dufry1

Copyright © 2005 Deloitte Development LLC. All rights reserved. 0

HR Leaders Forum and Awards

Dubai, March 05 & 06, 2012

Global Growth Strategies:

Winning the race for talent in emerging markets

(facilitated by Celine Heinrich)

Global Growth Strategies: Winning the race for talent in emerging markets 1. Anticipating and proactively working with Business Leaders

to support & accelerate Growth in Emerging Markets

2. Expanding your understanding of Emerging Markets &

developing Talent Management Strategies

3. Importance of HR’s active participation & involvement in

market entry and expansion

DUFRY PROCESS AND PROCEDURES WORKSHOP

Part 1;

Anticipating and proactively working with

Business Leaders to support & accelerate

Growth in Emerging Markets


Role of the Business Leader is Essential

Evolving role of “Management”:

• From jobs, to skills and outcomes – rethinking the nature of work, adapt to the local and cultural environment

• Implement ―Best Places to Work‖ highly correlated to management practices

P&L management or P&L-like work Executive talent management focused on replicating high-quality leaders

• Develop Employee engagement and attitudes key to performance through top management. Employee engagement drivers are :

1. Challenging and exciting work 2. Career growth 3. Learning and development opportunities 4. Good boss

• From ―30 years at hard labor‖, to using flexibility as a business advantage: Creates genuine opportunities and exhibits desirable cultural conditions

Create a company culture from the top down: A company’s culture will play a vital role in emerging markets.

1. Brand promise has to feel authentic. 2. Employees must be rewarded for reasons of merit; 3. Although employees want to be recognized for individual achievements, they also want to feel a connection with their teams. 4. The culture has to be truly ―talent-centric,‖ so that people know they’re critical to the

company’s success.


Part 2:

Expanding your understanding of Emerging Markets

& Developing Talent Management Strategies

a) Booming markets in China, India, Russia

with shortage of talent

b) Developing talent strategies that leverage

skills and capabilities across markets


a. The Talent Market in Emerging Markets

China

• Deficit in middle, country, regional

leadership

• Only 50% of Asian executives believe the

supply of skilled labor is adequate

• The cultural revolution created a “missing

generation” of talent aged 45 to 55- so

expats fill most jobs at the top

• Limited experience working in a multi-

national organization

Russia

• The supply of senior talent is limited owing to

the legacy of a planned economy

• Most deficits stem from fast growth, labor

shortage, and heavy foreign direct investment

• Difficulty fielding critical talent due to cultural

assimilation into the business

• Limited experience working in a multi-national

organization

• Inadequate people management and

communication skills

India • India is notable for exporting talent on the

regional and global levels

• Less deficit in country and middle management

• Salaries for supervisory positions raised 20% in

2005 • Indian companies are increasingly focused on

developing employees to drive retention as the

war for talent grows increasingly competitive

The Talent Market in Russia, China, India Although the talent gap between supply and demand is pervasive in the developing world, the particulars vary by country. Below some information on Russia, India, and China .

6 Copyright © 2006 Deloitte Development LLC. All rights reserved.

In an environment of skills shortages and limited resources,

the focus must shift from managing “A” players to “A” positions

From “A” Players To “A” Positions

How do we

support our most

critical

positions?

How do we support

our top performers?

A Critical Workforce Segment-

Based Talent Strategy

b. A new model focuses on develop, deploy, connect


Building a critical workforce segment strategy: example

Business Unit Strategic Plan Build new Market - Grow Asia

HR, Finance, IT Sales and

Marketing Retail Operation

Commercial

Director

Commercial

Analyst

Strategic

Support

Strategic

Support

Operation Retail

Mgr

Logistic

Mgr

Critical

Position

Core

Support

HR Business

Partner SAP Analyst

Critical

Position

Core

Support

For Core Support Positions

• Reduce talent investments or outsource

For Strategic Support Positions

• Maintain investments and buy talent

For Critical Positions – Regardless of Level

• Increase access to investments and

build talent by feeding from strategic

support positions


3. Connect

2. Deploy 1. Develop

Acquire Retain

Connect Create networks and

high-quality relationships that maximize performance

Deploy Broaden and

deepen capability through stretch

assignments

Develop Build capability

through on-the-job learning

Advantages

• Focused on productivity of critical talent

• Creates dividends for acquisition and retention

• Potential to maximize existing talent

A new model focuses on develop, deploy, connect


Connect

Deploy Develop

Capability

Commitment

Performance

Alignment

• Formal training helpful for meeting specific requirements

• Learning is social in nature - people learn through their interactions with others, especially when tasked with real-life issues

• People are more committed to the learning that occurs when they are ―tested‖ in ways that matter, especially when they collaborate with or are accountable to others

Develop: Ensuring that critical workforce segments are acquiring cutting edge skills to drive innovation


• People learn the most in jobs that stretch them to grow, tap their unique skills, and fuel their imaginations

• The best organizations avoid pigeonholing people based on the confines of their resumes

• They also employ formal systems to manage performance - And they offer frequent dialogue and feedback

Deploy: Strategic deployment of critical workforce segments will enable intensified growth

Connect

Deploy Develop

Capability

Commitment

Performance

Alignment


• People-to-People: Cultivate high-performance networks of high-quality relationships (i.e., CoPs, knowledge management programs)

• People-to-Purpose: Build and sustain a sense of personal and organizational mission

• People-to-Resources: Manage knowledge, technology, tools, capital, time, and physical space to achieve professional and business goals

Connect: Connecting talent in critical workforce segments converts knowledge into productive action

Connect

Deploy Develop

Capability

Commitment

Performance

Alignment


Part 3:

Importance of HR’s active participation &

involvement in market entry and expansion


HR plays a vital role in Emerging Markets

Organization looking to expand into emerging markets need an HR strategy that reconciles differences in Economic Structure, labor laws and staffing expectations Many emerging countries are seeing both business expansion and strong merger and acquisition activity on the local level. When dealing in these markets, the skill and aggressiveness of a company’s human resources team can make the difference between success and failure, as each market has unique operational challenges in terms of economic structure, access to capital, consumption patterns, educational achievement and cultural expectations. Bringing HR to the table as early as possible can help avoid potential missteps and produce better long-term results, as HR can address specific issues at every step of the startup or acquisition process, from site selection to recruitment and retention. Involving HR professional with specialties in local labor law Low-wage countries generally present a consistent human capital challenge. Only a small percentage of university graduates with general degrees are equipped to work in a multinational company, and graduates with technical degrees can be similarly unprepared


HR involvement in market entry and expansion

HR steps to expand in emerging markets: 1. Site Selection (evaluating the Talent Pool) 2. Labor laws and regulations (visa/work permit; employment conditions) 3. Staffing determination (Expat vs Local / cost on PEX) 4. Recruitment & retention. (Salary & Benefits) Site Selection • How large is the potential pool of talent? Does the education system consistently replenish

that pool? • How much flexibility is there for future growth? how easy is it to shut down operations in

the future, if it is necessary? • Are there special country-unique considerations that may come into play? Labor Law • Labor laws in many emerging markets are protective of employees and, as a result, pose a

potentially significant strain on a company’s budget. (i.e wrong assumption on social Tax in china is 45% ). Organizations may not be permitted to terminate employees, for example, without incurring government-mandated costs.

• Health care, pension benefits and unemployment compensation must all be considered in light of the eventual possibility of terminating individual employees or shutting down or downsizing an entire operation


HR involvement in market entry and expansion

Staffing Determination • The local talent pool in an emerging market often lacks the experience to meet startup

staffing needs or plans for future growth. • Expatriate employees are costly, both in terms of direct compensation and infrastructure.

They will inevitably have higher salaries than local talent, a discrepancy that should be properly managed in order to avoid disgruntled local employees.

• One method that works well in bringing local employees up to speed involves selecting potential local managerial talent at the outset and sending that team abroad —often to headquarters — for six to nine months. There the local talent learns global business norms in preparation for return to the home country. Then, when it is time for the startup expatriates to leave, there is a local team

• Be flexible, allow for early ―non-obvious‖ moves. Dow also enables employees to move freely between functions and businesses, specifically allowing—and encouraging—non-traditional and ―non-obvious‖ moves.

Recruitment & Selection • In order to recruit and retain good professionals, organizations should develop an

attractive and well-designed remuneration package for each category of employee. • HR will also have responsibility for developing local HR and benefits policy documents,

producing a mandatory staff handbook and documenting disciplinary procedures. • Makes plans to support operational growth in emerging markets. Growth won’t support

itself

Emphasize on Training & Development

• Begin career planning early in an employee’s tenure.

introducing career paths as part of employee on-boarding —

several years earlier than most competitors.

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