria General requirements
A degree Confident knowledge of English including negotiating capabilities At least two years of experience with the K&H Group Excellent permanent performance Possessing the KBC Pearl values (respectful, sensitive and result-oriented) Proven accountability: strong commitment, above expectations performance, sense of ownership A definite motivation for personal development, personal development ideas Outstanding flexibility Mobility (functional mobility is a basic requirement, geographical mobility is an advantage)
Source: Internal documents of K&H Bank
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Figure 14: Programme specific criteria/ expectations Programme specific criteria/ expectations Young Potentials High Potentials Top Potentials - over 30 years of age - ages 26-30 years (a - over 30years of age - (a flexible criterion) flexible criterion) - at least 8 years of - at least 12 years of - at least 3 years of professional experience, professional experience, professional experience - at least two years of - junior expert, junior experience in a managerial - at least 6 years of experience in a managerial manager, or junior position position, specialist experience , - experience of work in one - experience gained at least - strong leadership of the basic functional in two basic functions capabilities, areas - outstanding leadership - potential successor to an - (retail or corporate sales, capabilities, upper- mid-level sales support, lending - an empowering managerial position (products related to management style according to the lending), insurance, - ready to fulfil a senior managerial assessment; investment, fund managerial post in two having successful AC/DC management, financial years’ time according to results as a mid-level markets and stocks, ICT, the managerial assessment; manager. cash-flow, risk having successful AC/DC management and control results as a top-level functions, finance, law, manager, taxation), - experience gained at least - the person’s name - in two of the following job regularly arises in areas: dealer, sales support succession planning professional, operational professional, rule-maker. - strong leadership capabilities, - an empowering management style, - potential successor to a senior managerial position of K&H according to the managerial assessment; having successful AC/DC results as an upper midlevel manager. Source: Internal documents of K&H Bank
The benefits of the programme experienced so far: structured and individualised,
personal attention and care,
institutionalised, all the managers are aware of it,
international:
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a) KBC Academy = a 5-week high-level career development programme for the Young Potentials, b) KBC MBA = a group-wide, common development platform for the High Potentials, c) Inter-Alpha Banking School available for the Top Potentials. The cultural impact of the programme can be quantified only later. Some examples of the cultural impact are that
development and mentoring makes the participants become responsible managers in the long run;
there is a growing appreciation of those who are involved in talent management as line managers or mentors within the organisation;
more and more previously, mentored employees undertake mentorship later.
Besides the benefits listed above, the return on the programme is also an indicator of its success: we can quantify the recruitment costs saved due to the immediate availability of the highly qualified internal successors. 46% of the top 100 vacancies were filled with talented employees in the bank in 2012. The percentage was 35% earlier. There are approximately 10-15 positions in the bank, including mid-level managerial posts which are filled with their own talents. If there were not any internal successors, they would have to turn to a recruiter to find candidates. Furthermore, it is possible to quantify the retaining effect of the programme indirectly: if we assume that there are 10 positions annually where there are no vacancies because of the increased managerial attention, development and career management, the return on the programme costs is ensured. Criteria for the selection of the employees taking part in the K&H network manager programme The programme is primarily aimed at employees working in retail or small / medium - sized business banking areas who:
are talented / have outstanding leadership capabilities,
perform above the average,
observe the K&H values at work,
fulfil positions ranging from administrative ones, through salespersons , experts, senior experts and senior sales persons to leaders of minor professional groups;
have been the employees of the K&H Bank for at least six months and have 2 years of professional experience; 137
have a college or university degree,
are geographically mobile ( within their own cluster and within 3 nearby clusters),
have a B Category Driving Licence,
undertake to acquire at least an intermediate level of knowledge of English by the end of the programme.
K&H Network Manager Programme The programme has completely fulfilled the hopes placed in it:
the majority of the participants follow their planned carrier paths,
due to the relations network, it has a strong motivating and retaining effect even after the two-year formal programme.
Intensive time investment is the only drawback of the programme: besides taking part in the 17 days’ long development activities annually, the participants have to do well at work, which causes difficulties especially in branches operating with a smaller staff without formal replacement possibilities. The supervisors concerned are regularly consulted on the performance of the participants. Participation in the programme cannot be to the detriment of performance. It sometimes occurs that participants cannot attend their development session because of their workload.
Conclusion remarks and recommendations The talent management programmes of the K&H Bank provide opportunities for intensive, individualised development. These programmes are based on annual personal development plans and they are adapted to the requirements of the K&H Group. The KBC Talent Bank and the K&H Network Manager programmes are given special HR attention in career planning and in the case of internal vacancy notices. They enjoy special top managerial attention when it comes to workshops, projects, annual talent reviews or succession planning. These programmes are advantageous not only for the talented employees, but also for the participating managers. A top manager is a developing manger as well. By participating in the programmes, they themselves learn and develop and they are held a mirror at the same time. The bank received the Oscar Mentoring Award in 2012. It is awarded by the counselling sector and certifies that the programme of the bank proved to be the most thoroughly elaborated and sustainable system in the comparison of multinationals.
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The talent programmes have their own limitations, which they are going to change in the future.
Openness to rotation might hinder the operation of the programme. The talents and the nominating managers were equally afraid of rotation but they saw and they still see that it is a possibility rather than an obligation. A persuasive example is the participant who was given the opportunity to return. The question arises whether they should base their recruitment on openness to rotation, competence or professional knowledge. It is a challenge they have to face. It might cause difficulties that they want to have employees who perfectly know everything about their job and who are competent in every field.
The type of managerial attitude, which assumes that the nomination and the development of a successor endanger the manager’s own position, has faded into the background during the past years because managers understood that good managers are not replaced and they also realised that they enrich themselves by supporting the development of others. (Interview with Júlia Oláh, Head of Leadership Capability Dept. at K&H Bank Zrt. 2013)
Conclusion The presented descriptive case studies reflect successful talent management implementation in the organizations from the Visegrad countries. The case studies indicate that there are different organisational perspectives and approaches to talent management and this fact is reflected in the way these specifics are tailored to the context in which the companies operate.
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3.2 Integrated Talent Management in Carlsberg Accounting Service Centre sp.z.o.o. Bhatti, W.A., Waris, S. Zaheer, A. & Ur-Rehman (2011), The effect of commitment and motivation on human talent and its contribution to organizational performance, Management & Marketing Challenges for the Knowledge Societ. 6 (3), pp. 471-482. Carleton, K. (2011). How to Motivate and Retain Knowledge Workers in Organizations: A Review of the Literature, International Journal of Management. 28 (2), pp.459-468. Earle, H. A. (2003). Building a workplace of choice: Using the work environment to attract and retain top talent. Journal of Facilities Managemen. 2(3), p. 244. Kaye, B. & Jordan-Evans, S. (2000). Retention: tag, you're it! Training and Development, 54(4), pp.29-39. Leigh, A. (2009). Superstars prima donnas and mavericks: Facing up to the company rebels, Training Journal. July, pp. 48-52. Mihelic, K. K. & Plankar, K. (2010). The growing importance of talent management, An Enterprise Odyssey. International Conference Proceedings: 12, 15. Zagreb: University of Zagreb, Faculty of Economics and Business. pp. 1251-1263. Porter, J.H. (2011). Attract and retain top talent. Strategic Finance. June, pp. 56-61. Pruis, E. (2011). The five key principles for talent. Development industrial and commercial training. 43(4), pp. 206-216. Remillard, B. (2012). Motivating top talent in de-motivating times. Ceramic Industry, August, pp.24-25. Tansley, C. (2011). What do we mean by the term "talent’" in talent management?. Industrial and Commercial Training. 43(5), pp. 266. Ulrich, D. & Brockbank, W. (2009) The HR Business-Partner Model: Past Learnings and Future Challenges. People and Strategy. 32(2), pp. 5-7
3.3 Talent Management in the Telecommuniccation Company Černá, D., HR manager Vodafone Czech Republic,a.s., (Personal interview, March, 8, 2013). Gavriliuc, A. C., HR manager Vodafone Czech Republic,a.s., (Personal interview, May, 7, 2013). Interactive Talent Guide. Internal documents of Vodafone. (2013). Vodafone.com. Retrieved from http://www.vodafone.com/content/index/about/sustainability/ /sustainability_report/issue_by_issue/our_people/performance_data.html. 146
Vodafone.cz. Retrieved from http://www.vodafone.cz/o-vodafonu/o-spolecnosti/historie-afakta/fakta-a-cisla/.
3.4 Talent Management in T-Systems Slovakia s.r.o. TSSK Process – Performance and potential review process description. (2010), version 2.0. TSSK Process – Induction program for new employees, (2010) version 1.1. TSSK Process – Training coordination process description. (2010), version 1.0. TSSK Guideline – Recruitment process – Internal recruitment including Assessment centers for managerial positions. T-Systems International HR Development – Talent Management presentation as a guideline, TSSK Guideline – Employee development system instructions.
3.5 Integrated Talent Management at K&H Bank Oláh, J. K&H Bank HR Directorate (Personal interview, June, 8, 2013). Internal documents of kh/hu/lakossag.html.
K&H
Bank.
Retrieved
from
http://www.kh.hu/publish/
Internal documents of K&H Bank. Retrieved kh/hu/khcsoport/bank/bank_tortenete.html.
from
http://www.kh.hu/publish/
Gandossy R.,Tucker E. & Verma N. (2007). Gazdálkodj okosan a tehetséggel! HVG Kiadó Zrt. Budapest. p. 232.
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Summary The monograph deals with the concept of talent management, mainly in the context of business organizations in Visegrad countries. It is designed to uncover how these organizations are developing and implementing talent management. The company practice is reflected on the basis of research survey and case studies conducted by the authors of the monograph. The monograph has been divided into three parts and nine chapters. Part one specifies the basic theoretical framework for talent management. This part includes two chapters, each of which looks at the concept of talent management from a different perspective. Specifically, the concept of integrated talent management that represents paradigm shift for both talent management and human resource management is introduced in this part. Part two provides a summary of the research survey implemented as part of the Visegrad Fund project "Integrated Talent Management - Challenge and Future for Organizations in the Visegrad Countries". The objective of this research survey was to explore the current state of applying the concept of talent management in organizations from the Visegrad countries. The results of the research showed that there are regional differences in the way the concept of talent management is implemented. The findings also indicate that the size of the organization is the factor that most influences applying the talent management in organizations. Hopefully, the results of research survey might be appeal to organizational managers, executives, policymakers as well as academics. Part three presents descriptive case studies reflecting successful talent management implementation in the organizations from the Visegrad countries. The case studies indicate that there are different organisational perspectives and approaches to talent management and this fact is reflected in the way these specifics are tailored to the context in which the companies operate. The presented case studies contribute to a deeper understanding of how organizations develop and implement talent management. The monograph brings together theory and practice concerning talent management and thus tries to fill the gap in the talent management theory and practice, specifically in the context of the organizations from Visegrad countries.
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Integrated Talent Management - Challenge and Future for Organizations in Visegrad Countries Dana Egerová, Ludvík Eger, Milena Jiřincová, Drahoslav Lančarič, Radovan Savov, Ladislav Sojka, Viktória Ali Taha, Michaela Sirková, Zuzana Kaščáková, Csilla Czeglédi, László Hajós, Zsuzsanna Kuna Marosné, Tadeusz Leczykiewicz, Agnieszka Springer, Katarzyna Szypuła
Published in the Czech Republic by NAVA Náměstí Republiky 17, 301 00 Plzeň Tel. + 420 377 223 143, www.nava.cz 1st Edition, 2013 Printing: 250 copies Printed by DTP NAVA, spol. s.r.o.
ISBN 978-80-7211-454-2
