There’s nothing quite like meeting the promise of tomorrow. For me, it happens when I am invited to join the judging panel of the NZIM/Eagle Technology Young Executive of the Year Award.
This year was no different. The three national finalists, two young women and one young man, exemplify the outstandingly talented young leaders the award’s programme has uncovered for the past 17 years. They are wise beyond their 35 years or less, are extraordinarily accomplished and destined to achieve more.
They are also living testaments to the value of the management development programmes their respective organisations have provided or otherwise encouraged them to undertake. They are feedstock for New Zealand’s much-needed next generation of leaders. That there aren’t more similarly focused organisations making comparable efforts to find, grow and retain talented young executives and to build their enterprise-wide talent pools is both disappointing and potentially problematic for local enterprise.
Research by the global employment consultancy Manpower Group released in May this year showed that 48 percent of New Zealand employers were having difficulty filling key positions in their organisations. This result sits “well above” the global average of 34 percent, the survey said. New Zealand now ranks eighth highest of 41 countries measured for talent shortages.
And earlier this year global accounting consultancy Deloitte released its 2012 Talent Edge survey in which an overwhelming 83 percent of Kiwi employers said talent shortages were impacting their business results. Notwithstanding current economic uncertainties, talent shortages are “clearly big issue”, the report said.
Interestingly, the employers surveyed by Deloitte were optimistic about their workforce growth expectations – except in the public sector. “But,” asked study leader Richard Kleinert, “where will these employees come from?” There was, he added, large disconnect between employer expectations and future turnover versus employee expectations on job movement. “New Zealand employers may be excessively confident in their ability to attract and retain the talent they’ll need in the future,” he said.
Worse to come
New Zealand’s talent and skill shortages are expected to worsen next year. Employers should not be surprised, therefore, if they lost some of the “most talented” people, according to Kleinert. Employers were, he said, too inclined to take their experienced employees for granted even though they may be the most valuable in terms of experience, relationships and institutional knowledge.
NZIM chief executive Kevin Gaunt agrees with the Deloitte study and its conclusions. “We are constantly surprised by the way in which many organisations fail to look after and develop their most promising young executives. Research proves time and again that finding and attracting new talent is important, but retaining and building the talent an enterprise already has is critical, particularly in today’s highly mobile and competitive talent marketplace.”
Some recently released research from Pennsylvania-based global executive research company Development Dimensions International (DDI) confirms that, as Gaunt suggests, it pays organisations to “grow their own” leaders. “And that is one of the most important messages of our Young Executive Award programme,” says Gaunt.
According to the DDI study, it is more expensive to hire external talent than to select talent for leadership positions from within the business. Promoting talent from within was, they found, the most reliable way to ensure that organisations put “the right people in critical leadership roles”. Conversely, organisations that hired externally for non-leadership roles were more successful at identifying the right person for the job.
More often than not, new hires feel disconnected between what they learn about job in the hiring process and the actual job. Only half of new hires that responded to the DDI study were “confident they made the right decision” in accepting their job offer.
Riskier option
Hiring new talent, rather than developing and retaining it, is riskier option. Hiring the best involves knowing what it takes to be successful in particular job and making sure that who is hired has what it takes to succeed. Too many organisations don’t thoroughly define what’s needed to be successful in the job, according to DDI. Nor do they necessarily use the right mix or number of assessments to know more about candidates. “Hiring managers rely too much on their own judgement when making hiring decisions and this results in hiring failures.”
“Obviously organisations must recruit from outside when there are talent and skills shortages,” says Gaunt. “But our observations suggest that most often the best leaders are promoted from within. Bringing them up to speed as leaders means investing in them and making commitment to fleshing out their experiences. We see the payback from that investment every year when organisations nominate their best talent for our award. Nominating them sends another important and reinforcing message – that their organisation values them and wants to acknowledge their success.”
Deloitte’s Kleinert doesn’t think New Zealand employers fully understand what really motivates and appeals to different groups or segments of employees. “Most organisations operate with limited insight of these considerations and rely on old human resource programmes and people management practices that have not been updated and tailored to respond to the needs and interests of different employee groups. For example, the baby boomers’ desire for flexible work arrangements,” he wrote in his survey’s findings.
“Despite the growing diversity of the population and the New Zealand workforce, diversity is not seen as high priority among respondents. How long employers can continue to ignore this issue is growing concern,” he added.
Meanwhile, the shift in workforce demographics is relentless, globalisation continues, more Kiwis move overseas and high level of employees are sufficiently disgruntled with their existing employers to want to change jobs. It looks like burning platform according to Kleinert.
It need not be so, he adds. “There is great opportunity for proactive organisations to review their existing policies and practices through the lens of their future talent needs and better align and focus their talent strategies.”
Again Gaunt agrees. “People make the difference today. They will equally make the difference tomorrow. We see the future potential each year when we interview the award finalists. Would that more organisations saw their people as strategic assets in which to invest and prime for leadership. Talent will always and increasingly define the measure of an organisation’s success.” M
Reg Birchfield FNZIM is writer on leadership, governance & management. [email protected]
