Working Paper 196
TALENT MANAGEMENT:
AN INDIAN PERSPECTIVE
Madhavi Mehta and Satinder Gill
The purpose of the Working Paper Series (WPS) is to provide an
opportunity to IRMA faculty, visiting fellows, and students to sound out
their ideas and research work before publication and to get feedback
and comments from their peer group. Therefore, a working paper is to be
considered as a pre-publication document of the Institute.
Institute of Rural Management Anand
Post Box No. 60, Anand, Gujarat (India)
Phones: (02692) 260181, 260186, 260246, 260391, 261502
Fax: 02692-260188 Email: [email protected]
Website: www.irma.ac.in
August 2006
TALENT MANAGEMENT: AN INDIAN PERSPECTIVE
Madhavi Mehta1 and Satinder Gill
2
Abstract
One of the most critical issues of discussion and therefore redressal in the
growth story of corporate India has been “How to develop and manage
talent”. Corporate India has been coming to terms with this challenge, i.e.,
attrition of talent, more recently. The diversification, expansion and forward
and backward integration of businesses is putting a lot of pressure on the
existing pool of human resources. Talent Management is therefore becoming
a critical HR issue for Corporate India. The study being reported was an
attempt to ascertain the view of the HR professionals in India vis-à-vis Talent
Management, its importance, organisational engagement with Talent
Management, Talent Management strategies, interventions and other
important aspects. The findings of the study indicate that majority of
respondents perceive Talent Management to be a critical HR issue for the
rapidly growing economy of the country as well as for their own
organisations. Attrition of talented workers and poaching by competitors are
recognized as main reasons making Talent Management a critical HR issue.
The findings also indicate that developing high potential individuals and
retaining key staff are perceived by respondents as two most important
objectives of Talent Management interventions.
1 Madhavi Mehta is Assistant Professor at the Institute of Rural Management Anand
(IRMA), Anand-388 001, Gujarat, India, and can be reached at [email protected]
2 Satinder Gill is Manager (Corporate HR) at National Dairy Development Board (NDDB)
and can be reached at [email protected]
1
TALENT MANAGEMENT: AN INDIAN PERSPECTIVE
1.0 BACKGROUND
Throughout the annals of time, the human civilisation has been a witness to
migration of people towards land of “opportunities, wealth and resources”.
While history is replete with many examples to prove the point, however, the
present flux of human resources in Corporate India is a strong reminder of
the historical happenings. This flux of people towards land of “opportunities,
wealth and resources” has been described as “Gold rush”, “Journey to the
promised land”, “Brain drain” in different cultural and historical contexts.
While India as a country has witnessed this phenomenon very often,
however, Corporate India has been coming to terms with it more recently.
Attrition of talent (as termed in management parlance) in corporate sector is
akin to migration of people to land of “opportunities, wealth and resources”
in the historical context.
Until recently, loyalty to the organisation was a cherished value and loyal
employees perceived themselves and were in turn perceived by others very
highly. Loyalty then was defined in terms of working for an organisation for
life and committing oneself fully to the goals of the organisation. The
changing context has led to re-defining the meaning of “loyalty” as a value.
Loyalty now is being perceived as providing professional services to an
organisation. The “life-time loyalty” factor is slowly giving ground to
“loyalty any which way” i.e. for whatever time a person remains with an
organisation.
The change in mind-set coupled with the increasing opportunities offered by
a wide range of industry and the internet revolution has led to change in
many established patterns as far as the job market in India is concerned.
Some of the interesting changes have been:
2
Continuous change in the status with respect to (a) best organisations to
work for and (b) type of industry to work with,
Availability of “opportunities information” at the desktop,
Regular movement of talent across the board, i.e., from entry level,
middle management to top management, and
Flexibility in terms of “policy support” shown by organisations to
welcome talent.
It is these changes that have been responsible for “war for talent” and are
attracting attention of HR managers in India.
2.0 TALENT MANAGEMENT: A BRIEF INTRODUCTION
2.1 The Concept
According to Clake and Winkler (2006) Talent Management could be
described as the entire gamut of „activities related to identification,
development, engagement/retention, and deployment of “talent” within a
specific organisational context.‟ Talent Management is not about promotion
based on tenure or political favourites. „Talent Management is not about
hiring likable folks, or winners. It is a constant challenge to have the right
people matched to the right jobs at the right time and doing the right things‟
(Mucha 2004). Understanding the “needs and aspirations” of human
resources and addressing them is core to the philosophy of Talent
Management. According to Pareek (2004), „A very important motivating
factor for people joining and continuing in an organisation is the kind of
work they get, and whether they are valued in the organisation. Unless the
organisation satisfies one of the basic psychological needs of being valued
and appreciated, people, howsoever well paid may not like to continue there.
However, these are not contradictory. In fact, these have to be integrated, i.e.,
the compensation system should communicate to the employees that they are
valued. It should cater to some basic psychological needs.‟ Talent
3
Management (TM) interventions are therefore designed for “valuing”
employees. Furthermore, what differentiates TM from the HRD interventions
is the fact that the TM interventions are not stand alone, static HRD
interventions, but are more holistic, action oriented activities (Clake &
Winkler 2006).
One may ask as to why have these activities assumed so much of importance
when organisations have been identifying, developing, retaining and
deploying human resources since their inception or even before they were
formally incorporated. In order to understand this, one needs to understand
the changing economic and social milieu that has forced the HR professionals
to review their HR processes and design and implement TM interventions.
2.2 TM: Reasons in the Western Context
The McKinsey article that generated/activated the debate over TM considers
the changing nature of economy - industrial to knowledge - and hyper
competition as two major reasons fuelling the need for TM in organisations
(Cliffe 1998). Besides these broad reasons, high cost of attrition seems to be
a very important reason making TM crucial for organisations in the western
context. „….several experts have predicted that annual voluntary turnover
could rise to 20% or more for white-collar workers‟ (Mucha 2004).
According to Blanchard and Blanchard (2005) the attrition of talented
workers, the prospect of a labour shortage, worker dissatisfaction and
defection, massive disruption to operations, a profound change in the
employer-employee relationship, etc., are some of the reasons making TM a
crucial issue in organisations.
2.3 TM: Reasons in the Indian Context
In the Indian context too, attrition seems to be a substantial reason making
TM a crucial HR issue. The figures indicating the costs of wrong hiring as
given below, seem to be telling the same story:
4
It is estimated that at least 1/3rd
of business failures are due to poor hiring
decisions and inability to attract and retain the right talent.
The average cost of replacing a manager or professional is 1.5 to 3 times
the salary.
The cost of working around an under-performer can run as high as six
(digit) figures.
The cost of consistently failing to attract and retain good talent –
including declining productivity, morale, culture and reputation – is
inestimable.
Each vacant position costs your organisation Rs. 60,000 on average. For
some management positions, it can easily run into six (digit) figures…
(Source:http://www.bpoindia.org/research/talent-acquisition-big-challenge. shtml).
Employee turnover is an important reason forcing the organisations to work
on managing the talent they have or would want to have. Skyrocketing costs
of turnover is certainly an issue but overall impact of increasing employee
turnover, is more significant and far-reaching. Other reasons necessitating the
need to look into TM in India include the rapid changes in the economy
resulting in a boom in the job market, the internet revolution and, easy
accessibility to the net and job portals. The study being reported has also
examined the reasons making TM critical in India and the same are discussed
later in the paper.
2.4 TM Interventions
It is important that organisations intervene in order to manage their talent.
Some of the interventions that the Mckinsey report suggests are fairly
conventional, and often overlooked, such as: redesigning pay package for
best performers, weeding out mediocre performers, holding line managers
responsible for talent development. An important and less conventional
intervention it suggests is to develop an employee value proposition (EVP)
that will help attract and retain the talent you need. „An EVP … provides a
5
way for companies to think clearly about what distinguishes them as
employers and to send consistent and compelling messages to the labour
market‟ (Cliffe 1998: 19). In order to develop an EVP, the organisation
needs to ensure that its key employees are treated in accordance with their
needs. The „key employees gravitate towards one of four basic brand
positions. “Go with a winner” employees are most interested in growth and
advancement, “big risk, big reward” players value advancement and
compensation. Those out to “save the world” need an inspiring mission,
while “lifestyle” employees seek flexibility and a good fit with the boss‟
(Cliffe 1998: 19).
In India, one finds that organisations started grappling with the issues related
to TM in the 90‟s. Some organisations used the conventional strategies
whereas the others designed and implemented innovative interventions to
Box-1
Interesting TM Practices in Indian Organisations
Asea Brown Boveri (ABB) has systems of team-based compensation and appraisals
delinked from rewards that were geared exclusively to the development of its management
staff. ABB also managed to maintain a flat structure of grades which it believed resulted
in better business efficiency through better internal communication.
The Shell, seemed to be comfortable in operating a 360 degree feedback system. By this
performance appraisal system, assessments were kept confidential from the boss. The
system was designed to stimulate individual development.
Thermax (TL) used the concept of a campus ambassador to woo prospective candidates
from engineering colleges. It also had a policy of documenting and creating knowledge
silos to face the challenge of the flight of talent. The employees satisfaction survey in TL
clearly brought out the fact that the improvement of business processes would lead to
better satisfaction levels as it was perceived that with such improvements in place, work
would be done in more planned ways.
NIIT has practices that are both innovative and thought provoking. The company used a
cafeteria approach for career development, moving from the issue of grappling with
retention to the issue of “staying” in the Company. “Heart-cuffs” were more important
than “hand-cuffs”. Hence the company designed some interesting sentiments centred
allowances ….geared to satisfy individual needs.
(Source: Sriram and Bhaduri 1998).
6
deal with the issues of TM. Box 1 briefly describes some interesting practices
of some of the organisations in India.
3.0 THE RESEARCH STUDY
In the previous section we have given an over view of the existing literature
on TM. In this section, we present the empirical research that was conducted
to ascertain the Indian perspective on the theme: Talent Management.
The research being reported is focused on understanding perceptions of HR
professionals with respect to: (a) Important components of TM in India, (b)
TM as a critical HR intervention area, (c) Reasons making TM a critical HR
issue, (d) Engagement of organisations with TM and how, (e) Focus of TM
interventions and strategies, (f) TM interventions – frequency of their usage
in respondents‟ organisations and respondents‟ perception of their
effectiveness.
The research reported here is primarily a questionnaire survey, which also
embodies qualitative perspective of HRD professionals. It is a descriptive
study conducted to bring forth various aspects related to TM as perceived by
HRD professionals in India. The research tool is constructed based on the
available literature, which is largely conceptual in nature and not empirical. It
is a questionnaire containing 31 questions. The questions include those
seeking background information about the individual respondents as well as
that about the current organisation of the respondents. The questions related
to TM are based on the aforementioned research objectives. The
questionnaire contained both open ended as well as close-ended questions.
The questionnaire was e-mailed to about 800 HRD professional across the
country and we received 82 responses. Most of the responses were through
e-mail however, a few respondents sent print copy of the questionnaire along
with their response.
7
46.3
73.2
61 61
73.265.9
73.2
0
10
20
30
40
50
60
70
80
Ide
nti
fic
ati
on
of
ke
y
Po
sit
ion
s
De
fin
ing
Ke
y
Ta
len
t
Pla
nn
ing
fo
r
Ta
len
t
Ac
qu
isit
ion
Att
rac
tin
g K
ey
Ta
len
ts
Re
tain
ing
Pre
miu
m
Em
plo
ye
es
Tra
inin
g a
nd
De
ve
lop
ing
Ta
len
t
Cre
ati
ng
Pe
rfo
rma
nc
e
Ori
en
ted
Yes
No
Figure-1
Components of TM
4.0 FINDINGS OF THE STUDY
4.1 Profile
The analysis suggests that profile of respondents studied is predominantly
male (87.8%), below 40 years of age (56.4%), post-graduate (92.7%), with
tenure of 1-5 years in their current position (85%), occupying middle and
above level positions in the management (97.6%) with work experience of up
to 20 years (72.5%). On the other hand, the profile of the organisations
represented in the sample studied is predominantly private sector (80.5%),
private limited companies (31.7%), established for more than 20 years
(75.7%), in service industry (51.2%), employing more than 1000 employees
(57.5%).
4.2 Components of TM
Figure 1 below explains the respondents‟ views on what constitutes TM.
Creating performance-oriented culture, defining key talents and retaining
premium employees, are the three major components as close to three forth
of the respondents (73.2%) perceive them to be important components of
TM. Furthermore, the respondents have perceived activities such as training
and developing talent (65.9%), planning for talent acquisition and attracting
8
key talent (61% each) as important. It is pertinent to note that a little more
than half of the respondents (53.7%) did not perceive identification of key
position in the organisation as an important component of TM.
4.3 TM as a Critical Intervention and Business Priority
An overwhelmingly large majority of the respondents consider TM to be a
critical HR issue in India (95.1%) and in their organisation (90.2%). As
Figure 2 depicts, a little more than two third (67.5) of the respondents
perceive TM to be a highly critical issue whereas a little less than one third of
the respondents (30%) perceive it to be a critical HR issue. It is only a very
small number of respondents (3%) who think that TM is somewhat critical. It
is important to note that not a single respondent perceives TM as “not at all
critical an HR issue”.
When asked if TM was a business priority for their organisation, a large
majority of the respondents (85.4%) responded in the affirmative. The
correlation analysis of the data also indicates that the large majority of the
respondents belonging to the middle management and above category
believed that TM is a business priority for their organisation, whereas the
respondents who belonged to the supervisory cadre did not consider TM as a
business priority for their organisation. The number of years spent in HR area
Figure-2
TM as a Critical HR Issue
9
is also correlated with the respondents‟ view regarding TM as a business
priority for their organisation. All the respondents with thirty-one years and
above of total HR experience agreed that TM was a business priority for their
organisation. Similarly all the respondents from the organisation which have
been in existence for more than 50 years had the same opinion.
The response of the large majority of the respondents to the question whether
their organisation engaged in TM was also in affirmative. Correlations
analysis indicates that respondents in the supervisory cadre responded in
negative even to the question related to their organisation engaging in TM.
All the respondents from organisations which have been in existence for
more than 50 years responded that their organisations also engaged in TM
activities.
4.4 Reasons Making TM a Critical HR Issue
The data collected to ascertain the reasons that make TM a critical issue in
India or in the respondents‟ organisation (RO) is provided in Table 1.
Attrition of talented workers (82.9% in India and 89.7% in RO) and poaching
by competitors (68.3% in India and 56.4% in RO) are perceived by majority
of the respondents as reasons making TM a critical HR issue. Close to half
the respondents also consider increased demand for work-life balance (46.3%
Table 1
Reasons Making TM a Critical HR Issue
Sl. No.
Reasons In India In Respondent
Organisation (RO)
1 Attrition of talented workers 82.9 89.7
2 Prospect of labour shortage 36.6 23
3 Worker dissatisfaction and defection 36.6 23
4 Poaching by competitors 68.3 56.4
5 Increased demand for work-life balance 46.3 41
6 Expectation of meaningful work 48.8 44
7 Entrepreneurial ventures by talented employees 36.6 12.8
8 Increasing workforce diversity 36.6 28.2
9 Inadequate skills of new recruits 30 36
10
in India and 41% in RO) and expectation for meaningful work (48.8% in
India and 44% in RO) as reasons making TM a critical HR issue. It is
important to note that reasons such as prospect of labour shortage, worker
dissatisfaction and defection, increasing workforce diversity, entrepreneurial
ventures that are relatively new phenomena are also becoming relevant now
in the Indian context. Inadequate skills of new recruits is also considered an
important reason (by 30% for India and 36% for RO) making TM a critical
HR issue.
4.5 TM Policy
Though a little more than half of the respondents (56.4%) agreed that their
organisation had a formal TM policy, only 20.5% of the respondents shared
information about TM policy in their organisations. (See box 2 for a snap
shot of TM policy of some of the organisations that the respondents belonged
to.)
Box-2
Snapshot of TM Policy of some of the Respondents’ Organisations
“We believe in the basic instinct of human kind of having due environment to grow,
providing all possible help to grow in the designated professional field and let free the
talent to do the rest for the benefit and growth of an individual…”
“Keeping in view the concept of globalisation and stiff competition in the market, we
take due care for identification, acquisition, training and development and retention of
our workforce.”
“Retention based hiring compensation management, competency management – role
and need based training, career development, employee engagement, leadership
programmes…”
“We only pick up the best recruits from premium institutes and give them a free reign to
work on their projects…”
“Role specific incentive schemes, various learning and developments strategies, anti-
attrition measures, etc.”
“It operates on the right associate at the right time in the right place.”
11
As briefly described in the box, the TM policies of the Respondent
Organisations are broadly related to providing the right kind of environment
that gives the employees space to grow and contribute. Some organisations
focus on recruitment and selection, whereas, some others focus on retention
strategy. However, some organisations focus on specific interventions such
as hiring, compensation, training and development, career development,
incentive schemes, competency mapping, development centre etc.
4.6 Focus of TM Interventions and Strategies
As indicated in Figure 3, an overwhelmingly large majority (93%) believe
that while designing TM intervention, both – motivation factors as well as
hygiene factors should be focused. Not a single respondent said that hygiene
factors are the only factor that should be considered while designing TM
interventions. It is important to note that there were a few respondents (7%)
who believed that only motivation factors should be focused on while
designing TM intervention strategy. This was the view largely emanating
from the respondents whose organisations are relatively young i.e. 5-10 years
of age. When asked about TM acquisition strategy, a little over four fifth of
the respondents (81%) were of the opinion that organisation should be both
making as well as buying talent and 17% of the respondents were of the view
that organisations should be using „make‟ strategy rather than „buy‟. Though
small in number, 2% of the respondents were in favour of only the „buy‟
strategy.
Figure-3
TM Interventions Design Strategy
Focus of TM Acquisition Strategy
17%
2%
81%
Making Talent Buying Talent Both
Focus of TM Intervention design
7%0%
93%
Motivation Factors Hygiene Factors Both
7% 0%
12
It is important to note that in the study we found that all the respondents were
of the view that line managers are one of the most important players as far as
TM is concerned.
4.7 Objectives of TM Interventions
The literature in the western context suggests the following as the objectives
of TM Interventions in organisations:
i) Identify, select, and cultivate super keepers,
ii) Find, develop, and position highly qualified backups for key positions, and
iii) Allocate resources (compensation, training, coaching, and job assignments) to employees based on their actual or potential contribution to excellence (Blanchard and Blanchard, 2005).
Table 2 provides information on respondents‟ perceptions regarding
objectives of TM interventions. Developing high potential individuals
(73.2%) and retaining key staff (70.7%) seem to be two most important
objectives of TM interventions according to the respondents. Some other
important objectives of TM according to the respondents are meeting future
Table 2
Objectives of Talent Management
Sl.
No. TM Objectives Yes No
1 Developing high potential individuals 73.2 26.8
2 Growing future senior managers 56.1 43.9
3 Enabling achievement of strategic organisational goals 46.3 53.7
4 Meeting future skill requirements 65.9 34.1
5 Attracting key staff 41.5 58.5
6 Retaining key staff 70.7 29.3
7 Supporting changes 34.1 65.9
8 Addressing current skill shortage 39 61
9 Assisting organisational resource planning 56.1 43.9
10 Redeployment of staff to other roles 36.6 63.4
13
skill requirements (65.9%), growing future senior managers and, assisting
organisational resource planning (56.1% of the respondents for both). On the
other hand, only 34.1% of the respondents believe that supporting changes is
an objective of TM. The table also indicates that only 36.6% of the
respondents believe so about redeployment of staff to other roles. According
to 39% of the respondents, addressing current skill shortage is an objective of
TM. Less than half the respondents, i.e., 41.5% believe that attracting key
staff is an objective of TM, whereas, only 46.3% of the respondents believe
that enabling achievement of strategic organisational goals is one of the
objectives of TM interventions.
4.8 Beneficiaries (focus group) of TM Interventions
As depicted in Figure 4, there seems to be a wide range of response in terms
of which category of employees should TM interventions focus on. While
45.7% of the respondents are of the view that TM interventions should be
designed and implemented for all the employees. Forty per cent of
respondents opine that it is the super keepers (employees exhibiting superior
performance and inspiring others to superior performance) who should
Bene ficiaries of TM Inte rventions
45 .7
37 .1
40
28 .6
17 .1
8 .6
48 .6
57 .1
54 .3
65 .7
77
85 .7
All s taff
Key Leade rsh ip
Pos itions
S uper keepe rs
Keepe rs
S olid Citizens
Mis fits
No
Yes
Figure-4
Beneficiaries of TM Interventions
14
benefit by TM interventions. According to an overwhelmingly large majority
of the respondents (85.7%), misfits (employees who do not meet performance
expectations) should not be covered under any TM interventions. Similarly,
77% of the respondents think so for the solid citizens (employees who meet
performance expectations, but do not go beyond). A little more than one-third
of respondents (37.1%) think that the employees in key leadership positions
should be benefited by TM interventions. However, it is important to note
that there is not a single category of employees that even 50% of the
respondents perceive should be benefited by TM interventions. For keepers
(employees exceeding performance expectations) 28.6% of the respondents
agree as them being a category that should benefit from TM interventions.
4.9 TM Interventions- Frequency of their Usage and their Effectiveness
Table 3
TM Interventions – Frequency of their Usage and their Effectiveness
Very often
Occasio-nally
Rarely Not at
all Highly
Effective Somewhat effective
In-effective
Campus Recruitment 53.7 17.1 24.4 4.9 31.7 46.3 7.3
Lateral Recruitment 56.1 26.8 4.9 12.2 46.3 34.1 0
On boarding programmes 26.8 22.9 7.3 41.5 17.1 31.7 2.4
Mentoring & Buddying 34.1 22 12.2 31.7 34.1 24.4 4.9
MDPs (In-house) 68.3 17.1 2.4 12.2 48.8 36.6 0
Performance Management System
68.3 17.1 0 11.4 53.7 26.8 2.4
360 feedback 31.7 7.3 22 36.6 36.6 17.1 4.9
Assessment-cum-Development Centre
22 22 19.5 34.1 19.5 24.4 7.3
Coaching 31.7 12.2 22 31.7 34.1 17.1 9.8
Retraining 22 34.1 4.9 39 31.7 29.3 4.9
further studies 19.5 19.5 24.4 34.1 22 26.8 12.2
MDPs (external) 39 36.6 9.8 12.2 36.6 36.6 9.8
Succession Planning 51.2 19.5 7.3 19.5 46.3 24.4 2.4
Special track develop-ment programmes for hi-potential
43.9 19.5 9.8 26.8 58.5 9.8 0
Job rotation 41.5 29.3 14.6 14.6 51.2 29.3 2.4
Cross functional teams 46.3 17.1 14.6 22 43.9 31.7 0
Secondments 17.1 14.6 29.3 36.6 12.2 34.1 9.8
Compensation redesign 48.8 22 9.8 19.5 36.6 39 2.4
Experimentation 19.5 19.5 24.4 34.1 24.4 31.7 7.3
Communities of Practice 26.8 14.6 19.5 36.6 24.4 22 12.2
Employer Branding 29.3 12.2 19.5 36.6 24.4 26.8 7.3
15
Respondents‟ views regarding the kind of TM interventions used in their
organisations and, the respondents‟ perceptions about the frequency of their
usage as well as effectiveness of the TM interventions are depicted in table 3.
It is found that In-house Development Programmes and Performance
Management System are the two most widely used (according to 68.3% of
the respondents) interventions. Campus recruitment (53.7%) and lateral
recruitment (56.1%) are also well-used TM interventions. It is quite
heartening to note that according to 51.2% of the respondents, succession
planning is used very often in their organisations. We would also like to point
to the abysmally low usage of on boarding programme which is not a new
generation TM intervention and is considered as one of the very basic
intervention that all the employees should experience upon joining an
organisation. According to 41.5% of the respondents, their organisation does
not use on boarding programme at all. The authors would also like to draw
attention of the readers to another finding which is about the new generation
TM interventions and close to 70% or more of the respondents have opined
that they are used occasionally, rarely or never in their organisations. These
are: Assessment-cum-Development Centre (75.6%), Retraining (78%),
Further studies (78%), Secondments (80.5%), Experimentation (78%),
Communities of Practice or Knowledge Management (70.7%) and Employer
Branding (68.3%).
The data regarding the effectiveness of the TM interventions indicate that
Performance Management Systems, Special Track Development Programmes
as well as Job Rotation are found to be highly effective by more than half the
respondents. It is important to note that on boarding programmes which are
not used much by a large majority of the respondents are also not found to be
highly effective by more than half of the respondents who use them
(irrespective of the frequency of their usage).
16
5.0 CONCLUSION AND DISCUSSION
The major findings of the study can be summarized as given below:
Creating performance oriented culture, defining key talents and retaining
premium employees are the three major components of TM.
TM is perceived to be a critical HR issue in the rapidly growing Indian
economy.
TM is a business priority for organisations, and there are a number of
organisations that have a formal TM policy yet very few respondents
were able to express it. It is plausible that either the policy is not well
frozen or that it is not well publicised.
Attrition of talented workers and poaching by competitors are found to
be the major reasons making TM a critical HR issue in Indian
organisations. Demand for work-life balance and expectation of
meaningful work are also increasingly becoming relevant reasons for the
Indian context.
While designing TM interventions focus should be on both motivation as
well as hygiene factors and TM acquisition strategy should focus both on
„making‟ as well as „buying‟ talent.
Line managers have an important role to play in managing organisational
talent.
Developing high potential individuals and retaining key staff seem to be
the major objectives of TM interventions.
There is a wide variation in the views of the respondents as far as the
question of who the TM interventions should target at.
In-house Development Programmes (Training) and Performance
Management Systems (PMS) are found to be the most frequently used
TM interventions whereas PMS, Special Track Development
17
Programmes and Job Rotation are found to be the most effective TM
interventions.
When one looks at these findings in the context of the previous work, one
finds the study being supported by earlier research as well as conceptual
literature. A study in the context of UK (Clake and Winkler 2006) yielded
similar response where the vast majority of the sample agrees that TM is a
business priority for their organisations (87%), that majority of organisations
did not have any formal TM strategy, and a large majority does not have any
formal definition for TM. The study also reported that developing high-
potential individuals (67%) and growing future senior managers (62%) are
the two main objectives for TM activities in their context. The UK study also
reported variation in the views of the respondents regarding the target/focus
of TM interventions (Clake and Winkler 2006). According to the same study
small organisations (with less than 250 employees) report that coaching is the
most popular method of developing talent (44%) of the relevant sample.
However, larger organisations (250 or more employees) report that in-house
development programmes are far more popular than other methods (66% of
the relevant sample) (Clake and Winkler 2006).
There are some aspects of the study that are quite unique to the Indian
context. These are related to:
a) The respondents‟ perception about the role of the line manager in TM:
Though the conceptual literature suggests the need for line managers‟
involvement in TM (Blanchard and Blanchard 2005) the practitioners in
the western countries do not acknowledge this and would mostly point to
external factors, such as compensation and benefits, lack of inspiring
leadership, mergers or acquisitions and economic constraints as the
reasons for employee attrition (Cliffe 1998). In our research, we found
that all the respondents were of the view that line managers are one of
the most important players for TM.
b) Talent acquisition strategies: When the western countries are going back
to the strategy of „growing‟ their own future talent rather than simply
18
relying on the wider marketplace to provide it (Cliffe 1998), the Indian
HR manager is focusing on both „buying‟ as well as „growing‟ talent.
c) The frequency of usage and effectiveness of the TM interventions: The
UK study found In-house development programmes, coaching and
succession planning to be the most frequently used TM interventions,
whereas we found that in addition to in-house development programmes
it is the PMS which is used very often in India. The UK study found in-
house development programmes, internal secondments, and coaching to
be the most effective (Clake & Winkler 2006). While in the Indian
context we found PMS, Special Track Development Programmes and
Job Rotation to be the most effective.
An appraisal of the findings of the study suggests that TM is not just another
management jargon or concept, but is a powerful tool for nurturing
individuals, developing groups and ensuring continued supply of competent
human resources in the organisation. Some important areas have emerged
from the study and these may require interventions from organisations.
While TM is being discussed, debated and interventions are being made,
findings suggest that very few organisations have taken steps for putting in
place a formal TM policy. Absence of a laid down policy leads to lack of
clarity within the organisation as to the strategy, focus and other important
parameters of TM intervention. It may lead to efforts without specific
objectives, structure and direction. With the demand for talent slated to
increase rapidly, as the economy grows, organisations sincere about
managing talent may have to formulate explicit and clear TM policy and
strategy to facilitate focused and structured efforts.
Due to pre-occupation of HR professionals with attrition and poaching by
competitors, some important interventions that can help manage talent may
get sidelined. Findings of the study indicate, in addition to other factors,
relevance of work-life balance and meaningful work in managing talent. A
happy individual is less likely to become target of poaching and therefore
attrition. The economic surge is creating new circumstances and bringing in
19
new players every day in the market which is in turn increasing competition
for market share. In the fight for numbers (targets), many principles and ideas
may be compromised including work-life balance. While in short-term, such
deviations go unnoticed, however, a sustained assault on work-life balance
may be counter-productive to facilitate development and management of
talented employees. Therefore, a holistic approach, if taken while designing
TM interventions may go a long way in increasing the sustainability of such
interventions.
Another important aspect emerging out of the study is the role of Line
Managers in implementation of TM strategy. In the present scenario, the
responsibility of TM often rests either on the HR professionals or on people
in the top management. Line Managers apparently do not have much stake in
the TM strategy. Findings of the study suggest that in the “war for talent”, the
role of Line Managers is going to be very important. In fact, Line Managers
should be lead stakeholders in TM strategy, because of their proximity to the
employees and understanding about the employee attitudes, issues troubling
them and the modes of redressing the same.
The sudden upsurge in attrition coupled with lack of formal TM policy has
resulted into knee-jerk reaction from organisations in India as far as their
response to TM challenge is concerned. The nervousness and therefore lack
of clarity in terms of who should be the target of TM interventions is also
reflected in the findings of the study. Respondents‟ have wide variation of
opinion in terms of who should be the target group. In the circumstances,
broader coverage of TM interventions may have greater acceptability in the
organisation. Organisations also have to be sensitive to how the TM
interventions are perceived by larger chunk of employees in the
organisations. According to Walker and LaRocco (2002), „Stars often
consider themselves exempt from normal faults and behave in a narcissistic
manner. The most widespread concern is the adverse effect upon the 80-to-90
percent of managers who have been relegated to class B or C status.‟
Despite these challenges, companies will likely continue to use talent pools to
develop leadership talent and to ensure a ready supply of candidates for
20
internal assignments and progression. The approach is far superior to the
traditional succession planning process in which executives groomed “back-
up” candidates for key management positions.
In the changing context as the economy expands, the war for talent is going
to become dearer and tougher. Organisations that are able to create a
perception of “employees are valued here” through effective measures
supported by scientific study, wisdom and workable solutions would be able
to sustain and retain the talent within the organisation.
References
Blanchard, K. and Marjorie Blanchard (2005) “Retain Top Talent: Sustain your
Business Momentum,” Leadership Excellence, November, pp. 7-8.
Clake, Rebecca and Victoria Winkler (2006) “Change Agenda: Reflections on TM,”
accessed from the website of Chartered Institute of Personnel
Development, UK (http://www.cipd.co.uk/subjects/recruitmen/general/
_rfltlntmgt.htm) on April 19, 2006.
Cliffe, Sarah (1998) “Human Resources: Winning the War for Talent,” Harvard
Business Review, 76 (5), pp. 18-19.
http:/www.bpoindia.org/research/talent-acquisition-big-challenge.shtml viewed on
April 26, 2006
Pareek, Udai (2004) “Reward System for Nurturing Talent and Teams,” Indian
Journal of Training and Development, 34(1), pp. 28-398.
Mucha, Rochelle T. (2004) “The Art and Science of TM,” Organisation
Development Journal, 22(4), pp. 96-100.
Sriram, Y and A Bhaduri (1998) “Attracting and Retaining Talent: A Managerial
Challenge,” IIMB Management Review, 10(1-2), pp. 5-10.
Walker, J W and J M LaRocco (2002) “Talent Pools: The Best and the Rest,”
Human Resource Planning, 25(3), pp. 12-14.
