Fast Forward on HR Innovation

The rapid evolution of digital-information technology has opened the door for HR innovation to reach beyond its traditional capabilities, providing employers with meaningful solutions in key areas that have always been especially challenging.

Friday, November 1, 2013
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Game-changing innovation in HR has often lagged that of such other corporate realms as supply or finance. Instead, HR's focus has tended toward administrative and broadly strategic contributions to business operations and results. But the rapid evolution of digital information technology has opened the door for HR innovation to reach beyond its traditional capabilities, providing new and practical solutions for HR success in key areas that have always been especially challenging.

This is vital, as industries struggle to fill jobs on a global basis, despite a rise in global unemployment by 4.2 million in 2012 to over 197 million, according to the International Labour Organization. For HR, the global talent gap is an enormous challenge and opportunity, with lack of applicants commonly cited as a reason for the difficulty in filling jobs, while 90 percent of HR executives at 22 top oil- and gas-industry firms identified "talent shortages" as a top-five business issue, according to recent talent-shortage from the Manpower Group.

At the same time, the world's unemployed clamor for more opportunity to enrich their skill sets. MIT reported that 150,000 people from 160 countries signed up for its first free online coursework in the spring of 2012, while other organizations offering free online university-level courses report monthly registrations of nearly one and one-half million.

Clearly, there's a mismatch between what sort of talent global organizations need and the level of talent that is available in the global pool. And so our clients are asking us for ways to increase their access to critical talent as well as plan for future workforce needs. In the short-term, they need immediate help in sourcing and pre-qualifying global talent; in the long term, innovation points to the development of talent hubs, or locations that contain a critical mass of talent with the skills and expertise required by employers in a specific company, industry or collection of industries.

But how can HR help close the short- and long-term talent gap? It takes the right solutions, of course, and in today's 24/7 communication climate, the key innovations for HR success lie in a dynamically networked world, as access to HR information moves to mobile devices like smartphones and tablets, while companies seek integrated data about employees, better tools to reward and assess performance, and social, user-friendly applications that facilitate employee recruitment and engagement.

It's a world of social-media crowd- and cloud-sourcing, as well as "big data," with exponential growth in the volume and variety of data that companies rely on to analyze workforce needs and employee performance. As a result, HR leaders must embrace new testing and data strategies as they fast-forward through the first quarter of our wired century, toward fresh horizons of talent assessment, acquisition, development, and talent mobility. The right HR innovations can make a significant difference. 

New Ways to Engage Job Seekers

For example, new software solutions are being designed to assess the technical and behavioral skills of entry-level through mid-level managers. In most organizations, these solutions can help identify and focus the skills of high potentials all the way through the director level. Innovative approaches such as "gamification" -- by which a pool of candidates can be sourced and engaged -- are part of this new world of HR interactivity. Recognizing that new generations of talent are accustomed to real-time, online competition, this approach makes use of game-think and game mechanics, but in a non-gaming context that engages users in experiencing up front some of the problems and challenges they'll be faced with as an employee.

Thus, candidates who participate in new social and mobile recruiting techniques gain greater visibility to employers -- beyond the conventional job-board and resume-dumping sites that have become old hat. These new approaches can showcase their problem-solving abilities, not by asking them what problems they've solved but by engaging them in actual problem solving. Gamification puts them in peer competition and can yield valuable insight and information for staffing executives -- the kind that doesn't rise from the resume stacks -- revealing candidates who may have the job skills that traditional credentialing or sourcing often miss.    

But while such innovation can reveal candidates and their preferences about where they'd like, or agree, to work, companies need to also find local talent. . In the recent past, companies have relied on mobility programs -- moving people to jobs -- in order to meet business expansion needs. Mobility gets the job done, but can be expensive and does not fully tackle the scale of intervention now required. More and more artificial barriers are also being created: for example, some governments are taking action to ensure local workers have priority over foreign workers in terms of employment. As a result, companies are looking for innovative alternatives, including ways to move jobs to people. Thus, in addition to enabling the mobility of talent, creating a sustainable local talent hub is equally critical in solving the talent crisis.

Creating the Talent Hub

As we mentioned, a talent hub is a location that contains a critical mass of talent with the skills and expertise required by employers in a specific company, industry or collection of industries. The creation of a talent hub may be driven by "demand", e.g. natural resources or increasing economic activity, or "supply" e.g. higher education or oversupply of labor due to industry diversification. Talent hubs can be driven by a variety of entities for any number of reasons but are ideally accomplished through collaboration across many stakeholders. A single organization may also seek to create a sustainable talent hub to advance its business strategy.

For example, in order for Walmart to successfully expand into Brazil, one of the fastest growing economies in the developing world, it has had to collaborate with government and academia to develop talent with the critical retail skills it needs. The creation of a talent hub may also be driven by the existence of natural resources in a particular location and thus the need for talent with the skills to effectively exploit those resources. Saudi Aramco, for instance, has had to actively develop the engineering and technical talent it needs to effectively manage the country's vast oil reserves.

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Alternatively, talent in a region may already have certain skills that make the location attractive to businesses in a certain industry. Thus, the prevalence of English-speakers in India, coupled with lower wages and a large population, has fuelled the growth of that country as a hub for the information technology and business process outsourcing industry. NASSCOM, a trade association for the IT-BPO industry, is now working with government and educational institutions to develop industry-wide critical skills and increase the employability of the Indian workforce.

Finally, the creation of a talent hub may be driven by a government's socio-economic strategy aimed at enhancing a region's attractiveness to employers. Since its independence from Malaysia, Singapore has embraced this approach, investing significantly in the education and training of its people and enjoying rapid economic advancement. Additionally, the troubled city of Detroit is trying to re-characterize and re-skill its talent in areas other than automobile manufacturing in order to attract other industries to the region.

Local Influence

Indeed, such proactive development action and other innovations are very much a part of HR's new world, but the long-term goal of turning business locations into true talent hubs is a broader challenge. It calls for the utilization and mastery not only of software solutions but the marshaling of world-class HR expertise, the sort that can implement best practices in recruiting, retaining, and developing global talent on a local basis. This calls for industry-specific knowledge on one hand and, on the other, the ability to shape and influence local and regional policies and educational systems so that the right talent fills the business pipelines and closes the talent gap.

Maximizing the innovative techniques and networking capabilities of the digital age, HR must connect with critical talent in its nascent stage, through partnership with governments and municipalities, regional and local trade associations, industry groups, the world of academia, and even start-up entrepreneurs.

In fact, that's the very definition of a talent hub: connecting the multitude of talent sources by means of global technology and local organizational skill. This HR vision is hardly out of reach for companies who embrace the talent innovations of today along with a proactive commitment to developing tomorrow's workforce.

It's a workforce undergoing enormous transformation, as enterprise social networks become primary channels for much of today's and tomorrow's work, leveraged by smartphone, tablet and laptop (as mobile-first strategies overtake the primacy of the PC), while big data and predictive analytics drive workforce decisions. Yes, it will take vision and partnership to manage these innovative new frontiers, but the ultimate reward is a sustainable network of worldwide talent.

Orlando Ashford is the New York-based president of Mercer's global talent business. Barbara Marder is the Baltimore-based global leader of mobility solutions at Mercer.

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