Fighting the winning battle

The tightening labour market has caused concern in many sectors. But Victoria Winkler, advisor for the Chartered Institute of Personnel and Development (CIPD) is optimistic that - through innovation and investment – your enterprise could be on the winning side of the war for talent.

FST. Bearing in mind the war for talent in the industry, is it getting more difficult to recruit? How can the financial services sector position itself to win the war?
VW. People are increasingly facing recruitment difficulties. Our 2006 recruitment, retention and turnover survey showed 82 percent overall are facing difficulties recruiting into vacancies, a figure that is consistent within the financial sector. The financial services market is competitive in terms of salary, so organisations must compete to attract individuals with the right skill sets.

To combat this, there is an increasing sense of employers positioning themselves as an ‘employer of choice’; looking at how they present themselves to candidates and what they offer. In terms of external recruitment, a lot of work is being done in how employers brand themselves, how they demonstrate their ethics and values, and other related factors that might attract someone to their organisation. This is of course in addition to the more obvious things like job description, salary and so forth.

For example, I’ve come across financial services firms that are promoting the work they do on work-life balance and flexible working arrangements. That can be a differential factor in financial services, where people are often expected to put long hours in. It’s really about demonstrating that wider package to potential employees.

FST. So that’s the main thing, to position yourself as an employer of choice?
VW. In terms of recruiting external candidates, then yes, that is what’s happening. But in an environment where there are skills shortages and you have to compete for these talented individuals, then there is a lot of focus on developing your own internal labour market to make sure that people can progress through your organisation. That way - hopefully - a lot of the jobs can be filled internally.

FST. You mentioned companies using their websites to promote their brand. Are there any other ways that people are using these emerging technologies?
VW. Although traditional recruitment agencies are still being used, there’s certainly evidence that people are increasingly using online job recruitment agencies - things like job boards - and so on. Organisations are looking at how they position themselves on those, for example giving links to their own websites to give that extra bit of background information.

FST. Have you seen anything particularly innovative in this area?
VW. Cadbury is the example often cited for its graduate recruitment. Graduates who entered into Cadbury’s graduate training scheme were encouraged to keep a blog of their day-to-day activities, to give the company an insight into what it was actually like to enter the organisation and work there. That has obviously worked well for them as they could look at real life examples. This is the kind of stuff going on, although blogging is still pretty much in the minority. I can’t imagine that in every organisation by any means.

FST. Have you seen a sense of movement across countries affecting approaches to recruitment? Is it only at the executive level, for example?
VW. In terms of movement it tends to apply mainly at the executive level, but as business becomes globalised people can increasingly look at recruiting overseas. Large companies tend to be international organisations, and in terms of recruiting people that global scale can be a big draw, in terms of giving opportunities to live and work overseas, for example. But it’s important to take into account that isn’t going to be a draw or be appropriate for everyone. What might attract some people might be a turn off for someone else, so while it’s important to make those opportunities available you shouldn’t be restrictive by making them requirements.

FST. So do you think organisations are going to be looking overseas? In Europe for example there’s been a lot of movement of people from east to west. Are companies responding by going out to those markets and looking for staff?
VW. Going back to the stats, in 2005, only 15 percent were actually targeting migrant workers, in terms of actually going out to the countries and seeking workers out. There is a lot of evidence most companies are using migrant labour to fill gaps, but it is as and when, rather than being a strategy.

FST. You spoke about developing your internal labour market and looking at retaining staff better. What are the key challenges in that area? Where do you start?
VW. A big challenge is keeping people engaged and motivated. HR and people management can have an influence on that. A main factor is the role the line manager plays; it’s a cliché that people often leave their manager rather than their job, but it’s nonetheless still true. The role the line manager plays in engaging with individuals – particularly in terms of talent management programs - is very important. This is why organisations are increasingly looking at introducing more formalised talent management programs, because they’re keen to ensure that their staff do feel valued, and do feel that there is a sense of progression there for them in the organisation.

FST. What exactly do you mean by ‘formalised’ programs?
VW. Basically that means defining things more as an organisation, taking a certain view about what talent means within the business, how that talent is going to be identified, and who’s going to play what role. Deciding what role senior managers have, what role HR, learning and development have, what role the line managers have. Importantly, also deciding what role talent itself has. It’s setting a strategy and making it clear how that links with the business objectives.

In terms of keeping employees engaged and motivated, there are a variety of things which are down to individual priorities and preferences. Most importantly having opportunities to learn and receive training, career development, access to flexible working: all those kinds of things can have a big impact. But a lot is to do with how the ‘work’ is actually designed; whether individuals feel they have autonomy in what they’re doing, how much control they feel they have, and so on. It’s about continuing from the recruitment side by getting people in who have a clear understanding of what the organisation stands for, and actually thinking about how you live up to that and can align with it.

FST. How is it best to manage succession planning – identifying your best talent and grooming them for the next role - is there a risk that you upset people not identified?
VW. Succession planning has been around for a long time. One of the problems has been that it can be quite process driven, and turn into something of a tick-box exercise. In talent management, it’s easy to articulate why someone is on a talent management program. But with succession planning it is unlikely that you would make clear that you wanted that person in a certain job in a few years time, as after all, there are risks associated with that.

Talent management can mean different things to different organisations, but essentially it’s about identifying high potential: identifying that person who has the potential to move up from where they are now. The key is to position your succession planning activity within a whole program and support system, in terms of how the talent pool is created how you develop your staff. It’s about putting talent management and succession planning together, and it then becomes a much more dynamic process, which is more about people moving through the organisation and changing. It’s less about seeing people as pieces on a chessboard and moving them around: it’s more about developing them.

FST. There is this need for HR to add value, so how can you show that the costs of recruitment branding, staff development and engagement work are doing that? If I’m asking you what the ROI is as a CFO, how do you do that?
VW. There are different ways of doing that. Given the situation we’re in given with this tight labour market, if you look at value to the organisation then your CEO and senior business management are more readily convinced that this is worthwhile activity. There are certain ways that you can demonstrate this, evaluation techniques and so forth, but actually it’s about saying that you place value in these staff development activities and the engagement work. Ultimately that’s what’s keeping people motivated within the organisation, that’s what’s keeping the organisation agile and able to respond to new challenges. While it is important to record and monitor the activity, it is much more about putting your faith in people. It is said a lot that people are our greatest asset and greatest competitive advantage, but often that is just talk.

You look at financial services, and without the people there would be very little else: your product is your people, almost. So investment in your people should be done in the same way that a car-parts manufacturer would invest in its product. There’s a whole knowledge economy going on now, where the money is being made from the individual’s knowledge, and it’s important to encourage them to share that and use it to the best of their ability.